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As the S&P/ASX 200 Index (ASX: XJO) sinks this month, it has never been more important to be selective about which stocks to buy.

The ASX 200 has dipped 3.9% in September, and no one knows whether this is the start of a larger correction or if it’s a temporary hiccup.

Fortunately, 3 experts have each revealed one ASX share that they think will go gangbusters over the next 12 months.

The quality of these businesses, they say, could prove to be more resilient against market corrections than more speculative, momentum-reliant stocks.

The ASX share that ‘consistently outperforms’

Switzer Financial director Paul Rickard rates CSL Limited (ASX: CSL) as “Australia’s best healthcare company”.

“I just love CSL for all the right reasons,” he told Switzer TV Investing.

“It consistently outperforms. In other words, it tells the market one thing then delivers results that are better.”

CSL’s massive plasma collection business in the US took a hit after COVID-19 arrived due to lower numbers of donors coming forward.

But, in the long run, the coronavirus might have had a positive impact on CSL and its peers.

“The pandemic has got to be good longer-term for health companies. I think we’re all going to be a lot more conscious of these things,” he said.

“My guess is CSL is going to be one of those companies that’s going to be well-supported even in a bear market.”

CSL shares were trading at $306.78 on late Tuesday morning, which is 7.6% up so far this year.

‘Oversold’ and ready to ‘bounce back’

A fertiliser producer is Burman Invest chief investment officer Julia Lee’s pick.

“If you’re talking about the next one year, probably Nufarm Ltd (ASX: NUF). I think it’s oversold at the moment. The market’s too pessimistic,” she said.

“It’s already started to bounce back but I think that bounce is going to continue.”

The sector is in the midst of a structural shift, Lee believes.

“Fertilisers in Europe are reaching a record price and a part of that story is because of the electricity price over there, which is at record highs,” she said.  

“Fertiliser companies here in Australia are in a good spot.”

Late Tuesday morning, Nufarm shares were going for $4.62 which is 11.7% up for the year thus far.

‘Cheap’, ‘defensive’ and ‘premium’ ASX share

Tribeca Investment Partners portfolio manager Jun Bei Liu likes the look of Ramsay Health Care Limited (ASX: RHC).

She said Ramsay’s already the leader in private hospitals in Australia but has plenty going on elsewhere too.

“Many years ago it went offshore — so it went to France, the UK. In those markets, it’s gradually building a very strong market share.”

The stock was trading for $69.74 late Tuesday morning, which is already up 11.3% for the year.

But with the stock below pre-COVID highs of around $80, Liu reckons it’s still good value as a “premium” and “defensive” business.

“It is very cheap compared to its healthcare peers. Cochlear Limited (ASX: COH) or Resmed CDI (ASX: RMD) — they’re all trading on an average of about 40 times earnings,” she said.

“Whereas Ramsay is trading on just over 20.”

The post 3 experts pick 3 ASX shares to rocket in next 12 months appeared first on The Motley Fool Australia.

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• Why is the ASX All Ordinaries (ASX:XAO) struggling lately?
• The CSL (ASX:CSL) share price has had a good 6 months. Is it a buy?
• Top brokers name 3 ASX shares to buy next week
• 2 high quality ASX 50 shares named as buys
• CSL (ASX:CSL) share price lifts amid ASX 200’s best day in 8 weeks

Motley Fool contributor Tony Yoo owns shares of CSL Ltd. and ResMed Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended CSL Ltd. and Cochlear Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia has recommended Cochlear Ltd., Ramsay Health Care Limited, and ResMed Inc. 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 Telstra Corporation Ltd (ASX: TLS) share price is having a pretty decent day so far this Tuesday, all things considered. Telstra shares are currently trading at $3.90 each, up 0.64% for the day so far. That stands in pretty stark contrast to the broader S&P/ASX 200 Index (ASX: XJO) today, which is currently down 0.05% so far to 7,244 points.

Telstra shares have been pipping the ASX 200 over some other metrics too. Over the year to date in 2021, Telstra shares are up a healthy 29.7% so far. Over the past 12 months, Telstra has managed an even more impressive 38%. In contrast, the ASX 200 has returned around 8.1% year to date so far. As well as 24.07% over the past 12 months.

Telstra beats out the ASX 200

Why all of this rather solid outperformance from the Telstra share price? Well, investors seem to have been impressed time and time again about what Telstra has had to say over the year so far.

