Tag: Motley Fool

Coinbase Global Inc (NASDAQ: COIN) officially listed on the NASDAQ exchange last night. The debut was anything but boring, with the Coinbase share price demonstrating plenty of volatility.

From the open, the cryptocurrency exchange began trading at US$381 per share – representing a 52% premium to its initial public offering (IPO) reference price of US$250. The company’s shares then quickly proceeded to rally to an intraday high of US$429. Unfortunately for new shareholders jumping in, it was downhill from there. Coinbase gradually slid 23% from its high to close its first day at US$328.28 – 31% above its reference price.

A long journey to the beginning

Motivated by the mission to make cryptocurrency easy to use, Coinbase has gone from a startup working out of a small San Francisco loft, to the first major crypto exchange publicly listed.

When the company originally was founded by Brian Armstrong and Fred Ehrsam, Bitcoin (CRYPTO: BTC) was worth US$6 a coin. Roughly 9 years later, the original digital currency is now worth US$62,825 a coin.

Over those years, Coinbase has worked on building a more fair, accessible, efficient, and transparent financial system made possible by cryptocurrency. But it hasn’t been a straightforward path.

Given the speculative nature of Bitcoin, the company rode the violent Bitcoin price rollercoaster. The bear markets being particularly difficult. Between 2014 and 2017 Coinbase lost over a third of its employees, with many thinking the digital currency was dead.

Despite the challenges, Coinbase has pulled through, riding the Bitcoin wave to new heights. Although, Coinbase believes that it’s only the beginning.

Coinbase shares in Bitcoin’s ambition

Co-founder, Brian Armstrong sees plenty of opportunities still to come for the company. Like the anonymous creator of Bitcoin, Satoshi Nakamoto, Armstrong wants to create economic freedom through Coinbase and cryptocurrency.

In a tweet today, Armstrong pointed out that increased economic freedom correlates with higher gross domestic product growth and life expectancy, among other advantageous attributes.

23/ Societies with greater economic freedom have higher GDP growth and life expectancy, less war and corruption, better treatment of the environment, and higher income of the poorest 10% of people in society.

— Brian Armstrong (@brian_armstrong) April 14, 2021

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It will be interesting to see how Coinbase navigates future unchartered waters. The higher unpredictability creates a whole new level of uncertainty for investing in Coinbase shares, not to mention regulatory issues. For now, we can acknowledge that last night marked a watershed moment for the crypto-ecosystem. 

After the volatile share price movements, Coinbase’s market capitalisation finished its first day at US$85.8 billion.

More reading

• The Coinbase (NASDAQ:COIN) IPO price has been announced
• Bitcoin price hits new record high as Bitcoin ETF tops $1.3 billion
• The DigitalX (ASX:DCC) share price is up 30% this week
• What’s driving the Bitcoin price higher?
• Will this Nasdaq IPO send the Bitcoin price back to record highs?

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

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Late buying activity pushed the IOUpay Ltd (ASX: IOU) share price 18.67% higher to 44.5 cents on Wednesday. The renewed buying interest will come as a welcome relief to shareholders, with IOUpay shares having fallen by around 23% since 2 March. 

What’s driving the IOUpay share price? 

Continued momentum in BNPL service

Last Tuesday, IOUpay announced it had signed a strategic teaming agreement with Malaysia’s MYP1 to integrate with its Smart POS system. 

This agreement will see MYP1 refer its merchants to IOUpay’s services, including buy now, pay later (BNPL). The company has described this opportunity as one which will fast track its market penetration across large numbers of merchants into its BNPL payment services. 

Life coming back into the broader BNPL sector 

IOUpay isn’t the only ASX-listed BNPL provider notching up some gains lately.  

BNPL leaders such as Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P) and Sezzle Inc (ASX: SZL) have all risen by more than 20% in April, indicating a return of investor appetite into the sector. 

Even the broader S&P/ASX 200 Info Tech Index (ASX: XIJ) has surged 12% so far this month, putting fears over rising bond yield somewhat behind us. 

