Tag: Motley Fool

The S&P/ASX 200 Index (ASX: XJO) finished the day higher by 0.4% to 7,490 points.

Here are some of the highlights from the ASX:

NIB Holdings Limited (ASX: NHF)

The NIB share price fell around 11% after the private health insurance business reported its FY21 result.

It said that group underlying operating profit (UOP) went up 39.5% to $204.9 million. The group underlying revenue increased 2.9% to $2.6 billion, whilst the group claims expense went up 2.5% to $2 billion. The total group expenses fell 8.8% to $362.1 million.

Total net profit after tax surged 84.5% to $160.5 million – this included the benefit of $51.8 million of net investment income. Its return on invested capital (ROIC) was 19.1%, similar to the pre-pandemic levels.

The board declared a final dividend of 14 cents per share, up from 4 cents last year.

The ASX 200 share said that it expects market conditions for FY22 to remain similar to the past 12 months, with the pandemic having mixed consequences.

Management said the ongoing COVID-19 threat will further encourage private health insurance participation throughout Australia and New Zealand.

It’s expecting Australian resident health insurance net policyholder growth to be in the range of between 2% to 3% and for growth in its New Zealand business to be consistent with recent years.

NIB said that there will be less healthcare treatment of all kinds as long as lockdowns persist.

Sonic Healthcare Ltd (ASX: SHL)

The Sonic Healthcare share price dropped around 3% today after releasing its FY21 report.

The ASX 200 healthcare business revealed that revenue increased by 28% to $8.8 billion, predominately thanks to the millions of COVID-19 PCR tests it’s doing around the world. Excluding the testing, FY21 global base revenue (excluding COVID testing) was up 6%.

COVID test volumes were lower in the FY21 second half compared to the first half, but are now increasing with the spread of the Delta variant.

Sonic’s earnings before interest, tax, depreciation and amortisation (EBITDA) increased 81% to $2.6 billion and the net profit rose 149% to $1.3 billion.

The board continue its progressive dividend policy with an 8% increase of the final dividend to 55 cents per share. That meant the total dividend was up 7% compared to FY20.

Sonic said that its balance sheet is set for growth by acquisition, with gearing at a record low level and $1.5 billion of liquidity currently available.

The ASX 200 healthcare company said its core business is increasingly resilient to pandemic waves and COVID PCR testing is expected to continue for the foreseeable future.

Reliance Worldwide Corporation Ltd (ASX: RWC)

Plumbing product business RWC reported its FY21 result today.

It said that net sales increased by 15% to $1.34 billion. Net sales were up 25% on a constant currency basis.

The Americas recorded 27% constant currency growth. Asia Pacific saw constancy currency sales growth of 18% for the year, driven by “strong” Australian residential construction and remodelling activity. RWC noted that UK and European sales recovered strongly with 25% constant currency sales growth.

This helped reported EBITDA increase by 56% to $340.7 million and net profit after tax (NPAT) went up by 111% to $188.2 million.

The ASX 200 share’s board declared a final dividend of 7 cents per share. That brought the FY21 dividend to 13 cents per share, up from 7 cents per share last year.

In July 2021, the first month of FY22, it saw sales growth in all three regions, with reported net sales up 9% overall. These trends have “continued broadly” in August.

It said underlying demand remains strong, but sales are being constrained by ongoing supply chain disruption including raw materials availability, shipping delays and a shortage of labour in plumbing trades.

The post ASX 200 rises, NIB plummets, Sonic drops appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares on Monday
• NIB (ASX:NHF) dividend up 70%, shares sink regardless
• 2 ASX COVID-19 shares reporting big growth
• Which ASX companies are the top movers in the ASX 300 today?
• Why Ampol, NIB, Redbubble, & Sonic shares are dropping

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 Reliance Worldwide Corporation Limited. The Motley Fool Australia has recommended NIB Holdings Limited, Reliance Worldwide Corporation Limited, and Sonic Healthcare 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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As some of you likely know, my duties here at The Motley Fool include making media appearances.

Among other things, I appear nightly (Sunday to Thursday) on Nine’s Late News, and on Sunday mornings on Weekend Sunrise.

