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The reporting season can make or break the fortunes of ASX shares.

Not only is the company’s performance for the 2021 financial year important, but the outlook for the current and future years will also set the tone for the stock price.

Here are 3 August results season winners that Shaw and Partners senior investment advisor Adam Dawes picked out this week:

Technology and market dominance will keep the pizzas hot

Shares for pizza chain Domino’s Pizza Enterprises Ltd (ASX: DMP) went gangbusters in August.

The stock has gained more than 30% in the past month after it pleased the market with a boost in sales, earnings, profit and dividend.

And Dawes reckons the upward movement has plenty of legs.

“Domino’s Pizzas has certainly done really well,” he told Switzer TV Investing. 

“Mainly because everyone’s stuck at home… People are sick and tired of cooking, and they may as well keep the kids happy by buying a couple of pizzas.” 

The business has strategically placed itself as a “no contact” and low-cost takeaway option, according to Dawes.

But if it’s such a COVID beneficiary, wouldn’t Domino’s shares plummet once Australia’s vaccination coverage is up and society re-opens?

After all, this ASX share has already more than doubled in the past 5 years.

While Dawes acknowledged that as a risk, he pointed out a couple of positive forces to cancel out any sales slowdown from Australians getting out of the house more.

“These guys are very technology-driven and I think that’s what’s separated them from a lot of the other pizza delivery people,” he said.

“Also, it’s the store dominance that they’ve got — they’re around most corners. They actually place themselves quite comfortably in lower socio-economic areas, also, because their pizzas are quite cheap.”

Wilson Asset Management portfolio managers Catriona Burns, Matthew Haupt, and Oscar Oberg last week were also glowing about Domino’s prospects.

“We remain positive on Domino’s Pizza, with key growth markets such as Japan, Germany, and France reaching an inflection point underpinning a robust organic growth profile, while latent capacity remains for further earnings accretive acquisitions.”

‘Standout business’

Construction materials business James Hardie Industries plc (ASX: JHX) has seen its shares rise by more than 14% over the past month, breaking all-time highs.

Hinting at its history of making asbestos, Dawes acknowledged James Hardie has “a chequered past”. But the August results revealed a booming US arm that was going too well to ignore.

“An upgrade that came from the US building and manufacturing business there has absolutely kicked a lot of goals,” he said.

“We’ve seen other companies like Boral Limited (ASX: BLD) try to go overseas and come back with their tail between their legs.”

Dawes noted that several Australia-only companies in the construction and materials sector had downgraded this August.

“So I think James Hardie is a really standout business, especially for that US growth and especially for the ability for them to run their business.”

Great results, ESG-proof and excellent business

Stocks for small-cap technology company Calix Ltd (ASX: CXL) have risen more than 31% in value in the past month.

According to Dawes, the business’ flagship technology removes the heat out of cement manufacturing to recycle into energy.

He admitted this ASX share is a riskier bet than James Hardie and Domino’s — but the $630 million business has much going for it.

“We’ve got a ‘buy’ [rating] on it at Shaw and Partners,” said Dawes.

“The ESG [environmental, social and governance] theme plus the royalties they’ll get from some of these European operations, I think, is a fantastic one… It’s a great business.”

It’s not just in August that Calix shares have had a good time. They’ve more than quadrupled in value in the 12 months.

The post 3 tempting ASX shares that rocketed after their results appeared first on The Motley Fool Australia.

More reading

• Why the Domino’s (ASX:DMP) share price is up 27% in August
• NIB and Ampol share prices fall, new record for Domino’s. Scott Phillips on Nine’s Late News
• 10 ASX shares we’re overweight in right now: fund
• 2 ASX shares shining this results season
• Revealed: The biggest shocker from results season

Motley Fool contributor Tony Yoo 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 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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With the end of winter and yet another earnings season now firmly behind us, we asked our Foolish contributors to compile a list of some of the ASX shares experts are saying to buy in September.

Bernd Struben: Smartgroup Corporation Ltd (ASX: SIQ)

Smartgroup Corporation is a salary packaging and fleet management solutions provider.

