Tag: Motley Fool

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

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

Pfizer Inc. (NYSE: PFE) and BioNTech SE (NASDAQ: BNTX) started the phase 3 clinical trial for their coronavirus vaccine BNT162b2 around the same time as Moderna Inc (NASDAQ: MRNA) started its phase 3 study for mRNA-1273.

But all signs point to Pfizer and BioNTech generating faster efficacy data than Moderna. Here’s why:

1. Faster coronavirus vaccine booster shot

Pfizer and BioNTech give the booster shot for their vaccine 21 days after the initial dose, while Moderna’s protocol calls for doctors to wait 28 days before giving the second dose. Since the efficacy measurements don’t start until after the second dose is administered, the difference produces a week advantage for Pfizer and BioNTech.

2. COVID-19 efficacy readout is quicker

The efficacy in both clinical trials is based on the rate of COVID-19 among participants who receive the vaccine compared to the participants who receive placebo. But Pfizer and BioNTech decided to measure the rate of infection after seven days, while Moderna doesn’t start measuring efficacy until 14 days after the second dose.

The difference creates an additional seven-day advantage for Pfizer and BioNTech compared to Moderna. Of course it’s only an advantage if patients are truly protected during that seven-day period. Presumably the decisions of seven days for Pfizer and BioNTech vs. 14 days for Moderna were based on when the companies saw the formation of antibodies in earlier studies, but Moderna’s conservative approach could end up benefiting the company with a slower-but-more-accurate efficacy readout.

3. Quicker enrollment

Since the efficacy measurement is events driven, early enrollment of participants in the study should help the companies generate efficacy data quicker.

Pfizer and BioNTech appear to have the edge here too, with 28,146 participants having received two doses of their vaccine as of Oct. 5,  compared to 19,369 participants in Moderna’s clinical trial as of the update a few days earlier on Oct. 2.

Potential bonus: Interim readouts

If BNT162b2 works really well, Pfizer and BioNTech could have a time advantage over Moderna based on how the companies have set up their clinical trials.

Both studies incorporate multiple interim evaluations of efficacy to determine whether the studies should be stopped early if it’s clear the vaccine is working. Pfizer and BioNTech have interim looks after 32, 62, 92, and 120 participants have developed COVID-19. Moderna’s study only incorporated interim looks after 53 and 106 cases of COVID-19.

While the protocols offer an opportunity for Pfizer and BioNTech to call their clinical trial a success after 32 events, well before Moderna can even take a look at its data at 53 events, investors should keep in mind that the extra peeks at the data come at a statistical cost.

As a result, if both studies go to the end of their analysis, Pfizer and BioNTech need the vaccine efficacy to be 52.3% at the final readout with at least 111 of the 164 positive patients in the group who received placebo. Because Moderna has fewer interim looks, the biotech company only needs a vaccine efficacy of 49.5%, or 101 of the 151 positive patients falling in the placebo group, to call the clinical trial a success.

Is “October” vs “Thanksgiving” all that important?

Pfizer and BioNTech have told investors that data could come as early as October, while Moderna’s management has said data should be available around Thanksgiving. That’s only a few weeks’ difference, with the obvious caveats that neither group can really know the timeline given the unknown infection rate.

The first group with data will have an advantage if it can gain the Food and Drug Administration’s attention after requesting an emergency use authorization (EUA). But in a pandemic, the FDA’s workload isn’t necessarily a first-in-first-out situation. Better efficacy by the second vaccine maker could even the playing field, or perhaps even give it an advantage in the timing of authorizations.

And investors should keep in mind that demand is likely to outstrip manufacturing capacity. While the timing of an EUA is important, if the authorizations come in similar time frames, the group with the ability to manufacture the most vaccine is likely to capture the largest market share.

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

More reading

• Johnson & Johnson (NYSE:JNJ) starts late-stage coronavirus vaccine clinical trial
• Coronavirus vaccine trial adverse event was probably unrelated to treatment
• Pfizer says it could know if its COVID-19 vaccine candidate works in October
• The surefire vaccine winner following AstraZeneca’s COVID-19 trial pause
• What if more than one company wins the coronavirus vaccine race?

Brian Orelli, PhD and the Motley Fool have 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.

