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The Santos Ltd (ASX: STO) share price has been on a continuous decline since the middle of June. This comes as the spot price of oil faces renewed pressure.

Nonetheless, at Wednesday’s market close, Santos shares finished the day up 0.33% to $6.16.

What’s going on with the Santos share price?

It seems investors have been relatively pessimistic about the Santos share price recently, considering its 7% drop over the past month.

In its FY21 half-year results released last week, the company reported revenue of US$2.04 billion, up 22% over the prior corresponding period. The robust performance was driven by record production of 47.3 mmboe (million barrels of oil equivalent) and record sales volumes of 53.8 mmboe.

In addition, higher oil prices were realised but were offset by lower LNG (liquified natural gas) prices due to long-term, fixed-price offtake contracts.

This led the company to post a net profit after tax of $354 million. This represented a swing of $643 million compared to a net loss after tax of $289 million achieved in H1 FY20. Santos attributed the turnaround to the lower after-tax impairment loss of $6 million, compared to the $526 million posted in 2020.

However, the Santos share price has been tumbling as the spot price for oil corrected from its recent rally. The WTI (West Texas Intermediate) crude oil price is currently trading at US$67.57 per barrel. This represents a 12% drop from its 52-week high of US$76.98 per barrel reached in July.

Santos dividend yield

Santos paid a fully-franked final dividend of US 5 cents per share to shareholders in March. On top of this, the company rewarded shareholders with an interim dividend payment of US 5.5 cents apiece this earnings season.

When factoring in the current share price, this gives Santos a trailing dividend yield of 2.35%.

Santos commands a market capitalisation of roughly $12.8 billion, with more than 2 billion shares on its books.

The post The Santos (ASX:STO) share price is now trading on a trailing 2.35% fully-franked dividend yield appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Energy sector leading the ASX 200 shares on Tuesday
• August hasn’t been a great month for the Santos (ASX:STO) share price
• 5 things to watch on the ASX 200 on Monday
• Why Cochlear, Santos, St Barbara, & TPG shares are dropping

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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The Fortescue Metals Group Limited (ASX: FMG) share price has been under pressure this past month. Shares in the Aussie iron miner have fallen more than 20% since 26 July amid a broader iron ore slump.

Why the Fortescue share price is down 20% in a month

Until this month, 2021 had been pretty good for iron ore prices. In fact, the key commodity price hit as high as US$229.50 per tonne on 12 May. There was a price slump through to late May before a recovery followed.

The Fortescue share price tracked iron ore prices lower throughout May and similarly recovered to $26.30 per share by late July.

However, iron ore prices have been plummeting since. From 16 July to 23 August, the value of iron ore has fallen from US$217.2 per tonne to US$132.6 per tonne. That’s a decline of 39% in the space of just 5 weeks.

The Fortescue share price hasn’t slumped quite as hard. Shares in the Aussie iron ore giant fell 24.4% over that same 5 week period and it wasn’t the only one.

Fellow iron ore producers BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) also saw their values get hammered. BHP shares slumped 14.3% from 16 July to 23 August while the Rio Tinto share price fell 18.3% in the same period.

It means that despite a broadly positive earnings season, August has not been a good month for the Fortescue Metals share price.

The biggest factor, perhaps unsurprisingly, has been a crackdown from China. China is a major importer of iron ore but regulators are looking to keep a cap on steel production levels to reduce emissions.

That’s bad news for iron ore demand and comes amid a global infrastructure and property boom that has boosted demand.

The market has reacted accordingly, sending iron ore prices and the Fortescue Metals share price plummeting.

The post August hasn’t been a great month for the Fortescue (ASX:FMG) share price appeared first on The Motley Fool Australia.

More reading

• These 3 ASX 200 shares were the most heavily traded on Monday
• Pilbara Minerals (ASX:PLS) share price bounces back, up 8% on Monday
• Just how dependent is Fortescue Metals (ASX:FMG) on China?
• ASX 200 Weekly Wrap: Miners drag ASX back to earth
• Can the Western Areas (ASX:WSA) takeover prompt BHP (ASX:BHP) to go nickel shopping?

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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If you’re looking to add some blue chip ASX 200 dividend shares to your portfolio, then the two listed below might be ones to consider.

