Tag: Motley Fool

The Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) share price, or Soul Patts, has been rising in recent months. What do brokers make of the business?

What is Soul Patts?

Soul Patts is an investment conglomerate that has been listed since 1903. It was originally a pharmaceutical business but it has since diversified into a number of different businesses and industries.

The company has a large number of listed investments in the portfolio including: TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW), New Hope Corporation Limited (ASX: NHC), Clover Corporation Limited (ASX: CLV), Bki Investment Co Ltd (ASX: BKI), Pengana International Equities Ltd (ASX: PIA), Pengana Capital Group Ltd (ASX: PCG) and Tuas Ltd (ASX: TUA).

Soul Patts also has a number of unlisted investments in sectors like resources, financial services, swimming schools and agriculture.

What has the Soul Patts share price done recently?

Over the last month, the Soul Patts share price has risen by 6%.

In the last six months it has gone up by 16%.

Recent news

A few weeks ago, Soul Patts announced that it intends going to merge with/acquire Milton Corporation Limited (ASX: MLT).

Milton shareholders will be offered Soul Patts shares as consideration with Milton shares to be valued at a 10% premium to the adjusted net tangible assets (NTA).

The Milton independent directors have unanimously recommended the takeover deal, assuming there are no better offers and the independent expert concludes that the deal is in the interests of Milton shareholders.

Soul Patts said that the merger will create a larger, more diversified investment company, focused on achieving long-term market outperformance, continuing long-term growth in dividends and growing portfolio allocations to new and alternative asset classes.

There was also a proposed takeover of Australian Pharmaceutical Industries Ltd (ASX: API) – one of Soul Patts’ larger investments – by Wesfarmers Ltd (ASX: WES).

Wesfarmers has offered $1.38 cash per share. That proposal represented a 21% premium to the last closing price of $1.145.

Soul Patts owns 19.3% of API and has agreed to vote in favour of the proposal and has granted a call option in respect of its API shares in favour of Wesfarmers.

Wesfarmers says that it’s well-positioned to bring capital and unique capabilities to support investment that will strengthen the competitive position of API and its community pharmacy partners.

However, Wesfarmers is still looking to find the support of the API board and its recommendation of the proposal to API’s shareholders.

What do brokers think of the Soul Patts share price?

Morgans currently rates Soul Patts as a hold with a price target of $28.84. That means that the broker is expecting the ASX share to potentially fall more than 10% over the next 12 months.

The broker pointed out that Milton deal could add approximately 15% to its net tangible assets (NTA). Morgans reckons the deal will add diversification but doing it without needing to sell any of its bigger positions.

Time will tell if Morgans increases its price target when the deal is done.

According to the broker, it’s valued at 37x FY22’s estimated earnings.

The post Do brokers rate the Soul Patts (ASX:SOL) share price as a buy? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company 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 Washington H. Soul Pattinson and Company Limited and Wesfarmers 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 Nearmap Ltd (ASX: NEA) share price has accelerated over the past month, leaving the S&P/ASX 300 (ASX: XKO) behind. At the end of Tuesday’s market close, the aerial imagery specialist’s shares finished 14.36% higher, trading at $2.27.

This means that in a month, Nearmap shares have gained more than 20%, reflecting renewed positive investor sentiment.

Following the company’s latest share price rise, we take a look at its recent updates including yesterday’s upgraded guidance.

Why is the Nearmap share price surging lately?

Trading performance

Investors appear buoyant on the company’s prospects after it provided some clarity on its trading performance for FY21.

In Tuesday’s statement to the ASX, Nearmap revealed its unaudited preliminary results for the year ending 30 June 2021.

According to the release, the company reported that it expects to exceed its recently upgraded guidance of $128 million to $132 million. Annual contract value (ACV) is forecast to close FY21 at $133.8 million on a constant currency basis. This represents an increase of 26% on the prior corresponding period (FY20).

Nearmap’s robust performance was driven by record ACV growth in North America, surging 54% to US$44.5 million. The company noted that this reflected 46% of the entire group portfolio.