BNPL leaders eyeing Asian expansion 

In a ‘Digital Payments in SEA‘ presentation on 16 March, IOUpay described the South East Asia opportunity as follows: 

The ‘Sweet Spot’ for BNPL is larger in SEA due to the lack of consumer credit and underbanked populations overlaid with mobile penetration levels and the ever increasing growth in e-payments which facilitate BNPL offerings and adoption rates.

It could be for these reasons that Afterpay and, more recently, Zip have been targeting an expansion into the South East Asian region. 

Afterpay announced an early-stage investment into Asia back in late 2020, with an established base in Singapore to drive early development. It could also potentially leverage ties with its substantial shareholder, Tencent Holdings for opportunities. 

Similarly, Zip’s quarterly update highlighted the strategic acquisition of leading Philippines BNPL player, TendoPay. 

While the billion-dollar-plus market capitalisation BNPL companies have started to take interest in the SEA region, IOUpay is also gaining a foothold in the market and has a market cap of just $245 million. 

More reading

• Is the Klarna / Flybuys partnership the future for ASX BNPL providers?
• 5 things to watch on the ASX 200 on Thursday
• 2 outstanding ASX growth shares to buy now
• Could the Galaxy (ASX:GXY) share price be next to raise capital after Zip (ASX:Z1P)?
• Why the Zip (ASX:Z1P) share price is in a trading halt

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 ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Sezzle Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the IOUpay (ASX:IOU) share price is up 15% this week appeared first on The Motley Fool Australia.

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The Viva Leisure Limited (ASX: VVA) share price is one to watch in early trade after a quarterly update from the Aussie leisure group.

Why is the Viva Leisure share price on watch?

Viva Leisure reported stronger membership numbers for the quarter ended 31 March 2021 (Q3 FY21). Direct member numbers totalled 120,300, up from 117,000 on 25 February 2021. Plus, Fitness membership increased to 177,551 compared to 172,364 members in February.

Membership suspensions have reportedly remained in line with management expectations at 4,461, down from 4,700 in February.

Today’s update means Viva Leisure has grown its direct membership base by 313.1% since FY2017 when it recorded 29,124 members.

The Viva Leisure share price is on watch this morning following the update. As at yesterday’s close, shares in the leisure group were trading at $2.60 with a $213.1 million market capitalisation.

Viva Leisure this morning reported an increased annual revenue run rate. That now sits above $95 million, up from $90 million in January 2021, with March bringing in $8.1 million.

The Aussie company has appointed Gordon Martin as head of franchising. He is a former general manager of Anytime Fitness Australia with success managing brands in the fitness industry. According to the release, the appointment is part of a master plan to rapidly expand the Plus Fitness network across Australia and overseas.

Viva Leisure now has 107 operating corporate locations in its portfolio, and all are open without restriction. The company has reportedly secured a further 20 locations, with the majority opening during FY2022.

Foolish takeaway

The Viva Leisure share price is in focus early this morning after a quarterly update from the gym operator. Shares in the company are up 52.1% in the last year after being smashed in the March 2020 bear market but have struggled to climb higher in 2021.

The All Ordinaries Index (ASX: XAO) has climbed 4.7% this year to 7,280.6 points, while the Viva Leisure share price is down 11.3% to start the year.

More reading

• Why the Wisr (ASX:WZR) share price is on the move
• ASX 200 Weekly Wrap: ASX sees 7,000 points once more
• Why the Fatfish (ASX:FFG) share price is soaring today
• What’s happening with the Musgrave Minerals (ASX:MGV) share price?
• Why the McGrath (ASX:MEA) share price is climbing today

Motley Fool contributor Ken Hall 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.

The post Why the Viva Leisure (ASX:VVA) share price is one to watch appeared first on The Motley Fool Australia.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Bernie Madoff has died at the age of 82. Convicted of fraud against a massive group of investors in a Ponzi scheme involving tens of billions of dollars, Madoff remained in prison until his death.

Madoff’s story involves a professional investor who had had a successful career before taking things one step too far. Unable to live up to the commitments he had made to the many investors who turned to him for help, Madoff successfully covered up his activities for years. It was only when the financial crisis brought things to a head that the full extent of Madoff’s fraud became evident, leading to his arrest, trial, conviction, and 150-year sentence.

