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Might the Sezzle Inc (ASX: SZL) share price be one to think about after the buy now, pay later company’s recent decline.

Since 8 July 2021, the Sezzle share price has actually dropped by around 16%.

There hasn’t been too much market sensitive news since its quarterly update for the three months to 31 March 2021.

One announcement has been that the buy now, pay later business has entered into a three-year agreement with the US-listed Target Corporation. In early June, it said that it had concluded its proof of concept with Target. Under the agreement, Sezzle’s product will be used in-store and across Target’s digital platforms, providing access to interest-free payment plans for purchases made at Target.

Another announcement was that Discover Financial Services is going to invest US$30 million into Sezzle, based on a share price of $8.83. The two parties have also proposed to enter into an expanded partnership, including plans for a buy now, pay later network solution on the Discover Global Network, as well as a dedicated referral program introducing Discover credit and debit products to Sezzle’s consumer base.

Investors particularly like to pay attention to the quarterly update from the buy now, pay later business.

Latest quarterly update

When the company first announced its performance for the three months to 31 March 2021, the Sezzle share price went up 8.4% to $9.63 on the day. But it has actually fallen by 16% from then.

Sezzle revealed that in the first quarter of its 2021, it reached new highs for underlying merchant sales (UMS), active consumers, active merchants and repeat usage.

UMS for the first quarter increased 214.1% year on year to US$375.1 million (or $492.5 million in Australian dollar terms). This represented 16.9% quarter on quarter growth. The March UMS beat December’s UMS by 30%.

The buy now, pay later business also said that its income as a percentage of UMS remained steady year on year at 5.9%.

Another 400,000 active consumers were added during the quarter, bringing the total to more than 2.6 million active consumers (up 126.6% year on year).

Over 7,300 active merchants were also added in the quarter, the largest quarterly increase in the company’s history. There were over 34,000 active merchants on the Sezzle platform at the time of the update.

Management said that the consumer profile continues to improve as active consumer repeat usage grew to 90.7% (which was the 27^th consecutive month of improvement).

It also saw a positive shift of more than 10 percentage points year on year towards automated clearing house (ACH) as a payment method. This comes with lower costs.

Is it time to look at the Sezzle share price after the decline?

The broker Ord Minnett currently rates Sezzle shares as a buy. The price target is $11.90, which suggests the Sezzle share price could increase by a large 45% over the next 12 months if the broker is right.

Ord Minnett has pointed out that the deal with Target could lead to a significant increase to UMS in future years and proves its alternative offering can win over major merchants.

The post Is the Sezzle (ASX:SZL) share price a buy? appeared first on The Motley Fool Australia.

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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 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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On Thursday the S&P/ASX 200 Index (ASX: XJO) was back on form and stormed higher. The benchmark index rose 0.5% to 7,417.4 points.

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

ASX 200 futures pointing slightly higher

The Australian share market could end the week on a mildly positive note. According to the latest SPI futures, the ASX 200 is expected to open the day 4 points or 0.05% higher this morning. This follows a positive night on Wall Street, which saw the Dow Jones rise 0.45%, the S&P 500 climb 0.4%, and the Nasdaq edge 0.1% higher.

Oil prices jump

Energy producers such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could end the week on a high after oil prices jumped overnight. According to Bloomberg, the WTI crude oil price is up 1.6% to US$73.58 a barrel and the Brent crude oil price is up 1.8% to US$76.06 a barrel. A combination of a softening US dollar and tightening US supplies boosted prices.

Janus Henderson impresses

The Janus Henderson Group CDI (ASX: JHG) share price could charge higher today following the release of its second quarter results after the market close yesterday. The fund manager reported a 95% increase in second quarter adjusted operating income to US$269.3 million. Management advised that this reflects growth in assets due to positive markets and good investment performance. This translated into significant performance fees. The Janus Henderson share price rose 6% on Wall Street.

