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In afternoon trade the S&P/ASX 200 Index (ASX: XJO) has fought back from a soft start and is charging higher. At the time of writing, the benchmark index is up 0.35% to 6,710.8 points.

Four shares that have failed to follow the market higher today are listed below. Here’s why they are dropping lower:

BrainChip Holdings Ltd (ASX: BRN)

The BrainChip share price is down 6% to 53.7 cents despite there being no news out of the artificial intelligence technology company. However, with its shares rocketing 18% on no news on Friday, it appears as though profit taking has been weighing on its shares this week. The BrainChip share price is now down 18% from Monday’s high.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price is down almost 2% to $1.13. This morning the lithium miner announced the completion of its retail entitlement offer. Pilbara Minerals raised $60.6 million from the offer, bringing the total raised from its capital raising to $240.2 million. These funds are to be used to acquire the Pilgangoora Lithium Project in Western Australia.

Premier Investments Limited (ASX: PMV)

The Premier Investments share price is down close to 3% to $24.67. This appears to have been driven by profit taking and a couple of bearish broker notes. In respect to the latter, this morning Goldman Sachs retained its sell rating and put a $20.80 price target on its shares. Elsewhere, UBS has downgraded the retail conglomerate’s shares to a neutral rating with a $24.50 price target. Both brokers expect a strong result in FY 2021, but then a sharp decline in earnings in FY 2022.

Tyro Payments Ltd (ASX: TYR)

The Tyro share price has fallen almost 7% to $2.64. This morning Goldman Sachs retained its neutral rating but cut its price target on the payments company’s shares to $3.15. The broker has concerns over the outage that has been impacting some of Tyro’s customers since last week. It fears these temporary terminal connectivity issues could weigh on medium-term growth and possibly lead to compensation claims.

More reading

• Here’s why the Pilbara (ASX:PLS) share price is on watch today
• Top fund managers reveal 3 top ASX shares to buy for 2021
• Is it too late to buy Premier Investments (ASX:PMV) shares?
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 rises 0.1%

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 Tyro Payments. The Motley Fool Australia owns shares of and has recommended Premier Investments 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 Orthocell Ltd (ASX: OCC) share price is one of the best performers on the market today. This comes after the company announced that it has received regulatory approval for its flagship product, CelGro.

At the time of writing, the regenerative medicine company’s shares are up 23.91% to 57 cents.

What’s pushing the Orthocell share price higher?

The Orthocell share price is soaring higher today, with investors fighting to get a hold of its shares after this most recent announcement.

Orthocell advised it has achieved 510(k) clearance from the United States Food and Drug Administration (FDA) to market and supply its CelGro device.

CelGro is a collagen scaffold that supports tissue reconstruction and repair, with a wide range of uses in orthopaedics, general, gynaecology and ENT surgeries.

In the United States however, CelGro will be used for dental bone and tissue regenerations procedures. This includes dental bone repairs, growth around dental implants in extraction sockets, and tissue regeneration in intrabony defects.

The approved clearance will see Orthocell supply Striate+ for the United States dental market. Striate+, formerly branded as CelGro Dental, is manufactured in Australia, using the company’s SMRT technology.

Following the milestone achievement, Orthocell will now seek negotiations with United States dental companies for marketing and distribution rights. Orthocell highlighted that after this recent success, it is confident of securing a distribution partner to bring the product to market.

Orthocell stated that CelGro can be further developed to service the peripheral nerve repair market. It is estimated that this sector alone is worth more than US$7.5 billion per annum, with 3 million potential CelGro procedures each year.

Management commentary

Orthocell managing director Mr Paul Anderson welcomed the positive outcome, saying:

US approval has come sooner than expected and is a significant inflection point for our Company. I am excited by this strategic milestone and the positive step it represents on our pathway to partnering Striate+ in dental GBR indications. I look forward to working with our leading dental surgeons to introduce the new global brand, Striate+, previously branded as CelGro Dental, and to make a meaningful impact in the US market.

