The company delivered classic triple-digit year-on-year growth across group revenue, transaction volume, and transaction numbers.
In addition, Zip reiterated its focus on global expansion, acquiring the remaining shares of Twisto Payments and Spotii Holdings to enter the respective Europe and Middle East markets.
During the quarter, the company launched organically into Canada and Mexico.
And in May, Reuters reported that Zip chief executive Larry Diamond is, “actively looking at Singapore, Malaysia, Thailand, Philippines and India.”
Despite what was otherwise a solid result with plenty of growth initiatives, the Zip share price would tumble 7.91% to $6.91 on the day of the announcement.
Selling pressure continues to mount
The Zip share price has experienced three major sell-offs this month.
On 14, 15, and 22 July, the company’s shares fell 11.4%, 5.6%, and 7.9% respectively.
On these dates, approximately 25 million, 20 million, and 30 million shares exchanged hands.
To add some perspective, the current 10-day average volume of Zip shares is approximately 14 million.
It’s more than just the Zip share price
The broader ASX-listed buy now, pay later sector is under pressure on Monday, with selling across the board.
The Afterpay Ltd(ASX: APT) share price is down 2.4% to $104.31.
Sezzle Inc(ASX: SZL) is the hardest hit in the large cap space, down 4.57% to $7.72.
Smaller buy now, pay later players continue to fall sharply with Openpay Group Ltd(ASX: OPY) and Laybuy Group Holdings Ltd(ASX: LBY) tumbling 3.49% and 6.67% respectively.
Before you consider Zip Co, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Zip Co wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
Motley Fool contributor Kerry Sun 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 and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small gain. At the time of writing, the benchmark index is up 0.1% to 7,400.7 points.
Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are tumbling lower:
The A2 Milk share price is down 5.5% to $6.41. Today’s decline appears to have been driven by regulatory concerns in China. This follows news of government crackdowns in the Chinese educational sector. There are fears that regulators may use regulatory measures to favour domestic dairy brands.
The Cann share price has crashed 16% to 32 cents. This follows the announcement of another capital raising by the cannabis company. Cann is aiming to raise a further $20 million at a discount of 27.5 cents. Should the company complete this capital raising successfully, it will mean it has raised $138.2 million from investors since listing. Cann recorded sales of $4.3 million in FY 2021. Cann is raising these funds to help it deliver substantial cost savings as it ramps up production.
The Flight Centre share price is down 3% to $14.45. This travel agent’s shares have come under pressure recently amid concerns that the Delta variant of COVID-19 could push back the travel market recovery and lead to Flight Centre burning through significant more cash than previously hoped.
The GPT share price is down 2.5% to $4.63. Investors have been selling the property company’s shares after it withdrew its guidance for FY 2021. According to the release, GPT has withdrawn its Funds From Operations (FFO) and distribution guidance for 2021 due to uncertainty caused by COVID-19 lockdowns in Melbourne and Sydney.
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The Appen Ltd(ASX: APX) share price hasn’t exactly been a top performer recently. Aside from the 3% the shares have lost just today, Appen is also down 14.75% over the past month, 50% in 2021 so far and 66% over the past 12 months.
It seems the tech company’s reputation as a red hot ASX growth share delivering double-digit returns year in, year out are long gone — at least for now.
So why has Appen had such a year to forget, especially the past month’s woes?
After all, other ASX tech shares were smashed last year with the onset of the global pandemic. But today, the S&P/ASX All Technology Index (ASX: XTX), of which Appen is a component, is still up almost 28% over the past 12 months. So why is Appen is dragging the chain here?
A year to forget
A number of factors have been working against Appen recently. The company is still struggling to regain its strength following the initial shock of the pandemic last year.
The company has been forced to downgrade its earnings guidance for one. The subsequent share price drops resulting from this also ensured Appen was booted out of the ASX 100 Index, likely further reducing buying pressure.
Additionally, Appen is a company that reports in US dollar terms. And the Aussie has spent the past year mostly rising against the greenback. This is another headwind the company has had to face.
One potential catalyst for Appen that may become relevant in the near term is a potential takeover offer. As my Fool colleague Tristan covered earlier this month, broker Citi has described Appen as a takeover target due to its current depressed share price.
The broker noted that Appen’s rival Lionbridge has recently been acquired at a 16x – 20x earnings multiple, which makes Appen’s current multiple of 13x look objectively attractive.