Fortescue rated as a sell

According to a note out of Goldman Sachs, its analysts believe the Fortescue Metals Group Limited (ASX: FMG) share price is overvalued. This follows the release of its fourth quarter production update. While Fortescue smashed the broker’s expectations with its record shipments, it wasn’t enough for a change of rating. Goldman notes that its shares trade at a significant premium to its rivals and thus has retained its sell rating and put a $19.90 price target on them.

Gold price jumps

Gold miners Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) will be on watch after the gold price jumped overnight. According to CNBC, the spot gold price is up 1.2% to US$1,828.10 an ounce. Traders were buying gold in response to the US Federal Reserve’s dovish tone.

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

More reading

• Here are 3 of the most heavily traded ASX 200 shares this Thursday
• ASX 200 rises, Fortescue up, Airtasker climbs
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• Here’s why the Zip Co (ASX:Z1P) share price is leaping 5% today

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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Are you interested in making some additions to your income portfolio? if you are, then below are two options to consider.

Here’s why these ASX 200 dividend shares have been rated as buys:

Australia and New Zealand Banking GrpLtd (ASX: ANZ)

The first ASX 200 dividend share to consider is ANZ. It could be a top option due to the increasingly positive outlook for the big four banks. This is being driven by improving trading conditions and cost reductions.

For example, during the first half of FY 2021, ANZ reported a statutory profit after tax of $2,943 million and cash earnings from continuing operations of $2,990 million. This was up 45% and 28%, respectively, on the second half of FY 2020. More of the same is expected with its third quarter update next month.

Analysts at Morgans are positive on the company and have an add rating and $34.50 price target on its shares.

As for dividends, the broker is forecasting fully franked dividends of $1.45 per share in FY 2021 and then $1.65 per share in FY 2022. Based on the latest ANZ share price of $27.75, this represents yields of 5.2% and 5.9%, respectively.

Sonic Healthcare Limited (ASX: SHL)

Another ASX 200 dividend share to look at is Sonic Healthcare. It is one of the world’s leading healthcare providers, with operations in Australasia, Europe and North America.

Sonic has been a very strong performer in FY 2021. This has been driven by growth across the business, but particularly from its COVID-19 testing business. And with the Delta strain proving hard to control, testing volumes look likely to remain elevated for some time to come. This bodes well for its performance in FY 2022.

Analysts at Credit Suisse expect its growth to continue. In light of this, last week the broker retained its outperform rating and lifted its price target to $43.50.

Credit Suisse is also forecasting partially franked dividends per share of 99 cents in FY 2021 and then 102 cents in FY 2022. Based on the latest Sonic share price of $40.22, this implies potential yields of 2.45% and 2.55%, respectively, over the next couple of years.

The post 2 buy-rated ASX 200 dividend shares with attractive yields appeared first on The Motley Fool Australia.

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• Own ANZ (ASX:ANZ) shares? Here’s what to look for during reporting season
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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 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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The S&P/ASX 200 Index (ASX: XJO) has had a pretty decent day of trading this Thursday. At market close, the ASX 200 is up a healthy 0.52% to 7,417 points. But let’s now take a deeper look at which ASX 200 shares traded the most heavily today.

3 of the ASX 200’s most heavily traded shares on Thursday

Regis Resources Limited (ASX: RRL)

ASX 200 gold miner Regis Resources is our first share to check out today. A hefty 11.3 million Regis shares have changed hands so far. This is probably the direct result of the Regis share price performance today.

This Regis Resources share price closed the day up 5.65%, trading at to $2.62. this is after going as high as 7% earlier today. This move seems to be a consequence of the company’s fourth-quarter update that was released to the markets before open. Investors seemed impressed with the record production and sales volume the miner recorded.

Telstra Corporation Ltd (ASX: TLS)

Yet again, ASX 200 telco Telstra makes this list. This Thursday has seen a very substantial 17.3 million Telstra shares swap owners today so far. That’s despite the flat performance of the Telstra share price today.

It ended the day where it started – at $3.78 a share. In saying that, Telstra just yesterday hit a new 52-weekly high of $3.82. So perhaps momentum or just goodwill is spilling into the telco’s trading volume today.