The post 3 reasons Pfizer and BioNTech will have coronavirus vaccine data before Moderna appeared first on Motley Fool Australia.

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

from Motley Fool Australia https://ift.tt/3iKoUjy

As I mentioned here at the weekend, the economics team at Westpac Banking Corp (ASX: WBC) are expecting the Reserve Bank to cut the cash rate to the record low of 0.1% next month.

In light of this, if you haven’t done so already, I think now would be a good time to consider switching out of term deposits and into one of the many quality dividend shares listed on the Australian share market.

But which ASX dividend shares would be good options right now? Two that I would buy are listed below:

Rural Funds Group (ASX: RFF)

The first ASX dividend share I would buy is this agriculture-focused property group. Rural Funds is the owner of a number of quality properties across five agricultural sectors. These properties are leased to some of the biggest players in the industry, such as wine giant Treasury Wine Estates Ltd (ASX: TWE), on long term agreements. So much so, at the end of FY 2020, the company’s weighted average lease expiry (WALE) stood at a lengthy 10.9 years.

These leases and their fixed rental increases led to the company performing strongly during the pandemic. Rural Funds reported an 8% increase in property revenue to $72 million in FY 2020. Looking ahead, further growth is expected in FY 2021. As a result, management is intending to lift its distribution by 4% to 11.28 cents per share. Based on the current Rural Funds share price, this works out to be a 4.8% yield.

Wesfarmers Ltd (ASX: WES)

Another ASX dividend share to consider buying is this conglomerate. I think it could be a great option due to the quality of its portfolio of businesses. This is particularly the case for its key Bunnings business, which I believe is well-placed to underpin strong growth in the 2020s. This is thanks to its strong market position, government stimulus, tax cuts, and the relaxing of responsible lending rules. The latter should be supportive of the home improvement market in the near term.

Overall, I believe Wesfarmers will be in a position to pay a fully franked dividend of ~$1.50 per share in FY 2021. Based on the latest Wesfarmers share price, this equates to an attractive fully franked 3.2% dividend yield.

More reading

• ASX 200 Weekly Wrap: Budget, US election sparks 5% surge in ASX shares
• Why it is important to diversify your ASX portfolio and how you can do it
• How to replace your entire wage with ASX dividend shares
• Say goodbye to low interest rates and buy these ASX dividend shares
• Brokers name 3 ASX shares to buy right now

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. The Motley Fool Australia owns shares of Wesfarmers 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.

The post 2 of the best ASX dividend shares you can buy today appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3nIAjny

The S&P/ASX 200 Index (ASX: XJO) has slipped lower in morning trade, down 0.05% at the time of writing.

This morning’s retrace came following a strong performance last week, which saw the ASX 200 finish the five days up 5.4%.

It also came despite most major European indexes gaining on Friday, alongside every United States index finishing well into the green. Technology shares again led the way, with the tech-heavy Nasdaq Composite (NASDAQ: .IXIC) gaining 1.4%.

Though still down 4% from its 2 September all-time highs, the Nasdaq is up 27% so far in 2020. That compares to a gain of 7% on the S&P 500 Index (SP: .INX) and an 8.8% loss from the ASX 200.

Tech shares still shining

Technology shares, as you likely know, were already outperforming heading into the pandemic. And since the lockdowns and social distancing began, they’ve really grabbed investor interest amid growing demand for tech gadgets and services from a nation now working, shopping and socialising from home.

That’s seen ASX tech shares enjoy similarly strong gains to US listed technology companies. Unfortunately, it’s difficult to give you a simple like-for-like comparison for the full year without crunching 50 plus company share price movements myself. That’s because the S&P/ASX All Technology Index (ASX: XTX) – which tracks 50 of Australia’s leading and emerging technology shares – didn’t launch until 24 February this year.

I can tell you that the All Tech Index is up nearly 29% since then. And that it’s up 1.5% in intraday trading today, while the broader index is flat.

Which leaves us with two takeaways.

First, the bull run in technology shares appears far from over. Meaning if you don’t already own some quality ASX tech shares, or want to add to your holdings, I believe that window is still open. If you want to own some of Australia’s biggest tech companies with a single investment, you can look into the BetaShares S&P/ASX Australian Technology ETF (ASX: ATEC). The share price of the exchange-traded fund (ETF) is up 41% since its inception on 4 March.