Not-for-profit organisations, healthcare, education and the public service sectors make up roughly 96% of Smartgroup’s salary packaging customers. The company is well established in Australia and trades at a relatively modest price-to-earnings (P/E) ratio of 20.5 times.

It delivered strong half-year results, with a 53% boost in net profit after tax (NPAT). Smartgroup also declared a 7.5 cent interim dividend, fully franked. That brings its trailing dividend yield to around 6.2% based on the current share price. The company has a market capitalisation of just under $1.1 billion.

The Smartgroup share price has climbed by around 16% year to date and around 38% over the past twelve months.

Motley Fool contributor Bernd Struben does not own shares of Smartgroup Corporation Ltd.

Sebastian Bowen: VanEck Video Gaming and Esports ETF (ASX: ESPO)

Video games and e-sports are sectors without too much presence on our own S&P/ASX 200 Index (ASX: XJO). And yet these are two of the fastest-growing industries in these modern times. Luckily, this ASX exchange-traded fund (ETF) gives investors an easy way to access some of the companies that are benefitting the most from the growth of gaming and e-sports.

Some of its largest holdings include names like Activision Blizzard, Tencent Holdings, Nintendo Co and Nvidia Corporation. The VanEck Video Gaming and Esports ETF charges a management fee of 0.55% per annum. It has delivered a return of almost 12% since its inception in September last year.

Motley Fool contributor Sebastian Bowen does not own shares of the VanEck Vectors Video Gaming and Esports ETF.

Mitchell Lawler: Jumbo Interactive Ltd (ASX: JIN)

Jumbo Interactive is an online lottery operator with roots dating back to 1995. Since then, it has grown to become an international online lottery retailer, processing transactional volume of $487 million in FY21.

Following its recent full-year results release, the Jumbo share price has taken a ride to the downside. This is despite growth across revenue and underlying profits as well as the announcement of another acquisition.

The latest acquisition opens the Canadian lottery market to this ASX share. Based on its full-year earnings, Jumbo is currently trading on a P/E ratio of around 35 times.

The Jumbo Interactive share price has climbed almost 10% year to date and around 15% over the past twelve months. That’s despite falling by around 14% in the past week.

Motley Fool contributor Mitchell Lawler owns shares of Jumbo Interactive Ltd.

James Mickleboro: NextDC Ltd (ASX: NXT)

NextDC is a leading data centre operator that has been benefitting greatly from the cloud computing boom. Thanks to the ever-increasing amount of data being generated by consumers and businesses, demand for capacity in its data centres has been increasing strongly.

This led to NextDC reporting a 23% increase in revenue to $246.1 million and a 29% lift in earnings before interest, taxes, depreciation and amortisation (EBITDA) to $134.5 million in FY21. Pleasingly, more of the same is expected in FY22, with management guiding to EBITDA growth of 19% to 23%.

Goldman Sachs remains very positive on this ASX share. It currently has a conviction ‘buy’ rating and a $14.40 price target for NextDC shares.

At Tuesday’s close, the NextDC share price was trading at $13.24.

Motley Fool contributor James Mickleboro owns shares of NextDC Ltd.

Tristan Harrison: VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This is an ETF invested in businesses that are deemed to have strong economic moats which are expected to endure for many years into the future.

These businesses are selected by analysts from Morningstar. Companies only make it into the portfolio if the analysts believe they are trading at an attractive price compared to their estimates of fair value.

At the latest disclosure, some of the biggest positions held by the Wide Moat ETF were Salesforce.com, Corteva, Dominion Energy, Emerson Electric, Facebook, General Dynamics, Gilead Sciences and Alphabet (Google).

The Wide Moat ETF share price has rallied by around 30% so far in 2021.

Motley Fool contributor Tristan Harrison does not own shares of the VanEck Morningstar Wide Moat ETF.

Brendon Lau: NextDC Ltd (ASX: NXT)

The market didn’t react well to the data centre operator’s latest profit results. The NextDC share price fell by 5.4% last Friday on the day the company released its FY21 earnings. But most brokers are sticking to their ‘buy’ recommendation on the shares.

