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The best performer on the S&P/ASX 200 Index (ASX: XJO) over the last 30 days has been the Corporate Travel Management Ltd (ASX: CTD) share price by some distance.

Since this time last month, the corporate travel specialist’s shares have jumped over 65% higher.

Why is the Corporate Travel Management share price on fire right now?

Investors have been fighting to get hold of the company’s shares in recent weeks following the release of a better than expected full year result for FY 2020.

For the 12 months ended 30 June 2020, Corporate Travel Management reported underlying earnings before interest, tax, depreciation and amortisation (EBITDA) of $65 million.

While this was a sharp decline on a year earlier, it was far better than what many of its travel peers reported. Webjet Limited (ASX: WEB), for example, posted an EBITDA loss of $91.3 million for FY 2020.

Corporate Travel Management’s second half was supported by cost cutting measures and the provision of travel solutions for essential workers during the pandemic.

Balance sheet strength.

Another positive was the company’s balance sheet. Despite not undertaking a capital raising like Webjet and Flight Centre Travel Group Ltd (ASX: FLT), Corporate Travel Management still finished the year with a very strong balance sheet. It reported a net cash balance of $55 million and no debt on its book. It also has $180 million available to it from a committed undrawn facility.

Given that its cost base is currently $13.5 million (or $16 million without government support), the company clearly has more than enough liquidity to ride out the storm. Not that it looks likely to burn through much more cash given the improving trends. 

Improving trends.

As alluded to above, I think the improving trends the company is experiencing are what got investors most excited.

Although it was unable to provide guidance, management made a few comments on current trading conditions.

It said: “July activity continued higher month on month versus June suggesting a broad-based recovery in corporate activity is underway in the northern hemisphere, with corporates back at work late August.”

And despite July traditionally being its quietest month of the year, the company only recorded an underlying EBITDA loss of $2.2 million.

Should you invest?

Overall, I think things look very promising for Corporate Travel Management.

And while I’m not personally in a rush to invest just yet, I do feel it could prove to be a great long term investment option for patient investors.

More reading

• These are the 10 most shorted ASX shares
• The one type of ASX company that outperforms all others
• Why Afterpay, Flight Centre, Helloworld, & QBE shares are tumbling lower
• These were the best performing ASX 200 shares in August
• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Webjet Ltd. 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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I think that there are some S&P/ASX 200 Index (ASX: XJO) shares that could be really good value.

There are some shares that may look cheap like Australia and New Zealand Banking Group (ASX: ANZ), but I’m not sure how much growth potential they have.

Whereas I think there are some businesses that look really good value but also have good long-term growth potential:

Brickworks Limited (ASX: BKW)

Brickworks is a leading building products business in Australia. It’s the market leader for bricks in the country. It sells a variety of other products including masonry, paving, roofing, precast and so on.

Things are currently difficult with construction due to COVID-19 impacts. However, I don’t think the tough conditions will last forever. I believe the best time to buy a cyclical business is near the bottom of the cycle. This could actually make it a good time to buy with regards to its construction earnings.

The ASX share also recently made some acquisitions in the US which made it into the market leader in the north east of the US. The company plans to bring its Australian efficiencies to the American subsidiary. This should improve its profit margins over the coming years.

What I particularly like about Brickworks is its defensive investments. It owns around 40% of investment house Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). The ASX share has been around for over a century and its owns a broad portfolio of different industries including telecommunications, resources and listed investment companies (LICs).

Brickworks also owns a 50% stake of an industrial property trust along with partners Goodman Group (ASX: GMG). This property trust leases to quality tenants and it’s exposed to the growth trends of ecommerce and logistics.

The value of the Soul Patts shares and the stake of the property trust alone supported the value of Brickworks’ market capitalisation. We get the rest of the business for free.

At the current Brickworks share price it offers a grossed-up dividend yield of 4.7%. It hasn’t cut its dividend in four decades.

A2 Milk Company Ltd (ASX: A2M)

I think that A2 Milk is a great ASX 200 growth share. It sells a variety of dairy products, though the high margin infant formula is the key for the business.

It sells an enormous amount of infant formula overseas. In FY20 the company grew its China label infant nutrition by over 100% to NZ$337.7 million. In the USA it grew its revenue by 91.2% to NZ$66.1 million.