The Australia and New Zealand segment lifted by 7% to $69.1 million, further extending its market leadership position.

Nearmap declared a healthy cash balance of $123.3 million for the end of the 2021 financial year.

Other updates

In addition to the trading result, the company announced its HyperCamera3 prototype has been tested in flight. Nearmap aims to roll out the next-generation camera system commercially sometime in FY22.

Nearmap also provided an update on the United States district court proceedings. It said that claims of patent infringement made by Eagle View Technologies, Inc and Pictometry International Corp are without merit. As such, Nearmap has engaged in internationally recognised patent litigators to lead its defence against the accusations.

A broker note from Citi came in the middle of May putting a price target of $2.00 for Nearmap shares. Although this is more than a month old, more brokers may weigh in the company’s share price target following yesterday’s release.

Despite plenty of peaks and troughs along the way, the Nearmap share price remains relatively unchanged when compared to this time last year and for the 7 months in 2021.

The post Why the Nearmap (ASX:NEA) share price is up 20% in a month appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras owns shares of Nearmap Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Nearmap 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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Banking, mining, retail, technology — we all know the ASX sectors that investors favour.

But what about some of the lesser-known industries?

If most people are backing companies in the same old fields then surely there must be some underpriced gems in niche areas?

When The Motley Fool spoke to Cyan Investment Management portfolio manager Dean Fergie recently, he picked 2 shares that he considered the best buys currently.

And they both play in unusual sectors.

Steady-earning ASX share is working on the ‘one big winner’

Melbourne electronic games developer Playside Studios Ltd (ASX: PLY) floated on the ASX last December.

Fergie noted that game makers can go down one of two paths. Either create original content or make software for other companies, such as movie studios.

“Playside has got a really, really good blend of building games for the other big studios. So that revenue is more defined, a lot lower risk,” he told this week’s Ask A Fund Manager.

“But what they’re also doing is developing their own IP in games and working towards having that one big winner down the track — be it console, mobile or PC.”

Hitting that ‘home run’ makes or breaks most games developers.

“It’s almost like running a movie studio. If you’ve got enough content, you’re going to get that one big hit that really builds the company.”

Playside shares entered the ASX with an initial public offering (IPO) price of 20 cents. That immediately doubled to 41 cents within a few hours of listing.

That IPO hype has now died down, with the stock going for 30 cents on Tuesday afternoon.

A famous name who found an absolute steal

Did you know television chef Maggie Beer has an ASX-listed company named after her?

Fergie is a fan of Maggie Beer Holdings Ltd (ASX: MBH), which focuses on producing gourmet food and drinks.

“Everyone knows the Maggie Beer name,” he said.

“But most excitingly, a couple of months ago, they bought an online business called The Hamper Emporium. And we think they got that at an absolute steal.”

According to Fergie, having this online presence perfectly complements the existing physical business.

“We think as entertainment is kind of subsiding a bit — you’re not thanking your customers anymore by taking them to the footy or the Grand Prix or the Olympics,” he said.

“This hamper kind of gifting is going to continue to boom.”

Maggie Beer, which has its namesake on the board, has seen its shares slide down 21.4% for the year. However, the stock is up 75% in the past year.

Fergie still can’t believe how little the company paid for The Hamper Emporium.

“They paid about a third of the multiple. I actually don’t know how they got it so cheaply, but they did.”

The post 2 hot ASX shares playing in niche sectors appeared first on The Motley Fool Australia.

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• ‘That hurts’: Fund manager reveals his 35-bagger ‘failure’

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

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If you’re unhappy with the low interest rates on offer with savings accounts and term deposits, then you might want to look at the numerous dividend options on the Australian share market.

Two ASX dividend shares that could help you beat low rates are listed below. Here’s what you need to know about them:

Rio Tinto Limited (ASX: RIO)

Rio Tinto could be an ASX dividend share to look closely at. It is one of the world’s largest miners with a portfolio of world class operations across a number of commodities. One of those commodities is of course iron ore, which is currently commanding sky high prices.