Vicinity Centres (ASX: VCX)

And our top ASX 200 share today in terms of trading volume goes to ASX 200 Real Estate Investment Trust (REIT) Vicinity Centres. A staggering 24.5 million Vicinity units traded today, well eclipsing any of its closest rivals. Even so, there is no obvious reason why this company has experienced so much trading volume today.

The Vicinity share price ifinished the day flat at $1.51 a share. REITs have been in the news a little bit lately, so this might be why there are heavier trading volumes than normal with Vicinity today.

The post Here are 3 of the most heavily traded ASX 200 shares this Thursday appeared first on The Motley Fool Australia.

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• Telstra (ASX:TLS) share price and improving sector dynamics – Expert
• Why the Regis Resources (ASX:RRL) share price is surging 7% higher today

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

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The Marley Spoon AG (ASX: MMM) share price will be one to watch on Friday.

This follows the release of the meal kit delivery company’s second quarter update.

How did Marley Spoon perform in the second quarter?

Marley Spoon continued its growth during the second quarter of FY 2021, albeit at a slower rate than recent quarters following a normalisation in customer behaviour.

According to the release, the company reported second quarter revenue of EUR80.6 million, which was up 10% on the prior corresponding period. Management advised that this was driven by all regions, with Europe leading at 43% growth compared to the prior corresponding period.

This ultimately led to its first half revenue growing 36% year on year.

What about earnings?

Potentially weighing on the Marley Spoon share price tomorrow could be its operating result.

The update reveals that the company recorded an operating loss of EUR9 million during the period. This led to a half year operating loss of EUR15 million. Management advised that this was driven by its investment in growth and talent.

In addition, the company reported a Contribution Margin of 27% for the second quarter, down nearly 4 percentage points versus the same period last year. Management blamed this on an adverse operating environment in the US.

Outlook

One positive that may lend some support to the Marley Spoon share price on Friday was management reaffirming its revenue guidance for FY 2021.

Despite the slowdown in the second quarter, it expects to deliver year on year growth of 30% to 35%.

Though, this positive may be offset by a downgrade to its Contribution Margin guidance to 27%. This is down from its prior guidance of 28% and in line with FY 2020’s Contribution Margin.

Management commentary

Marley Spoon’s CEO, Fabian Siegel, commented: “We are pleased to report continued post-COVID growth for the past quarter. Net revenue grew 12% on a constant currency basis. More importantly, our Active Subscriber base, a leading indicator of true underlying growth, grew 37% year over year.”

“User behaviour across the regions has mostly normalized to its pre-COVID state with the 2021 holiday season being more pronounced than in pre-COVID years. Our business continues to show strong growth enabling us to re-affirm full year 2021 net revenue guidance.”

Mr Siegel then provided more colour on the aforementioned adverse operating conditions in the US.

He explained: “However, in Q2 our team continued to face operational headwinds, especially in our US business. These included unprecedented weather disruptions in Q1, which led to the temporary closure of our Texas site, and acute nationwide labour shortages which not only impacted our facilities directly, but also affected our inbound food supply and logistics partners. We are implementing a series of measures across the organisation and supply chain to improve productivity and quality. These improvements are mitigating the impact on our margins and customer satisfaction. Given the aforementioned we are revising our CM guidance for the year to be consistent with the 2020 margin.”

Nevertheless, the CEO remains positive on the future and expects strong revenue growth over the coming years.

He concluded: “Our investment in growth and strengthening our operational bench, paired with the lower than expected margin in H1 led to a negative Operating EBITDA margin of (9%) for the half year. At the same time, we controlled investments to deliver near to break-even cash from operating activities. We are also pleased to have secured additional funding in Q2 to further support our 2021/2022 growth investments and mid-term ambition of becoming a 1 billion Euro revenue business by 2025.”

The post Marley Spoon (ASX:MMM) share price on watch after mixed Q2 update appeared first on The Motley Fool Australia.

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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 Marley Spoon AG. The Motley Fool Australia owns shares of and has recommended Marley Spoon AG. 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 Race Oncology Ltd (ASX: RAC) share price finished in the red today. The dip came after Race updated the market on its quarterly results before the open.