The A2 Milk growth runway is really long in my opinion. The ASX share is steadily growing its market share overseas. It’s investing for that growth, but I think it’s worth it. Scale does help with a consumer business.

In Canada the company has recently entered into an exclusive licensing agreement with Agrifoods to produce, distribute, sell and advertise A2 Milk branded liquid milk in the Canadian market. The product has recently been launched to customers in Western Canada.

Since listing on the ASX, this share has done incredibly well. FY21 is expected to show continued strong revenue growth. However, the earnings before interest, tax, depreciation and amortisation (EBITDA) margin is expected to be lower in FY21 due to higher raw and packaging costs, more marketing and pantry-stocking not likely to be replicated. The share price has dropped back since reporting season – I think it’s a good time to buy. 

At the current A2 Milk share price it’s trading at 27x FY22’s estimated earnings.

Foolish takeaway

I think both of these ASX shares are really good value right now. Using Brickworks’ book value, it looks like a good time to buy. A2 Milk is a great ASX growth share and it’s trading much cheaper than many of its growth stock peers. If you don’t need income then I think A2 Milk could be the best pick in the ASX 200.

More reading

• New to investing? Here are 5 ASX dividend shares to buy now
• New to investing? More ASX growth shares to buy now
• 3 ASX shares every retiree should own
• Here’s how to make a $1 million portfolio by investing $1,000 a month
• I love volatile ASX share market days like today

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of A2 Milk. 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 5G Networks Ltd (ASX: 5GN) share price has started the week deep in the red after returning from a trading halt.

In afternoon trade the data networks company’s shares are down 8% to $1.96.

Why is the 5G Networks share price sinking lower?

The 5G Networks share price has come under pressure on Monday after it announced the successful completion of its institutional placement.

According to the release, the company raised $27.5 million through the issue of 15.28 million new shares at $1.80 per share. This represents a 15.5% discount to the last close price.

The company advised that the placement was completed with a broad range of new and existing institutional investors.

In addition to this, the company’s founder, Joe Demase, has sold 2.78 million shares for the same price. While this represents 14.5% of his shareholding, he will remain 5G Networks’ largest shareholder with a relevant interest in approximately 16.2 million shares. This is the equivalent to approximately 15.3% of the ordinary shares on issue post the placement.

The company advised that Mr Demase sold the shares in part to satisfy a personal tax obligation and to fund the exercise of performance rights which may be exercised in the future.

Why is 5G Networks raising funds?

5G Networks launched the institutional placement to provide it with the funds to make an acquisition proposal for Webcentral Group Ltd (ASX: WCG).

According to the release, the company has tabled a non-binding indicative proposal to acquire the small business digital services provider for 17.7 cents per share or $21.6 million.

This is significantly more than the 10 cents per share that has been offered by Web.com for Webcentral.

Why does 5G Networks want to acquire Webcentral?

Management believes the combination of the two businesses can generate synergies of over $7 million per annum on a run rate basis.

It also believes the proposed acquisition would be transformational for its earnings. Its earnings per share is expected to more than double on a pre-synergies basis and further increase on a post-synergies basis.

This news has no doubt gone down well Webcentral shareholders. The shares of the company formerly known as Melbourne IT are up 50% this afternoon.

More reading

• 5G Networks launches capital raising for Webcentral acquisition
• 3 small cap ASX shares I’d buy with $1,000
• Top ASX Stock Picks for September 2020
• Analysts think 5G Networks shares could be a post-COVID-19 winner
• My top 5G ASX share to buy right now

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends 5G NETWORK 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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Last month’s reporting season turned out to be less frightful than many were expecting. But I think the ASX small caps delivered better results than those in the S&P/ASX 200 Index (Index:^AXJO).

ASX stocks at the smaller end of the market tend to be more sensitive to the domestic economy, and while things have been tough during the COVID-19 shutdown, Australia is holding up better than many comparable economies.

It’s not the FY20 profits that matter

But the issue isn’t the FY20 profit numbers. It’s what happens next as earnings from the last financial year were propped up by temporary government stimulus that will expire over the coming months.

