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The conventional wisdom on the ASX boards is that the big four ASX bank shares dominate the largest-yielding companies on our share market. Whilst this is usually true to varying degrees, it doesn’t mean that the big four banks such as Commonwealth Bank of Australia (ASX: CBA) or Westpac Banking Corp (ASX: WBC) necessarily offer the largest yields on the market, or even in the ASX banking sector. So today, let’s check out what the Bendigo and Adelaide Bank Ltd (ASX: BEN) share price has to offer.

With a current market capitalisation of $5.17 billion, Bendigo Bank is a relative minnow compared to its larger banking brethren. The smallest bank of the big four by market cap is presently Westpac. But even though Westpac has had a rough few years, it still remains roughly 16 times larger than Bendigo Bank with its current market cap of roughly $78.8 billion.

But even so, size in regards to market cap is irrelevant to the size of a company’s dividend. So let’s see how Bendigo Bank measures up in that regard.

How does the Bendigo Bank dividend measure up against the big four banking shares?

So after a tumultuous 2020, ASX big four bank dividend yields have returned to what you might call their ‘normal’ levels. As it stands today, Westpac is the big four bank offering the largest yield on current pricing. It’s past two dividends equate to a trailing yield of 5.5% right now.

Australia and New Zealand Banking Group Ltd (ASX: ANZ) is offering up a yield of 4.98% today.

National Australia Bank Ltd. (ASX: NAB) is next up with its 4.33% dividend yield.

And Commonwealth Bank comes in last with its 3.46% yield.

So how does that compare to Bendigo Bank?

Well, Bendigo paid out two dividends last year, as you’d expect. Shareholders received an interim payment of 28 cents per share in March. That was followed by the final dividend of 26.5 cents per share that was paid in September. Both dividends were fully franked.

That gives the Bendigo and Adelaide Bank share price a trailing yield of 5.92% on current pricing, which grosses-up to 8.46% with that full franking.

As you can see, that dividend yield runs rings around the majors as they stand today. No doubt a very welcome piece of information for all Bendigo Bank shareholders.

The post The Bendigo Bank (ASX:BEN) dividend is smashing the big four right now appeared first on The Motley Fool Australia.

More reading

• Could this impact the performance of ASX 200 banks more than interest rates in 2022?
• How the Bendigo Bank (ASX:BEN) share price went in 2021
• What’s the outlook for the Bendigo and Adelaide Bank (ASX:BEN) share price in 2022?
• Are Bank of Queensland (ASX:BOQ) shares a better buy for 2022 than Bendigo Bank?

Motley Fool contributor Sebastian Bowen owns National Australia Bank Limited. 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 Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Westpac Banking Corporation. 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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Key Points

• The Bank of Queensland share price is currently up 0.85% to $8.30
• The company completed its ME Bank acquisition in July 2021
• Senior management is conducting on-market trades, taking advantage of share price weakness

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The Bank of Queensland Limited (ASX: BOQ) share price continued its ascent in 2021, despite dipping in the latter months.

Over the calendar year, the regional bank’s shares climbed almost 8%, spurred by investor confidence in the market. In comparison, the S&P/ASX 200 Index (ASX: XJO) gained roughly 13% over the same period.

For the final day of 2021, Bank of Queensland shares closed down 1.34% to $8.09 apiece. It’s worth noting that in early October, its share price touched a 52-week high of $9.84 before treading lower.

What happened to Bank of Queensland shares?

You could be forgiven for thinking that with Australia constantly facing pandemic challenges, the Bank of Queensland share price would suffer.

However, the company’s shares have rallied higher to reach pre-COVID levels, reflecting optimism among investors.

The Bank of Queensland completed its acquisition of ME Bank in July, achieving a critical milestone in its multi-brand strategy. It aims to compete with the big banks offering portfolio diversification and a common digital retail bank technology platform.

In addition, the company moved to strengthen its board, with the inclusion of ME Bank director Deborah Kiers. This led Bank of Queensland shares to leap from the mid $8 mark to as high as $9.73 in the following month (August).

However, the company’s share price sunk during November despite Bank of Queensland not releasing any price-sensitive market announcements to the ASX. It seems the broader market weakness, coupled with the new Omicron variant, may have put pressure on investor confidence.

