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If your portfolio is light on S&P/ASX 200 Index (ASX: XJO) alternative real estate shares, you may wish to run the old slide rule over it.

Traditional real estate shares are comprised of assets including offices, residential property, and retail property.

In contrast, alternative real estate shares are focused on assets including infrastructure, hospitals, schools, industrial facilities and data centres.

So why might you wish to up your exposure to ASX 200 alternative real estate shares?

I’m glad you asked.

Advantage alternative real estate shares

It’s no secret that the global pandemic has ushered in many years’ worth of changes in the investment markets in just a single year.

Chief among those changes has been the increased pace in the growth of digitalisation. With people working, shopping and socialising from their homes, the demand for data – and places to securely store that data – has rocketed.

Going hand in hand with that trend is also the need for more logistics space to accommodate the surge in online purchases. However, the ASX remains quite light on investment opportunities in these sectors.

Hence both ASX data centre shares and ASX logistics shares are among those on Goldman Sachs’ real estate radar.

As reported by the Australian Financial Review, alternative real estate accounts for more than 50% of the listed real estate sector in the United States. In Australia, that figure is closer to 10%.

Adrian Sheldon is Goldman Sachs head of real estate. According to Sheldon:

The Australian listed real estate market is significantly under-represented in alternatives, when you look at alternatives in other markets. So there is massive opportunity in alternative real estate here.

Sheldon adds that alternative real estate “is essential services real estate. What that means is that the underlying demand driver for this type of real estate is very strong, it is not going anywhere and people understand it”.

ASX 200 data centre shares and ASX 200 logistics shares

There is a range of quality shares trading on the ASX involved in data storage and a separate selection in logistics services.

On the larger end of the scale, that number is more limited for investors looking for ASX 200 listed shares.

For the purposes of this article, we’ll look at 1 blue-chip share from each sector.

First up is Centuria Industrial REIT (ASX: CIP). The real estate investment trust is Australia’s largest pure-play industrial REIT. It provides ASX 200 investors with shareholdings in quality logistics assets across Australia’s capital cities.

Over the past 12 months, the CIP share price is up 22%, trailing the 30% gains posted by the ASX 200. At the current price of $3.29 per share, CIP has a market cap of $1.8 billion. The REIT pays a 5.3% dividend yield, unfranked.

Turning to data storage, we have ASX 200 listed Nextdc Ltd (ASX: NXT). Among its assets and services, Nextdc owns 9 data centres across Sydney, Melbourne, Brisbane, Perth and Canberra.

Up 3% in intraday trading today, the NEXTDC share price is up 26% over the past 12 months. So far in 2021, shares have been slipping, down 11% year-to-date. At the current price of $11.05 per share, Nextdc has a market cap of $5.0 billion.

Nextdc’s current share price may represent a bargain. In February Goldman Sachs’s analysts placed a price target of $13.50 per share on the data centre’s stock. That’s 22% above the current share price.

More reading

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• NEXTDC (ASX:NXT) share price tipped to charge 28% higher
• 2 rapidly growing ASX shares that could be strong buys in April

Motley Fool contributor Bernd Struben 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 SEEK Limited (ASX: SEK) share price is continuing its upwards trend today following the release of Australian job advertisement data for March. At the time of writing the job marketplace provider’s shares are trading 3.16% higher at $29.75 a share.

Highest Job ads since post-GFC

On a day for good news, the Australia and New Zealand Banking GrpLtd (ASX: ANZ) reported another strong gain in job ads for the month of March. Reportedly, job advertisements in Australia increased by an additional 7.4% month-on-month, or 39.7% compared to this time last year.

As a result, job ads have hit a 12-year high – with the number reported not seen since November 2008. At that time Australia, and the world, was climbing out of the global financial crisis (GFC). Twelve years later, the world is clambering to recover from a crisis of a different kind – although economically the fallout is comparable.

The positive monthly growth makes for the tenth month of consecutive increases in job ads. A figure that has SEEK shareholders smitten, as the share price continues to exceed pre-COVID-19 levels.

SEEK share price and job ads break pre-pandemic levels

At 190,542 ads, positions looking to be filled have now exceeded pre-pandemic levels by roughly 52% when compared to January 2020. Unsurprisingly, SEEK and its share price have come along for the ride, being Australia’s number one employment marketplace.

