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The Flight Centre Travel Group Ltd (ASX: FLT) share price has been among the best performers on the S&P/ASX 200 Index (ASX: XJO) in November.

Since the start of the month, the travel agent giant’s shares have risen a sizeable 46%.

This compares to an excellent gain of 10% by the benchmark index.

Why is the Flight Centre share price rocketing higher this month?

The catalyst for the strong Flight Centre share price gain this month has been news of two potentially effective COVID-19 vaccines.

This has sparked hopes that the global travel market could bounce back quicker than expected, which would be great news for Flight Centre. It is currently operating at a loss despite its rampant cost cutting.

What are the vaccines?

The first vaccine is being developed by biotech giant Pfizer and is a mRNA-based vaccine candidate named BNT162b2.

Last week it released the first set of results from a phase 3 COVID-19 vaccine trial.

In the first interim efficacy analysis, the vaccine candidate was found to be more than 90% effective in preventing COVID-19 in participants with no evidence of prior SARS-CoV-2 infection. This was significantly better than expectations.

Pfizer expects to produce up to 50 million vaccine doses globally in 2020 and then up to 1.3 billion doses in 2021.

The second vaccine, mRNA-1273, comes from US biotech Moderna. At the start of this week, it revealed that its Phase 3 study has met the statistical criteria pre-specified in the study protocol for efficacy, with a vaccine efficacy of 94.5%.

Moderna expects to have approximately 20 million doses of mRNA-1273 ready to ship in the U.S. by the end of the year. After which, it remains on track to manufacture 500 million to 1 billion doses globally in 2021.

Both vaccine candidates are using mRNA technology. This is a new approach to vaccines that uses genetic material to provoke an immune response.

What now for Flight Centre share price?

Two brokers that appear to have called time on the Flight Centre share price rally are Macquarie and Citi.

Last week they put neutral ratings and $13.50 and $16.00 price targets, respectively, on its shares. This compares to the current Flight Centre share price of $16.45.

More reading

• Why the Webjet (ASX:WEB) share price is up 48% in November
• Flight Centre and Webjet were among the most traded shares on the ASX last week
• Flight Centre (ASX:FLT) share price on watch amid notes offering and debt refinancing
• Vaccine hopes cause ASX 200 to rise on Tuesday
• Why the Sydney Airport (ASX:SYD) share price rocketed 24% higher today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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A corporate tussle is brewing at e-commerce retailer Kogan.com Ltd (ASX: KGN) over proposed share options to be granted to its senior executives. The Kogan share price lifted to an intraday high of $19.24 but has since retreated to $18.89, down 0.74% at the time of writing.

What’s being disputed

The Kogan board is proposing to grant 3.6 million share options to chief executive Ruslan Kogan, and 2.4 million share options to his chief financial officer, David Shafer. The board says the share options are meant to be an incentive for the two executives to stay at the company for the next three years. Options are a type of derivatives, giving holders the right but not the obligation to buy the underlying shares at a pre-determined ‘exercise price’. 

But Proxy advisers CGI Glass Lewis, acting on behalf of institutional investors in the matters of executive compensation, has said that these options grants are “overly generous”, and encouraged shareholders to vote down the proposal. The advisers also threatened to vote against the re-election of specific directors in future if the company goes ahead with granting the options. 

The main contention is the exercise price of the options, which was set at $5.29 and perceived to be too low, without strict performance targets attached. Kogan said this exercise price was calculated based on the three-month weighted average price of Kogan shares between 1 February and 30 April, when the market was at its lowest levels due to the coronavirus-induced panic. With the Kogan share price currently aroun $19, these share options are practically already in-the-money, giving both executives a windfall of more than $100 million in paper profits.

What the chairman said

Kogan chairman Greg Ridder defended the options grant proposal, saying that Mr Kogan and Mr Shafer “more than deserved it”:

I want to know that Ruslan is there to drive the hardest driving performance, and he is the smartest guy in the room, he is there to drive that value for all of us. We are making sure there are big incentives for a big outcome.

These guys have been working for close to nothing in the four years they have been with the company. In Ruslan’s cohort of comparable companies that the proxy advisers drew in this, he was the lowest-paid executive among 16 entities and yet was the second highest performing of all those entities.

How has the Kogan share price performed in 2020

Kogan, like other technology-based retailers, has had a fantastic year after the pandemic shifted people’s buying habits to online. The Kogan share price started the year at $7.47 before slumping to $3.79 at the height of market panic in March. It has bounced back strongly to trade at $18.89 today. The company commands a market cap of $2 billion.