While NextDC’s FY21 revenue was at the low end of guidance, Macquarie Group Ltd (ASX: MQG) believes the company’s structural growth story remains intact.

The broker sees further potential upside for this ASX share from enterprise and government market segments, while development activity continues to accelerate. Macquarie reiterated its ‘outperform’ recommendation and its 12-month price target on the stock is $14.05. This represents an upside of around 6% on the current NextDC share price.

Motley Fool contributor Brendon Lau does not own shares of NextDC Ltd.

The post Top ASX shares to buy in September 2021 appeared first on The Motley Fool Australia.

More reading

• 2 ASX tech shares that could be buys in September 2021
• Have money to invest? 2 ASX shares that could be buys
• Leading brokers name 3 ASX shares to buy today
• ASX 200 flat, Wesfarmers drops, Nextdc declines
• Why Integral Diagnostics, Mayne Pharma, NEXTDC, & Wesfarmers are dropping

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Activision Blizzard, Alphabet (A shares), Alphabet (C shares), Facebook, Jumbo Interactive Limited, Nvidia, and Salesforce.com. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Dominion Energy, Inc and Gilead Sciences. The Motley Fool Australia owns shares of and has recommended Jumbo Interactive Limited, Macquarie Group Limited, and SMARTGROUP DEF SET. The Motley Fool Australia has recommended Activision Blizzard, Alphabet (A shares), Alphabet (C shares), Facebook, Nvidia, Salesforce.com, VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports ETF, and VanEck Vectors Morningstar Wide Moat ETF. 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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If you’re in the process of building an income portfolio, then you might want to look at the shares listed below.

Here’s why these ASX dividend shares could be in the buy zone right now:

Adairs Ltd (ASX: ADH)

The first ASX dividend share to look at is this leading retailer of homewares and home furnishings.

Adairs has been a fantastic performer over the last 12 months, leading to the recent release of a very strong FY 2021 result. For example, Adairs reported a 28.5% increase in sales to $499.8 million and the almost doubling of its EBIT to $109.1 million.

Analysts at Morgans remain positive on the company. In response to its full year results, the broker has upgraded its shares to an add rating with a $4.20 price target.

Morgans is also expecting generous dividends from the retailer in the next couple of years. It has pencilled in fully franked dividends of 22 cents in FY 2022 and 27 cents in FY 2023.

Based on the current Adairs share price of $4.01, this will mean yields of 5.5% and 6.7%, respectively

Westpac Banking Corp (ASX: WBC)

Another ASX dividend share to consider is Australia’s oldest bank. It has also been a positive performer over the last 12 months after rebounding strongly from the pandemic.

For example, during the first half, Westpac reported cash earnings of $3,537 million. This was a 256% increase over the prior corresponding period and a 119% increase over the second half of FY 2020.

One broker that has been impressed with its recovery is Goldman Sachs. Its analysts currently have a buy rating and $29.93 price target on the bank’s shares.

Goldman is also expecting generous dividends of 116 cents in FY 2021 and 128 cents in FY 2022. Based on the latest Westpac share price of $25.82, this implies yields of 4.5% and 5%, respectively.

In addition, the broker has tipped the bank to return $5 billion to shareholders in the near future due to its surplus capital and franking credits.

The post 2 buy-rated ASX dividend shares with big fully franked yields appeared first on The Motley Fool Australia.

More reading

• Australia’s rising delta recession risk could hit these ASX 200 shares badly
• ASX 200 Weekly Wrap: A mixed bag of earnings dominates ASX
• How has the Westpac (ASX:WBC) share price performed against the banking sector in August?
• 2 excellent ASX dividend shares analysts rate as buys
• 2 blue chip ASX 200 dividend shares named as buys

Motley Fool contributor James Mickleboro owns shares of Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ADAIRS FPO. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO. 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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On Tuesday the S&P/ASX 200 Index (ASX: XJO) was on form again and pushed higher. The benchmark index rose 0.4% to 7,534.9 points.