At the closing bell, Race Oncology shares were exchanging hands at $3.44 apiece, a 2.82% fall from the market open.

Let’s take a look at Race’s report in a bit closer detail.

Quick refresher on Race Oncology

Race Oncology is a precision oncology company that commercialises assets in the cancer and oncology fields.

Its flagship product is a phase 2/3 cancer drug called Bisantrene.

The pharmaceutical company has a market capitalisation of $511 million at the time of writing.

Race Oncology’s quarterly results

The major takeout from the quarter was that Race’s “three pillar” strategy advanced with “two phase 2 clinical programs under way” in Israel and Australia.

These clinical studies are examining the impact of Bisantrene as a combination drug in patients with “relapsed/refractory” acute myeloid Leukemia (AML).

Furthermore, Race signed an agreement with clinical research organisation (CRO) Parexel, to “manage Race’s phase 2 AML program in Australia”.

This arm of the AML clinical program is investigating Bisantrene’s impact on the “extra-medullary (EMD) form of the (AML) disease”. The Race Oncology share price jumped 3% on this update.

Moreover, the company also announced a collaboration with the University of Newcastle to investigate Bisantrene in melanoma and kidney cancer.

Additional takeouts from the report

Race also appointed Dr David Fuller as chief medical officer. He has “30 years experience in oncology”.

Additionally, the company also successfully raised $5.4 million to support its pre-clinical, clinical and related manufacturing initiatives.

Cash expenditure of $2.8 million was significantly higher than the previous quarter, and was dedicated to procurement of the CRO contract with Parexel alongside clinical trial initiatives.

Despite this, at the end of the quarter, Race reported cash and equivalents of $9.32 million on its balance sheet, a 44% increase from the quarter prior.

Speaking on the progress, Race CEO Phillip Lynch said:

The team has progressed key elements of the Three Pillar Strategy, in the most recent quarter, confirming clinical programs where we will study Bisantrene further in the Acute Myeloid Leukaemia setting. Importantly, we added critical appointments to the team to better support our ability to execute the breadth of our plans.

Race Oncology share price snapshot

The Race Oncology share price has posted a return of 96% since January 1.

Over the past 12 months, the shares have gained 282%, well ahead of the broad index. For comparison, the S&P/ASX 200 Index (ASX: XJO) has posted a return of 23% over the same time frame.

The post Race Oncology (ASX:RAC) share price slumps on quarterly update appeared first on The Motley Fool Australia.

More reading

• The 5 best performing ASX healthcare shares of FY21, did yours make the cut?

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

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As an investor, regulatory intervention is always a lingering risk. For Woolworths Group Ltd (ASX: WOW) shareholders, the risk is heating up in New Zealand, according to reports by The Australian on Thursday. As a result, the Woolworths share price is down 0.5% as the market digests the news.

While the news is circulating in the media, the ASX-listed company has yet to provide an announcement regarding the matter.

Let’s look at the details.

What’s moving the Woolworths share price?

A little competitive nudge on the cards

Monopolies and duopolies hurt consumers because the lack of competition often leads to higher prices. Effectively, such companies can name their price. The New Zealand competition regulator is concerned that Woolworths could be operating within a duopoly.

A report compiled by the New Zealand Commerce Commission found that Woolworths’ Countdown chain and Foodstuffs are pulling in remarkable profits compared to international standards. As a result, the kiwi country’s grocery prices are among the most expensive for developed nations.

Consequently, the regulator suggested the NZ government make it easier for new competitors to enter the market. However, if this fails to conjure up increased competition, the government may be forced to take a more direct approach.

Specifically, the report outlines the potential of the grocery chains being forced to sell some stores to create a third competitor. Otherwise, the government acting as a joint venture partner for a new competitor might be another option.

Commission chair Anna Rawlings said:

If competition was more effective, retailers would face stronger pressures to deliver the right prices, quality and range to satisfy a diverse range of consumer preferences.

In short, the New Zealand regulator wants more retailers to take a bite of Woolworths’ pie. Investors might be concerned that in doing so, a bite is also taken out of the Woolworths share price.