More reading

• Why the Orthocell (ASX:OCC) share price has popped 6% today
• Why the Orthocell (ASX:OCC) share price is edging higher today

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 Ampol Ltd (ASX: ALD) share price has barely budged today after the company released its fourth-quarter numbers. Currently, shares are trading slightly higher at $28.67, up 0.42%.

Overall, the Ampol share price is down 19.71% in the last year, while the S&P/ASX 200 Index (ASX: XJO) is down 4.41% over the same period of time.

What’s affecting the Ampol share price?

This morning, Ampol released the Lytton refinery unaudited results for the fourth quarter of FY20. The Lytton refinery started operating in 1965 and is the country’s largest oil refinery. Its fate, however, has been called into question since the COVID-19 pandemic.

The good news for Ampol

In the fourth quarter, Lytton’s earnings before interest and tax (EBIT) showed a loss of $4 million, rounding out the full-year results for the refinery to a loss of $145 million.

The good news is this result exceeded analyst expectations by $20 million. Originally the consensus reflected a $165 million loss.

And not so good news…

The fact is that it’s still a substantial loss and, in Ampol CEO Matt Halliday’s own words, “unacceptable”.

As today’s update outlined, ongoing economic disruptions in 2021 have resulted in continued uncertainty.

The impacts on both international and domestic demand, in tandem with the strong Australian dollar, have tightened refining margins even further. Today’s update unveiled the refiner’s margins slipping to US$5.13 per barrel, compared to the US$9.08 per barrel refiner margin in the first half of 2020.

Meanwhile, the Lytton refinery continues to undergo its comprehensive review as Ampol works to determine the best course of action. The review is expected to be completed in the first half of 2021.

Lastly, Ampol disclosed that its net debt at the end of December 2020, excluding lease liabilities, was $434 million.

The future of Lytton

As previously mentioned, all options are on the table for the refinery. The Federal Government’s $2.5 billion fuel security package, proposed late last year, did not tickle the fancy of Mr Halliday, who told the Australian Financial Review:

We appreciate the intent of the proposed support package, but we need to be realistic about the extreme structural challenges that are facing the asset up at Lytton. We need to take control of our own destiny and focus on how we are going to deliver value for our shareholders.

If Ampol does decide to close the Lytton refinery, it would come after BP’s closing of the Kwinana refinery in Western Australia. Adding to the other 3 refineries that have shut down in Australia in the last 8 years.

Based on the Ampol share price at the time of writing, its market capitalisation is now $7.13 billion.

More reading

• Could this be why Afterpay (ASX:APT) and other BNPL shares are soaring today?
• Why this top broker thinks the Telstra (ASX:TLS) share price could surge ~40%
• Why this broker sees little upside to the Polynovo (ASX:PNV) share price right now
• BHP, Rio Tinto’s new copper mine under threat
• ASX 200 up 0.3%: Afterpay surges, Pro Medicus rockets on $40m contract, Whitehaven rises

Motley Fool contributor Mitchell Lawler 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 Ampol (ASX:ALD) share price is flat today appeared first on The Motley Fool Australia.

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ASX buy now pay, later (BNPL) shares have pushed higher across the board on Thursday. At the time of writing, the Afterpay Ltd (ASX: APT) share price is 7.37% higher, eyeing its previous record all-time high of $123.40 and Zip Co Ltd (ASX: Z1P) shareholders can breathe a sigh of relief as its shares are 4.4% higher. 

Elsewhere, the Sezzle Inc (ASX: SZL) share price is 6.62% higher following its record fourth quarter results announced on 12 January 2021. 

The Laybuy Holdings Ltd (ASX: LBY) share price is 8% higher after announcing record third quarter results today. Some laggards include Splitit Ltd (ASX: SPT), Openpay Group Ltd (ASX: OPY) and Humm Group Ltd (ASX: HUM), which haven’t seen the same level of gains.  

While ASX BNPL shares are grinding higher, a new US-based BNPL initial public offering (IPO) soared on its debut yesterday, demonstrating investor appetite for fintech IPOs and BNPL shares. 