Yesterday morning, the segment was prompted by news that many Australians are looking to start investing for the first time.

“How can we help them get started?” was the general question.

Now, as much as my mother loves me, there’s only so much of me the rest of Australia wants to see on a Sunday morning, and I had three minutes to make my case.

Take out the intro, and the host’s questions, and my time was probably down to less than 100 seconds.

That’s not a whole lot of time to take a viewer from ‘not investing’ to ‘knowing enough to invest’.

So, I decided to strip right back.

To take a viewer — or, today I hope, a reader — from not investing to investing by the end of the week.

Now, I can’t ever give personal advice — I don’t know the specific circumstances, goals, objectives or risk tolerance of everyone who watches me, or reads what I write.

So, as ever, you need to consider how the suggestions that follow suit your needs.

But, here’s my 100-second answer to the question of ‘how can I get started’, that should give you a good leg-up.

And, while what follows is somewhat prescriptive, I also hope it’s helpful in dealing with what psychologists call the ‘paradox of choice’ — we have so many options available to us, our decision-making goes from ‘wow, it’s great to have some options’ to ‘there are so  many options, I’m paralysed by the challenge of trying to decide’.

Here, paraphrased, is how I suggested people can go from ‘zero’ to ‘invested’ in a week:

Monday: Choose a broker

I use CommSec. I reckon they’re a very good choice for the new investor because you know the brand, the website is very good, the brokerage isn’t too expensive, and the customer service is pretty good.

So,  go with CommSec. Open an account today. (alternative: if you already have a savings account with another bank, and they have a brokerage business, it might be easier to just open an account with your bank’s broker)

And when you do, make sure you also open an investment savings account so you can put your investment cash in there (and get your dividends paid into that account) to help you resist the urge to spend your investment proceeds!

Wednesday: Transfer some cash

Now your account is open, transfer your first lump sum. It assumes you have some cash saved up, of course, and it you don’t, this step might have to wait for a couple of paycheques first. But try to transfer at least something… it’ll create some momentum and get you moving toward your goal.

Bonus points: When you do, also make yourself set up an auto-transfer between your savings account and your investment account, so that every payday, you put some of that paycheque to work building your wealth.

Friday: Time to buy

The Motley Fool was founded on the basis that it’s possible to beat the market through carefully building a portfolio of well-chosen shares.

That remains true. And, in time, I think you should consider such an approach.

But this week, I don’t want to let the paradox of choice (or the avoidance of risk and uncertainty) stop you from getting started.

So if you’re following my one week plan, we’re going to kick off your portfolio building by splitting your investment cash in two, and putting one half into Australian shares and the other into international shares (but don’t worry — it’s easy, and you can do it all on the ASX).

So, I reckon you could get started by putting 50% of your cash into each of two exchange-traded funds: the Vanguard ASX 300 ETF (ASX: VAS) and the Vanguard MSCI Index International Shares ETF (ASX: VGS).

The former gives you exposure to the top 300 Australian companies. The second gives you part interest into the largest ~1,500 companies in the developed world (other than Australia).

In one fell swoop, you have both Australia and the rest of the developed world covered. 

(And these ETFs are super-broad — you’re now diversified across ~1,800 companies globally — and super low-cost. The fees are 0.1% and 0.18% per annum, respectively. Plus, Vanguard is a not-for-profit business, so you know they’ll be working hard to look after fundholders.)

And there you have it.

This morning you weren’t an investor.

By Friday (all going well), you’ll have made your first strides into the world of investing.

Then, next payday, more money will go into that account (you did set up your automatic deposit, didn’t you?). 

Then you can buy more shares.

Done over and over again — making saving and investing a habit — and despite market volatility and the occasional losing stock pick, I’m pretty sure you’ll be very happy with the results.

That is investing. And the power of investing.

And you can start, today.

(By the way, if you’re already investing, congratulations. Perhaps, like the mother who messaged me this morning — and sparked the idea for this article — you’re trying to help someone else get started. If you do, please forward them this email. You could just change their life.)

You can watch the segment, below:

Fool on!

The post Want to invest, but not sure where to start? appeared first on The Motley Fool Australia.