The second takeaway is that all shares in every market are, at times, volatile. Share prices can swing from losses to gains and back again in a single day. Over the long haul, though, share prices of quality companies tend to only head in one direction. Higher.

Which, belatedly, brings us to Dr Takao Inui.

Why ASX investors need a ‘bulbous bow’

As far as I know, Takao Inui never invested in any Australian shares.

What he did do was develop the modern bulbous bow still used in many large ships today.

Building on research from other scientists, Inui’s work at the University of Tokyo in the 1950s and 1960s led to his discovery that ships with the right type of bulbous bow had less drag in the water along with greater stability. Meaning they can ride through the peaks and troughs in rough seas with far less discomfort for their passengers.

That’s incredibly useful for ships ploughing ahead through big swells. Rather than plunging up and down, the captain can keep a steady eye on the horizon.

And it’s this same horizon that long-term investors should keep in mind rather than bemoaning any short-term losses or even celebrating any short-term gains.

This ‘buy-to-hold’ investment philosophy is the same one employed by The Motley Fool’s own Scott Phillips and his lead analyst Andrew Legget in their investment service, Share Advisor. A philosophy that’s seen Scott outperform the benchmark with his ASX recommendations by more than 25% since 2011.

Here’s what Andrew wrote to members of Share Advisor last week:

[V]olatility is not risk, it is not something to be avoided or feared, it is just the price of admission into the lucrative world of investing on the share market. If you want impressive returns, you have to become comfortable with holding great companies during tough periods.

Avoid the desire to get in and out of investments because some ‘bad news’ arrives. In fact, if you continue to like the company and believe it has a strong long-term future, these are more often than not buying opportunities, rather than reasons to get out.

Over the short term, markets will fluctuate, sometimes for no reason at all. Your patience and nerves will be tested, sometimes for no reason at all. But if you stay the course over the long-term, the share price will match the performance of the business. Don’t believe us, just pull up the long-term chart of your favourite company and see for yourself.

That’s great advice from the team at Share Advisor. I especially like the last line. It’s real ‘bulbous bow’ thinking.

More reading

• ASX 200 down 0.1%: CBA’s COVID-19 loan deferrals improve, Link receives takeover approach
• Why I’d watch the Platinum (ASX:PTM) share price this week
• ASX 200 Weekly Wrap: Budget, US election sparks 5% surge in ASX shares
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 next week

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.

The post The valuable lesson Dr Takao Inui has for every ASX investor appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/30YR985

The Commonwealth Bank of Australia (ASX: CBA) share price is pushing higher on Monday.

At the time of writing the banking giant’s shares are up 0.4% to $67.98.

What is driving the CBA share price higher today?

Investors have been buying the bank’s shares following the release of an update on its COVID-19 loan deferrals as of the end of September.

According to the release, the bank continued to see encouraging trends in the number of its home loan and SME lending customers who are able to return to making normal repayments on their loans.

This led to the total number of loan repayment deferrals reducing to 129,000 at the end of September. This compares to 174,000 in August and 210,000 in June.

The total loan balances on these deferrals has also fallen materially. It now stands at $42 billion, down from $59 billion in August and $67 billion in June.

The vast majority of its loan deferrals relate to home loans. Approximately 93,000 home loans were on deferral at the end of September, representing a balance of $37 billion.

What’s next?

Pleasingly, management expects further significant reductions in October as initial temporary repayment deferrals continue to expire. It notes that 52,000 of the 93,000 home loans on deferral are due to resume repayments in October. These loans represent a balance of $20 billion.

However, while these trends are positive, Commonwealth Bank’s CEO, Matt Comyn, acknowledges that the hard times are far from over and further support may be required for some customers.

He commented: “While these trends are encouraging, we are conscious that many of our customers still require our ongoing support, particularly in regions most affected by COVID-19, such as Victoria, which is reflected in requests for deferral extensions. We will continue to offer support and assistance to our customers as the economy recovers.”

More reading

• ASX 200 down 0.1%: CBA’s COVID-19 loan deferrals improve, Link receives takeover approach
• ASX 200 Weekly Wrap: Budget, US election sparks 5% surge in ASX shares
• Forget term deposits and buy these ASX dividend shares instead
• ASX 200 finishes 1.3% higher after federal budget
• ASX 200 up 0.4%: Big four banks push higher, Westpac upgraded, ARB impresses

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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.