US BNPL Affirm doubles on debut 

Affirm is a US-based BNPL player with a classic product that allows shoppers to pay for purchases in fixed amounts over time without deferred interest, hidden fees or penalties. In FY20, the company recorded 6.2 million customers, 6,500 merchants and US$4.6 billion in gross merchandise volume. 

The company raised $1.2 billion in an initial public offering at an offer price of $49 per share. Its shares surged to $97.24 at the market close on Wednesday, an almost 100% gain. 

The surging Affirm share price has ballooned its market capitalisation to around US$23 billion on FY20 revenues of US$509.5 million. This values the company at approximately 45 times FY20 revenue. 

What about ASX BNPL shares? 

If we looking at the major ASX BNPL shares with operations in the US, it’s the Afterpay share price that has surged the most today.

At its current market cap of $31 billion with FY20 revenue of $502.7 million, the company appears to be more expensive, trading at a revenue multiple of 62. That said, the Afterpay share price delivered some of the best returns in 2020. The company has expressed its intention to maintain its growth trajectory by expanding into the rest of Europe and develop a strategy for the South Asia market. 

In comparison, the Zip share price has seemingly gone nowhere recently. The company currently has a market cap of $3 billion with FY20 revenue sitting at $161 million. It trades towards the lower end of the spectrum with a FY20 revenue multiple of just 18.

More reading

• ASX 200 up 0.3%: Afterpay surges, Pro Medicus rockets on $40m contract, Whitehaven rises
• Why Afterpay, Australian Ethical, Pro Medicus, & Sezzle shares are charging higher
• Why the Laybuy (ASX:LBY) share price is surging higher today
• 4 ways to lose all your money
• 5 things to watch on the ASX 200 on Thursday

Lina Lim 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 Humm Group Limited and Sezzle Inc. 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 Telstra Corporation Ltd (ASX: TLS) share price has been a disappointing performer but at least one broker sees big potential upside.

The TLS share price slumped by nearly 20% over the past year and is trading at $3.08 at the time of writing.

That’s significantly worse than the circa 3% dip in the S&P/ASX 200 Index (Index:^AXJO). Other ASX telecommunications stocks are also miles ahead.

Can the Telstra share price play catch-up in 2021?

The Amaysim Australia Ltd (ASX: AYS) share price doubled, Vocus Group Ltd (ASX: VOC) share price rallied 28% and the TPG Telecom Ltd (ASX: TPG) share price added 1%.

But the lagging Telstra share price could be worth a lot more than what the market is expecting, according to Macquarie Group Ltd (ASX: MQG).

This is because Telstra plans to split its assets into separate entities could release significant value. Specifically, the move to spin off its mobile towers division could attract a high valuation.

Unlocking value via mobile divestment

This division, affectionately termed TowerCo, is leveraged to the 5G opportunity. Macquarie thinks the spin-off could either come via an initial public offer (IPO) where half of the business is sold to ASX investors, or through a 50% sale to a partner.

“We derive an EV of ~$5-6bn representing a 25-30x FY1 EBITDA multiple,” said the broker.

“We believe listed markets would pay ~25x EV/EBITDA forTowerCo whereas an unlisted Australian investor could pay up to 34x given value attributed towards franking credits and a lower return hurdle (equity IRR assumed: 7%).”

Fibre asset has big upside too

As for Telstra’s fibre infrastructure asset, these could be worth around 14 times earnings before interest, tax, depreciation and amortisation (EBITDA). Macquarie noted that other listed fibre companies trade at between 12 and 14 times EBITDA.

What’s more, the multiples paid in past transactions range between 10 and 20 times with the average at 14 times.

“While the path to crystalising is uncertain, we note there is material upside if these assets are marked to market,” noted Macquarie.

“We estimate a ‘fair’ value release valuation of ~$3.95ps, representing ~30% upside to the current share price.”

What the Telstra share price could be worth

The upside could be much more significant under the broker’s bull case scenario. Macquarie estimated that the divestments could value the TLS share price as much as $4.29. That’s a 39.3% increase to the current Telstra share price excluding dividends.