A year on from a drastic 42% crash, the SEEK share price has now gained 108% in the last 12 months. Prior to the pandemic, the company’s share price hit an all-time high of $24. As of today, the company’s shares are trading 24% beyond that previous high.

Although job ads might be growing, the prior half remained challenging for the company. Group revenue lagged 6% compared to the prior corresponding period, while net profit after tax slumped 8% to $69.7 million.

A promising sign for unemployment

Job ad data in conjunction with the Reserve Bank of Australia’s (RBA) commentary remains optimistic for unemployment. This afternoon the RBA maintained the cash rate at 0.1%. Adding that Australia’s economic recovery has been stronger than expected with unemployment falling to 5.8% in February.

High job ads and a falling unemployment rate are certainly promising indicators for a healthier job market looking ahead. Given the prosperity of the job market is closely tied to SEEK’s share price success, this might have a bit to do with the recent lift. 

More reading

• ASX 200 up 0.9%: Cleanaway jumps, tech shares rise, Incitec Pivot sinks
• Top brokers name 3 ASX shares to buy next week
• Commonwealth Bank (ASX:CBA) share price and weekly news wrap
• Here’s why the ANZ (ASX:ANZ) share price jumped 8% in March
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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has recommended SEEK 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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Experts say Australia is in a position to benefit hugely from the electric car revolution.

With an abundance of lithium, cobalt and nickel miners listed on the ASX, we certainly have plenty of resources to produce electric vehicles – right here in our own backyard.

A report by the Electric Vehicle Council in September 2020 found that replacing a traditional petrol or diesel vehicle in Australia with an electric car could generate a net government revenue of 1.1 cents per kilometre driven.

So what’s stopping Australia from chasing (or, in the case of Victoria, increasing taxation on) an electric dream?

The Submission on the Future Fuels Discussion Paper, written by Audrey Quicke and published today by the Australian Institute, asks just that.

Charging ahead or crashing our potential?

Quicke argues that the Federal Government is crashing the future of electric cars in Australia.

She says the government’s Future Fuels Strategy: Discussion Paper is disappointing and uses misleading modelling to show electric vehicle subsidies are not value for money.

Quicke reasons a correct future fuel strategy should include short-term financial incentives to make electric vehicles more affordable and set a target for the government’s fleet to be made of 100% electric vehicles by 2030. It should also take into account light vehicle CO2 emissions standards.

She says the government’s discussion paper doesn’t compare costs and savings for like-for-like cars over their lifetime. Further, emissions comparisons aren’t averaged over a vehicle’s lifetime and don’t consider the likelihood of powering electric cars with solar.

So, should government do more to promote electric cars?

“Instead toying with the idea of punishing people for buying electric vehicles by charging them additional taxes, the rational thing for government to do would be pull out all stops to encourage transport electrification.” https://t.co/nahH8tu9DV

— Electric Vehicle Council of Australia (@EVCouncil) September 27, 2020

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The Electric Vehicle Council’s September report found electric cars brought large benefits to the economy.

It found replacing a fossil-fuelled car with an electric one brought an average lifetime benefit of $8,763. If a traditionally fuelled bus was replaced by one of its electric counterparts, that figure became more than $40,000.

The council arrived at these figures by equating a multitude of factors, including:

• Sales taxes;
• Cheaper running costs meaning more disposable income for Australian households;
• Revenue from income tax, as producing electricity creates more Australian jobs than producing fossil fuels;
• Lesser costs associated with upkeeping Australia’s fuel reserve;
• Financial benefits of lowering Australia’s GHG emissions;
• Lower costs of air and noise pollution.

What about the environment?

The Australian Academy of Science recently found Australia must decarbonise much faster than planned to avoid the devastating effects of climate change.

It found we must drastically limit our GHG emissions or, most likely, face a global temperature increase of 2°C.

The statistics back that up. For the year ending September 2020, nearly 18% of Australia’s greenhouse gas (GHG) emissions were caused by transport using petrol, diesel or LPG engines.

There are plenty of arguments that electric vehicles could help solve the challenges facing Australia and its environment. 

