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The JB Hi-Fi Limited (ASX: JBH) share price continued its ascent on Tuesday.

The retail giant’s shares rose 4% to end the day at $53.70.

This means the JB Hi-Fi share price is now up over 9% since the start of the week.

Why is the JB Hi-Fi share price rising?

Investors have been bidding the JB Hi-Fi share price higher this week following the release of its half year results.

Although its sales and profit numbers were pre-released to the market in January, there were a couple of pleasant surprises that gave its shares a boost.

These were that trading was positive during the month of January, with JB Hi-Fi Australia and The Good Guys delivering solid year on year growth. The other was a $250 million off-market share buyback.

Can its shares keep climbing?

According to a note out of Morgans, its analysts believe the JB Hi-Fi share price has room to climb higher.

This morning the broker retained its add rating and $57,00 price target on its shares. Based on the current JB Hi-Fi share price, this implies potential upside of 6.1% before dividends and almost 11% including them.

Morgans commented: “JB Hi-Fi pre-announced its headline 1H22 earnings last month. The full earnings release issued today confirmed that EBIT was down 9% to $420.5m, but this was 60% above 1H20 and 17% above our estimate before the January trading update. Gross margins and operating cash flow were better than we had forecast.”

“We see JBH as a well-run retailer with good cost discipline, a robust balance sheet and a strong market position. Although we see only modest growth opportunities, we regard JBH as undervalued at current multiples and reiterate our ADD rating,” the broker concluded.

The post Is the JB Hi-Fi (ASX:JBH) share price in the buy zone after its results? appeared first on The Motley Fool Australia.

More reading

• Why Dexus, JB Hi-Fi, Seek, and Sims shares are climbing today
• Why Bendigo and Adelaide Bank, Crown, JB Hi-Fi, and Newcrest are pushing higher
• $250m buyback sends JB Hi-Fi (ASX:JBH) share price shooting higher
• ASX 200 (ASX:XJO) midday update: JB Hi-Fi impresses, Crown accepts $8.9bn Blackstone bid
• JB Hi-Fi (ASX:JBH) share price on watch after announcing results and $250m buyback

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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ASX tech shares showed signs of recovery today, outperforming the broader S&P/ASX 200 Index (ASX: XJO).

The S&P/ASX All Technology Index (ASX: XTX) climbed 0.89%, while the S&P/ASX 200 Info Tech Index (ASX: XIJ) jumped 0.97%. In contrast, the ASX 200 fell 0.51%.

Let’s take a look at how the technology sector fared today.

Tech recovery

ASX 200 technology shares Megaport Ltd (ASX: MP1) and WiseTech Global Ltd (ASX: WTC) gained 1.78% and 0.26% respectively. Meanwhile, Altium Limited (ASX: ALU) rose 2.21% and TechnologyOne Ltd (ASX: TNE) finished 0.97% in the green.

Another ASX tech share that performed well today was ELMO Software Ltd (ASX: ELO). The cloud-based HR and payroll software company reported it had delivered more strong growth during the first half of FY22. Elmo’s share price gained 3% in today’s trade.

Appen Ltd (ASX: APX) also climbed 1.93%, while Xero Limited (ASX: XRO) jumped 0.29% and Computershare Limited (ASX: CPU) increased 0.22%.

Buy now, pay later share Block Inc CDI (ASX: SQ2) ascended 4.23%, while Zip Co Ltd (ASX: Z1P) dipped slightly by 0.37%.

The Block share price gained on the back of its New York Stock Exchange listing Block Inc (NYSE: SQ) jumping 3.49% in Monday’s session. Intel Corporation (NASDAQ: INTC) announced Block will be among the first three customers to use its new blockchain accelerator.

ASX tech shares often follow in the steps of their US counterparts, however today they outperformed them. The Nasdaq-100 Technology Sector Index (NASDAQ: NDXT) climbed 0.18% in the United States on Monday. As dailyfx reported, US markets ended broadly lower on Monday, but technology shares bucked this trend and finished slightly ahead. Tesla Inc (NASDAQ: TSLA) gained 1.83%, while Nvidia Corporation (NASDAQ: NVDA) and Amazon.com Inc (NASDAQ: AMZN) finished 1.33% and 1.22% in the green respectively.