This bodes particularly well for Rio Tinto given how the steel making ingredient contributes significantly to the company’s earnings. It is thanks to this that analysts at Macquarie are forecasting bumper earnings and dividends from the mining giant in the near term.

The broker has pencilled in fully franked dividends per share of ~$13.19 in FY 2021 and ~$11.16 in FY 2022. Based on the latest Rio Tinto share price of $128.36, this equates to very generous yields of 10.3% and 8.7%, respectively.

Macquarie currently has an outperform rating and $163.00 price target on the miner’s shares.

Super Retail Group Ltd (ASX: SUL)

Another ASX dividend share to look at is Super Retail. It is the retail conglomerate behind the BCF, Macpac, Rebel, and Supercheap Auto brands.

Super Retail has been a strong performer in FY 2021 thanks to a combination of the favourable redirection of consumer spending during the pandemic and its strong brands and market position.

According to the company’s most recent update, its like for like sales were up 28% during the first 44 weeks of FY 2021 compared to the prior corresponding period. In addition, Super Retail’s elevated gross margin had remained stable since the end of the first half. This bodes well for its full year profit growth.

One leading broker that is positive on the company is Goldman Sachs. In fact, it suspects that a special dividend could be paid in August. As a result, Goldman is forecasting an 84 cents per share fully franked dividend for FY 2021. Based on the latest Super Retail share price of $12.62, this represents a 6.7% yield.

Goldman Sachs has a buy rating and $15.00 price target on its shares.

The post 2 high quality ASX dividend shares with very big yields 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 owns shares of and has recommended Super Retail 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 Kogan Ltd (ASX: KGN) share price could be an interesting one to think about at the current levels.

What is Kogan?

Kogan is a portfolio of retail and services that includes a large variety of businesses. Here are some of them: Kogan Retail, Kogan Marketplace, Kogan Mobile, Kogan Internet, Kogan Insurance, Kogan Travel, Kogan Money, Kogan Cars, Kogan Energy, Dick Smith, Matt Blatt and Mighty Ape.

It aims to offer those products and services to customers at a low cost thanks to digital efficiencies.

The company says it’s focused on making in-demand products and services more affordable and accessible.

Why the Kogan share price could be attractive

1: Cheaper Kogan share price valuation

Over the last six months, the Kogan share price has dropped by around 44%. In just the last three months it has declined by 17%.

That means that the business is not only cheaper, but it could be better long-term value.

In the last few months, Kogan has told investors about demurrage issues, but that has been resolved and does not expect any material demurrage issue to arise in the future.

Management said a key challenge during COVID-19 so far has been managing inventory levels to support its growth and then having too much after building up its inventory levels. That led to higher warehousing costs, and it has also led to increasing promotional activity, which meant a lower near-term gross profit margin and higher near-term marketing costs.

Management expect the business to return to normal levels (relative to the size of the business) and marketing spend as the inventory is reduced.

According to Commsec, the Kogan share price is valued at 23x FY23’s estimated earnings.

It’s also expected to pay a fully franked dividend of $0.34 per share in FY23. That translates to a grossed-up dividend yield of 4.3%.

2: Operating leverage

Prior to having those inventory issues, Kogan had been demonstrating operating leverage through the business.

In its FY21 half-year result, it reported that gross sales grew 97.4%, gross profit rose 126.2%, earnings before interest, tax, depreciation and amortisation (EBITDA) went up 132.4% and net profit after tax (NPAT) grew 164.2%.

Indeed, in the prior two first half periods, it had seen an increased in its gross profit margin, the contribution margin and the EBITDA margin.

Kogan had been experiencing scale of efficiencies, allowing profit to grow faster than sales. It has been investing in a number of areas for long-term growth. That includes improvements to its logistics network, speed of delivery, range expansion, and improved competition on the platform to improve the experience for customers.

It has pointed out that it’s experiencing repeat business from new customers. Kogan said more customers is expected to have ongoing long-term benefits as active customers continue repurchasing.