Consumers are on board

With or without government support, Australians are jumping onboard an electric vehicle revolution, according to the Electric Vehicle Council’s 2020 report.

56% of Australians surveyed said when buying their next car, they would consider buying an electric vehicle. In addition, public charging infrastructure is becoming more common, and demand isn’t waining yet. 

We’ve still got a long way to go. Globally, up to 1 in 20 new cars sold are electric. Only 0.6% of new cars in Australia can say the same. 

But with an abundance of ASX listed companies creating products aimed at powering the electric vehicle market, we might already be witnessing the beginning of the future.

More reading

• The ASX shares brokers think you should be watching
• Why the Champion Iron (ASX:CIA) share price is soaring 5% today
• Records on Wall Street, why the ASX 200 isn’t following, and house prices through the roof: Motley Fool CIO Scott Phillips on Sky News
• Why the Sonic (ASX:SHL) share price could be a hidden opportunity
• The Xref (ASX:XF1) share price is surging 16% today. Here’s why

The Motley Fool contributor Brooke Cooper 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 What’s stopping the wheels turning on electric cars in Australia? appeared first on The Motley Fool Australia.

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With the ASX 200 continuing to ping pong back and forth, here are the ASX shares that big brokers think you should be watching. 

Ardent Leisure Group Ltd (ASX: ALG)

Citi believes Ardent Leisure could be an attractive way to play into the re-opening economy and pent-up demand narrative. The broker notes that the company’s balance sheet and liquidity concerns are being resolved. Additionally, its valuation is underpinned by the theme park asset value of at least $89 million prior to rezoning. 

What’s interesting is that despite Citi’s buy rating, its target price of 82 cents was unchanged. The Ardent Leisure share price trading at 92 cents at the time of writing. This represents a downside of 10%. 

Boral Limited (ASX: BLD) 

Boral recently completed the sale of its 50% share in USG Boral to Gebr Knauf KG for US$1.05 billion (A$1.33 billion). The proceeds will be used to pay down debt, return capital to shareholders and reinvest in the business.

Morgan Stanley calls this move another step in the evolution of Boral. Furthermore, Morgan Stanley believes it represents a significant transformation. This comes from a period when serious concerns were raised about its balance sheet. The broker rates Boral shares as overweight with a $6.30 target price. The Boral share price is currently fetching $5.83. 

Rhipe Ltd (ASX: RHP) 

It’s been back and forth for the Rhipe share price since March last year.

Ord Minnett believes that it could be Rhipe’s time to deliver some meaningful shareholder returns. This comes with an accumulate rating and $2.45 target price. 

The broker’s commentary highlights the company’s recent acquisition of EMT Distribution, a cybersecurity distribution specialist. It believes this move will broaden Rhipe’s exposure to a growing cybersecurity market. Additionally, it plays a role in its broader strategy to diversify from its core cloud subscription offering. 

The deal will be immediately earnings accretive in FY22, and greater revenue synergies through cross-selling may be realised in the near-term. Overall, Ord Minnett is bullish on Rhipe’s growth both organically through increased cloud software adoption and through its growth via acquisition.

With Rhipe shares currently trading at $1.80, the broker’s target price represents a significant 36% upside. 

More reading

• Brokers name 3 ASX shares to buy today
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• ASX 200 rises, Webjet sinks, Boral climbs
• ASX 200 up 0.25%: AMP names new CEO, Boral’s buyback, Webjet sinks
• Why AMP, Boral, Rhipe, & Zoono shares are pushing higher

Motley Fool contributor Kerry Sun 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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Motley Fool Australia Chief Investment Officer Scott Phillips joined Sky News First Edition this morning to discuss the records on Wall Street, plus the boom in house prices and what the regulators might be forced to do to rein them in.

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More reading

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Motley Fool contributor Scott Phillips 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 Records on Wall Street, why the ASX 200 isn’t following, and house prices through the roof: Motley Fool CIO Scott Phillips on Sky News appeared first on The Motley Fool Australia.

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The Champion Iron Ltd (ASX: CIA) share price is racing higher in late-afternoon trade. This comes after the company announced the completed acquisition of the Kamistiatusset iron ore project (Kami Project). At the time of writing, the iron ore miner’s shares are swapping hands for $5.98, up 6.03%.