More reading

• Why ASX tech shares should fly long after this crisis is over
• Dow Jones hits new record highs. Are ASX 200 shares next?
• Why the Openpay (ASX:OPY) share price is up and down today
• Macquarie (ASX:MQG) picks best ASX stocks to buy for 2021 post-COVID recovery
• These ASX shares have been unstoppable in FY 2021

Eddy Sunarto 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. The Motley Fool Australia has recommended Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The economic fallout from the COVID-19 pandemic isn’t limited to zero-bound interest rates, ballooning government debt, and cratering share prices for ASX travel and leisure shares.

Australia’s unemployment rate has risen too, despite many jobs being spared by the government’s JobKeeper program.

Data from the Australian Bureau of Statistics (ABS) revealed that the unemployment rate in September, the latest month available, increased to 6.9%. Meanwhile the labour participation rate, people who are working or actively seeking work, fell to 64.8%. The underemployment rate – people who are working but would like to work more hours – also increased to 11.4%

And Australians who are working aren’t likely to have seen much, or any, of a pay rise.

The latest ABS Wage Price Index (WPI), released today, indicated the seasonally adjusted WPI rose just 0.1% in the September quarter. That brings the year-to-date growth down to 1.4%.

Addressing the results, Andrew Tomadini, Head of Price Statistics at the ABS said:

The September quarter is generally a quarter of solid wage growth, however, the impacts of the COVID-19 pandemic contributed to a subdued rate of wage growth in September quarter 2020.

Organisations continued to adjust to the economic uncertainty, recording fewer end of financial year wage reviews and delaying enterprise bargaining agreement increases. This led to a significantly reduced number of jobs recording wage rises when compared to previous September quarters.

Additionally, the staggered implementation schedule of the Fair Work Commission annual wage review moved some regular September quarter wage rises to later quarters.

The ABS notes that most of the private sector wage growth can be attributed to companies restoring wages to normal (or near normal) levels after cutting wages in the June quarter.

South Australia, where until this week the coronavirus had been largely held in check, notched up 1.8% in year-to-date wage growth, the highest of any state or territory.

Victoria, which only recently emerged from months of strict lockdowns after successfully suppressing new community transmissions, recorded the lowest wage growth, at 1.2%.

As Tomadini noted:

September quarter 2020 covers the period when COVID-19 restrictions were impacting parts of Victoria but had started to ease across the majority of other states and we can see the impacts of this in the data.

With several highly promising vaccines underway and Australia largely managing to keep the virus in check, we can all hope for a return to higher wage growth next year.

More reading

• 2 ASX shares making all-time highs today
• Why the Superloop (ASX:SLC) share price is surging higher today
• UK’s Doctor Care Anywhere to dial in to ASX telehealth ranks
• ASX stock of the day: Redbubble (ASX:RBL) shares up 5% today
• Top brokers name 3 ASX shares to buy today

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. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) has risen more than 0.3% today, following a day of green yesterday as well. In line with this, many individual companies are rising as a result.

Below, we take a closer look at two ASX shares making new all-time highs today.

REA Group Limited (ASX: REA)

REA Group is a multinational digital advertising business specialising in real estate. The company runs realestate.com.au, realcommercial.com.au and flatmates.com.au. Between them, these three websites operate Australia’s top residential, commercial and share property advertising businesses.

In addition to these well-known brands, the company owns an Australian ‘co-working’ space website called spacely.com.au.

Overseas, the company’s Asian operations in the property space are extensive and stretch across Malaysia, Hong Kong, Indonesia, Singapore, China and Thailand. Not only does the REA Group own and operate this large portfolio, but it also owns significant share portfolios in related companies in the United States and India.

The REA Group share price has been strong in 2020, rising more than 34%. In fact, since the March lows, it has made gains of 126%. Today, the intraday REA Group share price reached as high as $143.99, exceeding its previous high of $142.47 to secure a new record this morning.

However, the REA Group share price has since pulled back slightly and is up by 1.15% to $141 per share at the time of writing. 

Only yesterday the REA Group share price dipped lower by 1.31% following its AGM. It seems investors may have a renewed sense of confidence today, pushing the price to new heights.

Chalice Gold Mines Limited (ASX: CHN)

Another ASX share making all-time highs today is Chalice Gold Mines. Chalice Gold Mines operates a mineral exploration company, exploring for gold, copper, cobalt, palladium, and nickel deposits. One of its main properties is the Julimar Nickel-Copper-Platinum group element project located in the Avon Region, Western Australia. Another major project is the Pyramid Hill gold project located in the Bendigo Region, Victoria. 