More reading

• From zero to investing in one week: THIS WEEK. Scott Phillips on Sunrise
• 2 excellent international ETFs for ASX investors this month
• Why these 2 top ETFs could be buys
• ASX investors can’t get enough! ETF inflows hit new record high
• VAS share price history: What caused the biggest ups and downs?

Motley Fool contributor Scott Phillips owns shares of Vanguard MSCI Index International Shares ETF. 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 Vanguard MSCI Index International Shares 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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The Mach7 Technologies Ltd (ASX: M7T) share price ended Monday’s market session in negative territory. This comes after the healthcare imaging platform provider released its full-year results for the 2021 financial year.

At the closing bell, Mach7 shares finished down 3.52% to 96 cents.

Mach7 share price backtracks despite record sales orders

The Mach7 share price fell today following the company’s mixed result for the 12 months ending 30 June 2021. Here are some of the key highlights:

• Sales orders (total contract value) of $25.6 million, up 95% on the prior corresponding period (FY20 $13.14 million);
• Total revenue of $19 million, up 1% (FY20 $18.9 million);
• Earnings before interest, tax, depreciation and amortisation (EBITDA) loss of $1.8 million, down 155% (FY20 EBTIDA profit of $3.3 million); and
• Net loss after tax of $9.3 million, down 5,627% (FY20 $0.16 million).

What happened in FY21 for Mach7?

Mach7 delivered its most successful sales order increase on the back of 2 large contracts by premier hospital networks. They included Trinity Healthcare and Adventist Healthcare, realising a combined value of $13.2 million.

The sales order mix consisted of 20% Software-as-a-Service (SaaS) subscriptions, a significant improvement on the 3% in FY20. Mach7’s eUnity product, acquired in July 2020, predominately fuelled the growth.

The remaining sales orders were made up of capital sales (perpetual or term licenses) and services contracts (migrations). They represented 72% and 8%, respectively.

Mach7’s annual recurring revenue (ARR) soared by more than 80% to $10.9 million, accounting for now 57% of total revenue. Professional services revenue was stable at $2.2 million, with capital software license fee revenue decreasing by 42% to $6.0 million. The latter is due to a phased rollout which will see a solid order book for FY22.

At the EBITDA level, currency exchange losses mostly affected the result. Notwithstanding currency movements, EBITDA would have made a small loss of $0.7 million. This is attributed to incorporating Client Outlook in 202, and the delay of sales orders until FY22.

What’s next for Mach7 in FY22?

Looking ahead, Mach7 advised it remains on track to achieve revenue of $27 million for the current calendar year.

This is underpinned by the first-half recording revenues of $12 million, as well as the 50% current ARR run-rate of $13.4 million. In addition, the sales and service book valued at $8.3 million is expected to be recognised in the second half.

Mach7 stated that with these revenues, it will be generating a positive EBITDA.

The post Mach7 (ASX:M7T) share price slides on mixed FY21 result appeared first on The Motley Fool Australia.

More reading

• 3 small cap ASX shares to watch

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended MACH7 FPO. The Motley Fool Australia has recommended MACH7 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 S&P/ASX 200 Index (ASX: XJO) is having a decent start to this week’s trading today. At the time of writing, the ASX 200 is up 0.39% to 7,489.9 points. But let’s now dig a little deeper and see which ASX 200 shares are topping the charts in terms of trading volume.

The 3 most heavily traded ASX 200 shares on Monday

Fortescue Metals Group Limited (ASX: FMG)

Iron ore miner Fortescue is our first ASX 200 share to check out today, with a hefty 12.65 million Fortescue shares trading hands so far today. This appears to be a pure byproduct of what has happened with Fortescue share price today, seeing as there are no major news or announcement out of the company today.

This Monday has seen Fortescue lose a chunky 4.47% to $19.45 a share so far. This move is probably a response to the falling iron ore price, which has lost quite a bit of steam over the past week or two. The last time Fortescue was under $20 a share was way back in March.

South32 Ltd (ASX: S32)

Another ASX 200 miner in South32, this company makes the list today with a hefty 14.16 million shares traded so far today. Again, this appears to be the result of a decisive share price movement. South32 lost a bit of momentum last week when the diversified miner reported its FY21 earnings on Friday. At the time, South32 shares took quite a hit.