As painful as the Madoff episode was for the many investors snared by his scheme, it holds some valuable lessons that every investor can learn from. Perhaps the most important is that even after Madoff’s death, the risk of securities fraud remains alive and well.

1. It’s easy to follow the bandwagon over the cliff

One reason why Madoff was able to sustain his Ponzi scheme as long as he did was that it was easy for new investors to think that they were getting in on a great investment. Early on, Madoff attracted high-profile investors, including prominent charitable institutions. He didn’t advertise his business, instead relying on word of mouth from existing clients to bring in new money. By cultivating an air of exclusivity and success, Madoff could largely just sit back and wait for customers to come to him.

Investors need to do their own due diligence to decide if an investment is suitable for them. Relying on friends or business associates for help is common, but it’s only the start. If the only reason you invested in something is because somebody else made the same investment, you won’t know what to do when things go wrong — and you risk jeopardizing your relationships as well as losing money.

2. Know what you’re investing in

Most investors in Madoff’s investment scheme had little or no idea how his purported investment strategy was supposed to work. Few cared. As long as the returns seemed to be coming in — at least on paper — many investors were satisfied at what they saw as a job well done. It therefore came as a total shock when they found out exactly what Madoff was doing with their money and why it went wrong.

There are still many investments that are crafted with complex provisions that aren’t easy to understand. Even with simple stocks, the businesses that companies are engaged in can be almost impossible for someone outside the field to grasp. You don’t necessarily have to become an expert in every industry in which you invest, but you do need to know how you’ll make money and what risks there are. Only then can you accurately assess whether you’re making a smart calculated risk with that investment.

3. Diversify

When you have a great investment idea, it’s tempting to put all your money into it. That’s exactly what many of Madoff’s clients did, feeling that they’d never be able to match the performance that his investments were generating. That proved to be catastrophic in many instances, as institutions found themselves with huge losses that endangered their entire operations.

No matter whether you’re talking about a fraudulent scheme like Madoff’s or a completely legitimate yet misguided investment strategy like the doomed Long Term Capital Management experiment, no investment is free of risk. Unless losing everything is an option you’re willing to accept, it’s always worth it to find a second-best, third-best, and even tenth-best investment idea to go along with your top investment. That way, if things go catastrophically wrong, your losses won’t be quite as severe.

A road paved with good intentions

Madoff’s death will feel like justice for what many have seen as evil deeds motivated by greed. Yet as Diana Henriques, author of The Wizard of Lies: Bernie Madoff and the Death of Trust, told the Fool’s Mac Greer in 2017, neither Madoff nor his clients were as greedy as some believed. In the video clip below, Henriques argues that clients wanted security for their money, while Madoff wanted the adulation and fame of helping prominent charities and other institutions.

Unfortunately, even after Madoff’s death, there are still plenty of people out there seeking to take advantage of investors, both through fraud and by more legitimate means. No one can protect your money as effectively as you can, and the Madoff scheme is a good reminder that you have to be constantly vigilant to avoid investments that end up being too good to be true.

The Motley Fool has a disclosure policy.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• Why the Transurban (ASX:TCL) share price is in focus
• This ASX telco and bank will go gangbusters: fundie
• Bank of Queensland (ASX:BOQ) share price on watch after solid half year update
• 3 exciting small cap ASX shares to watch closely
• 3 ASX shares to buy for the real estate explosion

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Transurban Group (ASX: TCL) share price is one to watch in early trade after a quarterly update from the Aussie toll road operator.

Why is the Transurban share price on watch?

Transurban’s March 2021 quarter was headlined by average daily traffic (ADT) increasing 1.1% in 2020 while falling 3.8% compared to 2019 numbers.

Notably, traffic in Sydney recovered to pre-COVID-19 levels as restrictions were broadly lifted for the duration of the quarter. Sydney ADT increased by 21.8% to 936,000 trips with average workday traffic up 20.1%. Average weekend/public holiday traffic increased by 28.1% for the quarter. Both car and large vehicle traffic increased overall traffic numbers across Sydney’s major roads.

Brisbane was another strong market for Transurban during the quarter. Quarterly ADT volumes in Brisbane climbed 3.3% to 403,000 trips with average workday traffic up 2.8%.