What’s driving the Champion Iron share price higher?

Investors are picking up Champion Iron shares in anticipation of the company’s exciting future prospects.

According to its release, Champion Iron advised it has formally finalised the acquisition of the Kami Project.

The sale involves a cash consideration of $15 million from Champion Iron to former Kami Project owners, Alderon Iron Ore. In addition, roughly $19.4 million of secured debt accumulated from Alderon has been repaid.

As part of the agreement, Champion Iron will also receive an additional 8 million tonnes annually of port capacity in Sept-Isles, Que. Currently, the company sends its Bloom Lake iron ore concentrate to the same port.

Located near Labrador City, Newfoundland and Labrador in Canada, the Kami Project is a high-grade open-pit iron ore mine. Alderon Iron Ore also conducted a feasibility study in September 2018. Additionally, Champion Iron is seeking to revise the project’s scope and update its feasibility in the near term.

Champion Iron CEO David Cataford commented:

This acquisition adds a large scale and highly prospective project to our portfolio. In addition, by securing additional port capacity, this further de-risks our Bloom Lake Phase II expansion project, which is currently under construction. In keeping with our track record of diligently evaluating and transforming opportunities into valuable assets, we look forward to revising the Kami Project’s scope and updating its previously completed feasibility study, along with its potential to positively impact local communities and the regional economy, which is and has always been a key goal for our Company.

Over the past 12 months, the Champion Iron share price has gained over 200% and is up 25% year-to-date.

More reading

• These were the best performing ASX 200 shares last week
• Why the Hub24 (ASX:HUB) share price is firing up 12% today
• ASX quarterly rebalance: HUB24 joins ASX 200, Brainchip into ASX 300
• Why Nuix, Hub24 shares are on watch

Motley Fool contributor Aaron Teboneras 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 Sonic Healthcare Ltd (ASX: SHL) share price could be a hidden opportunity for investors to take advantage of.

Sonic shares haven’t done too much when you compare the current share price of $35.40 to the price of $30.78 on 6 March 2020.

But the business has actually been generating a lot of profit growth because of COVID-19 testing and this could be where an opportunity is waiting for investors.

How is the business going?

Sonic is a diversified pathology business with global operations across countries like the USA, Germany, Australia, the UK, Ireland, Switzerland, Belgium and New Zealand.

The company’s base/pre-COVID-19 business proved to be resilient in the first half of FY21, with revenue only down by 1% despite further waves of the COVID-19 pandemic.

It’s the COVID-19 testing that has really accelerated earnings for the business. Half-year revenue increased 33% to A$4.4 billion earnings before interest, tax, depreciation and amortisation (EBITDA) and net profit after tax (NPAT) went up 166% to $678 million.

The company’s COVID testing is playing an important part in controlling the pandemic. It has done over 18 million COVID-19 tests and it’s now seeing growing demand for immunity serology tests.

Why could the Sonic share price be an opportunity?

Firstly, the trading update that Sonic gave was particularly interesting. It said that it’s expecting a strong second half result based on the revenue growth trend in January and February.

It also revealed that “experience shows that temporary base business declines are more than offset by increased COVID-19 testing revenue”. If there are further waves, profit may increase faster, rather than being slowed down. 

The company continues to look for further growth opportunities, including acquisitions, contracts and joint ventures. It’s currently bidding on “significant” opportunities in Australia, the UK, the USA and Canada.

Sonic is showing signs of being increasingly resistant to impacts from COVID-19, partly thanks to the geographic and healthcare diversification of the business.

Earnings estimates seem to suggest that the market believes there will be a big decrease in Sonic’s earnings from FY21 to FY22, as COVID-19 testing drops off. For example, both Commsec and the broker Morgan Stanley seem to think that earnings per share (EPS) could decline by approximately $1 from this financial year compared to FY22.

But the decline may not be as much as investors are expecting. The number of new COVID-19 cases may be a lot lower in the US than a few months ago, and the vaccination rate is impressive, but that doesn’t necessarily mean that testing is going to drop off as much. Indeed, the US is starting to see COVID cases increase again in several major population areas as restrictions are lifted.