On that front, the picture isn’t quite as rosy for small caps. UBS found that 61% of emerging companies under its coverage saw FY22 consensus earnings per share (EPS) downgrades of more than 5% in the last two months.

This compares to only 20% that enjoyed upgrades of a similar magnitude for the next financial year.

Biggest ASX small cap downgrades

There’s a long list of stocks that suffered a downgrade, including those from the popular tech sector. These include the Appen Ltd (ASX: APX) share price, Audinate Group Ltd (ASX: AD8) share price and Megaport Ltd (ASX: MP1) share price.

Stocks in other sectors also featured prominently. Some examples include the Nanosonics Ltd. (ASX: NAN) share price, Bingo Industries Ltd (ASX: BIN) share price and Pro Medicus Limited (ASX: PME) share price, just to name a few.

Best ASX small cap consensus upgrades

On the flipside, several of the ASX small cap profit season winners came from the retail sector. These include the Premier Investments Limited (ASX: PMV) share price, the record high Kogan.com Ltd (ASX: KGN) share price and Adairs Ltd (ASX: ADH) share price.  

While this group of profit heroes outperformed the S&P/ASX SMALL ORDINARIES (Index: ^AXSO) by around 22% since the start of August, not all are expected to keep beating the market over the next 12-months.

Best ASX small cap stocks to buy and sell

UBS attempted to pick the best from the winners’ circle by applying five filters. The first is valuation by looking at several metrics, such as EV/EBITDA, P/E, P/B, and dividend yield.

It also used growth (two-year EBITDA and EPS), consensus EBITDA and EPS estimate revisions for FY22, balance sheet leverage and return on capital employed.

The small cap stocks that screened the best are the G8 Education Ltd (ASX: GEM) share price, the Infomedia Limited (ASX: IFM) share price and Kogan share price.

Meanwhile, the stocks that got the lowest score are the Japara Healthcare Ltd (ASX: JHC) share price, Regis Healthcare Ltd (ASX: REG) share price and Nextdc Ltd (ASX: NXT) share price.

More reading

• Stay invested in 2020? This wealth manager says yes
• Why the Ramelius share price is leading the gold sector higher today
• ASX 200 up 0.5%: CSL signs COVID-19 vaccine agreements, big four banks charge higher
• 4 of the best ASX shares to buy before 2021
• 5 ASX shares I will never sell

Brendon Lau owns shares of AUDINATEGL FPO. Connect with me on Twitter @brenlau.

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MEGAPORT FPO and Pro Medicus Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AUDINATEGL FPO, Infomedia, and Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Nanosonics Limited and Premier Investments Limited. The Motley Fool Australia owns shares of Appen Ltd. The Motley Fool Australia has recommended AUDINATEGL FPO, Kogan.com ltd, MEGAPORT FPO, and Pro Medicus 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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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy.

The good news is that brokers across the country are doing a lot of the hard work for you.

Three top shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:

Austal Limited (ASX: ASB)

According to a note out of Goldman Sachs, its analysts have retained their conviction buy rating and $4.35 price target on this shipbuilder’s shares. The broker believes that Austal is well-positioned to benefit from the U.S. Navy’s plan to increase its vessel count over the long term. Combined with the U.S. Navy’s funding for Austal’s steel capacity expansion, it believes the company will be able to deliver stable earnings for the foreseeable future. So, with the Austal share price changing hands at just 13x forward earnings, it believes they are great value. I think Goldman makes some good points and Austal could be worth considering.

Fortescue Metals Group Limited (ASX: FMG)

A note out of the Macquarie equities desk reveals that its analysts have retained their outperform rating and $20.00 price target on this iron ore producer’s shares. This follows the announcement of an increase to its port export capacity last week. In addition to this, Macquarie believes Fortescue could deliver strong earnings growth in FY 2021 due to high iron ore prices. It expects this to lead to a bumper payout for shareholders and is forecasting a ~$2.35 per share dividend. I agree with Macquarie and feel Fortescue would be a great option for income investors.

Westpac Banking Corp (ASX: WBC)

Analysts at Citi have retained their buy rating and $23.50 price target on this banking giant’s shares. According to the note, the broker notes that the big four banks have been offloading their wealth businesses. It believes Westpac’s BT business is the best of the lot due to its scale and could demand a premium if it divested. It estimates that a sale could add upwards of 120 basis points to its CET1 ratio. I think Citi is spot on and Westpac could be a great investment option right now.