The post CBA (ASX:CBA) share price higher on COVID-19 loan deferral update appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/36U9zuz

Damstra Holdings Ltd (ASX: DTC) is a provider of workplace management solutions in the form of integrated hardware and SaaS solutions for industries where safety and compliance is of utmost importance such as mining, resources and construction. It’s been exactly one year since its initial public offering (IPO) at an offer price of $0.90 per share. With its recent share price and business performance, could Damstra be the ASX tech share to own? 

What does Damstra do? 

Damstra provides solutions to various workplace safety and compliance sensitive segments. This includes: 

• Workforce management and onboarding, particularly contingent, casual, part-time or contractor workforces that are paid on an hourly basis 
• Access control used to restrict access to properties, facilities, buildings and rooms
• Learning management to offer courses to staff and provide an organisation with the ability to track and record enrolment, progress and completion of learning and development modules 
• Asset management software used to track fixed assets in organisations such as the depreciation values on fixed assets and track repair and overhaul schedules 
• Health, safety and environmental management including policies, risk assessments, incident reports, training records  

FY20 performance 

Damstra delivered a strong FY20 performance across the board with a 46.6% increase in revenue to $23.5 million and $4.8 million underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) compared to $1.8 million in FY19. The company’s growth is accelerating with 30.5%, 47.7% and 46.6% increase in revenue between FY18-20 respectively. Its accelerating growth demonstrates the benefits of its scalable software and hardware platform. 

COVID-19 has acted as a tailwind for the Damstra business with many clients seeking a ‘COVID’ solution for workplace safety and compliance. This includes features such as fever detection, mobility tracking, managing people’s access and integration with other systems.

What makes Damstra a leading ASX tech share candidate? 

I believe the combination of high client retention rates and stickiness combined with a scalable technology, digital adoption tailwinds and further product innovation makes Damstra a very strong ASX tech share candidate. 

It’s engaged with organisations and sectors that it believes require an efficient, integrated and scalable solution that reduces staff down-time, injury rates and manual labour while improving risk and compliance outcomes relative to an on-premise model. The integration of both hardware and software in its solution increases the stickiness of its clients and creates a barrier of entry for competitors. This also creates further opportunities to sell new products and features to existing clients.

Its solutions have been designed to be scalable on a global basis, incorporating an industry agnostic platform which can be configured to accommodate the requirements of multiple segments of the market across various jurisdictions. 

Taking into consideration the bigger picture, the company is arguably in its early days, with its FY20 report providing multiple examples of its future potential. This includes revenue growth from cross-selling products to existing clients, fever detection integrated with facial recognition and smart paperless forms. 

Foolish takeaway

The Damstra share price has run up more than 25% in the last five trading sessions and is trading up 3.14% at $2.30 at the time of writing. Its characteristics in growth, M&A and innovation is reminiscent of sales and marketing software provider, Bigtincan Holdings Ltd (ASX: BTH), which has also experienced a significant share price run in recent years. While I wouldn’t be buying Damstra at today’s prices,  I would watch closely for an entry opportunity. 

More reading

• Why the the Damstra (ASX:DTC) share price has surged 5%
• Top ASX Stock Picks for October 2020

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 and recommends BIGTINCAN FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Damstra Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Damstra Holdings Ltd. The Motley Fool Australia has recommended BIGTINCAN FPO. 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.

The post How far could your $10,000 go in this ASX tech share  appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3lBBXFY

It is sometimes hard for investors to commit to ASX shares with eyewatering valuations. Buying ASX shares that are value orientated can feel more tangible with the added benefit of dividends. Here are two cheap ASX shares for those who like to stick to the fundamentals. 

2 ASX shares I think are ideal for value investors

1. Bell Financial Group Ltd (ASX: BFG) 

Bell Financial Group is an Australia-based provider of stockbroking investment and financial advisory services to private, institutional and corporate clients. Across its companies, Bell Potter Securities, Bell Potter Capital and Third Party Platform, it services over 600,000 clients with funds under advice exceeding $58.4 billion. 