ASX tech share summary

The All Technology Index has descended 19% over the past year, while it is down 16% year to date.

Meanwhile, the Info Tech index has fallen 26% in the past year and 18% year to date.

For comparison, the ASX 200 has gained nearly 5% in the past year and dropped 3% year to date.

The post How did ASX tech shares perform today? appeared first on The Motley Fool Australia.

More reading

• Why is the Block (ASX:SQ2) share price squaring away such healthy gains today?
• The Zip (ASX:Z1P) share price hit another 52-week low this week. Is now the time to buy?
• ELMO Software (ASX:ELO) share price higher after reporting more stellar growth
• 2 quality ASX tech shares for investors after the selloff
• These are the 10 most shorted ASX shares

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Altium, Appen Ltd, Block, Inc., Elmo Software, MEGAPORT FPO, WiseTech Global, Xero, and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Appen Ltd, Elmo Software, WiseTech Global, and Xero. The Motley Fool Australia has recommended Amazon, MEGAPORT FPO, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The GWA Group Limited (ASX: GWA) share price closed 1.92% lower on Tuesday at $2.55.

Shares in the water solutions provider headed south after the company reported its results for the half-year ended 31 December 2021.

Let’s take a closer look at what the company revealed.

GWA share price tumbles despite profitable half

The company came in with a number of investment takeouts, including:

• Group revenue up 2% to $201.3 million, with Australian revenue alone climbing 6%
• Normalised group earnings before interest and tax (EBIT) of $35.6 million, up 11% on the prior year
• Normalised group EBIT margin lifted by 140 basis points during the half
• Normalised net profit after tax (NPAT) of $22.4 million, up 12% year on year
• Reported NPAT (including significant items) of $18.6 million, up 1% from the same time last year.

What else happened this period for GWA?

Operating cash flows came in stronger this half with normalised group EBIT gaining 11% year on year, resulting in a 1.4% gain in EBIT margin.

The improvement in earnings came despite the significant increase in freight costs compared to the prior corresponding period, GWA says.

As a result of the efficiencies, the group’s $201 million in revenue carried through to NPAT of $22 million, a 12% gain on the year.

This enabled the board to pay a fully-franked interim dividend of 7 cents per share, a 17% gain on the prior corresponding period. Investors can expect the dividend on 4 March 2022. Notably, the company’s Dividend Reinvestment Plan will not be offered to shareholders for the interim dividend.

GWA held a net debt load of $104 million as of 31 December, in line with the figure of $104.8 million from the same time last year.

The company has also been active in improving its credit metrics, with the gearing ratio of 21.2% contracting by around 30 basis points year over year. It also held adequate liquidity for operations in 2022, according to the company’s release.

“In October 2021, GWA successfully completed the extension of its syndicated banking facility which comprises a single three-year multicurrency revolving facility of $180 million which matures in October 2024,” it said.

Cash flow from operations also came in stronger than last year at $43.6 million, compared to $49.7 million in 1HFY21.

Management commentary

Speaking on the announcement, GWA’s Managing Director and CEO Urs Meyerhans said:

Throughout the period, we continued to operate within the COVID-19 impacted environment with the health and safety of our people and customers remaining as our first priority. We continue to implement our operational procedures to safeguard our people while minimising disruption to our customers to the extent possible.

Following an increase in the Lost Time Injury Frequency Rate (LTIFR) in FY21, GWA has implemented customised training strategies primarily to address the root cause to reduce manual handling injuries.

What’s next for GWA?

The Company expects “continued momentum in all its key markets, particularly in the Renovation & Replacement segment both for residential and commercial”.

However, in the same breath, it notes labour availability and global supply chain disruptions have “extended the timing of completions particularly for new detached projects from around 9-12 months to 12-15 months”.

As a result of these disturbances – which are actually tailwinds for the company – GWA expects its completions activity to remain strong into FY23.