The Transurban share price will be worth watching after the company reported a mixed set of numbers across its portfolio. While Sydney and Brisbane performed strongly amid weakened restrictions, Melbourne and North America struggled. Traffic numbers were down across both regions as restrictions and reduced movement persisted.

Melbourne ADT was down 15.2% to 675,000 transactions with average workday traffic down 15.3%. Transurban cited periods of lockdown as a key factor in the softer numbers.

North America ADT fell 26.9% to 101,000 trips during the period with lower numbers in Washington, Virginia and Montreal.

The Transurban share price has climbed 7.3% higher in the last 12 months and boasts a $37.8 billion market capitalisation. Shares in the Aussie toll road operator were smashed in the March 2020 bear market as investors tried to price in the impacts of coronavirus restrictions and widespread work from home orders.

Foolish takeaway

The Transurban share price will be in focus today after a mixed set of traffic numbers in this morning’s update. Stronger Sydney and Brisbane numbers were offset by lower figures across Melbourne and North American markets for the quarter.

More reading

• ASX 200 Weekly Wrap: ASX sees 7,000 points once more
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• Why the Transurban (ASX:TCL) share price is on watch

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Transurban Group. 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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Ask A Fund Manager

The Motley Fool chats with fund managers so that you can get an insight into how the professionals think. In part 1 of our interview, SG Hiscock High Conviction Fund portfolio manager Hamish Tadgell reveals which bank makes his mouth water for fat dividends and how he still has a soft spot for a small-cap fibre optics telco.

Transition from hope to growth

The Motley Fool: When you spoke to us in January, you felt like share markets were in a transition from ‘hope’ to ‘growth’. Do you still think that’s the case, or has it moved on to something else?

Hamish Tadgell: I think it is still the case. The growth recovery continues to play out on the back of the [COVID] vaccine rollout, the easing monetary and fiscal policy and the economy’s continuing to reopen. Also, everyone’s learning to live with the virus a little bit better, I think. In terms of not just the social distancing, but just managing that.

The February reporting season was a bit of a litmus test for that growth recovery. That really affirmed that the growth recovery is in train. Sixty per cent of companies beat consensus EPS forecasts. 

Having said that, the other thing which is clearly in play at the moment is rising inflation expectations and views around rising bond [yields]. With that hope to growth, there’s been a pick up in economic growth, and that’s now also fed into questions about ‘Will that deliver rising inflation?’.

This is going to consume a lot of the market’s focus for the next 12 months or so. There doesn’t seem to be a clear consensus on the inflation outlook at the moment. 

The question is: Is it cyclical and related to the reopening and recovery? Or is it more structural in nature? 

I think if you step back, the risk is that inflation expectations have increased, and that’s reflected in building rising bond yields. And shifting expectations actually matter because, at the end of the day, it’s that that really moves markets. 

Great expectations for banks and telcos

MF: What are your two biggest holdings currently?

HT: First of the biggest holdings, in an active sense, is Uniti Wireless, or Uniti Group Ltd (ASX: UWL), as it’s now called. I think we spoke about that last time.

We’ll see it very much as a COVID beneficiary. I think COVID shone the light on the fact that fibre and fibre networks are critical social infrastructure. 

The other thing that is working in Uniti’s favour, at the moment, is the recovery we’re seeing in the housing market – because Uniti basically rolls out fibre to greenfield residential development and high rise apartments. 

Clearly, the high rise has been impacted, but we are seeing continued strong indications and I think the first homeowner initiatives the government’s put in place and the like are clearly driving the resurgence in demand for housing, and we’re seeing that also in house prices as well.

We continue to see Uniti very well-positioned, and it’s a smaller cap stock that’s fast becoming a mid-cap stock. And it’s really being driven by consolidation… it bought OptiComm Ltd, it also bought Telstra Corporation Ltd (ASX: TLS)’s Velocity business. 

Fibre is now seen as social infrastructure, and that’s reflected also in Macquarie Group Ltd (ASX: MQG)’s recent bid for Vodafone. Also, super funds [are] taking a much more active interest in this area.