This led to Bank of Queensland shares falling across the final months of 2021. In particular, losses extended from 8 November to 6 December, when BOQ shares hit a 52-week low of $7.55.

Senior executive and chair Patrick Allaway appeared to think that the company’s share price was trading at a bargain. Mr Allaway conducted an on-market trade, buying 10,000 Bank of Queensland shares at $8.55 each back in early November.

Non-executive director Mickie Rosen followed suit, also picking up 10,000 shares during the middle of November at $8.50 apiece.

Are Bank of Queensland shares a buy?

A couple of brokers weighed in on the Bank of Queensland share price last month.

Analysts at Jarden cut its 12-month price target on the regional bank’s shares by 5% to $9.60. Based on the current price of $8.30, this implies an upside of around 15.6% for investors.

The most recent broker note, however, came from JPMorgan which also slashed its outlook on Bank of Queensland shares by 2% to $9.80. Similar to Jarden, this indicates an attractive upside of roughly 18% from where it trades today.

Bank of Queensland commands a market capitalisation of about $5.33 billion, with approximately 642 million shares on its books.

The post Here’s what happened to the Bank of Queensland (ASX:BOQ) share price in 2021? appeared first on The Motley Fool Australia.

More reading

• 2 ASX dividend shares rated highly by analysts
• 40% drawdown: The Bank of Queensland (ASX:BOQ) share price is struggling. Is it a buy?
• Is the Bank of Queensland (ASX:BOQ) share price a better buy than CBA? Here’s what top brokers say
• Bank of Queensland (ASX:BOQ) hoses down Humm (ASX:HUM) takeover rumours
• Is it a buy? Top brokers’ opinion on the Bank of Queensland (ASX:BOQ) share price

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. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Netflix‘s (NASDAQ: NFLX) earnings report is always closely watched on Wall Street. The subscription streaming video leader routinely wowed investors even before the pandemic put a new global premium on at-home entertainment.

But its upcoming fourth-quarter announcement, set for 20 January, will be followed for different reasons. Namely, investors are looking for evidence that Netflix can recover from a growth hangover and speed its sales growth rate back up above 20%.

There’s also concern about just how quickly the company can boost profit margins and cash flow now that the business is maturing.

Let’s take a closer look at what could be reported on Thursday.

Netflix could see strong subscriber gains

You wouldn’t know it by following the sinking stock price in recent weeks, but Netflix is likely to report strong growth for the Q4 period that runs through late December. Management in October forecast adding 8.5 million new subscribers compared to 4.4 million in the third quarter and 8.5 million a year ago.

That blockbuster result would be supported by a flood of new content releases, with hits like Don’t Look Up and The Witcher likely to receive shout-outs from co-CEO Reed Hastings and his team.

Hitting that growth figure would keep Netflix below the 20% annual sales growth rate that management has highlighted as an important milestone. Still, we should get a better idea about the company’s prospects for accelerating revenue gains again after sales trends soared by 24% in 2020 but slowed to about 19% in 2021.

Netflix investors are looking for margin updates

Investors looking for an inflation-proof stock have been attracted to Netflix for good reasons. Operating margin has been rising at almost exactly the 3 percentage-point annual target that management has outlined. It’s on pace to cross 20% of sales this year compared to just 4% back in 2016.

NFLX Operating Margin (TTM) data by YCharts

Whether or not that metric keeps climbing toward 30% of sales depends on Netflix’s growth rate, the competition, and its ability to boost the value — and price — of the service over time. Management’s favourite way to describe the potential is the fact that Netflix still only accounts for less than 10% of total TV watching time in the US, its most mature market. Investors are hoping the company can boost that figure by broadening its content catalogue to better rival cable networks.

Will Netflix’s cash flow remain strong?

If its latest batch of movie and show releases worked, then Netflix will issue a short-term growth outlook for the first quarter that looks good compared to the prior year’s spike of 4 million new subscribers. Investors might get more positive news in the form of cash flow, which is now strong enough to handle all of Netflix’s funding needs, plus aggressive stock buybacks, going forward.

Those financial wins all point to the potential for additional market-thumping returns for shareholders. But Wall Street is asking for more from growth stocks, even well-established market leaders like Netflix, right now.