Chalice Gold shares went for a massive 17%+ run in morning trade after new results released today showed positive discoveries for the company’s Julimar Nickel-Copper-Platinum project. Following a close of $3.30 yesterday, the Chalice Gold share price was driven as high as $3.88 today. Chalice Gold’s previous all-time high was $3.55.

Overall this year, the Chalice Gold Mines share price is up a staggering 1,568%. The company now holds a market cap of over $1 billion.

More reading

• ASX stock of the day: Redbubble (ASX:RBL) shares up 5% today
• Top brokers name 3 ASX shares to buy today
• Why ASX tech shares should fly long after this crisis is over
• Morgan Stanley updates its share price targets for the big 4 banks
• Why Aristocrat Leisure, Chalice Gold, Westpac, & Whitehaven Coal shares are charging higher

Motley Fool contributor Glenn Leese has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Superloop Ltd (ASX: SLC) share price has been a strong performer on Wednesday.

In afternoon trade the independent connectivity services provider’s shares are up over 4% to 98 cents.

Why is the Superloop share price climbing higher?

Investors have been buying Superloop’s shares following the release of an update at its annual general meeting this morning.

At the meeting the company provided investors with a reminder of how it performed in FY 2020 and its performance so far in the new financial year.

In FY 2020, Superloop delivered revenue of $107 million and earnings before interest, tax, depreciation and amortisation (EBITDA) of $13.5 million. The latter meant the company achieved the midpoint of its guidance range despite the challenges presented by COVID-19.

Management advised that this result was underpinned by significant growth in continuing businesses and prudent cost management.

What about FY 2021?

Superloop revealed that it has started FY 2021 in a positive fashion with strong growth in core fibre connectivity and home broadband during the first quarter.

In addition to this, the company spoke very positively about its enterprise opportunity, noting that IDC estimates that the SD WAN market is seeing remarkable growth. IDC expects a compound annual growth rate of nearly 70% and for the market to be worth US$8 billion by 2021.

Management commented: “With a multibillion dollar addressable opportunity, Superloop’s ambition is to become the leading challenger in this market, and we are extremely well positioned to execute this.”

Guidance.

Management expects core fibre sales growth to lead to strong underlying core EBITDA growth in FY 2021.

It also intends to make a ~$3 million investment in new growth initiatives to drive the accelerated monetisation of its existing assets.

As a result, it is forecasting FY 2021 EBITDA of between $18 million and $20 million. This represents a year on year increase of ~41%.

More reading

• UK’s Doctor Care Anywhere to dial in to ASX telehealth ranks
• ASX stock of the day: Redbubble (ASX:RBL) shares up 5% today
• Top brokers name 3 ASX shares to buy today
• Why ASX tech shares should fly long after this crisis is over
• Morgan Stanley updates its share price targets for the big 4 banks

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 SUPERLOOP FPO. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The UK-based healthtech company Doctor Care Anywhere lodged a prospectus on 30 October to undertake an initial public offering (IPO) in the Australian capital market on 4 December.

The company aims to raise $102 million with an issue price of $0.80 per share. This is upsized from the company’s original plans to raise $75 million.

Doctor Care Anywhere advises that the majority of the funds raised by the IPO will be used to support investments in marketing and engagement functions, investment in new products and building international business development capabilities.

What is Doctor Care Anywhere?

Doctor Care Anywhere is a London-based telehealth company founded by Doctor Bayu Thakar, a qualified medical doctor and a McKinsey alumnus. 

The company’s business model is to recruit its own clinicians to provide patients with virtual GP consultations in the form of video or phone consultations with GPs who are directly employed by Doctor Care Anywhere. It also provides diagnostic referrals and specialist reviews across the key clinical specialties.

The company has grown rapidly since its inception in 2014, providing services to more than 1,500 corporate and SME clients through its major channel relationships.

The digital health market

The global telehealth market was estimated to be $7.30 billion in 2019 and is forecast to reach $20.50 billion in 2024, growing at a compound annual growth rate of 23.10%.

Doctor Care Anywhere currently focuses on the UK private healthcare market but advises it is looking to accelerate its business expansion to capture this growing telehealth market. 

According to its prospectus, Doctor Care Anywhere has chosen to list in Australia because it is a developed market with investors who understand healthtech and are keen to invest in digital healthcare. 