Here’s what you need to know about them:

Aurizon Holdings Ltd (ASX: AZJ)

The first ASX 200 dividend share to look at is Australia’s largest rail freight operator. Each year, Aurizon transports more than 250 million tonnes of Australian commodities, connecting miners, primary producers, and industry with international and domestic markets.

It also provides customers with integrated freight and logistics solutions across an extensive national rail and road network, traversing Australia.

Earlier this month it released its full year results and revealed a 1% decline in revenue to $3.019 billion and a flat net profit after tax of $531 million. This was in line with the expectations of leading broker Credit Suisse, which led to the broker retaining its outperform rating and $5.30 price target on its shares.

Not only does Credit Suisse see value in its shares, it sees generous dividends in the near term. It is forecasting dividends per share of 29.5 cents in FY 2022 and then 30.9 cents in FY 2023.

Based on the current Aurizon share price of $3.82, this represents yields of 7.7% and 8%, respectively.

Westpac Banking Corp (ASX: WBC)

Another blue chip ASX dividend share to look at is Australia’s oldest bank. Although this banking giant’s shares are smashing the market in 2021, it isn’t too late to invest according to analysts at Goldman Sachs.

This morning the broker retained its buy rating and trimmed its price target slightly to $29.83. This compares very favourably to the current Westpac share price of $26.15.

The broker is expecting fully franked dividend yields of 4.4%, 4.9%, and 5.4% between FY 2021 and FY 2023.

Goldman likes Westpac due to its belief that the earnings risks are skewed to the upside because of its bold cost reduction plans. It notes that management is aiming to reduce its cost base down to $8 billion by FY 2024.

The post 2 blue chip ASX 200 dividend shares named as buys appeared first on The Motley Fool Australia.

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• Westpac (ASX:WBC) whacked with $10.5 million penalty
• Westpac (ASX:WBC) share price rises amid mortgage rate shake-up
• Westpac (ASX:WBC) share price is now trading on a forecast 3.5% fully franked dividend yield
• 2 ASX dividend shares named as buys
• What’s moving the ASX 200 Index (ASX:XJO) on Monday?

Motley Fool contributor James Mickleboro owns shares of Westpac Banking Corporation. 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 Aurizon Holdings 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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Some ASX dividend shares are implementing large dividend increases for shareholders in this reporting season.

It has been a strange time ever since the onset of the COVID-19 pandemic. Some businesses have been disrupted. Others have seen a boom in demand.

The following two businesses just implemented large dividend increases for their shareholders in the FY21 result:

Propel Funeral Partners Ltd (ASX: PFP)

Propel is the second largest funeral operator across Australia and New Zealand. Despite all of the disruptions caused by COVID-19, Propel performed 13,916 funerals in FY21 – an increase of 4.6%. Death volumes were below historical long-term trends.

The average revenue per funeral in FY21 was up 4.3% to $5,917.

Those two growth numbers combined helped operating earnings before interest, tax, depreciation and amortisation (EBITDA) grow 11.9% to $36.3 million, with the EBITDA margin increasing 90 basis points to 30.1%.

Operating net profit after tax (NPAT) went up 7.6% to $15.3 million, whilst operating earnings per share (EPS) climbed 6.7% to 15.3 cents.

The Propel board decided to pay a final dividend of 5.75 cents per share. That brought the annual dividend for FY21 to 11.75 cents per share, an increase of 17.5%.

During the year, the ASX dividend share spent $29.6 million on acquisitions in New Zealand, Western Australia, New South Wales and Queensland.

In FY22, it’s expecting to benefit from death volumes reverting to long-term trends, acquisitions and a “strong” funding position. It also pointed to the growing and ageing populations in Australia and New Zealand as long-term tailwinds.

In July 2021, it performed a record number of funerals, with total and comparable funeral volumes materially higher than July 2020.

Propel’s FY21 dividend translates to a grossed-up dividend yield of 4.6%.

Ansell Limited (ASX: ANN)

Ansell is another ASX dividend share that has grown its FY21 dividend substantially.

Indeed, it has grown its annual dividend by 53.6% to US 76.8 cents. That was after the board decided to pay a final dividend of 43.6 cents.

This came after a large increase in profit. Sales increased 25.6% to US$2 billion, whilst net profit grew 57.5% to US$246.7 million. EPS increased by 59.9% to US 192.2 cents. That means the dividend payout ratio is only 40%, allowing the business to re-invest for more growth.