Will the market be able to build on this on Wednesday? Here are five things to watch:

ASX 200 expected to fall

The Australian share market is expected to end its winning streak on Wednesday. According to the latest SPI futures, the ASX 200 is expected to open the day 37 points or 0.5% lower this morning. This follows a subdued night of trade on Wall Street, which saw the Dow Jones fall 0.1%, the S&P 500 drop 0.1%, and the Nasdaq edge 0.05% lower.

PointsBet shares rated as a buy

The PointsBet Holdings Ltd (ASX: PBH) share price could be in the buy zone according to analysts at Goldman Sachs. This morning the broker reiterated its buy rating but trimmed its price target slightly to $14.75 following the release of its full year results. Goldman believes PointsBet is well-placed to achieve a 10% share in the US states it operates in.

Oil prices fall

It could be a tough day for energy producers such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) after oil prices softened. According to Bloomberg, the WTI crude oil price is down 1% to US$68.50 a barrel and the Brent crude oil price is down 0.6% to US$72.96 a barrel. Oil prices fell after the US urged OPEC to pump more oil.

Shares going ex-dividend

A number of ASX 200 shares are going ex-dividend today and could trade lower this morning. This includes dairy company Bega Cheese Ltd (ASX: BGA), drinks business Endeavour Group Ltd (ASX: EDV), financial technology company IRESS Ltd (ASX: IRE), wine giant Treasury Wine Estates Ltd (ASX: TWE), and conglomerate Wesfarmers Ltd (ASX: WES).

Gold price edges higher

Gold miners Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) could have a decent day on Wednesday after the gold price edged higher. According to CNBC, the spot gold price is up 0.3% to US$1,817.3 an ounce. A weaker US dollar supported the precious metal’s gain.

The post 5 things to watch on the ASX 200 on Wednesday appeared first on The Motley Fool Australia.

More reading

• ASX 200 rises, Harvey Norman falls, Mesoblast sinks
• 2 excellent ASX 200 shares named as buys for September
• ASX reporting wrap-up: Harvey Norman, Cettire, PointsBet
• These 3 ASX 200 shares are the most traded this Tuesday
• Here are the top 10 ASX 200 shares 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. owns shares of and has recommended Pointsbet Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Treasury Wine Estates Limited and Wesfarmers Limited. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. 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 S&P/ASX 200 Index (ASX: XJO) went up by 0.4% today to 7,535 points.

Here are some of the highlights from the ASX:

Harvey Norman Holdings Limited (ASX: HVN)

Harvey Norman reported its FY21 result today. It said that total aggregated company operated and franchisee sales revenue increased by 15.3% to $9.5 billion.

The earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 54.2% to $1.46 billion. Reported profit before tax rose 78.8% to $1.18 billion, though excluding net property revaluations it increased 66.4% to $1.04 billion.

Reported net profit increased 75.1% to $841 million and excluding net property revaluations it increased 63% to $743.1 million.

Harvey Norman decided to pay an annual dividend of 35 cents per share, which was a 45.8% increase over FY20.

In the first few weeks of FY22, the ASX 200 share has seen growth across almost all countries (except Malaysia) compared to FY19. However, the Australian franchisees, New Zealand, Northern Ireland and Malaysia have seen aggregated sales decline in local currency terms compared to FY20.

Harvey Norman also said that subsequent to the year end, in August 2021, all of the wages support and assistance received in Australia totalling $6.02 million was repaid to the federal government via the ATO.  

Webjet Limited (ASX: WEB)

The Webjet share price increased by 3.5% after the ASX 200 travel share gave a trading update.

It announced that it’s going to be cashflow positive for the first half of FY22 (excluding investing and debt repayments) and that the WebBeds business has been profitable since July 2021.

Webjet managing director John Guscic explained further:

We have seen strong demand as travel restrictions ease in North America and Europe, suggesting significant upside as more international markets reopen.