Doctor Care Anywhere chair Jonathan Baines said:

The impact of COVID-19 on all our lives has demonstrated the vital role that technology can and must play in the future of healthcare. We see DOC at the forefront of this revolution and we have a clear and ambitious growth strategy that aims to create real value for investors in the rapidly growing digital health market.

More reading

• ASX stock of the day: Redbubble (ASX:RBL) shares up 5% today
• Top brokers name 3 ASX shares to buy today
• Why ASX tech shares should fly long after this crisis is over
• Morgan Stanley updates its share price targets for the big 4 banks
• Why Aristocrat Leisure, Chalice Gold, Westpac, & Whitehaven Coal shares are charging higher

Motley Fool contributor Miles Wu has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Redbubble Ltd (ASX: RBL) share price has popped today, up 5.06% at the time of writing to $4.57 a share. Redbubble shares closed at $4.38 yesterday and opened at $4.40 today before climbing to the current share price. The S&P/ASx 200 Index (ASX: XJO) is up 0.4% today (at the time of writing), so Redbubble is evidently doing a lot better than the broader market today.

It’s been a bumpy month for the Redbubble share price, on top of what has been an indisputably fantastic year for the company.

Redbubble was a $1.09 stock at the start of 2020 and fell as low as 40 cents a share in the COVID-19-induced market crash in March. But the shares have been hot property ever since. Between 23 March and 20 October, Redbubble shares climbed from a low of 40 cents to a high of $6.02 – a gain of 1,405%. However, the shares have cooled somewhat since then, and have fallen more than 24% from that peak on today’s prices, including 19% over the past month.

So what is Redbubble? And why is the Redbubble share price so volatile these days?

What is Redbubble?

Although it only floated on the ASX back in 2016, Redbubble has been around since 2006, when it was founded in Melbourne. It’s an art-focused company that, in the company’s own words, aims to “give independent artists a meaningful new way to sell their creations”. The company tells us that “today, we connect over 700,000 artists and designers across the planet with millions of passionate fans”.

So how does this ‘connecting’ process work? Redbubble operates as a virtual marketplace of sorts. Artists (or aspiring artists) ‘open a shop’ on Redbubble’s online marketplace, virtually stocked with whatever artworks or designs they have created. Customers can then ‘buy’ these designs or art, and have them printed on a variety of mediums. These can be anything from a conventional print or ‘painting’ to having mugs, phone cases, t-shirts, stationary, pillowcases or (more on this later) masks emblazoned with the art/design (Redbubble offers more than 60 products). The consumer pays for the art, the creator gets a royalty, and Redbubble, as the middleman/enabler, gets the rest.

What’s been happening with Redbubble shares in 2020?

Redbubble has clearly been on its own train in 2020, experiencing massive appreciation, as well as volatility. To illustrate the latter point, the shares are up close to 5%, and 4% more than the ASX 200, despite no news whatsoever out of the company. Even so, they remain down 19% over the past month, as we mentioned earlier. My Fool colleague James Mickleboro discusses how this was likely due to the rotation out of ‘COVID-19 shares’ earlier this month here.

So why this volatility? Well, a short answer is that this is a high-octane growth share by the numbers. And those kinds of shares are usually, by nature, volatile.

Some impressive numbers

By the numbers, I’m referring to Redbubble’s latest performance numbers that the company gave us in a quarterly update last month (for the quarter ending 30 September).

In this update, Redbubble told investors that quarterly marketplace revenue came in at $147.5 million, which was up 122% on the prior corresponding period. Profits were even better, rising 149% to $64.5 million against the same benchmark. Sales were strong across all of Redbubble’s key markets. Australia and New Zealand sales were up 125% in the quarter, while United Kingdom sales were up 122% and North America up 102%.

In terms of the coronavirus pandemic, the company has managed to make lemonade with that proverbial lemon. In the update, management advised that a good portion of the sales growth had been driven by a spike in demand for face masks on its platform as a result of the pandemic. It reported a 562% increase in accessories sales during the quarter. This appears to have been driven mostly by increasing demand for trendy/fashionable face masks. Accessories reportedly now account for ~27% of sales on its marketplace.

With numbers like that, it’s no surprise that this is a high-flying, if volatile, share.

More reading

• Why ASX tech shares should fly long after this crisis is over
• Morgan Stanley updates its share price targets for the big 4 banks
• Tesla (NASDAQ:TSLA) share price zooms 8% on S&P 500 news
• ASX 200 up 0.35%: Aristocrat FY 2020 results, big four banks higher, a2 Milk update
• Why the Downer (ASX:DOW) share price is outperforming today

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Many of Australia’s top brokers have been busy adjusting their financial models again, leading to the release of a large number of broker notes this week.