Under Macquarie’s bear case scenario, the Telstra share price would be only worth $2.69 a pop, or a 12.7% decline.

Given the risk-reward, the Telstra share price could be a worthwhile investment. Macquarie is recommending the stock as “outperform” with a price target of $4 a share.

More reading

• ASX 200 up 0.3%: Afterpay surges, Pro Medicus rockets on $40m contract, Whitehaven rises
• Are ASX 200 shares set to climb 15% higher in 2021?
• 2 highly rated ASX dividend shares to buy
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 rises 0.1%

Motley Fool contributor Brendon Lau owns shares of Telstra Limited. Connect with  me on Twitter @brenlau.

The Motley Fool Australia owns shares of and has recommended 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 Polynovo Ltd (ASX: PNV) share price was one of the best performing ASX 200 healthcare shares in 2020, running from $1.97 to $3.88.

But when the company’s share price started to turn in the wrong direction, it fell and it fell fast. 

It wasn’t just the trading update

Polynovo released a trading update on 12 January 2021 which saw its shares crash 13% on the day.

But it wasn’t just the trading update to point the finger at for Polynovo’s significant share price decline. Its shares had already slumped from $3.88 to $3.39 or 12% before the announcement, almost a tell tale of the bad news brewing. 

Furthermore, the S&P/ASX 200 Health Care (ASX: XHJ) has also fallen 4.3% in the new year. Adding further insult to injury for the healthcare sector.  

Bell Potter disappointed with first half FY21 trading update 

Bell Potter reports: “Polynovo announced a relatively disappointing trading update, with 1H FY21 sales growth of 31% vs the pcp well below our forecasts, consensus and management expectations”.

In the company’s November 2020 annual general meeting, Polynovo’s NovoSorb BTM product experienced very strong growth from $9.3 million in FY19 to $19.06 million in FY20.

Polynovo managing director Paul Brennan said at the time the company would “continue to harness this momentum to double our revenues again in FY21”.

Bell Potter’s report notes that “expectations were broadly that sales would double in FY21 vs FY20”.

It noted that management also “tempered expectations around growth for the second half given the uncertainty in patient volumes”. 

The broker did highlight some small positives including management’s strong update on new accounts, with successful customers additions and ongoing efforts to drive growth with integrated distribution networks. Those new customers may start to become more active users of Novosorb BTM in the coming months, especially if patient volumes recover well in a post-vaccine environment. 

Overall, Bell Potter reduced its Polynovo share price target from $3.20 to $2.90 with a hold rating. The Polynovo share price is trading up 4.48% at $2.80 at the time of writing. 

More reading

• ASX 200 rises 0.1%
• ASX 200 down 0.3%: Altium sinks, Premier Investments rockets, energy shares rise
• Why Afterpay, Altium, Mesoblast, & PolyNovo shares are dropping lower
• ASX 200 drops lower
• ASX 200 up 0.4%: Altium disappoints, ARB impresses, Mesoblast charges higher

Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of POLYNOVO FPO. 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 this broker sees little upside to the Polynovo (ASX:PNV) share price right now appeared first on The Motley Fool Australia.

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BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO)’s joint venture has been hit with a lawsuit against its plans to build a massive copper mine in the US.

Resolution Copper, which is 55% owned by Rio Tinto and 45% by BHP, has so far spent more than US$2 billion to advance the project in Oak Flat, Arizona.

But non-profit advocacy group Apache Stronghold has this week started legal action to prevent the government from handing over 980 hectares of land, also known as Chi’chil Bildagoteel, to Resolution.

The lawsuit is the latest move in the San Carlos Apache native American tribe’s resistance to the proposed copper mine.

“Oak Flat is holy and sacred. Chi’chil Bildagoteel is central to our traditional religion and identity as Apache people,” said Apache Stronghold leader Dr Wendsler Nosie. 

“Giving away our sacred land by the US government for destruction by a foreign mining company destroys our ability to practice our religion. It violates our First Amendment right to the free exercise of our religion protected by the constitution.”