But investors seem to have taken a ‘new week, new me’ approach today. South32 has recovered strongly this Monday, and is currently up 2.34% to $2.84 a share. This is probably behind the large number of Soth232 shares trading on the market today.

Pilbara Minerals Ltd (ASX: PLS)

And our final, and most traded share (as well as our third miner) today is ASX 200 lithium producer Pilbara Minerals. Pilbara shares are up an incredible 10.6% so far today to $2.24 at the time of writing. This has prompted a whopping 28.72 million Pilbara shares to change hands so far this Monday.

It’s not entirely clear why this lithium company is rallying so convincingly, but my Fool colleague Kerry took a deeper dive into this remarkable bounce earlier today. However, it is pretty clear that it’s this huge share price jump that has triggered this fat trading volume.

The post These 3 ASX 200 shares were the most heavily traded on Monday appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares on Monday
• Leading brokers name 3 ASX shares to buy today
• Pilbara Minerals (ASX:PLS) share price bounces back, up 8% on Monday
• Which ASX companies are the top movers in the ASX 300 today?
• Just how dependent is Fortescue Metals (ASX:FMG) on China?

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

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The Bitcoin (CRYPTO: BTC) price is up 2% over the past 24 hours. One Bitcoin is currently trading for US$50,268 (AU$69,816).

The last time the world’s largest token by market cap traded above the psychologically significant US$50,000 mark was on 15 May.

Back then, it was on the way down, having traded at all-time highs of US$64,829 on 16 April.

It would continue to lose ground (though not in any kind of straight line) until hitting lows of US$29,608 on 21 July. Which, our helpful calculator tells us, means Bitcoin has now gained a whopping 70% in just over 1 month.

Not bad for those who bought in at the 21 July low and were able to stomach the wild volatility that’s followed.

Commenting on the break above US$50,000, Mati Greenspan, CEO of Quantum Economics said (as quoted by CoinDesk), “It’s not the first time we’ve crossed this legendary milestone, but given the advancements in the industry lately, $50,000 certainly seems justified at this time.”

But with US$50,000 once more surpassed, what’s next?

Potential Bitcoin price catalyst ahead

Online investment platform eToro’s crypto analyst Josh Gilbert told the Motley Fool that he believes the world’s number 1 crypto “will be trading at a higher price” in 6-12 months than it is today.

Part of his bullish outlook stems from blockchain upgrades which are intended to make Bitcoin a competitor with Ethereum (CRYPTO: ETH) in the digital contract space.

According to Gilbert:

Bitcoin’s Taproot upgrade, which is expected to take full effect in October 2021, could provide a catalyst for new record highs. The upgrade will provide greater efficiency and, crucially, unlock the potential for smart contracts, meaning it can offer more than just payments.

Currently, smart contracts are the primary driver for Ethereum. Adding smart contracts capabilities to Bitcoin’s blockchain could be a game-changer.

Don’t ignore the headwinds

That’s a strong potential tailwind for further price gains.

When we asked what could stall any new bull run for the token, Gilbert told us:

Bitcoin’s headwinds are continuing scrutiny by regulatory bodies, as well as facing uncertainty from large mining regions such as China. Other assets like Ethereum continue to challenge Bitcoin, particularly with Ethereum’s more advanced technology.

Gilbert said Ethereum’s “transition towards decentralisation with Ethereum 2.0, which will accommodate the most complex ecosystem of applications” isn’t something Bitcoin is currently able to offer.

The post Bitcoin rockets past US$50,000 as analysts eye October price catalyst appeared first on The Motley Fool Australia.

More reading

• Up 50% in a month! Bitcoin is back over US$50,000
• 1 smart way to invest in Dogecoin without buying cryptocurrency
• ASX 200 Weekly Wrap: Miners drag ASX back to earth
• Cardano reaches new milestone as market cap narrows with Bitcoin
• Crypto assets surpass US$2 trillion on Bitcoin rally… now what?

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin. 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 Appen Ltd (ASX: APX) share price has walked through the session in the green during trade on Monday.