In the company’s half year announcement on 12 August, it announced a 7.4% increase in revenue to $129.6 million, a profit after tax of $23.5 million and $88 million net cash with no core debt. The Bell Financial share price trades at a relatively cheap price-to-earnings (P/E) ratio of just 12, despite a strong track record of growth, with a compound annual growth rate (CAGR) of 8.1% for revenue and 15.6% for NPAT between 2015 to 2019. Its consistency towers over many other ASX shares in the financials sector. The reliability of Bell Financial shares could make them a worthwhile value pick backed up by modest growth. The company also pays a generous, fully franked dividend yield of 6.20% at today’s prices. 

2. Pact Group Holdings Ltd (ASX: PGH) 

Pact Group is a leading provider of specialty packaging solutions in Australasia, servicing both consumer and industrial sectors. It specialises in the manufacture and supply of rigid plastic and metal packaging, materials handling solutions, co-manufacturing services, recycling and sustainability services. 

Pact Group represents a recovery story following significant higher input costs and a one-off restructuring cost in late 2018. The company delivered a sound FY20 performance driven by solid organic growth in contract manufacturing for hygiene category items and in-crate pooling services. Its sales fell 1% to $1,809 million while NPAT improved to $92 million, up from a $290 million loss in FY19. 

The concept of Pact Group being a turnaround business is prevalent in its FY20 presentation with the business focused on transforming its Australian packaging segment, pivoting towards recycling and creating a competitive platform in the ANZ fresh food segment. 

The business estimates that by 2022, it will be the largest PET recycler in the ANZ region. It aims to use local recycled material to differentiate its packaging products to meet the increasing demand for more sustainable packaging solutions. Sticking with the theme of recycling, the business wants to establish a leading position for the supply of locally sourced recycled packaging to the fresh food segment. The company has entered into an agreement to acquire Flight Plastics NZ, a leading provider of plastic trays and containers for the fresh food segments. This acquisition will give Pact access to over 5,000 tonnes of recycled PET to sell into food grade packaging in the ANZ region.

With an improvement in earnings and a clear vision for the future, I believe Pact Group could be a turnaround ASX share for value investors.

More reading

• Bell Financial (ASX:BFG) share price up 7% following presentation

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.

The post 2 cheap ASX shares I like for value investors appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3dmCIQm

At lunch on Monday the S&P/ASX 200 Index (ASX: XJO) has just dropped into negative territory. The benchmark index is currently down 0.1% to 6,097.5 points.

Here’s what has been happening on the market today:

CBA COVID-19 loan deferrals update.

The Commonwealth Bank of Australia (ASX: CBA) share price is pushing higher on Monday after the release of an update on its COVID-19 loan deferrals. According to the release, the banking giant has experienced another reduction in the number of loans on deferral. At the end of September, the total number of loan repayment deferrals stood at 129,000. This is down from 174,000 in August and 210,000 in June.

Link receives takeover approach.

The Link Administration Holdings Ltd (ASX: LNK) share price is rocketing higher on Monday after receiving a takeover approach. The administration services provider has received a non-binding and indicative offer of $5.20 cash per share from a consortium comprising Pacific Equity Partners, Carlyle Group, and their affiliates. This represents a 30% premium to its last close price. Major shareholder Perpetual Limited (ASX: PPT) intends to vote in favour of the proposal, subject to no superior proposal being tabled.

Gold miners charge higher.

The likes of Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Limited (ASX: NCM) shares are racing higher today with the rest of the gold miners. A strong first quarter update from Evolution, a broker upgrade for Newcrest, and a solid rise in the gold price has lifted their shares. At the time of writing, the S&P/ASX All Ordinaries Gold index is up a sizeable 1.8%.

Best and worst ASX 200 performers.

The best performer on the ASX 200 on Monday has been the Link share price by some distance with its 25% gain. This follows the receipt of its takeover approach this morning. The worst performer has been the Orica Ltd (ASX: ORI) share price with a 3.5% decline. This morning it revealed that its FY 2020 underlying earnings before interest and tax (EBIT) would be slightly above $600 million. This compares to EBIT of $665 million in FY 2019.