GWA also says it remains on track to deliver annualised supply chain savings of $3 million from FY22 with $2 million achieved in the first half of FY22.

“For FY22, GWA currently expects Group Normalised EBIT in the second half will be higher than the first half, subject to any potential further impact of the general economic environment,” the company concluded.

GWA share price snapshot

The GWA share price has lost more than 31% over the past 12 months, sliding more than 7% year to date.

At its current share price, the company has a market capitalisation of around $676 million.

The post How’s that dividend? GWA (ASX:GWA) share price falls despite 17% payout bump appeared first on The Motley Fool Australia.

More reading

• The Polynovo (ASX:PNV) share price sank to multi-year lows today. What’s going on?
• Down 36% in a year, could the Betashares Asia Technology Tigers ETF (ASX:ASIA) be poised to take off?
• Here are the top 10 ASX shares today
• Why did ASX 200 energy shares weigh on the index today?
• AFIC (ASX:AFI) is the biggest LIC on the market. But how does its performance stack up?

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Polynovo Ltd (ASX: PNV) share price had a tough day on the ASX, touching a new multi-year low of $1.165.

This comes despite the medical device company not releasing any announcements to the ASX in almost a month.

At the close, Polynovo shares were swapping hands for $1.17 apiece, down 3.31%. They are now down 25% this year to date.

Let’s take a look at what is impacting the company’s share price of late.

Polynovo continues to attract short interest

The negative sentiment around the Polynovo share price continues to attract the attention of investors holding short positions.

Largely, the inconsistent performance of the business regardless of its outlook may have led to a deterioration in the Polynovo share price.

Management previously stated that challenging market conditions caused by COVID-19 created headwinds for the company.

Although the United States reported a surge in sales volumes, as a whole Polynovo missed the mark on investor expectations. This is mainly related to the underperformance achieved in the United Kingdom, Ireland, and Europe.

Last Wednesday, the Australian Securities & Investments Commission (ASIC) released its short position report indicating an increased short interest in Polynovo shares.

As such, Polynovo took up the seventh spot on the list with 9% of its shares being shorted. This represents a 5.7% increase from the start of the month when its shares had a short interest of 8.51%.

Given the scope of short positions being taken up, it is possible investors believe the company’s performance will be underwhelming when it reports its half-year results later this month.

About the Polynovo share price

Financial advisory services firm Wilsons cut its 12-month price target for Polynovo shares by 29% to $1.42 in November.

Based on the current Polynovo share price, this implies an upside of roughly 21% for investors.

Looking back, the medical device company’s shares fell around 60% in value in 2021. In comparison, the S&P/ASX 200 Healthcare Index (ASX: XHJ) gained around 8% in the same time frame.

The post The Polynovo (ASX:PNV) share price sank to multi-year lows today. What’s going on? appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• The company’s last update was positive, so why are Polynovo (ASX:PNV) shares still among the most shorted on the ASX?
• These are the 10 most shorted ASX shares
• These are the 10 most shorted ASX shares
• Polynovo (ASX:PNV) share price melts 31% in 2 weeks. What’s going on?

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended POLYNOVO FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Of all the ASX exchange-traded funds (ETFs) on the market today, the BetaShares Asia Technology Tigers ETF (ASX: ASIA) certainly hasn’t been a great one to hold over the past 12 months. Since mid-February 2021, ASIA units have lost a nasty 36.3% on today’s closing pricing. Yep, this was an ETF that was worth more than $14 a unit a year ago. Today, it’s at $8.96.

It’s not too hard to see why this ETF has been through the wars of late. Its largest holdings are dominated by Asian tech companies. These including Taiwan Semiconductor Manufacturing Co and Samsung. As well as Tencent Holdings, Alibaba Group Holding Ltd and JD.com Inc.

These kinds of companies have been at the centre of a global selloff of tech-related shares we have seen play out over the past month or two. Growth shares in the tech space have been heavily punished across the world in 2022 so far. That includes in Asia, as well as the United States and here on the ASX.