3: Increasing earnings diversification

The company has been looking to diversify its earnings away from the core Kogan ‘exclusive brands’ and ‘third party brands’ offerings. Kogan Marketplace is seeing rapid growth, although this is from a small base. In the third quarter of FY21, Kogan Marketplace saw sales jump 104% year on year to $5.1 million.

In that same third quarter, Kogan Mobile saw growth of revenue of 23.8% to $3.5 million.

One of the biggest things that Kogan has done is buy Mighty Ape, which is a New Zealand business which Kogan said was the number one retail specialist.

Kogan said that Mighty Ape has fast-growing exclusive brands, which are driving margins higher. It also operates its own purpose built distribution centre, allowing room for future growth.

Mighty Ape is already generating a sizeable part of the overall profit. In the third quarter of FY21, Mighty Ape made $6.1 million of the total $44 million gross profit generated across the business.

The post 3 reasons why the Kogan (ASX:KGN) share price could be 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. owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com 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 Afterpay Ltd (ASX: APT) share price and the Zip Co Ltd (ASX: Z1P) share price could come under pressure on Wednesday.

This follows speculation that tech behemoth Apple is planning to enter the buy now pay later (BNPL) market.

Apple Pay Later

According to Bloomberg, Apple is reportedly working on a new service that will let consumers pay for any Apple Pay purchase in instalments.

The new offering, which is known as Apple Pay Later internally at Apple, will use investment bank Goldman Sachs as the lender for the instalment loans.

The two companies currently work together on the Apple Card credit card. Though, the report highlights that this new offering will not be tied to the card and consumers do not require the use of one.

Why would Apple enter BNPL?

The report suggests that Apple is interested in entering the BNPL market to help drive Apple Pay adoption and convince more users to pay for items using their iPhone instead of traditional debit or credit cards.

This would be another boost for the tech giant’s US$50 billion per year services business, with Apple receiving a percentage of transactions made with Apple Pay.

How will it work?

The new Apple Pay Later service is reportedly a mix of the Afterpay and Zip models, with two options for consumers to choose from. These are known internally as Apple Pay in 4 and Apple Pay Monthly Instalments.

Bloomberg understands that that when a user makes a purchase via Apple Pay on their Apple device in store or online, they will have the option to pay across four interest-free payments made every two weeks, or across several months with interest.

It also notes that users who want to use the Apple Pay Later service will need to be approved via an application submitted through the iPhone’s Wallet app. This is also where users will manage their payments.

Apple has declined to comment on the speculation.

How will Afterpay and Zip shares react?

Unfortunately for shareholders, it looks set to be a tough day for the Afterpay share price and the Zip share price.

In response to this news, the US-listed Affirm share price crashed 10% during overnight trade. This doesn’t bode particularly well for other BNPL shares today.

The post Afterpay and Zip shares on watch amid Apple Pay Later speculation 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 AFTERPAY T FPO, Affirm Holdings, Inc., Apple, and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia has recommended Apple. 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 will be one to watch closely today.

This follows the release of an announcement after the market close on Tuesday.

Why is the NAB share price on watch?

Late yesterday afternoon the banking giant confirmed speculation that it interested in acquiring the Australian Consumer business of Citigroup.

NAB commented: “Following media speculation, NAB confirms it is in discussions with Citigroup about the potential acquisition of its Australian Consumer business. NAB regularly assesses opportunities to acquire businesses that support its growth strategy in core banking markets.”

However, the big four bank has warned the market that there is no certainty these discussions will lead to a transaction. It will update the market further if and when appropriate.

How close is a deal?

According to the AFR, a $2 billion deal could be a lot closer to being sealed than NAB is leading on.

It is reporting that NAB has appointed Bank of America to help it secure the business, through an auction that is understood to be in the final stages. And, importantly, NAB is emerging as a frontrunner in the auction.

This deal has the potential to be a positive for the NAB share price. The banking giant reportedly believes it will help grow its retail book and is attracted to Citi’s expertise in unsecured lending. It also notes that it would be aligned with NAB CEO Ross McEwan’s simple and digital strategy, with some 90% of its 1 million customers coming to the lender through digital channels.