Our other second largest active position is National Australia Bank Ltd (ASX: NAB). That’s really just a more constructive view on the banks probably since about September, October last year. 

That is reflective of the fact that we’ve come through the pandemic probably better than most would have expected 12 months ago. Loss rates and provisions look like they’ll be lower. The banks have taken significant provisions last year, and we think that some of those will be unwound over the course of the next 12 months. 

Not to say that there won’t be losses and clearly, the JobKeeper unwinding is a risk that you will see more business failures.

But overall, we think that there’s the potential for the banks to release capital [and] increase dividends. And in an environment where rates are rising, albeit modestly, net interest margin [could move] to more neutral – maybe even slightly positive – for the banks.

So we continue to see upside in the banks, particularly on the dividend side.

Tomorrow in part 2 of our interview, Tadgell reveals two ASX stocks that were paralysed in 2020 but are raring to go this year.

More reading

• ASX 200 rises above 7,000, Resolute Mining soars, Galaxy jumps
• 2 fantastic blue chip ASX shares to buy in April
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Motley Fool contributor Tony Yoo owns shares of Macquarie Group Limited. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited and Telstra 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 Bank of Queensland Limited (ASX: BOQ) share price will be one to watch on Thursday.

This follows the release of the regional bank’s half year results this morning.

How did Bank of Queensland perform in the first half?

During the first half of FY 2021, Bank of Queensland achieved a 9% increase in cash earnings after tax to $165 million. This was driven by balance sheet growth, improved net interest margin (NIM), disciplined expense management, and lower loan impairment expense.

In respect to its NIM, the bank’s NIM increased by 3 basis points during the half to 1.95%. This improvement was largely due to lower funding costs from reduced deposit rates and lower wholesale funding costs. This was partially offset by asset pricing and mix, and the ongoing impact of the low cash rate.

Other metrics of note include a CET1 ratio of 10.03% (up 12 basis points) and its housing loan growth of 1.6x system.

This solid performance led to the Bank of Queensland board declaring a 17 cents per share interim dividend. This was up 11 cents per share from the prior corresponding period.

The bank’s CEO and Managing Director, George Frazis, said: “In the first half of our 2021 financial year, the BOQ Group has produced another strong performance and is building momentum, demonstrated by an uplift in statutory profit and cash earnings. This has been driven by above system asset growth, NIM improvement, cost discipline, and a strong capital position. These results reflect the Group’s sharp focus on our strategic priorities and the disciplined operational execution of our transformation plan.”

How does this compare to expectations?

The good news for shareholders and the Bank of Queensland share price, is that this result appears to be in line with expectations.

According to a note out of Goldman Sachs, its analysts were expecting a 9% increase in cash earnings to $164 million and a fully franked interim dividend of 17 cents per share.

Outlook

Also potentially giving the Bank of Queensland share price a lift today was its positive outlook commentary. Management appears optimistic on its future and notes that the economic outlook appears more positive and is showing encouraging signs of improvement. In light of this, the bank is guiding to a solid second half performance.

It commented: “We expect to deliver positive jaws of around 1% in FY21, driven by above system growth in lending, NIM positive in FY21 and broadly flat half on half, and cost growth of approximately 3%. BOQ Group remains prudently provisioned for any potential losses arising from the outcomes of COVID-19. We remain committed to sustainable profitable growth, supporting returns to shareholders and a dividend payout ratio target range of 60 – 75% of cash earnings.”

More reading

• 5 things to watch on the ASX 200 on Thursday
• Is the Bank of Queensland (ASX:BOQ) share price in the buy zone ahead of its results?
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• Is CBA (ASX:CBA) the best bank for dividends in 2021

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

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If you’re looking to gain exposure to the small side of the market, then you might want to take a look at the ASX shares listed below. 

Here’s why these three small cap ASX shares could be ones to watch:

Carbon Revolution Ltd (ASX: CBR)

Carbon Revolution is an advanced manufacturing company. It designs, manufactures, and markets single piece carbon fibre wheels for motor vehicles. By manufacturing wheels this way, the company is able to reduce their weight materially. Management estimates that these weight savings can result in up to 40% reductions in inertia, which is a very big deal for car companies that are always looking for ways to make their vehicles more efficient. Among its customers are car giants such as Ford and Ferrari.