Additionally, many Chinese companies such as Alibaba have come under additional pressure over concerns of investing in the Chinese market. The Chinese Communist Party has recently initiated several crackdowns on various industries in China that have spooked investors as well. And the United States government has raised concerns about Chinese companies listing on American stock exchanges in the past.

ASIA ETF has a year to forget…

So where to now for ASIA? Have we found the bottom for this ETF?

Well, according to the Shanghai-based Mingshi Investment Management, the opportunities of investing in Chinese companies is not to be ignored, despite the risks.

Here’s some of what Lewis Prescott, Partner and International CEO at Mingshi, had to say:

Sophisticated investors consider geopolitics as a major risk, but they also acknowledge that ignoring China as a source of both alpha and diversification is also a risk… The China onshore equity market provides a unique opportunity for uncorrelated alpha and high liquidity

Mr Prescott also says that China is “under-represented in most investors’ asset allocations” when it comes to international shares. He argues that increasing exposure to Chinese companies can improve investors’ annual returns.

ASIA is of course not the only ETF on the ASX with Chinese exposure. In fact, only 46.7% of ASIA’s portfolio is invested in Chinese shares. Other countries like Taiwan, South Kore and India make up most of the remainder.

However, if Mr Prescott’s predictions turn out to be accurate, it might mean good things for the BetaShares Asia Technology Tigers ETF. 

The post Down 36% in a year, could the Betashares Asia Technology Tigers ETF (ASX:ASIA) be poised to take off? appeared first on The Motley Fool Australia.

More reading

• Here are 3 highly-rated ASX growth shares
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• Why these 2 ASX ETFs are in major correction territory
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• Are these 2 ASX tech shares good buys in February?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended JD.com. The Motley Fool Australia has recommended BetaShares Asia Technology Tigers ETF and JD.com. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Today, the S&P/ASX 200 Index (ASX: XJO) succumbed to the selling pressure amid ongoing uncertainty around relations between Russia and Ukraine. At the end of the session, the benchmark index finished 0.51% lower at 7,206.9 points.

While a number of companies reporting their half-year results were well received by investors today, it wasn’t enough to offset the losers of the session. The energy sector was the heaviest of fallers across the market on Tuesday, slumping 2.8% after oil prices pulled back from their seven-year high this afternoon.

On the flip side, tech shares ended up being the best performers of the day. This was despite economists firming their belief that rates will rise sometime this year.

However, the question is: which shares delivered the biggest returns to investors on the ASX today? Here are the top ten stocks that came through for investors:

Top 10 ASX shares countdown today

Looking at the top 200 listed companies, Sims Ltd (ASX: SGM) was the biggest gainer today. Shares in the metal and electronics recycling company skyrocketed 13.68% after revealing significant growth across all major metrics in its half-year results. Find out more about Sims here.

The next biggest gaining ASX share today was Brambles Ltd (ASX: BXB). The supply-chain logistics company’s share price jumped 6.16% despite there being no announcements released today. Uncover the latest Brambles details here.

Today’s top 10 biggest gains were made in these ASX shares:

ASX-listed company	Share price	Price change
Sims Ltd (ASX: SGM)	$17.04	13.68%
Brambles Ltd (ASX: BXB)	$10.00	6.16%
SEEK Limited (ASX: SEK)	$29.47	6.08%
Zimplats Holdings Ltd (ASX: ZIM)	$25.20	5.48%
Infratil Ltd (ASX: IFT)	$7.47	5.06%
JB Hi-Fi Ltd (ASX: JBH)	$53.70	3.85%
Dexus (ASX: DXS)	$10.43	2.66%
Bendigo and Adelaide Bank Ltd (ASX: BEN)	$9.92	2.59%
Downer EDI Ltd (ASX: DOW)	$5.45	2.44%
Altium Ltd (ASX: ALU)	$34.72	2.21%

Our top 10 ASX shares today countdown is a recurring end-of-day summary to ensure you know which companies were making big moves on the day. Check-in at Fool.com.au after the market has closed during weekdays to see which stocks make the countdown.

The post Here are the top 10 ASX shares today appeared first on The Motley Fool Australia.