The report suggests the deal would add $11.5 billion in total residential loans and finance leases in Australia to NAB’s books. This includes $6.6 billion in housing loans and $3.6 billion in credit cards.

The NAB share price is up a sizeable 14.5% since the start of the year.

The post NAB (ASX:NAB) share price on watch after confirming Citi acquisition interest 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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The Select Harvests Limited (ASX: SHV) share price has gone up around 23% over the last month.

What is Select Harvests?

Select Harvests is a vertically integrated almond business, consisting of almond orchards, processing (hulling, shelling, roasting, slicing etc), trading (industrial products) and consumer products (through brands like Lucky and Sunsol).

It’s one of the largest Australian almond companies, supplying almonds domestically and internationally, to supermarkets, health food stores, other food manufacturers, retailers and the almond trade.

What has happened recently?

Yesterday, the business gave an update about the 2021 crop and current market conditions.

Select Harvests said that its 2021 harvest has been completed and all of the 2021 crop has been delivered to the Carina West processing facility in Victoria.

With over 60% of the crop processed, the nut company estimated that the crop volume, including from the acquisition of the Piangil orchard, will be approximately 28,250 MT, up around 21% from the 2020 crop volume of 23,250 MT.

Select Harvests said that processing productivity is continuing to improve, with investments in technology delivering efficiency gains and improving quality after leaving the farm.

Market conditions

Select Harvests also said that the almond industry has experienced significant growth in global demand across all markets, particularly in the markets of India, Europe and China.

Australian almond exports year on year are up 54%, with the South and Central Asian (India) market up 200%, Europe up 69% and the North East Asian (China) market up 9% during the period.

Continued strong shipment numbers and the worsening drought situation in California have led to an appreciation in almond pricing of between 5% and 10% over the last six months.

In the last few days, the US Department of Agriculture released the 2021 objective crop estimate for the 2021 US almond crop of 2.8 billion pounds, down 12.5% on the 3.2 billion pound subjective estimate released on 12 May 2021. With the California drought worsening in recent months, Select Harvests said the subjective estimate has proven to be too optimistic.  

Select Harvests said that forward commitments for California’s 2021 crop are down 29% compared to the same period last year with growers reluctant to sell and waiting to understand the potential impact of the drought on supply.

The business said that 60% of its 2021 crop is committed at prices in the range of A$5.90 per kilo and A$6.40 per kilo. However, the un-committed portion of the crop is the lower value grades. Select Harvests also said that 90% of the crop is covered at an exchange rate of 0.73AUD/USD and the current market price is in the range of A$6.20 to A$6.60.

Both Australian and US processors are experiencing some shipping delays due to container shortages. But Select Harvests said that it’s only experiencing minor related cashflow delays.

Management said development of Select Harvests’ 2022 crop is progressing well with good tree health, according to management. Volumes are benefiting as younger orchards reach maturity. Water supply and pricing is “much improved”.

Leadership commentary on the outlook

Paul Thompson said:

Record almond shipments and the worsening Californian drought have led to a recent price appreciation. Demand for almonds, both in their natural form and as a value-added food ingredient, in products such as plant based milks and yoghurts, continues to grow. Thanks in part to the December 2020 acquisition of Piangil Almond orchard, Select Harvests is set to achieve a record almond crop of 28,250MT in 2021. With good progress being made on the 2022 crop, Select Harvests remains focused on the factors within its control, including almond volume, quality, value adding and operating costs.

The post Why the Select Harvests (ASX:SHV) share price is up 23% in a month appeared first on The Motley Fool Australia.

More reading

• ASX 200 flat, Select Harvest jumps, Nearmap soars
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• Why the Select Harvests (ASX:SHV) share price is soaring 15% today
• Select Harvests (ASX:SHV) share price hits new 52-week high

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 Tuesday the S&P/ASX 200 Index (ASX: XJO) gave back its morning gains and ended broadly flat. The benchmark index ended the day at 7,332.1 points.