More reading

• Evolution (ASX:EVN) share price is punching higher. Here’s why.
• Why Evolution, Link, Newcrest, & NEXTDC shares are charging higher
• Why Event, Flight Centre, Oil Search, & Orica shares are dropping lower today
• Link (ASX:LNK) share price rockets 26% higher on takeover approach
• Why I’d watch the Platinum (ASX:PTM) share price this 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 Link Administration Holdings Ltd. The Motley Fool Australia has recommended Link Administration Holdings 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.

The post ASX 200 down 0.1%: CBA’s COVID-19 loan deferrals improve, Link receives takeover approach appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/33PhMhN

The Evolution Mining Ltd (ASX: EVN) share price is surging in mid-morning trade following the release of its quarterly results.

At the time of writing, the Evolution share price is punching higher since the opening bell, up 4.15% to $6.14.

The Australian mining and exploration company owns and operates five gold and silver mines in New South Wales, Queensland and Western Australia. Let’s see how it performed for the first quarter of FY21.

Quarter results for FY21

Evolution reported a strong quarterly result for the period ending September 30. The company achieved a gold production of 170,021 ounces, with an all-in sustaining cost (ASIC) of $1,198 per ounce. Before C1 cash costs, royalties, general corporate and administration expenses, all-in cost stood at $1,663 per ounce.

Operating mine cash flow came in at $272.3 million, and a net mine cash flow of $183.4 million.

Evolution advised net bank debt of $180.3 million, a decrease of the $196.4 million reached at the end of June.

The gold miner announced it was tracking ahead of its FY21, and hit a major milestone for the Cowan underground mine development. Evolution submitted a significant state development (SSD) application and modification 16 development application to the New South Wales Department of Planning, Industry and Environment. An environmental impact study will form part of the SSD.

Evolution is forecasting FY21 gold production of between 670,000 – 730,000 ounces, of an ASIC of $1,240–$1,300 per ounce.

What did the CEO say?

Evolution executive chair Jake Klein said it was great to start the new financial year with continued positive momentum. He added:

Our operations are performing well and it is pleasing to be ahead of where we had planned to be at the end of the first quarter. Most importantly, the business continues to generate sector leading cash flow per ounce and our balance sheet remains strong with net debt reducing even after rewarding shareholders with their 15th consecutive dividend of A$153.8 million.

Mr Klein also spoke about the company’s future plans:

The submission for approval of the Cowal underground mine is another important step towards achieving our objective of producing 350,000 ounces per annum of low-cost gold from this cornerstone operation.

Is the Evolution share price in the buy zone?

I think that a little bit of gold exposure is good for every portfolio. This is where established gold miners like Newcrest Mining Limited (ASX: NCM) or Northern Star Resources Limited (ASX: NST) have a little advantage.

As attractive Evolution’s opportunities may seem, I will be watching its developments from the side lines for now.

More reading

• ASX 200 down 0.1%: CBA’s COVID-19 loan deferrals improve, Link receives takeover approach
• Why Evolution, Link, Newcrest, & NEXTDC shares are charging higher
• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday

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. 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.

The post Evolution (ASX:EVN) share price is punching higher. Here’s why. appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/352A7r5

The S&P/ASX 200 Index (ASX: XJO) is fighting hard to maintain its winning streak on Monday. In late morning trade the benchmark index is up slightly to 6,105.3 points.

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

The Evolution Mining Ltd (ASX: EVN) share price is up 4.5% to $6.16 following the release of its first quarter update. The gold miner delivered a result ahead of expectations, with production coming in at 170,021 ounces. This was achieved with an all-in sustaining cost of $1,198 per ounce and an all-in cost margin of $871 per ounce. As a result, Evolution generated operating mine cash flow of $272.3 million for the quarter.

The Link Administration Holdings Ltd (ASX: LNK) share price has jumped almost 25% higher to $4.97. This follows news that the administration services provider has received a takeover approach from a consortium comprising Pacific Equity Partners, Carlyle Group, and their affiliates. An offer of $5.20 cash per share has been tabled. Major shareholder Perpetual Limited (ASX: PPT) intends to vote in favour of the proposal.

The Newcrest Mining Limited (ASX: NCM) share price has risen 3% to $32.24. Investors have been buying Newcrest and other gold miners on Monday following a solid rise in the gold price on Friday night. In addition to this, analysts at Citi upgraded the company’s shares to a buy rating with a $37.00 price target this morning. This follows news that its board has approved the expansion of its Cadia operation.