Back in late June, Telstra surprised most of us with its announcement that it will be selling half (well, 49%) of its mobile towers infrastructure business to a consortium of investors, which included the Future Fund.

It was the price that Telstra was able to command for these assets – $2.8 billion or 28x earnings – that really got investors excited. The company has a lot more infrastructure assets that could be sold in the future, so this was clearly good news for the the telco.

Then, Telstra delivered its FY21 earnings report last month. This report once again reaffirmed Telstra’s annual 16 cents per share dividend for FY21. It also announced a new $1.35 billion on-market share buyback scheme.

This also gave the Telstra share price a boost. As did Telstra’s announcement just last week that it would be implementing a new cost-cutting program called ‘T25’.

But that gets us to the current Telstra share price. So where to from here for this ASX 200 telco?

Could the Telstra share price be a buy today?

One broker who thinks it could be is investment bank, Goldman Sachs. Goldman currently rates Telstra shares as a ‘buy’ with a 12-month share price target of $4.40 a share. That implies a potential future upside of around 13.1% on current pricing. Goldman recently bumped up this price target to $4.40 earlier this month, from $4.30 previously.

The broker remains bullish on Telstra due to the additional new free cash flow the T25 program will unlock, which Goldman thinks will be allocated towards more share buybacks. Goldman also sees healthy dividend returns from Telstra shares going forward. As well as solid returns from the further “infrastructure monetisation over time”.

At the current Telstra share price of $3.90, this company has a market capitalisation of $46.44 billion. It also has a price-to-earnings (P/E) ratio of 25 and a dividend yield of 4.1%.

The post Why this broker loves the current Telstra (ASX:TLS) share price appeared first on The Motley Fool Australia.

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• Why the Telstra (ASX:TLS) share price is outperforming the ASX 200 today

Motley Fool contributor Sebastian Bowen owns shares of Telstra Corporation 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 shares of and has recommended Telstra Corporation 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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The Boral Limited (ASX: BLD) share price has underperformed the broad ASX indices lately.

Whereas the S&P/ASX 200 index (ASX: XJO) has slipped 3% into the red over the last month, Boral shares are down 10% over the same period.

In fact, the Boral share price has tanked by more than 17% since control of the company was passed over to Seven Group Holdings Ltd (ASX: SVW) back in July. Boral shares are currently trading at $6.04 — down 0.82% on the day.

There’s a lot of moving parts here, so let’s investigate a little further.

What’s happened since Seven took over?

Since Seven gained control of the company back in July, it hasn’t been a nice ride for the Boral share price.

Seven Group ended the takeover bid with 69.5% of Boral’s shares and therefore obtained majority voting rights for the company.

The takeover was a saga in itself. But perhaps what capped it off for investors was the appointment of Seven Group’s CEO, Ryan Stokes, as chair of Boral’s board, immediately after the takeover bid was finalised.

Seven’s chief financial officer Richard Richards was also appointed to Boral’s board, and the former chair, Kathryn Fagg, has stepped aside.

Since this announcement, the Boral share price has come off a high of $7.34 on 29 July. Shares are currently trading at $6.04 apiece — that’s a fall of more than 17%.

Perhaps not helping Boral’s situation is its lacklustre FY21 results that were released last month. In its report, Boral recognised a 6% year-on-year decrease in revenue to $2.9 billion.

It also stated it will see a headwind of around $50 million next quarter as a result of lockdowns. This was compounded by management’s decision to withhold the final FY21 dividend.

As a result of its recent underperformance, Boral’s shares have been removed from the ASX 100 index, following S&P Dow Jones Indices’ rebalancing of ASX indices this quarter.

Some might argue that Seven’s takeover manoeuvre hasn’t benefitted Boral shareholders in the short term – but Seven Group’s share price has also dropped 16% off highs of $24 in August.

Boral share price snapshot

Despite its recent underperformance, it’s not all doom and gloom for Boral shares.

The Boral share price has climbed 22% this year to date and has gained 45% over the past 12 months.

These results have outpaced the broad index’s return of around 25% over the past year.

The post The Boral (ASX:BLD) share price has fallen 17% since Seven took control appeared first on The Motley Fool Australia.