The report on Thursday might give investors that certainty they’ve been chasing. It’s more likely that the announcement answers some questions around earnings and profitability for 2022, while raising more about Netflix’s global membership potential. In any case, it will be worth watching what the digital entertainment titan has to say about the industry as pandemic demand trends settle to a new normal.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why investors will be tuning in for Netflix’s earnings report this week appeared first on The Motley Fool Australia.

More reading

• Here’s why the Adbri (ASX:ABC) share price is raging 8% higher today
• 2 ASX shares rated as strong buys by brokers
• Why a COVID-19 trial is exciting BOD (ASX:BOD) investors today?
• Is this driving Santos (ASX:STO) and Woodside (ASX:WPL) shares higher on Monday?
• Here’s why the Kogan (ASX:KGN) share price is being sold off today

Demitri Kalogeropoulos owns Netflix. The Motley Fool owns and recommends Netflix. The Motley Fool Australia has recommended Netflix. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Key points

• ASX-listed Adbri shares surge following supply agreement extension
• The extension with Alcoa of Australia for quicklime will add a further 12 months to the arrangement
• Agreement will see between $25 million to $35 million in additional revenue

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The Adbri Ltd (ASX: ABC) share price is finding a pocket of optimism within the materials sector today. This follows the company’s announcement of an extension to an existing lime supply agreement with Alcoa of Australia Limited.

At the time of writing, shares in the integrated construction materials company are trading 7.5% higher to $3 apiece. However, this only puts the 140-year-old materials manufacturer ~9% above its recently set 52-week low of $2.75.

Let’s take a closer look at this morning’s announcement.

What’s moving Adbri on the ASX today?

Investors have been drawn to the Adbri share price on Monday after the cement and lime producer posted an announcement to the ASX.

According to the release, Adbri’s subsidiary, Cockburn Cement Limited, has secured an extension for its lime supply agreement with Alcoa of Australia. This agreement is with the local Australian arm of the US$11.5 billion United States industrial giant, Alcoa Corp (NYSE: AA).

Furthermore, the agreement relates to the supply of ASX-listed Adbri’s ‘quicklime’ product. Additionally, the extension moves the end of the existing arrangement from 31 January 2022 to 31 January 2023 — an added year of supply.

As part of the updated agreement, the company expects a minimum of $25 million in additional revenue from the extended supply. Likewise, a maximum supply volume of quicklime has been agreed upon which would correlate with a maximum additional revenue of $35 million.

Commenting on the announcement, Adbri managing director and CEO Nick Miller said:

We thank Alcoa for continuing to work with CCL around the supply of quicklime to their operations in
Western Australia. The extension reinforces CCL’s position as a reliable and high-quality supplier of lime through
our local manufacturing and distribution network across Western Australia, supporting local manufacturing jobs,
the resources sector and broader WA economy.

Adbri share price in the rear view

It has been an uneventful period for Adbri on the ASX over the past year. To illustrate, accounting for today’s gain in share price, the company is back to where it was 12 months ago.

Prior to the company’s half-year results in August 2021, the Adbri share price was up ~15% since the beginning of the year. However, the market was unimpressed with Adbri’s performance during the half, leading to a selloff over the following months.

Finally, the company is trading on a price-to-earnings (P/E) ratio of 15 based on Adbri’s current pricing on the ASX.

The post Here’s why the Adbri (ASX:ABC) share price is raging 8% higher today appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Wesfarmers’ update, energy shares rise
• Here are the top 10 ASX shares today

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. 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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Key points

• Brokers have identified some opportunities for 2022
• One well-liked ASX share is Universal Store, an apparel business focused on younger customers
• The other stock is IDP Education, a global education and English language testing business which is seeing recovering volumes.

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Australia’s leading Australian brokers and analysts are always on the lookout for ASX share investment opportunities.

Some companies are now rated as buys by these notable investors.

In recent weeks, both of the below ASX companies have fallen materially and that could make them more attractive.

Universal Store Holdings Ltd (ASX: UNI)

Over the last two months the Universal Store share price has dropped around 25%.

For readers that haven’t heard of Universal Store before, it’s a specialty retailer of youth casual apparel. It sells products both online and through its store network of more than 70 outlets across Australia.

Its strategy is to offer a frequently changing and curated selection of on-trend clothing products to 16 to 35 year olds. It wants to provide a high level of customer service and a welcome and engaging store environment.