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

ASX 200 futures pointing higher

The Australian share market looks set to edge higher on Wednesday. According to the latest SPI futures, the ASX 200 is expected to open the day 8 points or 0.1% higher this morning. This is despite it being a poor night on Wall Street, which saw the Dow Jones fall 0.3%, the S&P 500 drop 0.35%, and the Nasdaq tumble 0.4% lower.

Apple to enter BNPL market

It could be a tough day for the shares of Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) on Wednesday amid speculation that Apple is going to enter the buy now pay later (BNPL) market. According to Bloomberg, the upcoming service, known internally as Apple Pay Later, will allow consumers to pay for any Apple Pay purchase in instalments. Apple will use Goldman Sachs as the lender for the instalment loans.

Oil prices push higher

Energy producers such as Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could rise on Wednesday after oil prices pushed higher overnight. According to Bloomberg, the WTI crude oil price is up 1.6% to US$75.31 a barrel and the Brent crude oil price is up 1.8% to US$76.51 a barrel. Traders were buying oil on the belief that US crude stockpiles are falling.

NAB confirms Citi interest

The National Australia Bank Ltd (ASX: NAB) share price will be on watch today. This follows the release of an announcement that confirms that the banking giant is interested in acquiring the Australian Consumer business of Citigroup. NAB advised that it is in discussions with Citi but warned that there is no certainty these discussions will lead to a transaction.

Gold price edges higher

Gold miners Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) will be on watch after the gold price edged higher. According to CNBC, the spot gold price is up 0.15% to US$1,808.50 an ounce. This was despite the release of a stronger than expected US inflation report.

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

More reading

• 3 ASX growth shares named as buys
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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 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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Exchange traded funds (ETFs) can be a fantastic way to balance out your portfolio. This is because ETFs provide investors with easy access to a large and diverse group of shares that you wouldn’t normally have access to.

With that in mind, I have picked out two ETFs that are popular with investors right now. Here’s what you need to know about them:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The first ASX ETF to look at is the BetaShares Global Cybersecurity ETF. This increasingly popular ETF gives investors exposure to the leading companies in the global cybersecurity sector.

Included in the fund are a number of global cybersecurity giants and emerging players that appear well-positioned to benefit from the increasing demand for cybersecurity services. Among the companies you’ll be buying a piece of are Accenture, Cisco, Cloudflare, Crowdstrike, Okta, and Splunk.

In respect to CrowdStrike, it is a provider of incident response and forensic analysis services via its Falcon platform. CrowdStrike’s services are designed to help businesses understand whether a breach has occurred. It then allows the user to respond and recover from a breach with speed and precision to remediate the threat.

As for Okta, it provides businesses with workforce identity solutions. This ensures that information is only accessed by those that are meant to have it. Management is positive on its growth prospects and is guiding to US$4 billion in annual revenue by FY 2026. This implies compound annual growth of at least 35% over the next five years.

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

Another ETF to consider is the VanEck Vectors Video Gaming and eSports ETF. This ETF gives investors exposure to a portfolio of the largest companies involved in video game development, eSports, and gaming related hardware and software globally.

VanEck points out that these companies are well-placed to benefit from the increasing popularity of video games and eSports. Among the companies included in the fund are the likes of Nvidia and game developers Activision Blizzard, Take-Two and Electronic Arts.

Take-Two is the company behind the Grand Theft Auto and Red Dead franchises. Whereas Electronic Arts is the company that makes the FIFA and Madden NFL series and Activision Blizzard is behind the Call of Duty series.

As for Nvidia, it is the graphics processing unit (GPU) developer that sparked the growth of the PC gaming market in 1999. Since then, its GPU deep learning ignited modern artificial intelligence, which is the next era of computing. The company’s technology is also used by cryptocurrency miners, giving investors indirect exposure to this growing market.

The post 2 quality ETFs that could give your portfolio a big boost 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 BETA CYBER ETF UNITS. The Motley Fool Australia owns shares of and has recommended BETA CYBER ETF UNITS. The Motley Fool Australia has recommended VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports 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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