Three broker buy ratings that have caught my eye are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

Afterpay Ltd (ASX: APT)

According to a note out of Morgan Stanley, its analysts have retained their overweight rating and $120.00 price target on this payments company’s shares. This follows the release of an update at its annual general meeting this week. That update revealed that Afterpay delivered record underlying sales in October and that November has started even stronger. This is consistent with what the broker is expecting from Afterpay. The Afterpay share price is trading at $94.78 this afternoon.

CSL Limited (ASX: CSL)

Analysts at UBS have retained their buy rating and $346.00 price target on this biotherapeutics company’s shares. The broker notes that the company’s Seqirus vaccine business is constructing an $800 million manufacturing facility in Melbourne. It believes the facility’s focus on cell-based technology will give it an edge over the competition, which are reliant on egg-based techniques at present. The CSL share price is changing hands for $311.84 on Wednesday.

REA Group Limited (ASX: REA)

Another note out of Morgan Stanley reveals that its analysts have retained their overweight rating and $150.00 price target on this property listings company’s shares. The broker is becoming increasingly positive on REA Group’s earnings growth prospects, particularly given the prospect of the NSW government making changes to stamp duty. In addition to this, a return to listings growth, price increaseS, and flat costs are expected to support its growth. The REA Group share price is fetching $141.24 on Wednesday afternoon.

More reading

• Afterpay (ASX:APT) share price under pressure by US BNPL giant
• ASX 200 rises again on Tuesday
• Why REA Group (ASX:REA) share price is trading lower after AGM
• Leading broker warns that US dollar could face bear market crash in 2021
• Flight Centre and Webjet were among the most traded shares on the ASX last week

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 CSL Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended REA Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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As the world cheered the announcement of 2 promising COVID-19 vaccines, a predictable shift occurred on the ASX and global share markets.

Technology shares – which broadly rocketed higher as the world locked down and people shifted to working, shopping and socialising from home – began to fall out of favour this past week.

Meanwhile, many value shares that remained beaten down by uncertainties over the coronavirus pandemic began to draw renewed investor interest.

The tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC), for example, has soared 30.9% higher so far in 2020. However, since the closing bell on Friday 6 November and the first vaccine announcement, the Nasdaq has gained a meagre 0.04%.

Compare that to the small-cap Russell 2000 Index (INDEXRUSSELL: RUT). Year-to-date, the Russell 2000 is up 7.5%. But at market closing on 6 November it was still down 1.4% for the year. Since the first vaccine announcement the index has rallied 9.0% higher.

You’ll find the same story playing out here in Australia.

The S&P/ASX 200 Index (ASX: XJO), for example, is up 5.4% since 6 November.

As for the S&P/ASX All Technology Index (ASX: XTX), which contains 50 of Australia’s leading and emerging technology companies? It’s down 0.4%.

Christopher Grisanti, chief equity strategist at MAI Capital Management explains (as quoted by Bloomberg):

It’s the same trend we’ve been seeing over the past several weeks which is a move toward value, toward companies that will rebound when COVID goes away. We have facts on the ground which can truly change the environment in a three- to six-month period.

New habits die hard too

If you’re day trading, then best of luck trying to time the ups and downs of value versus growth shares. Unless you have a system the rest of us don’t know of, you’ll need all the luck you can get.

For long term investors, don’t rush to sell the technology shares that were basking in the limelight less than 2 weeks ago.

As Macquarie wrote (from the AFR):

Predictably, investors are starting to assess relative winners and losers, and given that some of the impacted sectors are still 20 per cent to 30 per cent below pre-COVID levels, there is a strong temptation to buy losers and sell winners. Indeed, such rotation makes sense in the context of short-term trading.

If you’re investing with long-term horizon, however, Macquarie adds:

Despite everything looking brighter, the basic dynamics of declining returns on humans and conventional tangible capital are still in place, and indeed have been accentuated by COVID.

In other words, as technology continues to race forward at warp speed, well-run tech-oriented companies should continue to broadly outperform labour and capital intensive business models.

Nick Griffin, fund manager of Munro Partners, echoes that view:

Over the medium term, our view is that lockdowns have pulled forward demand in areas such as e-commerce, cloud computing and internet disruption and the new habits formed during the crisis are unlikely to reverse once the crisis is over.