UBS currently rates Universal Store as a buy, with a price target of $8. That suggests a potential upside of around 30% over the next year, if the broker is right. The broker thinks the ASX share can continue to rollout new stores and grow revenue.

In a FY22 trading update for the 20 weeks to 14 November 2021, it said that compared to FY20 sales were up 3.3% but down 14.1% compared to FY21 because of lockdowns in Victoria and NSW.

Online sales continue to soar higher. FY22 digital sales were up 67.8% year on year and up 275.2% compared to two years ago.

It’s investing in relocating its distribution centre and office facilities (and building the team), which will help support growth.

UBS thinks the Universal Store share price is valued at 16x FY23’s estimated earnings.

IDP Education Ltd (ASX: IEL)

The IDP Education share price has fallen by nearly 20% over the past two months.

This ASX share is involved in a number of different areas of the global education sector with student placements, education and English language testing.

Despite all of the impacts of the pandemic, at the company’s AGM it said that it was seeing a continued recovery in volumes across the network. It had a “strong performance” in the first quarter of FY22 with English language testing volumes up 84% year on year.

Its growth is being helped by the expansion of its English language testing network. During FY21 it added another 100 new computer-delivered test centres.

Whilst Australian borders make it difficult for students to enroll in Australian institutions, the northern hemisphere is seeing a better performance, particularly the UK.

The company says that a strategic breakthrough was experienced last year with the British Council in India, which saw IDP take on sole distribution of English language testing in that market. India is the largest English language testing market globally by volume.

UBS also rates IDP Education as a buy, with a price target of $36.40. That’s a potential upside of more than 10% if the broker turns out to be right on the direction of the company. It thinks that English language testing has returned to levels seen before COVID.

According to UBS, the IDP Education share price is valued at 50x FY23’s estimated earnings.

The post 2 ASX shares rated as strong buys by brokers appeared first on The Motley Fool Australia.

More reading

• 3 exciting ASX growth shares with major upside potential in 2022
• Why Afterpay, Healius, IDP Education, and Transurban shares are falling
• ASX 200 (ASX:XJO) midday update: CBA rises, Sandfire’s MATSA update
• 3 fantastic ASX 200 shares to buy in 2022
• Top brokers name 3 ASX shares to buy today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Idp Education Pty Ltd. 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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Key points

• The BOD Australia share price is up nearly 7%
• The company’s announced a new trial on treatment for long term COVID-19
• It involves a medicinal cannabis product

The BOD Australia Ltd (ASX: BOD) share price is surging today amid news of a new COVID-19 clinical trial.

The company’s shares are currently swapping hands at 23.5 cents, up 6.82%.

Let’s take a look at what the company announced today?

Medicinal cannabis to treat COVID-19?

BOD investors are reacting to news of a clinical trial into the use of medicinal cannabis to treat long term COVID-19.

The company will work with Drug Science UK on the six-month trial featuring BOD’s flagship product MediCabilis.

Symptoms of long term COVID-19 include chronic pain, anxiety, fatigue, and sleeping trouble. The trial will recruit 30 people suffering from the condition.

BOD is hopeful it will be able to commercialise its product in the UK and “other countries” if the trial is successful.

About 1.3 million people are estimated to have long-COVID-19 in the UK with 1 in 40 of these having symptoms lasting three months or more.

BOD said its MediCabilis product is already prescribed to treat people with long-COVID-19 symptoms including anxiety, sleep disorders, and chronic pain.

Management comment

Speaking on the news of the trial, CEO Jo Patterson said:

While there aren’t any existing treatments for long-COVID, our medicinal cannabis products have been used to treat and alleviate a number of similar conditions.

We anticipate that this clinical trial will provide us with great insight into its potential to treat long-COVID and build on the body of evidence for the use of cannabis-based medicines, in place of other pharmaceuticals.

Share price snapshot

The BOD share price has crashed by 50% in the past year. Despite this, it is up 4% in the last month and nearly 7% in the past week.

In comparison, the S&P/ASX 200 Index (ASX: XJO) has returned more than 10% to investors in the past year.

The company commands a market capitalisation of about 24.9 million based on the current share price.

The post Why a COVID-19 trial is exciting BOD (ASX:BOD) investors today? appeared first on The Motley Fool Australia.