More reading

• Why did ASX 200 energy shares weigh on the index today?
• These 3 ASX 200 shares are topping the volume charts this Tuesday
• Why Dexus, JB Hi-Fi, Seek, and Sims shares are climbing today
• Why is the Vanguard Australian Shares High Yield ETF (ASX:VHY) outperforming in 2022?
• ASX 200 (ASX:XJO) midday update: BHP and SEEK impress, Beach sinks

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Altium. The Motley Fool Australia owns and has recommended Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended SEEK Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Tuesday proved to be a bad day for S&P/ASX 200 Index (ASX: XJO) energy shares.

The S&P/ASX 200 Energy Index (ASX: XEJ) tumbled to close 3.1% lower despite oil prices hitting new multi-year highs.

For context, the broader market also suffered today, with the ASX 200 slumping 0.51% and the All Ordinaries Index (ASX: XAO) falling 0.59%.

Let’s take a look at what’s going on went on with ASX 200 energy producers on Tuesday.

ASX energy stocks fall despite oil prices hitting 7-year high

The ASX 200 energy sector had a disappointing day even as oil prices hit their highest point since 2014.

The price of a barrel of Brent crude oil rose to an intraday high of US$96.26 on Tuesday while West Texas Intermediate hit US$95.17 a barrel, according to data from CNBC.

Reuters reported the increases may have been a reaction to rising tensions between Russia and Ukraine, as fears mount Russia could stage an invasion in coming days.

If Russia was to invade, the flow of oil from Ukraine, a major producer, could be disrupted. This could, in turn, send oil prices above US$100 per barrel, according to Rystad Energy senior oil market analyst Nishant Bhushan.

Interestingly, the energy commodity’s price surge wasn’t enough to boost ASX 200 energy shares today.

What dragged on ASX 200 energy shares on Tuesday?

The major weight on the energy index today was the Beach Energy Ltd (ASX: BPT) share price. It fell 10.46% over Tuesday’s session.

As The Motley Fool Australia’s Zach Bristow reported, its tumble was likely a delayed reaction to the release of the energy producer’s half-yearly earnings yesterday.

Bristow reported the company failed to hit market and broker expectations, posting earnings per share (EPS) of just 9.34 cents – notably lower than analyst forecasts of 10.62 cents.  

Meanwhile, the Santos Ltd (ASX: STO) share price fell 4.15% on the eve of its full-year earnings release.

It will, of course, be the first time the company reports after it merged with Oil Search in December.

Paladin Energy Ltd (ASX: PDN) rounded out the 3 worst performing large-cap energy stocks in today’s session. Its share price tumbled 4.14%.

While there’s no clear reason as to why all ASX 200 energy shares slipped lower today, it could represent a market correction after the index surged 3.3% on Monday.

At market close on Tuesday, the ASX 200 energy index is 12.56% higher than it was at the start of 2022. For comparison, the ASX 200 has fallen 3.19% over the same period.

The post Why did ASX 200 energy shares weigh on the index today? appeared first on The Motley Fool Australia.

More reading

• Leading brokers name 3 ASX shares to sell today
• Why Adore Beauty, Beach, Fortescue, and Praemium shares are falling
• These 3 ASX 200 shares are topping the volume charts this Tuesday
• Not so sunny: why the Beach Energy (ASX:BPT) share price is sinking 10% today
• Why is the Vanguard Australian Shares High Yield ETF (ASX:VHY) outperforming in 2022?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Australian Foundation Investment Co. Ltd (ASX: AFI), or AFIC for short, is not the most well-known ASX share. But it is one of the oldest. A Listed Investment Company (LIC), AFIC opened its doors back in 1928, and has been investing in ASX shares on behalf of its investors ever since.

Today, it is the largest LIC on the ASX boards, besting rivals like Argo Investments Limited (ASX: ARG) and WAM Capital Limited (ASX: WAM) in terms of market capitalisation. But the modern world of investing is very different to the world upon which AFIC opened its doors to in the 1920s.