More reading

• Why Biotron, Fortescue, Ramelius, & Temple & Webster are storming higher
• ASX 200 up 0.5%: CSL signs COVID-19 vaccine agreements, big four banks charge higher
• ASX 200 Weekly Wrap: Friday crash pulls ASX back below 6,000 points
• Forget Westpac’s term deposits and buy these ASX dividend shares
• ASX 200 plunges 3.1%, Afterpay suffers

James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Austal Limited. 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 Polynovo Ltd (ASX: PNV) share price has dropped lower in early afternoon trade despite the company announcing it has received a grant from the Victorian Government for its hernia facility. At the time of writing, the Polynovo share price is trading at $2.15, down 2.7% compared to the S&P/ASX 200 Index (ASX: XJO) which is up 0.2% to 5,933.30 points.

About Polynovo

The Australian based medical device company specialises in producing biodegradable material that can be used in a variety of physical formats. Its flagship product NovoSorb BTM has been designed to help surgeons treat patients with traumatic wounds.

The company also has a development program covering breast sling, hernia, and orthopaedic applications.

Government funding

Polynovo was awarded a grant from the Victorian Government, Department of Jobs, Innovation and Trade for up to $252,000.

The funding is to support the company in purchasing new equipment and with ongoing construction of a cleanroom facility to manufacture its hernia product, NovoSorb Syntrel. The capital works is expected to be one of the company’s primary focuses in FY21.

Furthermore, Polynovo will seek to file NovoSorb Syntrel with the United States Food and Drug Administration (FDA) in June/July 2021. The Aussie biotech plans to enter the US healthcare market in FY22.

Management commentary

Polynovo Managing Director, Paul Brennan said:

We are grateful to the Victorian Government for their support of PolyNovo’s investment in local manufacturing capacity. This plant will produce a product that will change the way hernias are managed world-wide. It is a matter of pride that these products will be manufactured in Port Melbourne using Australian technology.

About the Polynovo share price

The Polynovo share price has made a strong comeback of nearly 68% since falling as low as $1.28 in March. For the calendar year to date, the Polynovo share price is up nearly 16%, but down more than 34% from its 52-week high.

More reading

• Up 38% in August, is the Mesoblast share price a buy?
• Polynovo and 2 more ASX 200 shares to watch this week
• My top 5 ASX shares to buy in 2020
• Polynovo share price rockets higher on insider buying news
• Why Costa, Flight Centre, Polynovo, & Pointsbet shares are storming higher

Aaron Teboneras 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. 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 Tyro Payments Ltd (ASX: TYR) share price has bounced this morning after the company released its most recent weekly trading update.

Tyro’s trading update

Tyro released its trading update for the week ending 4 September earlier today.

The update was highlighted by a 24% increase in date-on-date transaction values from FY20 to FY21. For the period between the start of September to 4 September, Tyro reported a transaction value of $247 million.

In comparison to FY20, the company also reported an increase in same day-on-day and year-to-date transaction values of 6% and 5%, respectively.

Tyro has been releasing weekly transaction value updates to the market, and today’s announcement marks its 25th update. The company decided to do this in a bid to provide transparency on the impact of the COVID-19 pandemic on operations.

More details on Tyro

Tyro is an electronic payments solution provider that listed on the ASX late last year. The company’s proprietary technology terminals (which accept debit and credit card payments) are provided to over 32,000 merchants.

In FY20, Tyro reported a 15% surge in transaction value of $20.1 billion. As a result, the company reported an 11% increase in revenue of $210.7 million for the full-year.

Behind the big four banks, Tyro is also Australia’s 5th largest merchant acquiring bank by number of terminals in circulation. For FY20, the company originated $60.1 million in loans and reported $50.5 million in merchant deposits.

Despite record transaction volumes and revenue, Tyro booked a $38.1 million net loss for the full-year. The company’s management cited the COVID-19 pandemic and Australian bushfires earlier in the year for its lacklustre performance.