More reading

• Here’s why the Adbri (ASX:ABC) share price is raging 8% higher today
• 2 ASX shares rated as strong buys by brokers
• Is this driving Santos (ASX:STO) and Woodside (ASX:WPL) shares higher on Monday?
• Here’s why the Kogan (ASX:KGN) share price is being sold off today
• Turning point? Magellan (ASX:MFG) posts market-beating fund returns for December

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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Key points

• The Santos share price is up 1.29% on Monday, while Woodside’s has gained 1.37%
• The oil producers’ stock might be impacted by boosted oil prices
• The companies’ home sector is outperforming most ASX 200 indexes on Monday

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Today is shaping up to be a good day for the Santos Ltd (ASX: STO) share price and that of Woodside Petroleum Limited (ASX: WPL).

The oil producers’ shares are currently outperforming the broader market, gaining 1.29% and 1.37% respectively.

At the time of writing, stock in Santos is trading at $7.085 while Woodside shares are swapping hands for $25.16.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently up 0.06% while the All Ordinaries Index (ASX: XAO) has gained 0.02%.

Could the price of oil have anything to do with today’s performance from the share prices of Santos and Woodside? Let’s take a look.

What’s boosting shares in Santos and Woodside today?

The price of oil shot up overnight, with Brent Crude gaining 0.2% to reach US$86.28 per barrel and West Texas Intermediate trading at US$84.27, a 0.5% gain, according to data from CNBC.

That’s on top of Friday’s gains of 1.9% and 2.1% respectively.

And, according to Reuters, the increases might be ongoing.

Earlier today (Australian time), the publication stated supply outages and disproved assumptions the COVID-19 Omicron variant would see demand for oil fall have bolstered the black liquid’s value.

As oil producers’ profits are tied to the commodity’s price, the increase is likely to boost their share prices.

Growing oil prices have also likely helped buoy the S&P/ASX 200 Energy Index (ASX: XEJ) to become one of the top-performing sectors on Monday, boasting a 1.3% gain.

The increase has helped the energy sector reach its highest point since October.

While the sector’s oil companies are helping it push higher, its coal producers are leading the charge.

The Whitehaven Coal Ltd (ASX: WHC) share price is its best performer, surging 4.64% higher on Monday.

Those of Worley Ltd (ASX: WOR) and Washington H Soul Pattinson and Co Ltd (ASX: SOL) aren’t far behind, gaining 2.8% and 1.64% respectively.

While Santos and Woodside’s shares aren’t their sector’s top performers, they’ve both made a strong start to 2022.

Year to date, the Santos share price has gained 12%. Meanwhile, the Woodside share price has increased by 14%.

The post Is this driving Santos (ASX:STO) and Woodside (ASX:WPL) shares higher on Monday? appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Wesfarmers’ update, energy shares rise
• 5 things to watch on the ASX 200 on Monday
• Is the Woodside (ASX:WPL) share price set for an “explosive performance” this year?
• Santos (ASX:STO) accused in court of ‘cavalier attitude’. Here’s why
• 5 things to watch on the ASX 200 on Friday

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. owns and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns and has recommended Washington H. Soul Pattinson and Company 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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Key points

• Kogan share price falls in response to update from Wesfarmers’ Catch business
• Catch sales grew just 1% during the first half
• Catch and Kogan reported strikingly similar sales in the prior corresponding period

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The Kogan.com Ltd (ASX: KGN) share price is having a tough start to the week.

At the time of writing, the struggling ecommerce company’s shares are down 3% to $7.95.

This means the Kogan share price is now down 62% over the last 12 months.

Why is the Kogan share price falling today?

The catalyst for the weakness in the Kogan share price on Monday appears to have been the release of an update from one of its rivals.

This morning Wesfarmers Ltd (ASX: WES) released its half year trading update, which included a summary on its Kmart Group business. This business is home to Kogan’s rival, Catch.

As you might have guessed from the Kogan share price performance today, that update was not an overly positive one.

According to the release, the Catch business recorded a first half sales increase of just 1% compared to the prior corresponding period. In addition, Wesfarmers revealed that Catch is expected to post a material loss during the half.

It explained: “An EBT loss for Catch of between $45 and $43 million is expected for the half, reflecting continued investment in team, technology, marketing, and capabilities to support long-term growth, as well as higher levels of inventory clearance compared to the prior corresponding period.”