Ansell has invested during FY21. It was focused on bringing its major capacity expansions into production despite the challenging operation environment. It was able to get 12 new glove lines and several new body protection lines live which helped it deliver the profit growth it reported.

However, in some areas of the business, it’s expecting lower demand in FY22 in areas that benefited the most during the onset of COVID-19, such as chemical body protection and exam/single use gloves.

Also, a number of Ansell’s factories and suppliers in the region have had short-term closures or reduced operations, which could impact sales in the first half of FY22. It continues to experience increased freight costs and shipping delays.

The post 2 ASX dividend shares that just grew their dividend by more than 10% appeared first on The Motley Fool Australia.

More reading

• The Propel Funeral Partners (ASX:PFP) share price lifts 5% on FY21 performance
• The ASX reporting wrap-up: Ansell, Kogan, Nanosonics
• ASX 200 rises, Kogan sinks, Ansell slumps
• Ansell (ASX:ANN) share price plunges 10% despite dividend boost
• Why Ansell, Kogan, Monadelphous, & NIB shares are tumbling lower

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 has recommended Ansell Ltd. and Propel Funeral Partners 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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Volatility in share markets, in times such as the past 18 months, can be nerve-wracking for investors with growth stocks.

So sometimes it can be comforting to hear some advice from experts about which ones they think can sustain their momentum.

Two prominent fund managers each picked out an ASX share that they thought could keep up double-digit earnings growth in the coming years.

Still early days for Temple and Webster

Sage Capital portfolio manager Kelli Meagher reckons Temple & Webster Group Ltd (ASX: TPW) won’t see double-digit growth this financial year but will do so in subsequent years.

“It’s enjoyed a huge amount of growth during COVID-19,” she told Livewire. 

“The other reason, though, that their earnings will not grow this next year is because they’re choosing to reinvest back into the business to really grow their brand presence and their IT. They’re doing some really cool things with artificial intelligence to shore up their growth profile.”

The furniture retailer is in the “early stages of penetration” in Australia, giving it a massive addressable market still to grab.

“Australia is way behind the US in terms of per cent of the market that is online — we’re about 9%. The US is more than double that at about 25%,” Meagher said.

“The industry will move online… and Temple and Webster, as the largest player in that industry, is going to continue to grow really strongly.”

The foundations are now set up for double-digit growth for patient investors, according to Meagher.

“It makes a profit, it’s debt-free,” she said.

“It generates a lot of cash, can self-fund its growth, and I think that it’s one that you can pop in the bottom drawer and wake up in five years and you will have made a lot of money.”

Temple and Webster shares lost 1.53% on Wednesday, but have gained more than 62% over the past 12 months.

COVID-19 is driving people to cars

Airlie Funds portfolio manager Emma Fisher is a fan of car dealership and parts retail network PWR Holdings Ltd (ASX: PWH).

“It’s a bit of an under the radar, smaller market cap business,” she told Livewire.

“But I think it’s one for the bottom drawer for the next 10 years.”

According to Fisher, a big money-spinner for PWR is providing cooling systems for motorsports.

“They supply every Formula 1 team,” she said.

“That tells you that they make the best cooling systems in the world.”

But the real driver of future growth is its “emerging technologies” division. 

“They are doing cooling systems for electric vehicles, for aerospace applications, for missiles, for defence — for a number of applications,” said Fisher.

“We think that business will underpin double-digit earnings growth well into the future.”

PWR shares closed up 2% on Wednesday to $8.40, after a 4% increase on Tuesday. The stock has gained almost 85% in value this year.

The post 2 ASX shares primed to grow double-digits for years: experts appeared first on The Motley Fool Australia.

More reading

• Top broker names Temple & Webster (ASX:TPW) share price as a buy
• 2 ASX COVID-19 shares reporting big growth
• These are the 10 most shorted ASX shares
• Here are 3 buy-rated ASX growth shares
• PWR Holdings (ASX:PWH) share price edges lower despite strong earnings

Motley Fool contributor Tony Yoo owns shares of Temple & Webster Group Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Temple & Webster Group Ltd. The Motley Fool Australia has recommended PWR HLDING FPO and Temple & Webster Group 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 A2 Milk Company Ltd (ASX: A2M) share price will be one to watch closely on Thursday.

This follows the release of the infant formula company’s full year results this morning.