The NEXTDC Ltd (ASX: NXT) share price is up 2.5% to $13.10. This morning the data centre operator announced a new $1.5 billion debt facility. This debt facility has lowered the company’s cost of debt notably and positioned it for growth. It is also worth noting that some of the facility is multi-currency. This could be a sign that NEXTDC has its eyes on expanding internationally in the near future.

More reading

• Link (ASX:LNK) share price rockets 26% higher on takeover approach
• NEXTDC (ASX:NXT) share price hits record high on debt update
• ASX 200 Weekly Wrap: Budget, US election sparks 5% surge in ASX shares
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 next week

James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Link Administration Holdings Ltd. The Motley Fool Australia has recommended Link Administration Holdings 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.

The post Why Evolution, Link, Newcrest, & NEXTDC shares are charging higher appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/3iU6D3k

The Qantas Airways Limited (ASX: QAN) share price has plummeted by around 40% year to date. On top of this, the national airline has recently announced it is terminating its 30-year sponsorship of Rugby Australia due to the deteriorating market conditions.

With all the trouble the Australian aviation industry is facing this year, namely the debt crisis, outbound travel restrictions and labor disputes, should investors consider buying Qantas shares?

Will COVID-19 permanently impact Qantas?

In Qantas’ recent FY20 Chairman’s report, Chairman Richard Goyder AO commented that “Aviation is all about connecting people and place, which is exactly what the public health response to COVID-19 is designed to avoid.”

There is no doubt that the COVID-19 pandemic is hitting the aviation industry hard, and the current crisis is worse than the problems Qantas faced in 2019 (namely, cost of fuel and a low Australian dollar). With the restrictions on international and domestic travel, the airlines are grounded, and the significant 22% drop in passenger revenue since June 2019 has hit Qantas’ balance sheet hard.

Can the business revive itself?

One of the most critical business indicators in the aviation industry is the cost of available seat kilometres (CASK). This is used to measure the unit cost expressed in cash value to operate each seat for every kilometre.

CASK has increased 11% to 8.87 since FY19 as a result of rising operational costs and less available seats due to pandemic restrictions. Qantas has a difficult time in controlling its CASK given the high revenue volatility from a range of external factors, including fluctuating exchange rate movements and higher fuel cost.

However, the Morrison Government announced a $165 million bailout plan earlier in April to keep the airline afloat. Furthermore, Qantas conducted a successful $1.9 billion capital raising via institutional investors in July, which demonstrates that investors still see equity value in Qantas. This bodes well for the airline’s future.

Three-year recovery plan to keep the iron bird alive

While the economic outlook still looks skinny, Qantas has decided to focus on cost cutting given its limited opportunity to generate income in the current environment.

It is clear to me that the coronavirus pandemic is pushing Qantas into a corner, so this cost cutting is probably the best defensive strategy the national airline can do to manage further downside risks at the moment.

While Qantas turned to the private placement market to shore up its balance sheet, the airline also launched a ‘flight to nowhere’ program in September to maintain its cash flow and keep its pilots working. The plane takes off and lands at the same airport and has proved popular – the first of these 7-hour routes around the country saw 134 seats sold out in 10 minutes.

Foolish takeaway

It may seem attractive for short-term traders to buy Qantas as it looks like a good bargain based on its share price. However, I think it will take a substantial effort for Qantas to return to its former glory.

With the continual refusal of the Queensland and Tasmania premiers to open up state borders in the near future, I would say the negative sentiment has not been fully priced in yet, and perhaps Qantas will also need to resume its dividend payment to further restore investors’ confidence in the long run. 

More reading

• ASX 200 up 2.3%: Big four banks charge higher, Qantas soars, energy shares jump
• Why Costa, Qantas, Santos, & Westpac shares are storming higher today
• Leading broker upgrades Qantas (ASX:QAN) shares to buy rating
• 5 things to watch on the ASX 200 on Monday
• The ASX shares that fund managers were buying this month

Motley Fool contributor MWUaus 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.

The post Should you consider buying Qantas (ASX:QAN) shares? appeared first on Motley Fool Australia.

from Motley Fool Australia https://ift.tt/2SNzRXc