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• This year’s ASX 200 Santa Rally to get a whopping $84bn cash boost
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• Why the Boral (ASX:BLD) share price is down 17% in a month
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• Boral (ASX:BLD) share price on watch as revenue falls

The author Zach Bristow has no positions 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 Sigma Healthcare Ltd (ASX: SIG) share price is out of form on Tuesday. This follows the release of its half year results this morning.

In early trade, the pharmacy chain operator and distributor’s shares dropped as much as 7% to 58.5 cents.

The Sigma share price has recovered a touch since then and is now down 3% to 61 cents.

Sigma share price tumbles on guidance downgrade

• Revenue up 5.5% to $1.73 billion
• Like for like pharmacy sales up 8.7%
• Underlying EBITDA up 14.7% to $39.2 million
• Underlying net profit after tax up 23.7% to $14.1 million
• Fully franked interim dividend of 1 cent per share
• Net debt of $82 million
• Outlook: FY 2022 underlying EBITDA guidance now 5% (from ~10% previously)

What happened during the first half?

For the six months ended 31 July, Sigma reported a 5.5% increase in revenue to $1.73 billion. Management advised that this was driven by a combination of above market organic growth across its pharmacy brands and independent network, a full run rate of sales to Chemist Warehouse, and the incremental on-boarding of a number of new customers.

PBS sales were up 14% for the half, with over the counter sales up 32%. However, excluding Chemist Warehouse, over the counter sales were down 5.4%. This reflects general market conditions including the softer cold and flu category.

On the bottom line, the company’s underlying net profit after tax increased 23.7% to $14.1 million. Management advised that this reflects its positive sales performance and operational platform efficiency.

What did management say?

Sigma’s CEO and Managing Director, Mark Hooper, was pleased with the half.

He commented: “It is pleasing to navigate a challenging operating environment and still deliver a strong set of results for the half. Our community pharmacy brands have again delivered industry leading like-for-like growth of 8.7%, with our upgraded infrastructure easily absorbing a 13% increase in wholesale volumes for the half.”

“Just as pleasing, we are now emerging from a period of significant investment and transformation which has set the business up for the next wave of growth, including the pursuit of acquisition opportunities,” he added.

Outlook

While management is confident on the medium and long term, it has warned that near term trading conditions remain tough due to COVID-19 restrictions.

As a result, underlying EBITDA is only expected to grow 5% in FY 2022. This is a sharp slowdown on its first half growth and means it is behind on its two-year growth target. That target is for a CAGR of 10% for underlying EBITDA growth in FY 2022 and FY 2023.

Mr Hooper concluded: “We have emerged from the challenges of the last 18 months to deliver a strong first half result and have the business in good shape. However, with the increased impact of COVID-19 restrictions that are expected to stretch well into the 2H22, we are now expecting FY22 Underlying EBITDA growth to be closer to 5%.”

The post Sigma (ASX:SIG) share price sinks 7% on half year update and guidance downgrade appeared first on The Motley Fool Australia.

More reading

• The Boral (ASX:BLD) share price has fallen 17% since Seven took control
• IGO (ASX:IGO) share price lifts amid Western Areas rumours
• Here’s what has been moving the IAG (ASX:IAG) share price in September 2021
• Why the Whitehaven (ASX:WHC) share price is lifting on Tuesday
• A fall in unemployment during a pandemic? What do the numbers really mean? Scott Phillips on Weekend Sunrise

Motley Fool contributor James Mickleboro 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 IGO Ltd (ASX: IGO) share price is in the green today amid rumours the company is scouring Western Areas Ltd‘s (ASX: WSA) books as it considers posing a new acquisition offer.

The mining company responded to the rumours in an ASX announcement earlier today, noting it has entered due diligence with Western Areas in recent days. However, it declined to comment further.  

The companies announced they were in takeover talks in August. The market hasn’t received any updates on their discussions since.

At the time of writing, the IGO share price is $9.11, 0.89% higher than its previous close.

Let’s take a closer look at the rumours regarding the nickel and copper miner’s reported potential takeover of Western Areas.

IGO confirms some truth to takeover rumours

The IGO share price is gaining amid reports its been given access to Western Area’s books.

The reported access is apparently part of the recently unveiled due diligence between the 2 companies. The due diligence period reportedly follows an acquisition offer of around $1 billion.

According to reporting by the Australian Financial Review (AFR), Western Areas has allowed IGO access to its books so it can pose a more serious offer.