There is also the worrying prospect of variants spreading in Europe and North America that appear to be more contagious, able to reinfect people, be more resistant to vaccines and be more serious for younger people. This may mean that demand for Sonic’s testing capabilities goes on longer than expected.

There’s also the prospect that Sonic uses some of its elevated profit generation to acquire other global healthcare businesses to cement its market position.  

Sonic Healthcare share price valuation

According to Morgan Stanley, the Sonic Healthcare share price is valued at 13x FY21’s estimated earnings and 20x FY22’s estimated earnings.

After the 6% increase to the interim dividend, Sonic has a trailing partially franked dividend yield of 2.5%.

More reading

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

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The Xref Ltd (ASX: XF1) share price is surging today after the company announced its revenue has increased by 36% this year while its costs have remained flat.

The Xref share price has risen 16% today to 29 cents per share.

Xref is a human resources technology company that automates the candidate reference process for employers. Essentially, it provides a data-driven analytics process that replaces the human, phone-call references that most people are familiar with.

It gathers data on the employee, the company and the role and then uses this to provide a report to hiring directors, letting them know whether the employee is suitable for the role they’re advertising.

It derives most of its revenue from Australia but also has a presence in Canada, the United Kingdom, Norway, New Zealand, and the United States.

Xref third-quarter update results

Xref released its third-quarter update today, showing revenue has increased 36% to $3 million, and sales have increased by 62% to $4 million. Meanwhile, its cash expenses have decreased by 17% to $3.5 million, and its cash balance has increased to $6.4 million.

New clients acquired in the quarter contributed 13% of total sales. Xref has built a strong customer base in the healthcare industry and has now entered a new geographic market in South Africa. Its new clients in Australia include the Australian Prudential Regulation Authority (APRA̼̩),  Cash Converters, and the Children’s Cancer Institute.

Its expanding profile of blue-chip clients outside the healthcare industry is partly behind the strong Xref share price performance.

Xref has simultaneously scaled back event and travel̩ development costs and office leases and has reduced its headcount from 18 to 64 people. This has driven a material reduction in cash expenses while continuing to support growth in sales.

The Australian company is also aiming to transition its credit-based cloud-based platform service to an annual recurring revenue (ARR) subscription model.

Xref share price snapshot

The Xref share price has risen 18% this week, 23% this month and 163% over the past year, but is down 20% overall in 2021 so far. It’s beaten the ASX technology sector by 69%.

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Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Xref Limited. The Motley Fool Australia has recommended Xref 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 Air New Zealand Limited (ASX: AIZ) share price is flying today. The positive price movement comes amid intense speculation regarding travel today. This was later confirmed by the New Zealand government, announcing quarantine-free travel between Australia and New Zealand.

At the time of writing, shares in the Kiwi carrier are up 6.65% to sell for $1.69. By comparison, the Qantas Airways Limited (ASX: QAN) share price is up 2.75% and the S&P/ASX 200 Index (ASX: XJO) is up 0.97%.

Let’s take a closer look at today’s news and how it’s affecting the Air New Zealand share price.

Trans-Tasman travel bubble

According to the Australian Broadcasting Corporation (ABC), reports emerged this morning that New Zealand prime minister, Jacinda Ardern, would announce a trans-Tasman travel bubble between her nation and Australia. In a press conference late this afternoon, Prime Minister Arden confirmed these reports.  Furthermore, announcing that New Zealand would accept Australian international arrivals without first having the need to quarantine. The borders will open 11:59pm NZST Sunday 18 April 2021.

“Quarantine-free travel between Australia and New Zealand will be safe,” Ms. Arden said.

However, Ms Arden warned travellers the borders could snap back shut again at a moment’s notice. This is similar to the situation many Australians have experienced travelling inter-state.

“We would likely suspend flights from a state with multiple suspected, unknown cases.” Ms. Ardern also confirmed the New Zealand government would not compensate any travellers who are affected by any sudden travel restrictions.

New Zealand shut its international borders at the onset of the COVID-19 pandemic in March 2020. In October, Australia opened its borders to New Zealand arrivals without the need to quarantine. After many aborted attempts, New Zealand will now open its borders to Aussies.