We’ll have to wait and see if anything comes of this speculation, but it’s certainly a situation worth keeping in mind. Especially if you’re currently an Appen shareholder.
At the current Appen share price of $12.39, the company has a market capitalisation of around $1.55 billion.
Before you consider Appen, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Appen wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
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. 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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The Carpentaria Resources Ltd(ASX: CAP) share price is starting the week off with a bang. This comes after the mineral exploration company provided an update on its entitlement offer announced on 6 July.
At the time of writing, Carpentaria shares are up 9.68% trading at 17 cents.
What did Carpentaria update the ASX with?
In today’s statement, Carpentaria advised it has raised roughly $11.83 million through its entitlement offer. This represents an interim shortfall of $15.62 million, with the remaining amount to be issued to underwriter Shaw and Partners.
The $27.45 million offer was presented to shareholders following the company’s successful $35.6 million placement.
Together, the combined funds will be used for the Hawsons Iron Project bankable feasibility study.
According to Carpentaria, the Hawsons project, near Broken Hill, has been identified by independent analysts as the world’s leading undeveloped high-quality iron ore concentrate and pellet feed project.
A pre-feasibility study completed in 2017 revealed the open-pit mine had a probable magnetite iron ore reserve of 755 million tonnes.
Carpentaria has a 68.69% interest in the project, with the remaining 31.31% owned by Pure Metals.
Early in the year, we carried out strategic planning sessions in respect of the Hawsons Iron Project and its financing. We developed a plan and are carrying it out. BFS funding is a significant part of that plan, and we are confident this will lead to the successful development and operation at Hawsons.
The entitlement offers allowed participating shareholders to subscribe at 15 cents per share for every 2.6 Carpentaria shares. Once the shortfall has been completed, it’s expected that 182.98 million shares will be added to the company’s registry.
Carpentaria will release the final shortfall number to the ASX sometime later this week.
About the Carpentaria share price
Since the beginning of May, the Carpentaria share price has soared to astronomical levels. Just this month, the company’s share price touched a multi-year high of 22.1 cents. Over the past year, Carpentaria shares are up more than 650%, and 300% year-to-date.
Carpentaria commands a market capitalisation of roughly $83 million, with a total number of 489 million shares on issue.
Should you invest $1,000 in Carpentaria right now?
Before you consider Carpentaria, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Carpentaria wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
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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If you follow me on social media, you’ll know that, among other things, I’ve been banging on about the need for the federal government to restore both JobKeeper and JobSeeker.
No, I haven’t been relieved of my senses.
Yes, I’m worried that the pile of debt we’ve amassed (and would add to) will be put in an extra-large can and kicked down the road.
No, I don’t think the government should be a limitless ATM, to be tapped every time something goes wrong.
But I think we should restore JobKeeper and JobSeeker.
Here’s why:
The economy — every economy — runs on Confidence.
Yes, so important, it deserves its own capital letter, if only for emphasis.
See, confidence is the single most important economic indicator there is.
It doesn’t exist on its own, of course — things like the unemployment rate, wages growth, interest rates and a whole lot more go into how confident we feel — but, as a metric, it is the most important one we have.
Because the economy is a self-fulfilling prophecy.
If we feel optimistic, we spend. If we spend, we add to economic activity. By doing so, we create even more economic activity — businesses hire, they invest in new equipment, and their new employees also spend more. Hey, presto! — the economy grows.
If we feel worried, we keep the wallets and purses closed. When we do that, we harm retail sales. Businesses don’t have the confidence — or the money — to hire, or to invest. That flows right through our economy… which contracts as a result.
Yep. What we expect becomes reality.
Now, let’s go back to 2020. After a couple of smaller, largely ineffective stimulus measures, the federal government realised the economy was in trouble.
It introduced JobKeeper and JobSeeker.
All of a sudden, most businesses could afford to keep staff. Employees felt like the government had their back. Those out of work had more money than usual. The net result? National income went up. Retail sales, after a shortfall, boomed.
The unemployment rate rose slightly but quickly started falling again. So much so that in June 2021, we reached the lowest unemployment rate in a decade.
In short: the stimulus worked.
The recession was short. The rebound was fast. And it was strong.
Never has there been a clearer case of the value of government spending at the right time in the right amounts.
(It also came with lower interest rates and important programs like bank loan deferrals and moratoria on renters being kicked out. In short: we pulled together, and it worked. Beautifully.)