Catch vs Kogan

Given their numerous overlaps, Catch is a great company to compare Kogan with. In fact, during the prior corresponding period, the two companies delivered very similar results.

For the six months ended 31 December 2020, Catch reported a 95.6% increase in gross transaction value to $610 million. Whereas Kogan posted a 97.4% increase in gross sales to $638.2 million.

In light of this, the market appears concerned that Kogan could report equally weak numbers next month when it hands down its half year results. Though, it is worth noting that in late November management said “we are proud to have delivered another period of top line growth” for July through October.

But as investors in the retail sector know all too well, the December period can make or break a retailer’s results. So, a lot could have changed between then and now. We’ll find out next month.

The post Here’s why the Kogan (ASX:KGN) share price is being sold off today appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• Here are Scott Phillips’ top 5 ASX shares for 2022. Is it time to buy?
• These are the 10 most shorted ASX shares
• Plot twist: Kogan (ASX:KGN) crypto deal changes shape
• Why is the Kogan (ASX:KGN) share price having such a lacklustre start to 2022?

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. owns and has recommended Kogan.com ltd. The Motley Fool Australia owns and has recommended Kogan.com ltd and Wesfarmers 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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Key points

• Magellan shares had a year to forget last year
• A series of negative developments pushed Magellan shares to new lows
• But could a spirited December performance mean that the worm has turned?

Much has been made of the frankly awful performance of the Magellan Financial Group Ltd (ASX: MFG) share price over 2021. Last year, Magellan shares lost a nasty 60% or so of their value, decimating this former high flyer’s reputation as a blue-chip growth share.

Magellan’s 2021 woes began with what has turned out to be some poor performances from its flagship investment funds in the months and years following the 2020 COVID share market crash. These performance issues were exacerbated by a number of developments in Magellan’s corporate sphere. Last last year, the company was rocked by the sudden (and unexplained) departure of its CEO Brett Cairns. Not only that, there was the news of co-founder and chief investment officer Hamish Douglass’ divorce. And then we had the loss of a major St. James Place funds management mandate for the company.

Long story short, it seemed that everything that could go wrong with Magellan in 2021, did.

But perhaps the embattled fund manager has reached a turning point. Let’s take a look at the company’s latest performance figures that have just been released for the month of December.

Magellan gives its investors some much-needed outperformance

So the company’s flagship Magellan Global Fund (ASX: MGF) returned 3.3% over the month of December 2021. That was a very healthy outperformance of 1.6% against the benchmark MSCI World Net Total Return Index (AUD). Magellan’s management said that the fund’s strong holdings in Microsoft Corporation (NASDAQ: MSFT), PepsiCo Inc (NASDAQ: PEP) and Intercontinental Exchange Inc (NYSE: ICE) were the major contributors to this outperformance. Meanwhile, Magellan’s Chinese investments continued to weigh on the fund, with Alibaba Group Holding Ltd being a major detractor.

Such a spirited outperformance might help assuage some of the concerns investors have evidently had with Magellan. Reading these numbers would certainly be eliciting some sighs of relief for many investors (not to mention at Magellan’s corporate headquarters).

But even so, December’s performance wasn’t enough to cover up the funds’ longer-term underperformance. After factoring in December’s numbers, the unlisted iteration of the Global Fund is still trailing its benchmark by -10% over the past 12 months, and by -1% per annum on average over the past 5 years.

But, a turnaround has to start somewhere, some might argue. And Magellan has certainly kicked off 2022 on a positive note in light of these numbers. No doubt shareholders will be keeping their fingers crossed that the company can keep it up.

At the current Magellan share price of $20.42 (at the time of writing), this company has a market capitalisation of $3.8 billion, with a trailing dividend yield of 10.36%.

The post Turning point? Magellan (ASX:MFG) posts market-beating fund returns for December appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX shares today
• Dividend beasts: 5 ASX 200 shares with the highest dividend yield
• Why API, James Hardie, Magellan, and St Barbara shares are dropping
• Magellan (ASX:MFG) share price falls after revealing $21bn funds decline
• Down 60%: Is the Magellan (ASX:MFG) share price now a bargain?

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Cryptocurrency Bitcoin (CRYPTO: BTC) has been one of the best investments you could have made over the past several years. It’s up roughly sixfold over the past 24 months, and many times more over its lifetime.