Damstra Holdings Ltd (ASX: DTC)

Damstra is a growing integrated workplace management solutions provider. Its cloud-based workplace management platform is used by businesses globally to track, manage, and protect their workers and assets. Damstra has been a solid performer over the last couple of years and has continued this strong form in FY 2021. During the first half of FY 2021, the company delivered a 29.6% increase in revenue to $13.3 million. Given that management estimates that its total addressable market will be worth US$20 billion by 2022, this gives it a very long runway for growth. 

Pointerra Ltd (ASX: 3DP)

A final small cap to watch is Pointerra. It is a technology company focused on the global commercialisation of its unique 3D geospatial data technology. Pointerra provides a powerful cloud based solution for managing, visualising, analysing, and sharing massive 3D point clouds and datasets. This solves entrenched problems associated with digital asset management workflows and allows very large 3D datasets to be managed and analysed without the need for expensive and time-consuming high-performance computing. Management estimates that its market opportunity is currently worth an enormous $500 billion annually.

More reading

• 2 highly rated ASX tech shares to buy this month
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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 recommends Carbon Revolution Limited and Damstra Holdings Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointerra Limited. The Motley Fool Australia has recommended Carbon Revolution Limited, Damstra Holdings Ltd, and Pointerra 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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Australian real estate prices are skyrocketing, thanks to near-zero interest rates and record household savings built up from the COVID-19 downturn.

Residential housing, especially, is soaring at a speed not seen since the late 1980s.

But if you’re an ASX investor, how do you take advantage of this?

Shaw and Partners portfolio manager James Gerrish last week picked out 3 ASX shares involved in the property market that he sees bright prospects for.

This is what he told his Market Matters (MM) newsletter subscribers:

DEXUS Property Group (ASX: DXS)

Dexus owns and rents out commercial real estate, which obviously took a heavy hit when many Australians started working from home last year.

While there’s uncertainty about what demand for office space will be like in the post-COVID world, Gerrish believes this anxiety is already priced in.

“DXS is trading at a 12% discount to the value of its underlying assets versus an average 8% premium,” he told his subscribers.

“Couple this with a 5.5% projected yield over the coming 12 months and it’s easy to see why we added it to the MM income portfolio last month.”

The stock is currently trading at $10.09, with Gerrish backing it to break $11.

“MM believes that office demand will taper — but not by the magnitude that many think — and there is a natural offset through growth in employment,” he said.

“For most businesses, the office will remain the primary place of work, of course with more flexibility around the edges.”

Goodman Group (ASX: GMG)

A giant of the industrial real estate space, Goodman Group has been a major beneficiary of Australia’s shift to online shopping.

“Goodman is now the largest property company on the ASX with a market capitalisation of around $34 billion — about the same size as Afterpay Ltd (ASX: APT)!” said Gerrish.

The company enjoys a supplier relationship with e-commerce behemoth Amazon.com Inc (NASDAQ: AMZN), providing warehouse space for its Australian operations.

“They are currently building Amazon’s first Australian robotics fulfilment centre in western Sydney — a building the size of 22 football fields manned by around 2,000 robots,” Gerrish told his subscribers.

Unlike many other ASX real estate shares, Goodman does not provide a massive yield. But Gerrish likes its growth prospects.

“MM is bullish GMG targeting a move above $20.”

Goodman shares are currently trading at $18.65.

National Storage REIT (ASX: NSR)

This real estate investment trust is a landlord to a network of about 200 self-storage locations around the country.

Gerrish explained that just over a year ago, there was a 3-way battle to acquire National Storage. Two bidders offered $2.20 per share and a third bid $2.40.

“The deal looked like getting done, however along came COVID and the extreme market volatility saw the bid pulled,” he said.

“Now there’s talk of a revitalised bid and private equity firm Blackstone is also being thrown into the mix.”

The National Storage share price is currently trading at $2.17, offering a 3.41% yield.