Now, fast forward 12 months or so.
There is a patchwork of government programs. Different rules for different people and businesses in different states and regions.
Most can be applied for and paid in arrears. Depending on circumstances. If you know what you’re eligible for.
I wouldn’t be at all surprised if these programs are cheaper and more ‘efficient’ than JobKeeper and JobSeeker.
Which will please some people.
But, economically speaking, it’s the ‘other’ E that is far more important.
It’s fine to be cheaper. And good to be efficient.
But unless the program is also Effective, those other two fade away, quickly.
I spoke to Peter Overton about it on Nine’s Late News last night. Take a look:
At its most stark, if a program is cheaper (per recipient, per person, as a percentage of GDP… take your pick) and more efficient (targetted, with less waste) but is not effective, it’s still worse than doing nothing at all.
You can spend $100b (as the government did last year) and rocket out of recession.
Or you can spend $10b, $20b or $30b… and still end up in recession, with a slower, less affluent recovery.
In which case, you’ve pretty much wasted billions of dollars (not to mention the tax revenue you forgo, and the welfare payments you have to make during the slower-than-otherwise recession).
Which is, simply, why JobKeeper and JobSeeker should be reinstated.
And yes, I have two stipulations I’d add if I was Treasurer:
First, the conditions that allowed companies to arguably profiteer from JobKeeper should be addressed. The rules of the program should be changed.
But — and this is important — only if there’s time.
Speed, like last time, is of the essence. If we have time to make the required changes, they should be made. If not, we should hold our noses and do it anyway… because the net result is a huge benefit.
Perfection should not be the enemy of good. But good should be made better if we have the chance.
And second, as a country, we’ve lived it up on the national credit card, while cash was tight. We should have plans in place to repay the debt.
(Yes, yes, fellow pedants, I know the country isn’t a household. I know the credit card analogy is imperfect. But we’ve used most of the ammo we had ready for a rainy day. We should restock the ammo cupboard as soon as the opportunity arises.)
We all hope that the combination of restricted movements and vaccine rollouts can eventually spell the end of the COVID ‘hiatus’. Whatever form ‘normal’ takes when we get there, hopefully it arrives quickly.
And, when we do, we’ll have to pay the piper.
But we owe it to ourselves — and each other — to get there in the best shape possible.
Together.
(Mostly, I write about investing. Sometimes, that writing strays to broader economic themes. This is one of those times. But, if you want the investing angle, it’s pretty simple: Economic prosperity means prosperous listed companies, which means more profits for shareholders, which means higher share prices and/or dividends. I don’t reckon we should look at this purely from an investing lens — there are bigger and more important things than investing returns — but even if you only want to look at it from that angle, restoring JobKeeper and JobSeeker makes sense!)
Selfishly — and societally — the same argument applies for JobSeeker. Want economic growth? Put stimulus in the hands of those most likely to spend it. Want more reasonable living standards for those on welfare? Do the same.
It’s not always the case that policy can be good for both investors and society in general. But in this case, we’re all on the same side.
As both citizens and as long term investors (which should be a tautology), the best thing we can hope — and argue — for is a robust, prosperous society.
That’s the foundation upon which well-regulated democratic capitalism flourishes. And that’s good for all of us.
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Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.
Motley Fool contributor Scott Phillips has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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The Mincor Resources NL(ASX: MCR) share price has dipped into the red during this afternoon’s session. The price action comes as Mincor released its quarterly earnings report.
Mincor shares are now exchanging hands at $1.24, a 4.62% drop from the market open.
Let’s comb over Mincor’s results in finer detail.
Quick recall on Mincor Resources
Mincor Resources is an Australian mining company with interests in gold and nickel. It focuses on developing assets for both of these precious metals.
In its report, Mincor outlined several progress points that were achieved this quarter.
It stated “massive sulphides [were] intersected at the ‘Golden Mile’” with an “intercept of 0.5 metres at 6.3% nickel”.
In addition, Mincor’s off-take partner BHP Nickel West revealed a “landmark nickel supply arrangement with Tesla” which, according to the company, highlights “the importance of sustainable nickel to the EV industry”.
The company also drew down significantly on its LME nickel stockpiles this quarter.
Stockpiles fell ~11% to ~232,000 nickel tonnes, signifying “around one month of global demand”, according to the company.