A2 Milk share price on watch after achieving downgraded guidance

• Revenue down 30.3% to NZ$1.21 billion
• Earnings before interest, tax, depreciation and amortisation (EBITDA) fell 77.6% to NZ$123 million
• Stock write-downs of NZ$109 million
• Net profit after tax down 79.1% to NZ$80.7 million
• Cash balance of NZ$875.2 million
• Board decides against capital return
• Outlook: Tough year ahead in FY 2022

What happened in FY 2021 for A2 Milk?

All eyes will be on the a2 Milk share price today after it delivered a result in line with the guidance it downgraded four times during FY 2021. For the 12 months ended 30 June, the company reported a 30.3% reduction in revenue to NZ$1.21 million. This compares to its most recent guidance of NZ$1.2 billion to NZ$1.25 billion.

This reflects a 16.6% decline in China & Other Asia revenue to NZ$583.4 million, a 42% decline in ANZ revenue to NZ$559.7 million, and a 3% decline in North America revenue to NZ$63.6 million.

The company notes that its performance was impacted by sustained weakness in the daigou channel because of COVID-19, a contraction in the Chinese infant nutrition market, and heightened competitive intensity in China. Management highlights that local players in China continue to gain share against the traditional multinational brands. This is being driven both by the strength of local brands in domestic channels, as well as an overall mix shift from cross-border to domestic channels.

Things were much worse for its EBITDA, which fell 77.6% year on year. This includes the impact of a whopping NZ$109 million write-down of its inventory. This reduced its inventory to NZ$112.2 million at the end of the financial year. Management notes that channel inventory in CBEC and daigou/reseller channels are now at target levels. Whereas China label inventory is expected to reach target levels by the end of first quarter. Positively, these actions are proving to be effective, with early signs of price stabilisation in the CBEC channel and some recovery in the daigou/reseller channel.

One thing that could weigh on the a2 Milk share price today is news that the board has decided against returning funds to shareholders. Despite sitting on a cash balance of NZ$875.2 million and have a depressed share price, the board stated that it plans to preserve balance sheet strength, having regard to market volatility and potential opportunities to reinvest in growth and supply chain.

What did management say?

A2 Milk’s Managing Director and CEO, David Bortolussi, acknowledges that FY 2021 was a difficult year but remains positive on the future.

He commented: “It was a challenging year for The a2 Milk Company but we remain confident in the long-term opportunity that the infant nutrition market in China represents.”

“The actions taken from the fourth quarter to address excess inventory are proving effective with channel inventory levels reducing, product freshness improving and pricing increasing. Our brand health metrics remain strong overall with some improvements in our most recent tracking research following a significant marketing campaign in China in the fourth quarter.”

Mr Bortolussi also revealed that the company is reviewing its growth strategy in response to a rapidly changing China infant formula market and structural factors in the daigou channel.

“We recognise that the China market and channel structure is changing rapidly and we are undertaking a comprehensive process to review our growth strategy and executional plans to respond to this new environment.”

This review includes the company’s approach to driving infant nutrition growth in both China label and English label channels, its infant nutrition product portfolio and innovation strategy, adjacent growth opportunities, and its brand positioning to ensure continued resonance and distinctiveness amongst an evolving consumer base.

What’s next for A2 Milk in FY 2022?

Unsurprisingly after being heavily criticised for downgrading its guidance four times in FY 2021, management has decided against offering guidance for FY 2022.

Instead, it is providing current observations on key drivers and important issues that may impact its FY 2022 results.

This includes China’s infant nutrition market being materially impacted by a lower birth rate, especially recently due to COVID-19 and related vaccination programmes causing many people to delay pregnancy. Market share gains by domestic brands compared to international brands are expected to continue.

It also notes that the English label infant nutrition segment is targeting sales stabilisation in FY 2022 but a wide range of outcomes is possible. This is due largely to COVID-19 impacts on the daigou/reseller channel and associated impact on CBEC for English label products which are expected to be prolonged.

Overall, the company is expecting first half revenue to be marginally lower than the prior corresponding period. Though, this includes revenue from the acquired Matura Valley business.

Furthermore, dross margins are expected to be similar for the full year, excluding FY 2021 inventory write downs.

It concluded: “Overall, although a2MC believes the business will continue to make significant progress on many fronts, FY22 is expected to continue to be a challenging and volatile year. Due to the actions taken in 4Q21 to address channel inventory and improve product freshness, coupled with strong brand health, the business is well-placed to adapt its strategy and execution to drive growth in the longer term. However, recovery in English label channels is expected to be slow and market growth in China will be subdued for some time.”