At this stage, the report is a draft with feedback and comments due back by 26 August. The final report is expected to be published on 23 November 2021.

Woolworths’ response

It is still early days for the grocery giant’s response to the report. However, Woolworths New Zealand managing director Spencer Sonn said:

We hadn’t seen the draft report ourselves ahead of its release today, so we will now take the time to read it so we can provide our feedback within the required time frame. We note this is only a draft report but on face value some of the options would have significant implications and we’ll need time to work this through and understand the impact.

The Woolworths share price is up 17.9% over the past year. This is in contrast to the S&P/ASX 200 Index (ASX: XJO) return of 23.4%.

The post Woolworths (ASX:WOW) share price struggles amid NZ duopoly concerns appeared first on The Motley Fool Australia.

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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 S&P/ASX 200 Index (ASX: XJO) rose by 0.5% today to 7,417 points.

Here are some of the highlights from the ASX:

Fortescue Metals Group Limited (ASX: FMG)

The Fortescue share price went up almost 2% today after revealing its update for the three months to 30 June 2021.

Fortescue said that for the quarter, it saw record iron ore shipments of 49.3 mt, and 182.2 mt for FY21. The annual production beat the guidance of 182 mt.

The ASX 200 miner achieved record revenue of US$168 per dry metric tonne (dmt) for the quarter and US$135 per dmt for FY21.

Its C1 cost for the fourth quarter was US$15.23 per wet metric tonne (wmt) – up 2% for the previous quarter – and the C1 cost for FY21 was US$13.93 per wmt. This was in line with guidance.

Fortescue said that strong free cashflow generation contributed to net cash of US$2.7 billion at 30 June 2021, compared to net debt of US$1 billion at 31 March 2021.

Total capital expenditure for FY21 was US$3.6 billion, with first production achieved at Eliwana and continued development of the Iron Bridge and Pilbara Energy Connect (PEC) projects.

It also pointed to the progress of Fortescue Future Industries (FFI). Fortescue said the FFI stretch targets were achieved to support Fortescue’s pathway to decarbonisation.

FY22 guidance from the ASX 200 share is for iron ore shipments to be between 180mt to 185mt. The C1 cost is expected to be between US$15 per wmt to US$15.50 per wmt.

Airtasker Ltd (ASX: ART)

The Airtasker share price went up around 6% today after providing a quarterly update that showed it had beaten its FY21 guidance.

Airtasker said that continuing strong marketplace performance in the fourth quarter produced positive operating cashflow of $763,000.

That led to positive FY21 operating cashflow (excluding IPO costs) of $7.4 million, with statutory operating cashflow of $5.5 million, compared to the prospectus forecast of $0.1 million.

The FY21 gross merchandise volume (GMV) was $153.1 million, exceeding the prospectus forecast of $143.7 million.

The company had 415,000 unique paying customers in FY21, exceeding the prospectus forecast of 405,000.

Regarding FY22, it said that the business had accelerated ahead of expectations after the IPO and into lockdowns. But those lockdowns are impacting the start of the first quarter, with weekly GMV down 12% compared to pre-lockdown.

However, management are expecting a “strong” bounce back once restrictions are lifted.

The business said it had $45.9 million of cash at the year end to pursue significant growth.

Macquarie Group Ltd (ASX: MQG)

The ASX 200 investment bank released its quarterly update to investors for the first three months of FY22.

It said it has seen improved trading conditions with the profit contribution from its operating segments up significantly on the prior corresponding period, where it had mixed trading conditions.

Macquarie said its annuity-style businesses (Macquarie Asset Management (MAM) and the banking and financial services division (BFS) saw a slight profit increase. But the market-facing businesses of commodities and global markets (CGM) and Macquarie Capital were up significantly.

It said that its financial position continues to comfortably exceed APRA’s regulatory requirements.

Finally, in order for the bank to have additional flexibility to support business growth, the board has altered its annual dividend payout policy range to 50% to 70%.