Businesses are not going to stop doing meetings virtually, consumers are not going to stop purchasing online, and so forth. Consequently, these societal shifts will continue long after the crisis is over.

E-commerce to keep on growing

A huge growth trend since the onset of the pandemic is the rapid rise in e-commerce. And despite the past week’s pullbacks, this trend looks like it will only keep on growing over the longer-term.

My own rather traditional family has gotten on board as well. We’ve largely switched to click-and-collect from Woolworths Group Ltd (ASX: WOW) and have ordered more from Amazon.com.au over the past few months than we’d previously done in years.

At first, setting up your accounts and shopping lists can be a bit tedious. But it quickly gets easier… and habit forming.

In the US, Bloomberg reports:

Tyson Foods Inc.’s CEO on Monday highlighted “stickiness in click-and-collect and click-and-deliver”, while executives at Chinese online giant JD.com Inc. said this week the shift toward online shopping is here to stay.

“We’re convinced that most of the behavior change will persist beyond the pandemic,” Walmart Chief Executive Officer Doug McMillon said on an investor call….

“The US consumer is in the middle of the largest shift in shopping behavior in the last 50 years, as convenience and safety increases in importance and e-commerce grows more rapidly than ever,” Hilding Anderson, head of retail strategy in North America at consultant Publicis Sapient, said in an email.

This is the same ‘shop from the convenience of your home’ trend that’s seen Australian online retailer Kogan.com Ltd‘s (ASX: KGN) share price rocket 154% higher this year. And that’s after losing 16% since 6 November following the first vaccine announcement.

Kogan’s potential to deliver strong share price gains won’t come as news to long time members of Scott Phillips’ Share Advisor service.

Scott first recommended Kogan to his Motley Fool readers way back on 28 September 2017. He cited the fact that the company was built for the online marketplace, had extremely low costs and a strong founder-led business among reasons he liked the stock.

Since Scott’s initial recommendation, the Kogan share price is up 428%.

And, in case you’re wondering, he’s still got it listed as a ‘buy’ in Share Advisor.

More reading

• Morgan Stanley updates its share price targets for the big 4 banks
• Tesla (NASDAQ:TSLA) share price zooms 8% on S&P 500 news
• ASX 200 up 0.35%: Aristocrat FY 2020 results, big four banks higher, a2 Milk update
• Why the Downer (ASX:DOW) share price is outperforming today
• 2 food-based ASX dividend shares to feed your income needs

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Bernd Struben 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 Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia owns shares of Woolworths Limited. The Motley Fool Australia has recommended Amazon and Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Broker Morgan Stanley has updated its price targets for the big 4 banks following the quarterly reporting season. 

The banks have been standout performers among the S&P/ASX 200 Index (ASX: XJO) and a driving force behind the recent 9-month high for the index. 

Big 4 bank price updates 

The Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price target was raised from $19.40 to $21.90 with an overweight rating. The ANZ share price has been the best performing big four bank in the last week, running more than 6%. Its share price is currently just above the target price at $21.95. 

The Commonwealth Bank of Australia (ASX: CBA) share price target was raised from $62.00 to $68.50 and retains an underweight rating. The CBA share price is currently $77.03 or 12.5% higher than the price target. 

The National Australia Bank Ltd (ASX: NAB) share price target was raised from $17.50 to $20.10. Despite the price upgrade, its rating was downgraded from equalweight to underweight. Morgan Stanley believes that the company’s recovery will likely lag its rivals. The NAB share price is currently 10% higher than the price target at $22.28. 

The Westpac Banking Corporation (ASX: WBC) share price target was unchanged at $17.00. Its rating was upgraded from equalweight to overweight. The broker anticipates that the bank will continue to sell off its non-core assets. The Westpac share price is currently $19.38 or 14% higher than the broker target price. 

More broadly speaking, the broker expects a rebound in dividends in FY21. However, the recovery in earnings will likely take longer. It believes loan losses may also surprise to the upside. 

What do the economic indicators say?

A range of economic indicators suggest that the worst may be behind us. These include: 

• The Westpac-Melbourne Institute index of consumer sentiment has reached a 7-year high of 107.7, up 11% compared to a year ago 
• NAB’s business confidence index has jumped to an 18-month high
• CoreLogic notes that house auction clearance rates are at the highest preliminary clearance rate since 1 March
• Bank loan deferrals have been consistently falling 

The recent interest rate cut to 0.10% and the guarantee of rates remaining low for at least 3 years will give home buyers and businesses confidence moving forward. 

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Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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