Appen shares are on the move ahead of the artificial intelligence (AI) company’s earnings report due on Thursday.

Let’s investigate further.

A bit more on Appen

Appen is a “global leader” in human annotated training data for machine learning and AI. It has two main segments, content relevance and speech collection.

Its language technology is used in over 150 languages and dialects by technology companies and various governments.

Appen has a market capitalisation of $1.47 billion at the time of writing.

What’s behind the Appen share price ahead of its earnings report?

Over the last week, Appen shares have gathered momentum on the charts, climbing from lows of $11.32 on 17 August.

There has been no market-sensitive information by the company over this time. However, investment bank Citi holds an $18 per share price target on Appen shares.

The broker feels that, because many of Appen’s large customers have recognised an accelerated growth period in revenue this year, Appen is well-positioned to benefit from this.

On this note, given the market’s reaction to Appen’s FY20 earnings report back in February, it may be that investors are seeing the strengths of its end-markets as a plus for the Appen share price.

What else?

As such, investors may be banking on an earnings surprise in its report on Thursday, where it would beat guidance on revenue, EBITDA and/or net profit after tax (NPAT).

An earnings beat is typically associated with positive sentiment, and investors may be seeking to enter a position early in order to capture any upward movements in the Appen share price post-earnings.

To illustrate, recall that after its last earnings report in February, the Appen share price sunk 7% on the day it was released. That’s despite the fact the company grew revenues by 12% and EBITDA by 8% over the year.

However, management downgraded guidance in the report and then subsequently again in May. Thus, Appen shares have faced selling pressure over the last few months.

For instance, in May, the company forecasted an EBITDA range of US$83–$90 million, down from US$120–$130 million in its FY20 report.

However, even this figure signifies an 18%–28% year on year growth pattern from the year prior.

Therefore, without any additional news related catalysts, it therefore stands to reason that investors may be pushing the Appen share price higher in anticipation of a strong performance in its FY21 half year results on Thursday.

Appen share price snapshot

Appen shares have posted a year to date loss of 48%, extending the previous 12 month’s loss of 68%.

Despite this, Appen shares are up 9.4% over the last week. Further, they are around 2% in the green over the last month.

These results have lagged the S&P/ASX 200 Index (ASX: XJO)’s return of around 25% over the past year.

As mentioned, investors can expect the company’s FY21 half year earnings report on Thursday. Remember, this may be subject to change, so keep an eye out.

The post Appen share price (ASX:APX) up 6% ahead of earnings this week appeared first on The Motley Fool Australia.

More reading

• Here are 3 buy-rated ASX growth shares
• Why the Appen (ASX:APX) share price fell 7% last time it reported
• 2 excellent ASX tech shares with strong growth potential
• Why AGL, Appen, CBA, & Rio Tinto shares are tumbling lower
• Appen (ASX:APX) share price slides following board renewal

The author Zach Bristow has no positions 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 has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Today, the S&P/ASX 200 Index (ASX: XJO) moved higher on a solid day for tech shares. The benchmark index finished 0.35% higher to 7,487.3 points. While most of the Aussie index was in the green, it was the tech sector that pulled the furthest ahead.

The question is: which shares from the top 200 delivered the most green on the ASX today? Here are the ten stocks that delivered the biggest gains:

Top 10 ASX 200 shares countdown today

Looking at the top 200 listed companies, Pilbara Minerals Ltd (ASX: PLS) was the biggest gainer today. Shares in the lithium producer increased 10.9% despite no announcements. Find out more about Pilbara Minerals here.

The next best performing ASX share out of the top 200 today was Whitehaven Coal Ltd (ASX: WHC). The coal producer’s shares climbed 7% to $2.28 as coal prices continue to strengthen. Uncover the latest Whitehaven Coal information here.

Today’s top 10 biggest gains were made in these ASX 200 shares:

Our top 10 ASX 200 shares countdown is a recurring end-of-day summary to ensure you know which companies were making big moves on the day. Check-in at Fool.com.au after the market has closed during weekdays to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares on Monday appeared first on The Motley Fool Australia.