More reading

• 2 fantastic blue chip ASX shares to buy in April
• This beaten-down ASX sector could soon be turning the corner
• 2 quality ASX dividend shares to buy next week
• 4 fantastic ASX shares with exposure to the cloud computing boom
• The National Storage (ASX:NSR) share price is at a 52-week high. Here’s why

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Tony Yoo owns shares of AFTERPAY T FPO and Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Amazon and recommends the following options: long January 2022 $1920 calls on Amazon and short January 2022 $1940 calls on Amazon. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Amazon. 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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Earlier this week, buy now, pay later (BNPL) payment provider Klarna Australia announced it has partnered with Flybuys in what the company is calling a “revolutionary” arrangement. But, what does this mean for ASX-listed BNPL shares?

Flybuys, a subsidiary of Coles Group (ASX: COL) and Wesfarmers Ltd (ASX: WES), has agreed to provide Australian Klarna users 3 Flybuys points for each Klarna ‘vibe’ point they transfer into their Flybuys account.

The deal is the first of its kind for an Australia-based BNPL company. Let’s take a closer look at the agreement between Klarna and Flybuys.

What is Klarna?

Klarna Bank is a Sweden-based FinTech company with its headquarters in Stockholm. It made headlines in Australia last year when it teamed up with Commonwealth Bank of Australia (ASX: CBA).

As previously reported by The Motley Fool Australia, Klarna is worth around US$31 billion to US$40 billion.

Every Klarna user gets a trophy

Klarna was the first of its kind to implement its own rewards system, and now it’s the first to implement someone else’s.

Klarna launched its ‘vibe’ rewards club in Australia in October 2020, offering users one vibe for every dollar spent through the BNPL platform. Now, the company has partnered with Flybuys, offering users the option to trade 1 vibe for 3 Flybuys points, though minimum transfer amounts apply.

According to Klarna, the concept encourages responsible spending since customers will only be rewarded for completed payments.

New Australia-based Klarna users who link their Flybuys account with the platform will receive 1500 Flybuys points upon the final payment of their first purchase.

Following the initial bonus, for their first 4 transactions, users must convert 250 vibes into 750 Flybuys points. After that, the next 4 transactions must convert at least 500 vibes into 1500 Flybuys points. Each conversion thereafter must consist of at least 750 vibes, with users receiving upwards of 2250 Flybuys points in return.

Klarna Australia country head Fran Ereira said the partnership is revolutionary:

Our partnership has been proudly designed for modern consumers. Shoppers want more flexibility in payment options so they can get what they want now, but they also want to be rewarded for taking this option. Klarna’s partnership with Flybuys will reward our customers by tripling their points collection and rewards potential.

Flybuys CEO John Merakovsky commented on the partnership, saying:

This partnership with Klarna opens up new opportunities for our members to collect points, and even more ways to be savvy with their shopping and be rewarded for it. We’re incredibly proud to welcome Klarna into the fold as our first buy now, pay later partner.

The partnership is set to take off in May, and all eyes will be on ASX-listed BNPL providers to see if they attempt to follow suit.

Will ASX BNPL companies follow Klarna’s lead?

Some BNPL providers already have their own, internally managed customer reward systems in place.

The largest listed on the ASX is Afterpay Ltd (ASX: APT), which offers top customers access to its Pulse rewards program. Pulse isn’t a points-based system. Rather, after completing 30 purchases through Afterpay and incurring no more than 3 late fees over 6 months, customers are invited to join the program. Pulse provides users with the benefits of more time to make payments, greater buying options and increased flexibility of payment.

The second-largest ASX BNPL provider, Zip Co Ltd (ASX: Z1P), doesn’t currently have a rewards system in place. However, it did offer its users 3% cashback from completed purchases between 16 November 2020 and 8 January 2021.

IOUPay Limited (ASX: IOU), the sixth-largest ASX listed BNPL provider by market capitalisation, has a typical rewards program. Within it, users earn points by shopping with the platform and can redeem them on future purchases through IOUPay.

Only time will tell whether competition among ASX-listed BNPL providers will heat up as a result of Klarna’s partnership with Flybuys, encouraging other big players in the space to seek out similar deals. 

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO, COLESGROUP DEF SET, and Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Is the Klarna / Flybuys partnership the future for ASX BNPL providers? appeared first on The Motley Fool Australia.

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