Webjet OTA (online travel agency) was profitable for April to July but has been subsequently impacted by the current lockdowns in Australia and New Zealand. Online Republic was profitable in April and May, but like the Webjet OTA, has been impacted by lockdowns. However, we are confident that both businesses will return to profitability as soon as the domestic Australia and New Zealand markets reopen.

The company believes it has the potential to grow market share by expanding into new market segments and benefiting from the shift to online purchasing of travel. Webjet believes it will have greater profitability once conditions normalise.

Mesoblast Limited (ASX: MSB)

The Mesoblast share price dropped around 16% after the business released its FY21 result. It was the worst performer in the ASX 200.

In terms of financial highlights, the company said it had US$136.9 million of cash on hand at 30 June 2021.

Revenue from TEMCELL royalties increased by 10% to US$7.2 million.

It made a loss after tax for FY21 of US$98.8 million, compared to US$77.9 million last year.

Mesoblast also said that it met with the US FDA, which told Mesoblast that an additional clinical study in COVID acute respiratory distress syndrome would be required for remestemcel-L which could provide a dataset in conjunction with the recently completed 222 patient clinical study that might be sufficient to support an emergency use authorisation.

It also continues to be in discussion with the FDA about remestemcel-L for the treatment of steroid-refractory acute graft versus host disease in children. This may include a resubmission with a six month review.

 

The post ASX 200 rises, Harvey Norman falls, Mesoblast sinks appeared first on The Motley Fool Australia.

More reading

• 2 excellent ASX 200 shares named as buys for September
• ASX reporting wrap-up: Harvey Norman, Cettire, PointsBet
• These 3 ASX 200 shares are the most traded this Tuesday
• Here are the top 10 ASX 200 shares on Tuesday
• Mesoblast (ASX:MSB) share price crashes 16% to 52-week low on cash concerns

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. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Harvey Norman Holdings Ltd. 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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If you’re looking for shares to buy in September, then you may want to look at the two listed below.

Here’s why these ASX 200 shares could be in the buy zone right now:

Breville Group Ltd (ASX: BRG)

The first ASX 200 share to look at is this appliance manufacturer. It is responsible for brands including Breville, Kambrook, and Sage.

Breville was a very strong performer again in FY 2021, outperforming its guidance. Earlier this month, the company revealed a 24.7% increase in revenue to $1,187.7 million and a 39.6% jump in EBIT to $136.6 million.

Driving this impressive growth was its ongoing international expansion and strong demand for whitegoods such as cooking equipment and coffee machines. The latter is being supported by trends including working from home.

The team at UBS appear to believe this positive form can continue. As a result, this month the broker retained its buy rating and $35.70 price target on its shares.

IDP Education Ltd (ASX: IEL)

Another ASX 200 share to look at is this leading provider of international student placement and English language testing services.

IDP Education has a strong market position across Australia and globally. It also recently bolstered its position in the key India market with an acquisition. It has acquired the British Council’s Indian International English Language Testing System for ~A$240 million. Positively, this deal is forecast to be significantly accretive to earnings both pre and post synergies.

And while the pandemic is having a negative impact on the company’s operations, analysts are tipping it to bounce back strongly once trading conditions return to normal.

For example, Goldman Sachs is very positive on IDP Education. So much so, earlier this month it put a buy rating and $34.00 price target on its shares. Its analysts are expecting strong earnings growth in the coming years.

Goldman explained: “Our 3-yr EPS CAGR of 69% justifies our Buy rating in our view. The growth profile is likely to be enhanced by potential future acquisitions, which are not included in our earnings forecasts. These may include further consolidation of the IELTS market.”

The post 2 excellent ASX 200 shares named as buys for September appeared first on The Motley Fool Australia.

More reading

• These 3 ASX 200 shares are the most traded this Tuesday
• Here are the top 10 ASX 200 shares on Tuesday
• Woolworths (ASX:WOW) share price history: What caused the biggest ups and downs?
• Why the Qantas (ASX:QAN) share price has beaten the ASX 200 in the last year
• The latest ASX shares to be hit by a broker downgrade

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 shares of 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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As well as covering large caps like Commonwealth Bank of Australia (ASX: CBA) and Telstra Corporation Ltd (ASX: TLS), many brokers also cover smaller companies.