The Motley Fool has contacted Resolution Copper for comment.

Both BHP and Rio have a lot riding on this copper mine, which is projected to supply almost 25% of copper demand in the US for 40 years.

The lawsuit is looking to block the release of the final environmental impact statement on Friday US time, which would prompt the transfer of Chi’chil Bildagoteel to Resolution.

Rio Tinto’s relations with locals have been rocky

The Arizona headache comes after Rio Tinto endured a year from hell in 2020 over its destruction of the Juukan Gorge in Western Australia in May.

Rio Tinto initially stated it did nothing wrong, citing that all its actions were legal. 

But after pressure from its major shareholders about the cultural and historical significance of the site, 3 executives departed the mining giant.

Then earlier this week, Rio Tinto had to deal with a new crisis in Mongolia. The government there has threatened to pull the plug on its Oyu Tolgoi mine expansion project.

Ulaanbaatar was left “dissatisfied” with the economic benefits of the plans for the copper and gold mine. So much so that it would revoke the Oyu Tolgoi Underground Mine Development and Financing Plan (UDP), which was signed with Rio in 2015.

Rio’s subsidiary Turquoise Hill Resources Ltd (NYSE: TRQ) announced it would be “engaging immediately” with the Mongolian government to save the UDP.

Rio Tinto’s shares were down 1.75% at the time of writing. BHP was down 1.21%.

More reading

• Iluka (ASX:ILU) share price surged higher on a potential $1bn+ valuation uplift
• The BHP (ASX:BHP) share price is Goldman Sach’s top pick for iron ore
• Rio Tinto (ASX:RIO)’s top growth project could be cancelled
• 5 things to watch on the ASX 200 on Wednesday
• Here’s why the Fortescue (ASX:FMG) share price is up 12% in a month

Motley Fool contributor Tony Yoo 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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At lunch on Thursday the S&P/ASX 200 Index (ASX: XJO) is on course to record a decent gain. The benchmark index is currently up 0.3% to 6,708.3 points.

Here’s what is happening on the market today:

Afterpay surges higher.

The Afterpay Ltd (ASX: APT) share price is back on form on Thursday and is surging higher. Improving sentiment in the tech sector and a positive broker note appear to be the drivers of this gain. In respect to the latter, this morning Morgan Stanley retained its overweight rating and lifted its price target on the payments company’s shares to $136.00. The broker notes that app downloads have been increasing strongly in the US and UK.

Pro Medicus $40 million contract win.

The Pro Medicus Limited (ASX: PME) share price is rocketing higher today after the leading health imaging software company announced another major new contract win. Pro Medicus has signed a seven-year contract worth $40 million with Salt Lake City based Intermountain Healthcare. The deal will see its Visage 7 Viewer and Visage 7 Open Archive products implemented across all of Intermountain’s radiology and subspecialty imaging departments.

Whitehaven Coal climbs higher.

The Whitehaven Coal Ltd (ASX: WHC) share price is climbing higher today following the release of its quarterly update. For the three months ended 31 December, Whitehaven Coal achieved a 64% increase in managed run-of-mine (ROM) production to 5.1Mt. And while its sales were flat on the prior corresponding period, management has tightened its guidance range to between 19Mt and 20Mt from 18.5Mt and 20Mt. The company also revealed that coal prices have been improving strongly.

Best and worst ASX 200 performers.

The best performer on the ASX 200 on Thursday has been the Pro Medicus share price. Its shares are up 12.5% following its $40 million contract win. The worst performer on the index has been the Abacus Property Group (ASX: ABP) share price with a decline of almost 5%. This is due largely to its shares trading ex-dividend today for its 8.5 cents per share interim dividend.