The post ASX 200 rises, Fortescue up, Airtasker climbs appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison owns shares of Fortescue Metals Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Airtasker Limited. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Venturex Resources Ltd (ASX:VXR) share price is again rocketing higher this week. This means that the company’s shares are now almost 20% higher than they were at the start of Monday.

At market close, the Venturex Resources share price is up 4.61%, trading at 80 cents.

The strong gains made come from Tuesday’s Whim Creek update and today’s release about an infill drilling program.

Sulphur Springs strategy underway

According to its statement, Venturex advised it has commenced a $10 million drilling program to develop its Sulphur Springs project.

Located 144 kilometres south east of Port Hedland, Western Australia, the Sulphur Springs project contains copper, zinc and silver deposits.

A Definitive Feasibility Study (DFS) was completed in 2018 which identified the project as economically strong. The site has a combined total Mineral Resource of 13.8 million tonnes grading 1.5% copper, 3.8% zinc and 17 grams per tonne of silver.

Venturex noted that since the completion of the DFS, the price of copper and zinc has jumped around 50% and 15%, respectively.

The infill drilling campaign aims to upgrade the majority of the mineral resources into the Indicated Category. This increases the level of geological knowledge and confidence of Sulphur Springs containing probable Ore Reserves.

If successful, this will essentially de-risk the project and give Venturex options to secure funding.

The company will target drilling in both the open pit and underground resources at Sulphur Springs. In addition, extension drilling will take place to test the known resource and mineralisation boundaries.

It is expected that the drilling program will form a part of a resource update in June 2022. Remaining project approvals are anticipated to be received later in the second half of next year.

Venturex managing director, Bill Beament touched on Sulphur Springs strategy to become a bankable project by the end of 2022. He said:

We aim to grow and advance the project at the same time. This approach will maximise our ability to unlock its full value, bringing forward the time to production and cashflow while expanding the mining inventory.

About the Venturex share price

Over the last 12 months, Venturex shares have accelerated to astronomical gains of more than 1,300%, with year-to-date up 600%.

On valuation grounds, Venturex has a market capitalisation of roughly $553 million, with more than 667 million shares outstanding.

The post Venturex (ASX:VXR) share price continues its strong run, up 5% today appeared first on The Motley Fool Australia.

More reading

• Why the Venturex (ASX:VXR) share price is surging 7% in afternoon trade

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 National Australia Bank Ltd (ASX: NAB) share price has been a positive performer in 2021.

Since the start of the year, the banking giant’s shares have risen 12%. This means the NAB share price is now up 42% over the last 12 months.

In light of this strong form, expectations are high for its third quarter update next month.

What is expected from NAB?

According to a note out of Bell Potter, its analysts have revealed what they are expecting from the banking giant next month.

The broker has revealed that its expects NAB to report third quarter statutory earnings of ~$1.59 billion and cash earnings of ~$1.60 billion. This compares to statutory earnings of $1.50 billion and cash earnings of $1.55 billion in the prior corresponding period.

The broker expects this to be driven by flat net interest income, higher other banking income, and lower operating expenses.

It commented: “3Q21 should again mirror 1H21 numbers on an average basis. This is given flat net interest income ($3.42bn both ways), higher other banking income ($842m vs. $800m previously) and lower operating expenses ($1.90bn, slightly down from $1.93bn). On the other hand, credit impairment charges were slightly higher based on normalisation of events ($106m charge vs. $64m benefit).”

Bell Potter is also expecting NAB’s CET1 ratio to improve year on year. It has pencilled in a CET1 ratio of 12.5%, up from 11.6% a year earlier and 12.4% at the end of the first half.

This is expected to be driven by ongoing strong cash earnings and slight benefits from RWA movements (asset quality and operational risk) and rates and foreign exchange movements.

Is the NAB share price in the buy zone?

Bell Potter doesn’t see enough value in the NAB share price at this point to maintain its buy rating.

In light of this, its analysts have downgraded its shares to a hold rating with an improved price target of $27.50. This compares to the latest NAB share price of $25.77.

The post Is the NAB (ASX:NAB) share price good value ahead of earnings season? appeared first on The Motley Fool Australia.

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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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