LICs have certainly lost some popularity at the expense of the ever-popular exchange-traded fund (ETF). The increasing desire of passively-minded investors to put their cash in index-tracking and low-cost ETFs instead of the more actively managed LICs like AFIC is a trend that has been growing for years now.

So how does AFIC measure up in the modern world of investing?

Well, let’s get straight into the numbers. So, AFIC tells us that as of 31 January, its total return (share price growth plus dividends and franking) was 12.5% for the preceding 12 months. That compares well with the S&P/ASX 200 Accumulation Index. It has returned 10.9% over the same period (also including dividends and franking).

Over the past five years on average, AFIC’s total return has come in at 10.6% per annum against the index’s 10%. But over the past ten years, AFIC and its benchmark are dead-even at 11.1% per annum on average each.

So that effectively means an investment in AFIC shares has bested investing in an ASX 200 ETF over both the past year and the past five years.

How does AFIC’s performance measure up against the ASX 200 and other LICs?

But how does this compare to Argo and WAM Capital?

Argo tells us that its total return performance, as of 31 December, was 25.5%. We can’t take too much stock in that when comparing to AFIC though. That’s because January was such a negative month for the ASX 200 Index. But over five years, Argo’s total return has averaged 10.5% per annum, just under AFIC’s. In saying that, it doesn’t appear that those returns factor in franking, which could give Argo an extra boost. Over ten years, Argo’s total return averages at 11.5% per annum.

Unfortunately, WAM Capital is not as transparent with its performance data. It only releases the performance of that LIC’s underlying investment portfolio, rather than the total return shareholders have enjoyed. Still, let’s check it out for comparison’s sake. So, as of 31 January, WAM Capital’s underlying portfolio enjoyed a gain of 7.5% over the preceding 12 months, including dividend returns (again, franking doesn’t seem to factor in here). Over the past five years, it has averaged a return of 9% per annum. And over ten years, it’s 13.7% per annum.

Those metrics don’t factor in WAM Capital’s management fee either, which, at 1% per annum, is far higher than AFIC and Argo’s 0.14%. AFIC and Argo’s performance figures account for their fees.

So that’s how AFIC’s performance stacks up against its rival ASX LICs, as well as the ASX 200 Index. It appears AFIC comes out on top for the five year period, but Argo and WAM Capital best it over ten years, if only slightly.

At the current AFIC share price, this ASX LIC has a market capitalisation of $9.94 billion, with a trailing dividend yield of 2.96%. 

The post AFIC (ASX:AFI) is the biggest LIC on the market. But how does its performance stack up? appeared first on The Motley Fool Australia.

More reading

• Why is the AFIC (ASX:AFI) share price sliding lower today?
• These ASX 200 shares can beat inflation: expert
• Rocketing returns trump souring outlook: Argo Investments (ASX:ARG) share price lifts on results
• ‘Solid performance’: WAM Capital (ASX:WAM) share price spikes after portfolio update
• Will a growing dividend help the AFIC (ASX:AFI) share price?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Yesterday we looked at three ASX shares brokers have given buy ratings to this week.

Unfortunately, not all shares are in favour with brokers right now. Three that have just been given sell ratings are listed below. Here’s why these brokers are bearish on these ASX shares:

Beach Energy Ltd (ASX: BPT)

According to a note out of Macquarie, its analysts have downgraded this energy producer’s shares to an underperform rating with an improved price target of $1.50. This follows the release of a half year result that fell short of the broker’s expectations. And while it has upgraded its earnings forecasts and price target to reflect production growth, it believes investors would be better off with other cheaper options in the sector. The Beach share price has fallen heavily today and is now trading at $1.46.

Insurance Australia Group Ltd (ASX: IAG)

A note out of Morgan Stanley reveals that its analysts have retained their underweight rating but lifted their price target on this insurance giant’s shares to $3.90. While IAG surprised to the upside with its half year results, this isn’t enough for a more positive rating. Morgan Stanley believes there are risks that are not being accurately priced in by the market. This is particularly the case with claims inflation. The IAG share price is fetching $4.74 today.