More reading

• Why Afterpay, Australian Ethical, Pro Medicus, & Sezzle shares are charging higher
• Are ASX 200 shares set to climb 15% higher in 2021?
• Why the Pro Medicus (ASX:PME) share price is racing 7% higher today
• Here’s why the Whitehaven Coal (ASX:WHC) share price is charging 5% higher
• 4 ways to lose all your money

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 Pro Medicus Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Pro Medicus Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post ASX 200 up 0.3%: Afterpay surges, Pro Medicus rockets on $40m contract, Whitehaven rises appeared first on The Motley Fool Australia.

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2020 was a tough year for the retail sector and many ASX retail shares. Shops were shuttered globally in the effort to fight COVID-19, putting a major dampener on sales. Retail sales in Australia fell more than 17% in April, the greatest fall on record.

While spending was down in the June quarter, the September quarter made up for it with sales rebounding above pre-COVID levels. Pent up demand was unleashed as restrictions eased, with retailers seeing a surge in volumes. Positive momentum continued into the December quarter, with Deloitte predicting growth of 2.6% in retail volumes over 2020. 

Still, spending was uneven. Clothing, cafes, and department stores lagged, while spending on food and household goods has been above pre-COVID levels. With physical stores closed, consumers in lockdown turned to online for their purchasing requirements.

This accelerated a trend which has been growing swiftly over the past few years. Rapid growth in internet penetration and increasing acceptance of online shopping as a feasible and safe alternative to in-store shopping has seen digital commerce boom. 

So as we head into 2021, what can we expect from ASX retail shares? This depends on the sector they operate in and the strength of their online presence.

Household goods are expected to continue to perform well as consumers spend more time living and working at home. Those peddling computers and electronics should continue to benefit from increased demand. Retailers with a strong online presence will be best placed to take advantage of the shift to online that accelerated last year. 

Household retailers 

Online household goods retailers Kogan.com Limited (ASX: KGN) and Temple & Webster Group Ltd (ASX: TPW) both reported record sales in 2020.

Kogan saw gross sales rise by a record 39.3% in FY20 to reach $68.9 million. The company has reported strong performance in the first few months of FY21, with sales expected to have peaked over the Christmas period. Kogan’s impressive 2020 sales performance led to a 155% increase in the company’s share price over 2020, with Kogan entering the S&P/ASX 200 Index (ASX: XJO) in December. 

Kogan is a clear beneficiary of the move to online shopping. In an ASX announcement on 17 August 2020, founder Ruslan Kogan said:

There is a retail revolution taking place as more and more shoppers learn about the benefits of eCommerce…once someone discovers the benefits of online shopping, I struggle to see why they would ever go back to the old way of doing things. After almost 15 years of preparation, the revolution occurring in retail represents a significant opportunity for Kogan.com.

Kogan is not the only beneficiary of this shift. Temple & Webster reported a 74% increase in full year revenue in FY20.

Australia’s largest eCommerce company in the furniture and homewares space, Temple & Webster saw active customer numbers increase 77% in FY20 to almost half a million. The company is growing its market share even as its brick-and-mortar competitors take online more seriously.

Temple & Webster highlighted that it is benefitting from the increasing advantages of scale as it gets larger. In the company’s latest AGM address, the CEO commented, “the bigger we get, the better and stronger our customer propositions becomes, which is a virtuous cycle.” 

Another household goods retailer with strong momentum coming in 2021 is Adairs Ltd (ASX: ADH). Adairs operates both online and through physical stores. When physical stores shut in 2020, Adairs saw a significant increase in online sales, a trend which has continued. In the first half of FY21 to December, online sales were up 99.7% on the prior corresponding period. Online sales represented 39% of total sales versus 20% in the same period of the prior year.

In a trading update on 8 December, CEO and managing director Mark Ronan said, “it is now clear our first half FY21 result will be outstanding and builds on the excellent result in FY20…these gains extend across all aspects of our business with Adairs achieving strong growth through our integrated omni-channel model.”

Adairs has forecast group sales of $235 million–$245 million for the first half of FY21, well above the $179 million achieved in the prior corresponding period.  