In light of this, I thought I would scour through a range of recent notes to see which small cap ASX shares are in favour with brokers at present.

Three that have been given buy ratings are listed below. Here’s why brokers like them:

Adore Beauty Group Ltd (ASX: ABY)

According to a note out of UBS, its analysts have retained their buy rating and lifted their price target on this online beauty retailer’s shares to $6.00. This follows the release of a solid FY 2021 result, which saw the company beat its guidance. And while UBS notes that management is investing in its growth at the expense of profit margins, it appears to believe this will be worth it in the long run. UBS continues to see Adore Beauty as well-placed to benefit from structural tailwinds. The Adore Beauty share price was trading at $4.86 on Tuesday.

Booktopia Group Ltd (ASX: BKG)

A note out of Morgans reveals that its analysts have retained their add rating and lifted their price target on this online book retailer’s shares to $3.72. Morgans notes that Booktopia delivered a full year result largely in line with its expectations and ahead of its upgraded guidance. The broker sees Booktopia as well-placed to gain market share. This is thanks to its proven ability to attract and retain customers, coupled with current and future improvements to the consumer offering. In addition, Morgans sees its margin improvement in FY 2021 as a sign of things to come in the future. The Booktopia share price was fetching $2.85 on Tuesday.

Silk Laser Australia Ltd (ASX: SLA)

Analysts at Ord Minnett have retained their buy rating but trimmed their price target on this laser clinic company’s shares to $4.85. According to the note, Ord Minnett was pleased to see Silk Laser deliver a full year result ahead of its upgraded guidance in FY 2021. Overall, the broker remains positive on the company’s growth prospects and holds firms with its buy rating. The Silk Laser share price was trading at $3.84 on Tuesday.

The post Top brokers name 3 ASX small cap shares to buy appeared first on The Motley Fool Australia.

More reading

• 2 online ASX shares expecting big things
• Why Adore Beauty, Fortescue, InvoCare, & Temple & Webster are charging higher
• Adore Beauty (ASX:ABY) share price climbs on record result
• Booktopia (ASX:BKG) share price sinks 7% despite 125% EBITDA growth in FY21
• 2 small-cap ASX shares pushing through lockdown pain

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 recommended Adore Beauty Group Limited, Booktopia Group Limited, and SILK Laser Australia Limited. The Motley Fool Australia owns shares of and has recommended Telstra Corporation Limited. The Motley Fool Australia has recommended SILK Laser Australia 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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Brokers have had their say about which ASX shares look like good value and could be worth looking at.

These brokers are always on the lookout for opportunities to make good returns. Share prices are changing every day and every week, so they can suddenly become good value if they fall in price or their prospects improve.

Some businesses are rated as buys by several brokers at once. These two ASX shares are heavily liked by brokers at the moment:

Seven Group Holdings Ltd (ASX: SVW)

Seven Group is currently rated as a buy by at least four brokers. Credit Suisse is one that rates Seven Group as a buy, with a price target of $26.25. That means the broker is suggesting the share price could rise more than 20% over the next 12 months.

This is a diversified business which operates across several areas. In industrial services, WesTrac is the sole authorised Caterpillar dealer in Western Australia, New South Wales and the ACT. It also owns Coates High, the largest equipment hire in the business and AllightSykes, a supplier in lighting towers, generators and pumps. The ASX share also owns around 70% of Boral Limited (ASX: BLD).

Seven Group has a growing presence in oil and gas in Australia and the US, as well as a 30% stake in Beach Energy Ltd (ASX: BPT). Finally, it owns around 40% of Seven West Media Ltd (ASX: SWM).

Credit Suisse notes that both WesTrac and Coates are expected to deliver growth in FY22, with continuing growth which could increase in future financial years. This guidance assumes lockdowns and restrictions are not prolonged or too restrictive.