According to Stats New Zealand, Australians made up the largest portion of tourists in the country in February 2020, prior to the start of the pandemic. Around 132,000 Australians arrived in New Zealand that month. That’s 2.5x more than the next highest nationality (China). Since Australian choices of nations to visit is limited to one country, this could be good news for New Zealand tourism. The Air New Zealand share price rise today reflects this fact.

Air New Zealand share price snapshot

The Air New Zealand share price is up 106.79% since this time last year. Of course, the airline was deeply affected by the coronavirus outbreak, along with other travel shares. At the beginning of February 2020, however, the Air New Zealand share price was trading for $2.65. That’s a negative return on investment (ROI) of 36.04% to today.

Air New Zealand has a market capitalisation of $1.8 billion.

More reading

• Qantas (ASX:QAN) share price takes off after latest COVID updates
• The Air New Zealand (ASX:AIZ) share price is slipping today. Here’s why
• ASX 200 dips lower, Webjet drops, REA bids for Mortgage Choice
• Flight Centre, Qantas, & Webjet shares fall on Brisbane COVID lockdown news
• ASX 200 travel shares poised to see pent up travel demand unleashed

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The Lynch Group Holdings Limited (ASX: LGL) share price has commenced trading on the ASX today following the successful completion of its $206 million initial public offering (IPO).

However, despite the market pushing notably higher, it hasn’t been a great debut for the wholesaler of floral and potted products.

At the time of writing, the Lynch Group share price is fetching $3.48. This is down almost 3.5% from its listing price of $3.60.

What is Lynch Group?

Lynch Group was founded in Australia all the way back in 1915 by the family of Leo Lynch.

It was initially a floral grower and wholesaler but eventually expanded to become a vertically integrated wholesaler which pioneered supply to major supermarkets and into the Chinese market.

In 2015, Next Capital acquired a majority interest in the Lynch Group to accelerate its growth trajectory.

Since then, the company has successfully continued to execute on its growth strategy, which included the acquisition of a 20% interest in VDB Asia – a premium rose grower in China with two farms focused on production for the Chinese domestic market.

Some of the proceeds from the IPO will be used to acquire the remaining 80% stake in VDB Asia.

What is its market opportunity?

According to its prospectus, the company operates in an Australian market worth ~$1.4 billion and a Chinese floral sector estimated to be worth $19 billion.

Management notes that flowers are a unique product category that are highly perishable and have a short vase life. This results in a complex and time‑sensitive supply chain with high barriers to entry.

Furthermore, access to robust breeds, premium growers, delicate handling processes and end‑to‑end cool‑chain integrity are important in ensuring that flowers reach the desired end‑market in a saleable condition and with optimal vase life. This is something Lynch Group has in abundance.

Current Australian customers include Aldi, Bunnings, Coles Group Ltd (ASX: COL), David Jones, IGA, and Woolworths Group Ltd (ASX: WOW). Whereas in China, the company typically sells its products to wholesalers via its WeChat-based web shop.

Forecasts

Lynch Group is expecting to deliver strong earnings growth in calendar year 2021.

Its prospectus forecast is for pro forma revenue of $329 million, pro forma EBITDA of $54 million, and pro forma NPATA of $29.3 million. This means that its pro forma revenue and EBITDA will be up 16.1% and 25.7%, respectively, year on year.

Lynch Group’s CEO, Hugh Toll, appears positive on the future.

Commenting today, he said: “Over our 100-year history, Lynch Group has established itself as a pioneer in the Australian floral industry becoming the #1 wholesaler and partner to supermarkets in the floral category. Our know-how, systems and expertise are proving highly transferable into the significantly larger and fast-growing Chinese market, where we are replicating the success of our vertically integrated Australian model.”

“Led by a highly experienced management team and Board, we are well positioned to benefit from the continued structural shift to supermarket channels in the Australian market. There are also compelling opportunities in the developing Chinese market to continue to increase our production capacity, and partner with more retailers to grow our direct-to-consumer channel as we build out additional processing capacity in China,” he concluded.

More reading

• Top ASX shares to buy in April 2021
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Woolworths 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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