More reading

• Whitehaven (ASX:WHC) share price lifts 6% ahead of earnings this week
• Pilbara Minerals (ASX:PLS) share price bounces back, up 8% on Monday
• Which ASX companies are the top movers in the ASX 300 today?
• What’s moving the ASX 200 Index (ASX:XJO) on Monday?
• ASX 200 midday update: NIB sinks and Sonic falls on full year results

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

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The Newcrest Mining Ltd (ASX: NCM) share price was a positive performer on Monday.

The gold miner’s shares rose 1.5% to end the day at $25.08.

However, despite this gain, the Newcrest share price is still down 24% over the last 12 months.

Why did the Newcrest share price push higher?

Investors may have been bidding the Newcrest share price higher after analysts at Goldman Sachs responded positively to its full year results release from last week.

According to the note, the broker has retained its buy rating but trimmed its price target on the company’s shares to $33.00.

Based on the current Newcrest share price, this implies potential upside of 31.5% over the next 12 months.

What did the broker say?

Goldman Sachs was pleased with Newcrest’s better than expected performance in FY 2021.

It commented: “NCM’s FY21 result was ahead of our expectations; EBITDA of US$2,443mn was +4%/+5% ahead of GSe/VisibleAlpha consensus respectively, driven largely by non-cash other income items.”

“Underlying NPAT of US$1,164mn was +1%/+4%. FCF of A$1,104mn was ahead of our expectations (+15%) after favourable 2H working capital movements and lower cash tax payments than expected. Net cash of US$176mn was therefore better than our expectations and also consensus.”

“The strong FCF, as well as an increase in payout ratio (41% of FY21 FCF), resulted in an upsized final dividend of US40cps (fully-franked), well ahead of our forecast, however in-line with policy of 30-60% for the full year,” it added.

Guidance disappoints but valuation remains attractive

One slight negative, though, was its guidance for FY 2022. Unlike its result in FY 2021, this was below its expectations.

Goldman said: “FY22 guidance was softer than our expectations, particularly driven by higher than expected AISC at key assets and higher capex. Gold and copper production were in-line with our prior estimates at the group level, however Lihir’s outlook was ~10-20% below our prior forecasts, offset by stronger production expectations at Telfer.”

Nevertheless, the broker still see a lot of value in the Newcrest share price. As a result, it has retained its buy rating, noting its “compelling valuation discount (0.76xNAV), attractive growth pipeline, and increasing copper earnings.”

So, while the last 12 months have been disappointing, Goldman appears confident the next 12 months will be much more positive for the Newcrest share price.

The post Top broker tips Newcrest (ASX:NCM) share price to have a golden 12 months appeared first on The Motley Fool Australia.

More reading

• ASX 200 Weekly Wrap: Miners drag ASX back to earth
• 5 things to watch on the ASX 200 on Monday
• The Newcrest (ASX:NCM) dividend boosted 129%
• 5 things to watch on the ASX 200 on Friday
• Newcrest Mining (ASX:NCM) share price on watch as profit jumps 55%

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

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The ASX Ltd (ASX: ASX) share price is surging today despite a joint investigation by the Australian Securities and Investment Commission (ASIC) and the Reserve Bank of Australia (RBA) finding the company’s implementation of a planned systems upgrade was “largely not consistent” with industry practices.

On 16 November last year, the ASX was forced to end the trading day early when technical issues arose from a botched systems upgrade. While independent assessor IBM Australia found the stock exchange operator met industry practices in 58 out of 75 of the capabilities assessed, it missed in 17.

Near the market close today, shares in the company were trading for $88.52 – up 3.01%. The S&P/ASX 200 Index (ASX: XJO), for context, is 0.35% higher.

ASX share price lifts after ASIC investigation finishes

When it came to business case development, resourcing, stakeholder engagement, and incident management of the systems update, the ASIC investigation found ASX met or exceeded industry practice.

However, ASIC and its partners found the system was not ready for implementation in mid-November and the ASX should have been more cautious. As well, it found risk management “did not meet industry practices” and that there were “gaps” in the rigour applied to risk management.

The investigation also made 7 key recommendations to ASX relating to risk, governance, and testing; among others.