Bitcoin’s market cap has ballooned to roughly $820 billion, more than a third of all value among cryptocurrencies. Bitcoin’s rate of appreciation may slow down at this large size, making a bear market possible for Bitcoin in 2022 if investors cool off toward it.

Meanwhile, technology is creating value in the broader cryptocurrency space, including data analytics company Palantir Technologies (NYSE: PLTR) launching Foundry for Crypto. While Bitcoin’s track record of gains is impressive, Palantir’s stock could outpace Bitcoin in 2022. Here’s why.

Is Bitcoin due for a soft year?

Bitcoin is up more than 29,800% over its lifetime, showing just how ridiculously good of an investment it’s been for early investors. The price has continued multiplying, up by roughly six times over the past two years, but just 20% over the past 12 months.

Bitcoin Price data by YCharts

Bitcoin is currently down after setting an all-time high in late 2021. To be sure, nobody can predict the price action of cryptocurrencies. But Bitcoin doesn’t have earnings or free cash flow like stocks do, which can be a compass of sorts for valuing them. Bitcoin and other cryptocurrencies are mainly a function of supply and demand.

Suppose investors begin shying away from “buying the dip” because of Bitcoin’s negative price momentum. In that case, investors could see a soft 2022 for it and other cryptos, especially after the massive price action seen from 2020 and 2021.

Foundry for Crypto can help the industry

Cryptocurrencies have become popular for several reasons; they operate on blockchain technology, a type of ledger that publicly tracks each transaction as an ongoing chain so that people can’t change it.

Blockchain technology means that cryptocurrencies are decentralized; they aren’t managed by a single party, like how the government controls the U.S. dollar. The unregulated nature of cryptocurrency is a plus for many crypto investors, but there could be hurdles that slow down how decentralized currencies are adopted by society.

For example, the cryptocurrency space has become a Wild West of sorts, where scams are rampant, and coin “pump and dump” schemes typically leave investors with losses after the founders abandon the project once they make money.

Palantir’s Foundry is a software-as-a-service data platform that interacts with data to help users make actionable decisions. It can integrate data, perform analytics, build models, map, and track decision-making. It’s almost like Iron Man’s power armor; it doesn’t function by itself, but it makes a superhero when combined with the user.

Palantir launched Foundry for Crypto to gain exposure to the growth of cryptocurrencies and decentralized applications. Foundry for Crypto lists offerings including anti-money laundering, fraud detection, intelligence for decentralized applications, and analytics across blockchains. It’s still very early, and Palantir will need to elaborate on the program’s progress over the coming quarters and years. Still, Foundry could prove a valuable tool in a space where security and regulation are lacking. Cryptocurrency is still speculative, but some estimate that it could grow into an enormous field, which could be a massive opportunity for Palantir over the long term.

Why Palantir could soar in 2022

Bitcoin isn’t the only asset coming down from a big run; Palantir’s stock has struggled, too, amid a marketwide sell-off of tech stocks. Shares are currently near 52-week lows, falling from $45 per share to under $17.

PLTR PS Ratio (Forward) data by YCharts

Palantir’s price-to-sales ratio has declined on a forward basis from nearly 48 to under 17 because the company’s revenue keeps growing while the share price drops. Meanwhile, free cash flow has turned positive over the past year, a great sign that the business is on a path to profitability. Adjusted free cash flow was $119 million in Palantir’s most recent reporting period, the third quarter of 2021, up from a negative $53 million in 2020.

The stock’s reduced valuation could be a great buying opportunity as the business is turning a corner producing free cash flow. Management has maintained a long-term revenue growth projection of at least 30% per year over the next four years.

If the market begins favoring fast-growing companies again, Palantir’s improving financials and signs of continued growth in future quarters could make it a big winner in 2022. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post This under-the-radar cryptocurrency stock could outpace Bitcoin in 2022 appeared first on The Motley Fool Australia.

More reading

• Crypto is crashing: Should you invest now?
• Bitcoin could hit ‘death cross’ soon! Expert explains why this is great
• Is Bitcoin making share prices more volatile?
• Bitcoin, Ethereum, and Dogecoin surge higher as crypto markets recover
• Why Bitcoin, Ethereum, and Dogecoin plunged today

Justin Pope has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends Bitcoin and Palantir Technologies Inc. The Motley Fool Australia owns and recommends Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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