The publication believes IGO is most interested in Western Area’s Odysseus Mine, an up-and-coming nickel mine.

In August, the AFR reported IGO posed a $1 billion mostly scrip offer to Western Areas which was, assumably, rebutted.

Now, it’s expected the IGO will take the next 4 weeks to analyse the true value of Western Areas before deciding whether to offer the nickel producer a bid it’s more likely to accept.

While the market might be getting excited over the potential acquisition, IGO has warned investors to keep their cool.

The company noted the “potential change of control transaction” is far from certain and, at this point, it’s only in discussions with Western Areas.

IGO share price snapshot

The IGO share price has been performing exceptionally well on the ASX lately.

It has gained 42% since the start of 2021. It is also 102% higher than it was this time last year.

For comparison, the Western Areas share price has gained 13% year to date and 31.8% over the last 12 months

The post IGO (ASX:IGO) share price lifts amid Western Areas rumours appeared first on The Motley Fool Australia.

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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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Motley Fool Australia Chief Investment Officer Scott Phillips joined Nine’s Late News on Monday night to discuss the 2% slump on the ASX, the ongoing fall of the iron ore price, and the private appetite for listed infrastructure assets.

The post Iron ore, ASX 200 get nailed. Infrastructure on the menu. Scott Phillips on Nine’s Late News appeared first on The Motley Fool Australia.

More reading

• The Boral (ASX:BLD) share price has fallen 17% since Seven took control
• Sigma (ASX:SIG) share price sinks 7% on half year update and guidance downgrade
• IGO (ASX:IGO) share price lifts amid Western Areas rumours
• Here’s what has been moving the IAG (ASX:IAG) share price in September 2021
• Why the Whitehaven (ASX:WHC) share price is lifting on Tuesday

Motley Fool contributor Scott Phillips 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 Insurance Australia Group Ltd (ASX: IAG) share price may be flat today, but that hasn’t been the case for September. The insurance giant has encountered some heavy selling of its shares, falling the past 6 consecutive trading days.

At the time of writing, IAG shares remain unchanged at $5 apiece. In comparison, the S&P/ASX 200 Index (ASX: XJO) is down 0.08% to 7,242 points.

What’s affecting the IAG share price

There are two main catalysts that have been weighing down the IAG shares this month.

The first is the broader market weakness on the ASX 200, which has fallen almost 4% in the last 3 weeks. Yesterday, the index plunged to its biggest one-day fall in more than 6 months, shedding 2.1%.

This had a knock-on effect for IAG shares, dropping 0.99% on Monday to a monthly low of $5.

Rising COVID-19 cases in Australia, along with the iron ore rout impacting the economy are being blamed for the fall. Furthermore, overseas losses are being felt as investors eagerly await the United States’ Federal Reserve policy meeting later this week.

While the macro factors appear to unsettle IAG shareholders, the company has been facing its own internal issues.

IAG recently announced that CMC Hospitality filed an application starting a representative proceeding in the Federal Court.

The company said it has not been served with the application and isn’t aware of the detailed nature of the application. Although, it appears to relate to insureds who hold policies with CGU and business interruption losses related to COVID-19.

In addition, IAG’s chief risk officer, David Watts announced his resignation from the company. No reason was given for the departure, and Mr Watts will leave the company sometime in the new calendar year.

IAG will conduct an executive search to replace its chief risk officer.

IAG share price summary

Despite being significantly lower this month, IAG shares are posting a 10% gain since this time last year. However, when looking at the last 2 years, its shares are down almost 40%.

Based on today’s price, IAG presides a market capitalisation of roughly $12.3 billion and has approximately 2.4 billion shares outstanding.

The post Here’s what has been moving the IAG (ASX:IAG) share price in September 2021 appeared first on The Motley Fool Australia.

More reading

• Why this broker sees the IAG (ASX:IAG) share price gaining 12%
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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 owns shares of 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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The Whitehaven Coal Ltd (ASX: WHC) share price is a rare bright spot on a tough day for ASX shares.

Shares in the Aussie coal miner have jumped 4.4% higher at the time of writing to $2.87 per share while the S&P/ASX 200 Index (ASX: XJO) has edged 0.2% lower.

Why the Whitehaven share price is lifting on Tuesday

Whitehaven is actually one of the biggest gainers in the ASX 200 this morning. That’s despite no news from the Aussie coal miner to start the day.