ASIC chair Joe Longo said:

The independent expert found that ASX met or exceeded leading industry practices in most areas, but the conclusion that the project was not ready for go-live is very disappointing.  ASX has acknowledged and accepted the need for improvement. 

We do, however, require assurance that these improvements are implemented effectively and result in an overall improvement to ASX’s enterprise-wide project management practices.

Despite today’s findings, the ASX share price is lifting today.

A separate investigation into whether ASX met its obligations under the Australian Market Licence, is still ongoing.

ASX responds

In a media statement, the ASX acknowledged the report findings and said it would address all the recommendations for improvement. The company added that management did believe it was ready for go-live, contrary to the findings of ASIC and the RBA.

ASX managing director and CEO Dominic Stevens said:

Last November’s market outage fell short of ASX’s high standards. We believed that the software was ready for go-live, as did our technology provider Nasdaq. Clearly there were issues, which was particularly disappointing given the significant progress we have made on resilience in recent years.

He added

ASX is well advanced in developing a detailed response plan for execution over the next 12 to 18 months, and we’ll commission the independent expert to review our actions to meet its recommendations. Our delivery of this program of work will be under the oversight of ASIC and the RBA.

ASX share price snapshot

Over the past 12 months, the ASX share price has fallen 0.85%. The 200 largest companies on its trading system have outperformed it by about 23 percentage points.

ASX Ltd has a market capitalisation of about $16.6 billion.

The post ASX (ASX:ASX) share price lifts despite ASIC findings on system failure appeared first on The Motley Fool Australia.

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Motley Fool contributor Marc Sidarous 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 cryptocurrency Bitcoin (CRYPTO: BTC) hasn’t exactly occupied the limelight as much as it used to over the past few months. Remember, this flagship cryptocurrency was one of the best-performing assets in the world during 2020.

It seems ludicrous now but, back in March 2020, Bitcoin plunged to almost US$5,000 a coin. By April 2021, it was back making new all-time highs of more than US$60,000 a coin, meaning some investors enjoyed gains of 10x or more in just over a year.

But the past few months have told a wildly different story. Since topping out above US$60,000 in April, Bitcoin has spent the subsequent 4 months falling back to Earth. By mid-July, it was back under US$30,000 a coin, quickly halving any gains investors had made by April. Such is life for a cryptocurrency investor.

What’s behind Bitcoin’s volatility in 2021 so far?

What caused this collapse? Well, with a decentralised asset like Bitcoin, it’s hard to know for sure. But most commentators put it down to a combination of the regulatory crackdown on cryptocurrencies in China as well as Tesla Inc (NASDAQ: TSLA) CEO Elon Musk’s whipsawing.

Musk made headlines earlier this year when he announced Tesla would accept Bitcoin as a payment method from its customers after the company invested some of its balance sheet cash into Bitcoin. Just a few months later, Musk backflipped, stating Tesla would no longer accept Bitcoin due to the environmental cost of mining the coins.

But that was then, and this is now. Since mid-July, Bitcoin has again surprised investors with a remarkable rally. The crypto has risen from below US$30,000 to just today crossing the US$50,000 price mark for the first time since May. Yep, in just over a month, Bitcoin has increased by almost 50%.

It’s not just Bitcoin either. Other cryptocurrencies like Ethereum (CRYPTO: ETH), Ripple (CRYPTO: XRP ) and Cardano (CRYPTO: ADA) have also rallied.

So what’s driving it? Again, it’s hard to say. A report in today’s Australian Financial Review (AFR) points to a self-fulfilling prophecy, stating that “the revival in virtual currencies has excited animal spirits again among the crypto faithful”.

However, the report also warns that the rally might be nearing its peak. It quotes Rick Bensignor, CEO of Bensignor Investment Strategies, as stating, “[Bitcoin is] getting nearer the higher end of what I expect as a new trading range in the low-$US40,000s to low-$US50,000s”.

We’ll have to wait and see what happens from here. If there’s one thing we can probably all agree on with Bitcoin, it’s to expect the unexpected.

The post Up 50% in a month! Bitcoin is back over US$50,000 appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen owns shares of Bitcoin, Ethereum, Ripple, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin, Ethereum, and Tesla. 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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