The price of nickel also finished the quarter at $24,541 per tonne, which came in “well above the definitive feasibility study assumption of $22,500 per tonne”.
In the report, Mincor’s managing director David Southam said:
Mincor took major steps during the 2021 financial year towards becoming Australia’s newest nickel sulphide producer, and we are now rapidly closing in on that objective with first nickel concentrate scheduled for late in the March 2022 quarter. I’m pleased to say that the Mincor Team collectively delivered on all of our commitments to shareholders during the year.
Additional takeouts
The company also implemented environmental management systems across all of its operations.
In addition, it also completed the re-establishment of the long victor 15L underground workshop and commissioned a “bio-remediation pad” at its Otter Juan waste dump.
Furthermore, Mincor also constructed a “discharge pipeline” from its Cassini site to Lake Eaton.
Mincor Resources share price snapshot
The Mincor Resources share price has posted a year to date return of 12.67%, extending the previous 12 months’ return of 64%.
These returns have beaten the S&P/ASX 200 Index (ASX: XJO)’s return of ~22% over the previous year.
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Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.
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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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy. The good news is that brokers across the country are doing a lot of the hard work for you.
Three top ASX shares leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:
According to a note out of Macquarie, its analysts have upgraded this stock exchange operator’s shares to an outperform rating with a vastly improved price target of $94.00. The broker has taken a close look at the ASX business and believes the company is well-placed to grow its revenue and dividend at a solid and sustainable rate over the coming years. The ASX share price is trading at $78.00 this afternoon.
A note out of Morgan Stanley reveals that its analysts have retained their overweight rating and $1.50 price target on this sales enablement platform provider’s shares. This follows the release of the company’s fourth quarter update, which revealed annualised recurring revenue (ARR) of $53.1 million. It notes that this leaves it well-placed to at least achieve the broker’s estimates for FY 2022. Looking longer term, Morgan Stanley is confident Bigtincan can grow organically at a quick rate and drive strong profit margin expansion. The Bigtincan share price is fetching $1.17 today.
Analysts at Ord Minnett have retained their buy rating and $16.00 price target on this toll road operator’s shares. According to the note, the broker is expecting Transurban to report a 15% decline in traffic volumes during FY 2021 compared to pre-pandemic levels. And while it expects the weakness to continue in the first quarter of FY 2022 due to lockdowns, it expects traffic volumes to rebound strongly thereafter. After which, it feels the company’s pipeline of development opportunities leaves it well-positioned for the next phase of its growth. The Transurban share price is trading at $14.28 on Monday.
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Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.
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. The Motley Fool Australia owns shares of and has recommended BIGTINCAN 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 Bubs Australia Ltd(ASX: BUB) share price is falling today, despite no news having been released by the company.
In fact, the last time the market heard price-sensitive news from Bubs was over a month ago when it announced it was to launch in the United States.
Right now, the Bubs share price is 48 cents, 4% less than its previous closing price of 50 cents.
Bubs’ fellow baby formula manufacturer A2 Milk Company Ltd‘s (ASX: A2M) share price is also falling today. It’s down 5.31%.
Let’s take a look at what could be driving the Bubs share price down today.
The latest from Bubs
Although there’s no obvious reason for today’s share price drop, the company was hit with a bearish broker note last week.
Bubs is famously reliant on daigou networks transporting its infant formula products to China. Recently, some market watchers predicted Bubs may see increased business after China adjusted its policy to allow its citizens to have up to 3 children.
The broker said the expected increase in China’s birth rate will likely occur in regions that rely on locally-made formula brands.
We haven’t heard anything from Bubs since 18 June when it announced it will be stocked in the United States.
The company’s products will be sold under the brand Aussie Bubs. They will be available on Walmart Inc’s (NYSE: WMT) website and through Amazon.com Inc. (NASDAQ: AMZN).
As part of its entry into the United States market, Bubs is launching a subsidiary named Aussie Bubs.
Bubs share price snapshot
2021 hasn’t been a good year so far for the Bubs share price.
Right now, it’s around 20% lower than it was at the start of the year. It has also fallen 53% since this time last year.
The company has a market capitalisation of around $294 million, with approximately 612 million shares outstanding.
Before you consider Bubs, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Bubs wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned.
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon and short January 2022 $1,940 calls on Amazon. The Motley Fool Australia has recommended A2 Milk, Amazon, and BUBS AUST 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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Australia and New Zealand Banking GrpLtd(ASX: ANZ) shares are outperforming in 2021.