A2 Milk share price performance

Given the company’s abject performance over the last 12 months, it will come as no surprise to learn that the A2 Milk share price is underperforming the market significantly.

The A2 Milk share price is down 62% over the last 12 months. Shareholders will no doubt be hoping for better over the next 12 months.

The post A2 Milk (ASX:A2M) share price on watch after 79% profit decline and weak outlook appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• The A2 Milk (ASX:A2M) share price crashed 16% last time it reported
• Here’s why the A2 Milk (ASX:A2M) share price is down 42% so far in 2021
• Here’s what has been moving the A2 Milk (ASX:A2M) share price in August 2021
• Here’s why the A2 Milk (ASX:A2M) share price is up 11% this week

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. 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 Wednesday the S&P/ASX 200 Index (ASX: XJO) was on form again and recorded a solid gain. The benchmark index rose 0.4% to 7,531.9 points.

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

ASX 200 expected to fall

The Australian share market looks set to fall on Thursday. According to the latest SPI futures, the ASX 200 is expected to open the day 13 points or 0.2% lower today. This is despite it being a positive night of trade on Wall Street. Overnight, the Dow Jones rose 0.1%, the S&P 500 climbed 0.2%, and the Nasdaq rose 0.15%.

A2 Milk results

The A2 Milk Company Ltd (ASX: A2M) share price will be on watch today when it releases one of the most highly anticipated results of the month. After downgrading its guidance four times during FY 2021, the struggling infant formula company is expecting to report revenue of NZ$1.25 billion with EBITDA of NZ$132 million to NZ$150 million. The latter will be down 73% to 76% year on year. An update on current trading conditions and its expectations for FY 2022 will also be of great interest.

Oil prices rise again

Energy producers such as Oil Search Ltd (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) could have a good day after oil prices rose again overnight. According to Bloomberg, the WTI crude oil price is up 1.1% to US$68.28 a barrel and the Brent crude oil price has risen 1.6% to US$72.17 a barrel. Strong demand for US fuel gave prices a further boost.

Gold price falls

Gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a difficult day after the gold price tumbled lower. According to CNBC, the spot gold price is down 0.9% to US$1,792.6 an ounce. Traders appear nervous ahead of the next US Federal Reserve meeting.

Appen half year results

The Appen Ltd (ASX: APX) share price will be on watch when it releases its half year results today. A recent note out of Citi has suggested that the artificial intelligence data services company could fall well short of expectations during the half. Citi is expecting EBITDA of US$27 million for the half, which is ~20% lower than consensus estimates. Nevertheless, Citi has a buy rating and $18.80 price target on the company’s shares.

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

More reading

• ASX 200 rises, WiseTech soars, Zip drops
• Here are the 3 most traded ASX 200 shares today
• Here are the top 10 ASX 200 shares on Wednesday
• The Appen (ASX:APX) share price slumped 7% last time it reported
• Oil Search (ASX:OSH) share price falls amid Santos merger skepticism

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 Appen Ltd. The Motley Fool Australia owns shares of and has recommended Appen Ltd. The Motley Fool Australia has recommended A2 Milk. 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 tech sector is home to a number of companies growing at a rapid rate.

Three that have been standout performers recently are listed below. Here’s what you need to know about these growing tech shares:

Bigtincan Holdings Ltd (ASX: BTH)

The first tech share to look at is Bigtincan. It is a fast-growing sales enablement platform provider. In FY 2021, the company reported a 48% increase in annualised recurring revenue (ARR) to $53.1 million. Positively, it has just announced an agreement to acquire US-based Brainshark. It is an industry-recognised and multi-awarded leader in its field of sales coaching, learning and readiness. Management expects this to lead to combined ARR of $119 million in FY 2022. This will be up 124% year on year.

Morgan Stanley is very positive on the company. Earlier today it put an overweight rating and $2.10 price target on its shares.

Hipages Group Holdings Ltd (ASX: HPG)

Another ASX tech share to look at is Hipages. It is a leading Australian-based online platform and software as a service (SaaS) provider connecting consumers with trusted tradies. At the last count, there were over 34,000 tradies using the platform. Hipages was on form in FY 2021 and outperformed its upgraded full year revenue guidance with a 22% year on year jump to $55.8 million.