In FY21, Seven Group saw trading revenue growth of 6.1% to $4.8 billion, underlying earnings before interest and tax (EBIT) growth of 7.3% to $792.1 million and operating cashflow growth of 15.6% to $622.4 million.

Credit Suisse thinks Seven Group is valued at 9x FY23’s estimated earnings.

Audinate Ltd (ASX: AD8)

Audinate is the provider of the Dante audio over IP networking solution which is used in the professional live sound, commercial installation, broadcast, public address and recording industries.

The company’s selling point is that Dante replaces traditional analogue audio cables by transmitting synchronised audio signals across large distances to multiple locations at once, using an ethernet cable.

The ASX share is currently rated as a buy at least three brokers. One of those brokers is UBS, which has a price target on the business of $11.75, which implies the Audinate share price could rise by more than 15% over the next 12 months.

UBS noted that Audinate thinks pre-COVID growth rates will return for the business, despite all of the COVID-19 impacts and logistics problems relating to the supply chain. Dante video could be an important factor for winning over more clients and growing revenue.

In FY21, Audinate generated revenue growth of 22.5% to US$25 million. Gross profit grew by 23.1% to US$19.2 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) surged 50.1% to $3 million. The net loss after tax was $3.4 billion, 17% better than FY20. Its operating cashflow grew 40% to $6.7 million.

The company is hoping to drive further design wins for Dante video and launching new products. It also wants to improve Dante adoption by non-English speakers, strengthen products against cyber issues and implement business scalability initiatives.

UBS thinks Audinate will start making a bottom line net profit in FY23.

The post Brokers think these 2 top ASX shares are buys in September 2021 appeared first on The Motley Fool Australia.

More reading

• The ASX reporting wrap-up: WiseTech, Bravura, Seven Group
• Seven Group (ASX:SVW) share price drops on FY21 earnings
• Audinate (ASX:AD8) share price climbs as FY21 revenue surges 22%
• The Audinate (ASX:AD8) share price tanked 7% last time the company reported
• Brokers name 2 mid cap ASX shares as buys

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 shares of and has recommended AUDINATEGL FPO. The Motley Fool Australia owns shares of and has recommended AUDINATEGL FPO. 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 Altium Limited (ASX: ALU) share price has come under significant pressure this week.

Since the start of the week, the electronic design software company’s shares are down almost 14%.

This means the Altium share price is now down 18% over the last 12 months.

Why is the Altium share price dropping this week?

Investors have been selling the company’s shares this week following the release of its full year results.

Although the company delivered revenue in line with its guidance, its earnings before interest, tax, depreciation and amortisation (EBITDA) was weaker than expected.

In addition, the company pushed back its FY 2025 aspirational revenue target of US$500 million by a year because of COVID-19.

Is this a buying opportunity?

One leading broker that isn’t in a rush to invest just yet is Bell Potter.

According to a note, the broker has retained its neutral rating and cut the price target on its shares by 7.1% to $32.50.

Based on the current Altium share price of $29.90, this implies potential upside of 8.7% over the next 12 months.

What did the broker say?

Commenting on its result, Bell Potter said: “FY21 revenue from continuing operations of US$180.2m was slightly above our forecast of US$179.2m and in line with the low end of the guidance range which the company had guided to.”

“EBITDA from continuing operations of $60.0m was, however, below our forecast of US$67.2m and the miss was partly driven by a number of one-off factors including M&A costs (US$2.3m), a write-back (US$1.4m) and restructuring costs (US$0.5m). The underlying EBITDA margin including TASKING of 36.1% was still, however, below the guidance of b/w 37-39% so there does appear to have been a negative impact from the shift to term licenses,” the broker added.

In light of this margin weakness, Bell Potter has downgraded its earnings assumptions and price target accordingly.

It explained: “We have modestly downgraded our EBITDA and NPAT forecasts by around 3% in both FY22 and FY23. The downgrades have been driven by reductions in our margin estimates which have more than offset increases in our revenue forecasts. We now forecast FY22 revenue and EBITDA of US$214.1m and US$76.5m respectively.”