Electronics and beauty 

JB Hi Fi Limited (ASX: JBH) also had a stellar 2020. The electronics retailer recorded a strong first quarter for FY21 with total sales growth of 27.3%, compared to growth of 4.7% in the first quarter of FY20. This growth was achieved despite store closures in Victoria with the online business continuing to scale. Online growth combined with continued in-store sales momentum has resulted in a strong start to FY21. 

Newcomer Adore Beauty Group Ltd (ASX: ABY) debuted on the ASX in late 2020 and is also reporting strong momentum. The pureplay online beauty and skincare retailer reported better than expected November promotional sales.

Additionally, the extension of the COVD-19 lockdown in Victoria delivered stronger sales for the company throughout the period. As a result, Adore Beauty upgraded its first half FY21 forecast revenue to approximately $95.2 million, 7% above the prospectus forecast.

CEO Tennealle O’Shannessy said, “we are pleased to report strong sales ahead of our prospectus forecasts. The business has continued to scale, deliver content and meet the needs of our customers at a time when they need it most.” 

ASX retail shares in 2021 

There is no doubt Australian retailers will be hoping for an easier ride in 2021 following the disruptions of 2020. As we have seen, changes in the way we shop and what we shop for means some are in a stronger position than others. This has resulted in the retail sector fragmenting, with some ASX retail shares expected to perform strongly in 2021 while others may have a bumpy road ahead. 

More reading

• 2 rapidly growing ASX ecommerce shares to buy
• The Accent Group (ASX:AX1) share price just got hit by a broker downgrade
• Retail sales rose 7% in November to boost ASX retail shares
• 3 highly rated ASX growth shares to buy now
• Capital returns galore from cashed-up ASX retail stocks

Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends ADAIRS FPO. The Motley Fool Australia has recommended ADAIRS FPO, Kogan.com ltd, and Temple & Webster Group 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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In late morning trade the S&P/ASX 200 Index (ASX: XJO) is fighting hard to stay in positive territory. At the time of writing, the benchmark index is up 0.1% to 6,692.5 points.

Four shares that are climbing more than most today are listed below. Here’s why they are charging higher:

Afterpay Ltd (ASX: APT)

The Afterpay share price is up almost 8% to $118.75. Investors have been buying tech shares again on Thursday after a solid night of trade on the tech-focused Nasdaq index. It isn’t just Afterpay recording a solid gain. At the time of writing, the S&P ASX All Technology Index (ASX: XTX) is up a sizeable 2.5%. In addition, analysts at Morgan Stanley lifted their price target on Afterpay’s shares to $136.00 this morning. They have an overweight rating on them.

Australian Ethical Investment Limited (ASX: AEF)

The Australian Ethical share price is up 3.5% to $5.72. This follows the release of the ethical fund manager’s second quarter update this morning. According to the release, Australian Ethical increased its funds under management (FUM) to $5.05 billion by the end of December. This was up 16.9% from $4.32 billion at the end of September.

Pro Medicus Limited (ASX: PME)

The Pro Medicus share price has surged almost 11% higher to $35.16. Investors have been buying the leading health imaging software company’s shares after it announced another major new contract win. Pro Medicus has signed a seven-year contract worth $40 million with Salt Lake City based Intermountain Healthcare. The deal will see its Visage 7 Viewer and Visage 7 Open Archive products implemented across all of Intermountain’s radiology and subspecialty imaging departments.

Sezzle Inc (ASX: SZL)

The Sezzle share price is up over 7.5% to $7.00. This appears to be a delayed reaction to the buy now pay later provider’s fourth quarter update this week. According to the release, Sezzle reported a whopping 195.6% year-over-year increase in merchant fees to US$17.2 million during the fourth quarter.

More reading

• Why the Australian Ethical (ASX:AEF) share price jumped 11% today
• Why the Pro Medicus (ASX:PME) share price is racing 7% higher today
• 4 ways to lose all your money
• 5 things to watch on the ASX 200 on Thursday
• 2 exciting ASX tech shares to buy today

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 Pro Medicus Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Australian Ethical Investment Ltd. 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 Australian Ethical Investment Ltd., Pro Medicus Ltd., and Sezzle Inc. 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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