Goldman Sachs currently has a buy rating and $4.10 price target on its shares.

PointsBet Holdings Ltd (ASX: PBH)

A final tech share to look at is PointsBet. It is a sports betting and iGaming provider with operations in the ANZ and US markets. It has been growing quicker than all the companies mentioned, delivering a whopping 228% increase in full year turnover to $3,781.4 million in FY 2021. Underpinning this impressive result was a 117% increase in Australian active clients to 196,585 and a 661% increase in US active clients to 159,321.

Credit Suisse is bullish and has an outperform rating and $13.30 price target on its shares.

The post 3 rapidly growing ASX tech shares to buy appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy today
• Why Bigtincan, Lovisa, SILK, & WiseTech shares are charging higher
• Bigtincan (ASX:BTH) share price rockets 20% with capital raising update
• 2 rapidly growing ASX shares rated as buys
• Bigtincan (ASX:BTH) share price halted ahead of $116 million Brainshark acquisition

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 BIGTINCAN FPO, Hipages Group Holdings Ltd., and Pointsbet Holdings Ltd. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO. 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) rose 0.4% to 7,532 points today.

Here are some of the highlights from the ASX:

WiseTech Global Ltd (ASX: WTC)

The WiseTech share price was the best performer in the ASX 200, it rose 26% after revealing its FY21 result.

It said that total revenue increased by 18% to $507.5 million. This was at the top end of the guidance range. CargoWise revenue grew 26% to $331.6 million, reflecting growth in usage. Acquisition revenue growth was 6% up to $175.9 million.

WiseTech said that market penetration is gaining pace with six new global rollouts secured in FY21 and the sign up of FedEx after 30 June 2021.

It generated earnings before interest, tax, deprecation and amortisation (EBITDA) growth of 63% to $206.7 million, exceeding guidance. The EBITDA margin was 41%, which was an increase of 11 percentage points. This occurred because of enhanced operating leverage and cost reductions.

Organisation-wide efficiencies and acquisition synergies delivered $22 million of cost reductions in FY21.

Underlying net profit grew 101% to $105.8 million, with free cashflow rising 149% to $139.2 million.

The board decided to increase the final ordinary dividend by 141% to 3.85 cents per share.

WiseTech is expecting FY22 revenue to grow by between 18% to 25%, with EBITDA growth of between 26% to 38%.

Zip Co Ltd (ASX: Z1P)

The Zip share price fell 2.6% after it reported its FY21 result.

Zip reported that revenue increased 150% to $403.2 million and total transaction volume increased by 176% to $5.8 billion.

Customer numbers increased by 248% to 7.3 million and merchant numbers went up 109% to 51,300.

Earnings before tax, depreciation and amortisation (EBTDA) was a loss of $22.9 million.

The buy now, pay later company said that it maintained strong unit economics while investing for growth. The cash transaction margin was 3.5%.

The ASX 200 business said that it has delivered a strong credit performance in light of COVID-19, driven by repeat customer usage and investments in its decisioning capabilities. Net bad debts as a percentage of transaction volumes were 1.28%.

Zip said it’s executing on its global strategy. It’s now operating across 12 months in five continents, with the official additions of the US, the UK, Canada and Mexico, plus regional market entry points in Europe, the Middle East and Southeast Asia.

The ASX 200 company also revealed that it has agreed to acquire the remaining shares in the South African buy now, pay later business, Payflex. Zip explained that Payflex has access to a “sizeable underbanked, young and fast-growing African population”.

Zip managing director and CEO Larry Diamond said:

The trend and shift away from the unfriendly world of credit cards that was the genesis of the Australian business has proven to be a global phenomenon, and Zip continues to accelerate in all our key markets. This global play supporting consumers and global retailers alike, provides a real point of difference as we strive to fulfil our mission to become the first payment choice everywhere, every day.

Afterpay Ltd (ASX: APT)

The Afterpay share price fell 1.2% after the ASX 200 buy now, pay later business reported its FY21 result.

Afterpay reported that underlying sales increased 90% to $21.1 billion. This was helped by a 63% increase of active customers to 16.2 million and 77% rise of active merchants to 98,200.

Group total income went up 78% to $924.7 million.

Some of its margins remained stable. The gross loss percentage of underlying sales was flat at 0.9%. The Afterpay income margin was also 3.9%.