However, as always with resources shares, movements in underlying commodity prices could provide some insight. Coking coal prices have been tearing higher in recent weeks and continued to make strong gains overnight.

According to data from S&P Global Platts, cited in the Australian Financial Review, premium hard coking coal from Queensland sold for US$379 per tonne on Friday, setting a new record price.

That underlying strength in coal prices has helped boost the Whitehaven share price higher on Tuesday morning. The Aussie coal miner has been making strong gains today even as many ASX 200 shares experience a second straight day in the red.

According to Trading Economics data, coal prices are now trading at a new 10-year high having climbed 238.42% in the past year.

The Whitehaven share price has reflected those commodity price gains over that same period. Shares in the Aussie coal miner are up nearly 200% in the last 12 months. That means the company now boasts a $2.9 billion market capitalisation.

It represents a huge turnaround in fortunes from early September 2020. As the COVID-19 pandemic crimped demand for energy, Whitehaven shares were changing hands for as little as $0.85 per share.

Foolish takeaway

The Whitehaven share price is climbing higher on Tuesday even as many other ASX 200 shares are in the red. Strong coal prices are persisting and helping support the company’s current valuation in 2021.

The post Why the Whitehaven (ASX:WHC) share price is lifting on Tuesday appeared first on The Motley Fool Australia.

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Motley Fool contributor Ken Hall 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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Motley Fool Australia Chief Investment Officer Scott Phillips joined Weekend Sunrise on Sunday to discuss the recent unemployment numbers — which were wonderful on the surface, but hid a lot of the bad news. No, it’s not a conspiracy, just a result of the way the numbers are counted. And some other stats might be more useful…

The post A fall in unemployment during a pandemic? What do the numbers really mean? Scott Phillips on Weekend Sunrise appeared first on The Motley Fool Australia.

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• Why the Whitehaven (ASX:WHC) share price is lifting on Tuesday
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Motley Fool contributor Scott Phillips 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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At lunch on Monday, the S&P/ASX 200 Index (ASX: XJO) has fought back from a heavy decline at the open. The benchmark index is currently trading broadly flat at 7,243.6 points.

Here’s what is happening on the ASX 200 on Tuesday:

APA starts bidding war for AusNet

This morning APA Group (ASX: APA) announced that it has made a takeover approach for electricity distributor AusNet Services Ltd (ASX: AST). APA has made a non-binding indicative proposal of $2.60 per share in cash and scrip. This compares to the $2.50 per share offer made by Brookfield Asset Management on Monday. Management believes it would create a listed flagship Australian company with the scale and capability to accelerate the $20 billion growth in electricity transmission infrastructure needed to support the decarbonisation of Australia’s economy.

New Hope results

The New Hope Corporation Limited (ASX: NHC) share price is charging higher today after it reported a big turnaround in its full year profits. The coal miner revealed a net profit after tax (NAPT) of $79 million for FY 2021. This compares favourably to a loss of $157 million in the previous year. Strong coal prices and improved costs helped drive the profit rebound.

Domino’s shares downgraded

The Domino’s Pizza Enterprises Ltd (ASX: DMP) share price is pushing higher on Tuesday despite being downgraded. According to a note out of Bell Potter, the broker has downgraded the pizza chain operator’s shares to a hold rating with a $155.00 price target. While Bell Potter is very positive on its outlook, its analysts believe its valuation is stretched. The broker notes that Domino’s shares trade at 40x estimated FY 2023 earnings.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Tuesday has been the Champion Iron Ltd (ASX: CIA) share price with a 4% gain. This appears to have been driven by hopes that the iron ore selloff has ended. The worst performer has been the APA share price with a 4% decline. Investors have responded poorly to its bid for AusNet.

The post ASX 200 (ASX:XJO) midday update: APA makes AusNet bid, New Hope results impress appeared first on The Motley Fool Australia.

More reading

• Why is everyone talking about ASX SPI Futures?
• New Hope (ASX:NHC) share price jumps on $337m profit turnaround
• AusNet (ASX:AST) share price to rise after APA (ASX:APA) starts bidding war
• Why this broker downgraded the Domino’s (ASX:DMP) share price
• 5 things to watch on the ASX 200 on Tuesday

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 shares of and has recommended APA Group. The Motley Fool Australia has recommended Dominos Pizza Enterprises 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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