Magellan Financial Group Ltd (ASX: MFG)

Analysts at UBS have retained their sell rating and $7.00 price target on this fund manager’s shares. The broker continues to believe that the risks are to the downside for Magellan. This is due to fund outflows, staff retention concerns, and its belief that Magellan may need to cut its fees to reduce retail fund outflows. This could put pressure on the company’s margins. The Magellan share price is trading at $18.12 currently.

The post Leading brokers name 3 ASX shares to sell today appeared first on The Motley Fool Australia.

More reading

• Why Adore Beauty, Beach, Fortescue, and Praemium shares are falling
• These 3 ASX 200 shares are topping the volume charts this Tuesday
• Not so sunny: why the Beach Energy (ASX:BPT) share price is sinking 10% today
• We’ll pass thanks: Top broker downgrades IAG (ASX:IAG) share price to hold
• ASX 200 (ASX:XJO) midday update: BHP and SEEK impress, Beach sinks

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Insurance Australia Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Leading fund manager Wilson Asset Management (WAM) has revealed two ASX shares that it rates as buys within the WAM Research Limited (ASX: WAX) portfolio.

WAM operates several listed investment companies (LICs). Two of those LICs are WAM Capital Limited (ASX: WAM) and WAM Leaders Ltd (ASX: WLE).

One of the LICs is called WAM Research, which looks at smaller businesses on the ASX.

WAM describes WAM Research as a LIC that invests in the most compelling undervalued growth opportunities in the Australian market.

The WAM Research portfolio has delivered gross returns (that’s before fees, expenses, and taxes) of 15.4% per annum since the strategy changed in July 2010, which is superior to the All Ordinaries Total Accumulation Index (ASX: XAOA) return of 8.9% per annum.

These are the two ASX shares that WAM outlined in its most recent monthly update:

Credit Corp Group Limited (ASX: CCP)

Credit Corp was described as a business that provides debt purchase and collection, and consumer lending services in Australia, New Zealand and the US.

The Credit Corp share price outperformed during January 2022 in the lead-up to the FY22 interim result, which was released at the start of February.

WAM said that investor expectations were growing ahead of a positive result. That result delivered, according to the fund manager. There was an 8% increase in the underlying net profit after tax (NPAT) in the half-year report thanks to strong collections activity.

The period included record investment driven by the US purchased debt ledger (PDL) acquisitions alongside the acquisition of Radio Rentals in Australia.

Credit Corp’s consumer lending demand accelerated to record levels over the three months to 31 December 2021. Key markets emerged from COVID lockdowns whilst pilot projects continued to demonstrate “promising results”.

WAM liked the confidence that the ASX share’s management showed by increasing the FY22 guidance, with PDL investment increasing to a range of between $300 million to $320 million and net profit between $92 million to $97 million.

The fund manager believes there is still upside to the given guidance and remains positive on the medium-term outlook as unsecured credit balances are “set to accelerate” as consumer stimulus fades and the impacts of COVID eases.

The above-mentioned impacts are expected to underpin organic growth, while a strong balance sheet positions the company to capitalise on further acquisitions that would add to earnings with a range of opportunities currently in the market.

BWX Ltd (ASX: BWX)

WAM describes BWX as an Australian-based company that is engaged in developing, manufacturing and marketing beauty and personal care products.

The company’s expansion into the US and UK is gaining traction. When coupled with new products and a larger distribution network, this is driving growth of the market share.

It was announced in January 2022 that CEO Dave Fenlon had resigned. Mr Fenlon is going to change to be a non-executive director position on the BWX board.

WAM wasn’t too concerned because the appointment of his successor is Rory Gration. Mr Gration was the chief operating officer. This demonstrated the continuity of the ASX share’s management team.

BWX recently expanded its portfolio with the acquisition of a 50.1% majority stake of Go-To Skincare for $89 million. In FY21, this business generated $36.8 million of revenue and $11.6 million of earnings before interest, tax, depreciation and amortisation (EBITDA).

The post 2 ASX shares that this top fund manager rates as a buy appeared first on The Motley Fool Australia.

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