However, the Afterpay net transaction loss as a percentage of underlying sales rose to 0.6%, up from 0.4%. Afterpay’s net margin as a percentage of underlying sales dropped from 2.3% to 2.1%.

Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) fell 13% to $38.7 million.

On 2 August 2021, Afterpay and Square announced that they had entered into a scheme implementation deed where Square will buy Afterpay in an all-share offer. At the time of the offer, this valued Afterpay at $39 billion.

The post ASX 200 rises, WiseTech soars, Zip drops appeared first on The Motley Fool Australia.

More reading

• Here are the 3 most traded ASX 200 shares today
• The Zip (ASX:Z1P) share price is down despite revealing major global growth
• Here are the top 10 ASX 200 shares on Wednesday
• The ASX reporting wrap-up: WiseTech, Bravura, Seven Group
• Why Bravura, Nine, Reece, & Zip shares are sinking 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 shares of and has recommended AFTERPAY T FPO, WiseTech Global, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO and WiseTech Global. 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 Nanosonics Ltd (ASX: NAN) share price has been a very strong performer this week.

Since the start of the week, the infection prevention company’s shares have jumped 20%.

This means the Nanosonics share price is now up 32% month to date.

Why is the Nanosonics share price rocketing higher?

Investors have been bidding the Nanosonics share price higher this week following the release of its full year results and the announcement of an upcoming new product.

In FY 2021, Nanosonics reported a 3% increase in revenue to $103.1 million and a 15% decline in net profit after tax to $8.6 million. The latter was notably better than the market was expecting thanks to a strong second half.

But arguably giving the Nanosonics share price the biggest lift was the announcement of another new product – Nanosonics Coris.

This new platform, which is expected to be launched in calendar year 2023, is for cleaning flexible endoscopes.

Management notes that more healthcare-associated outbreaks have been linked to contaminated endoscopes than any other medical device. Each year there are over 60 million flexible endoscopy procedures being conducted across the United States and the five largest markets in Europe.

Is it too late to invest?

Unfortunately, the team at Goldman Sachs believe the Nanosonics share price is overvalued at the current level.

According to a note this morning, the broker has retained its sell rating and cut its price target to $4.40.

Based on the current Nanosonics share price, this implies potential downside of 37% over the next 12 months.

What did the broker say?

Goldman notes that the Nanosonics share price is trading on very lofty multiples based on its forecasts.

It commented: “FY22 revenue guidance for ‘double digit growth’ was not a material surprise against a heavily Covid-impacted year (consensus +27%). However, NAN now expects gross margins to decline meaningfully from 78% towards 75% as the sales mix continues to normalise (consensus 78%), and management confirmed that new opex guidance of $90m (consensus $80m) should be considered a structural increase.”

“We post FY22/23E sales upgrades of +6/+8% to factor the FY21 beat and FX gains, but incorporating new cost/margin guidance drives (19)/(25)% downgrades to our FY22/FY23E EBITDA forecasts, and a (11)% reduction in our TP to $4.40. Although this stock has not historically traded on near-term multiples, posting these downgrades drives 2022E trading multiples up to 125x EBITDA (180x P/E) valuations which would ordinarily be associated with much higher growth profiles (we now forecast sales/earnings CAGRs of +8%/+15 from FY22-25E),” it added.

Goldman also warned investors not to get too excited by the new product launch due to the potential for further delays. Particularly given the company’s track record.

It said: “Furthermore, whilst the market may re-calibrate launch expectations from FY22 to CY23, we would assume a low degree of confidence in that time frame given the amount of progress required and the company’s track record to date (7+ delays and currently 4+ years later than planned).”

The post Top broker gives its verdict on the Nanosonics (ASX:NAN) share price appeared first on The Motley Fool Australia.

More reading

• Nanosonics flies, Kogan crashes and iron ore in the doldrums. Scott Phillips on Nine’s Late News
• The ASX reporting wrap-up: Ansell, Kogan, Nanosonics
• ASX 200 rises, Kogan sinks, Ansell slumps
• Why HUB24, MNF, Nanosonics, & Uniti shares are surging higher
• Nanosonics (ASX:NAN) share price up 28% after earnings beat and new product announcement

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 Nanosonics Limited. The Motley Fool Australia owns shares of and has recommended Nanosonics 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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