Since the start of the year, the banking giant’s shares have risen a sizeable 20%.
This has been driven by a significant improvement in its performance and expectations that this trend will continue.
In light of this, I thought now would be a good time to check to see what the market is expecting from ANZ during reporting season.
What is expected from ANZ during reporting reason
ANZ isn’t due to release its full year results until later in the year but will be releasing its third quarter update next month.
This update should give investors an idea about how the company is performing in respect to the market’s full year expectations and whether ANZ shares are trading at a fair price or not.
According to a note out of Bell Potter this morning, its analysts are expecting a strong third quarter update in August.
The broker is forecasting cash earnings from continuing operations of $1.3 billion for the three months. This is expected to be driven by relatively unchanged banking income, further improvements in operating expenses, a slight credit impairment charge, and an effective tax rate of 30%.
Bell Potter is also expecting the bank to end the period with a CET1 ratio of 12.4%. This will be comfortably ahead of APRA’s unquestionably strong capital requirement of 10.5%.
As a result, the broker suspects that further capital management initiatives could be coming in the next 12 months.
It commented: “This theoretically means the bank can pay at least another $2.5bn by FY22. This would bring its CET1 ratio to around 11.4-11.5%, suggesting the bank can still enjoy a buffer of around 1.0% over APRA’s minimum capital requirement.”
Are ANZ shares good value?
Bell Potter sees value in ANZ shares at the current level.
The broker has a buy rating and $30.00 price target on its shares. Based on the latest ANZ share price, this implies potential upside of 8.7% before dividends.
So, with Bell Potter forecasting dividend yields greater than 5% between FY 2021 and FY 2023, this potential return stretches to almost 14%.
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Commonwealth Bank of Australia(ASX: CBA) shares have had an interesting 2021 so far. After breaching the $100 a share mark for the first time ever back in May, CBA shares have treaded water ever since, including at today’s share price of $98.92 (at the time of writing).
But even so, the CBA share price remains up a substantial 18% year to date, and an even more pleasing 36.5% over the past 12 months.
A large force driving these gains may have been an increase in speculation that CBA will spend 2021 ramping up both dividends and share buyback programs for the benefit of its shareholders. It’s no secret that all of the ASX banks have surpluses of cash left over from last year. At the urging of the government, the ASX banks spent 2020 sandbagging their balance sheets and battening down the hatches for a coronavirus-induced recession.
This recession turned out to be far less severe than the ‘worst-case scenario’ the banks prepared for. Thus, all banks are very well capitalised at the current time, and, as a result, are primed to return cash to shareholders. Or at least, that’s how the theory goes.
Are buybacks coming?
Until very recently, this was looking promising too. Last month, the Fool covered some analysts predictions that CBA shares would “launch an off-market share buyback with a large franking component”.
Share buybacks are when a company ‘buys back’ its own shares from the market. This increases the entitlement of all existing shareholders to the company’s profits and dividends, because there are fewer shares to split said profits and dividends between. It also usually results in a share price increase simply due to less supply of shares. It’s an easy (and tax effective) way to boost shareholder returns.
So that’s what CBA shareholders were probably hoping was in store for them.
What will CBA shares give back in 2021?
Alas, this may no longer be the case. According to a report in the Australian Financial Review (AFR) today, some commentators are beginning to worry the NSW lockdown might be putting these buybacks at risk. The report quotes including Morgan Stanley analyst Richard Wiles on this matter. Mr Wiles stated the following on CBA”s buybacks:
The growing risk of an extended Sydney lockdown increases the probability that CBA downsizes or delays the announcement of a buyback at its FY21 result on August 11.
The report states the following:
Wiles’ base case is still for a $5 billion buyback, which would take CBA’s capital ratio to 12 per cent. Wiles expects the lockdowns could lead NAB and Westpac to decide to keep their buyback powder dry until May next year, rather than announcing them with their full-year results in October.
We shall have to wait until CBA reports its FY2021 full-year earnings next month to know for sure. But it seems the chances of shareholders getting a river of dividends and buybacks are certainly looking a lot drier than they were a month ago.
Should you invest $1,000 in Commonwealth Bank right now?
Before you consider Commonwealth Bank, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Commonwealth Bank wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
CBA (ASX:CBA) share price lags big banks as requests for deferrals surge
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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