All in all, this leading broker appears to believe investors should hold out for further weakness in the Altium share price before considering an investment.

The post Here’s what this top broker thinks of the Altium (ASX:ALU) share price appeared first on The Motley Fool Australia.

More reading

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• Why Altium, BlueBet, Healius, & HUB24 shares are tumbling lower
• Which ASX companies are starting off the week as the top movers in the ASX 300 today?
• Altium (ASX:ALU) share price down 12% after earnings report
• ASX 200 midday update: Fortescue result and dividend impress, Altium 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. owns shares of and has recommended Altium. The Motley Fool Australia owns shares of and has recommended Altium. 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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As we near the end of the ASX reporting season, a handful of companies made waves on the market with their results today.

We’ll quickly unpack today’s results and then wrap things back up for tomorrow.

Those that reported on the ASX today

Harvey Norman Holdings Limited (ASX: HVN)

The Harvey Norman share price weakened today after the company reported its FY21 full-year results. This was despite a solid result from the retail giant for the 12 months ended June 30. It seems investors were more forward-looking and did not take a liking to the slow start to FY22 as a result of ongoing lockdowns.

The takeaway points:

• Total aggregated sales up 15.3% to $9,491 million;
• Comparable store sales up 13.9% year-over-year (YoY);
• Earnings before interest, taxes, depreciation and amortisation (EBITDA) jumped 54.2% to $1,457 million;
• Profit after tax excluding property revaluations up 63% to record $743.1 million;
• Fully franked total dividend up 45.8% to 35 cents per share.

The Harvey Norman share price finished the day down 3.2% trading at $5.38.

Cettire Ltd (ASX: CTT)

The Cettire share price was a more positive performer on the ASX after reporting its full-year results for FY21. Shares in the online luxury goods retailer climbed 2.8% to $2.60 after revenue rocketed higher YoY.

The takeaway points:

• Gross revenue of $124.5 million, up 333% YoY on a constant currency basis;
• Sales revenue of $92.4 million, up 304% YoY on a constant currency basis;
• Statutory net profit after tax swung from $1.53 million to a loss of $251,000;
• Active customers increased 285% to 114,830;
• Operating cash flow of $12.7 million, up 131% on FY20;
• Cash position at the end of June 2021 of $47.1 million with no debt.

Pointsbet Holdings Ltd (ASX: PBH)

Lastly, the Pointsbet share price managed to add 1.7% on the ASX today after reporting a 159% increase in revenue in its FY21 result.

However, the sports wagering company had a relatively tame day on the market compared to its past performances. Investors might have been more cautious of the company’s shares given the significant bottom-line loss reported.

The takeaway points:

• Turnover up 228% to $3,781.4 million;
• Revenue increased 159% to $194.7 million;
• Normalised EBITDA loss of $156.1 million;
• Normalised loss after tax of $164.3 million compared to $39.7 million loss in FY 2020;
• Statutory loss after tax of $187.1 million;
• Cash balance of $276.2 million (including $30.6 million of client cash).

ASX shares reporting tomorrow

Well, the truth is, today has brought us to the conclusion of the ASX reporting season. While the annual reports might end here there is no doubt there will be other announcements rolling out from companies as always.

If you want to revisit any results coverage from the reporting season it is all linked on our calendar — check out our ASX Reporting Season Calendar.

The post ASX reporting wrap-up: Harvey Norman, Cettire, PointsBet appeared first on The Motley Fool Australia.

More reading

• Pointsbet (ASX:PBH) share price slumps on FY21 results. What’s next?
• Why Bubs, Harvey Norman, Mesoblast, & Regis shares are dropping
• ASX 200 midday update: Harvey Norman’s record profit, PointsBet posts large loss
• Cettire (ASX:CTT) share price slumps despite revenue quadrupling
• Harvey Norman (ASX:HVN) share price down 5% despite strong FY21 growth

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 shares of and has recommended Cettire Limited and Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Cettire Limited, Harvey Norman Holdings Ltd., and Pointsbet Holdings Ltd. 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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