The pandemic in particular has hit the company hard, with most of Tyro’s retail customers in the hospitality and retail sector. As a result, the company has opted to provide weekly update on transaction volumes, rather than offering financial guidance for FY21.

At the time of writing the Tyro share price is trading slightly lower for the day at around $3.38. Shares in Tyro have bounced slightly after hitting an intra-day low of $3.32 earlier. Overall, the Tyro share price is trading relatively flat for 2020, after rebounding by more than 235% from its low in mid-March.

More reading

• 5 ASX shares better than banks
• Why Tyro, Virtus Health, Webjet, & Westpac shares are dropping lower
• Tyro Payments share price sinks on heavy FY 2020 loss
• ASX shares to buy with $10,000 in August
• MoneyMe share price surges, but is it sustainable?

Nikhil Gangaram 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 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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After last week’s horror Friday, many ASX investors will probably be starting this week feeling a little uneasy. That’s totally understandable. On Friday, the S&P/ASX 200 Index (ASX: XJO) plunged by 3.1% in one of the worst days for ASX 200 shares since March.

That followed even bigger falls on the US markets late last week. The tech-heavy Nasdaq Composite index fell by 5% on Thursday night (our time) and another 1.3% on Friday night.

But according to the world’s largest wealth manager, investors should be using this pullback to double-down on their investments. According to reporting from Business Insider, Swiss investing giant UBS is merely viewing Friday’s sell-off as a “bout of profit-taking after a strong run” and thinks it shouldn’t be taken to heart by investors today.

Business Insider quotes UBS chief investment officer of global wealth management Mark Haefele: “Stocks are still well-supported by a combination of Fed liquidity, attractive equity risk premiums and an ongoing recovery as economies reopen from the lockdowns.”

As such, Mr Haefele thinks investors should “stay invested” by following these 3 recommendations:

1. Ease into markets with a dollar-cost averaging strategy
2. Diversify for the ‘next leg’ outside the big-name tech stocks like those with 5G prospects or those set to profit from a ‘green recovery’
3. Protect against the downside with diversification across both asset classes (including gold) and regions

Should ASX investors take note?

I think the advice of UBS is definitely worth considering today, even though share markets are still at historically high levels (especially over in the US). With interest rates at record lows, there’s really no alternative to investing in growth assets like ASX shares if you don’t want your money going backwards as cash.

Thus, apart from a carefully-manicured cash position in your portfolio to take advantage of any future opportunities, I still think ASX investors should be staying mostly invested in today’s environment. By all means, take some profits off the table and add to your cash position if you’re feeling nervous. But strategies like ‘selling everything and waiting for the next crash’ are high-risk ones right now, in my view. Trying to ‘time the market’ is never a good idea anyway.

Strategies like dollar-cost averaging and diversification, by contrast, can help investors to smooth out returns over time, and mitigate the risk of losing a large sum of capital if there does happen to be another market crash waiting around the corner. 

More reading

• Why the Ramelius share price is leading the gold sector higher today
• ASX 200 up 0.5%: CSL signs COVID-19 vaccine agreements, big four banks charge higher
• 4 of the best ASX shares to buy before 2021
• More radical action from RBA likely after Victoria’s extends harsh lockdown
• Share price opportunities to buy this week

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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Among all the ASX shares, the real estate investment trusts (REITs) have had a pretty tough year. For example, shopping centre REITs have carried much of the costs of the coronavirus lock downs with little compensation. The government’s code of conduct for commercial landlords has bound the hands of shopping centre owners in several areas.

First, they cannot evict tenants who don’t pay rent during the coronavirus period. Second, they are bound to offer waivers and deferrals up to 100% of rent owing, and no less than 50%. Hence, shopping centre owners have dramatically reduced revenues, reduced or eliminated dividends, and the companies share prices have fallen off a cliff.

Coming back soon

There have been a few indications that ASX retail shares are due for a rebound.  First, in a press release on 21 August, The Property Council of Australia released information from Deloitte Access Economics. This showed that the national impact on shopping centres from April to September had been around $6.8 billion. Moreover, this would rise to $14.9 billion if extended to March 2021. 

Second has been the recent rental agreement feud between Scentre Group (ASX: SCG) and Mosaic Brands Ltd (ASX: MOZ). This finally ended in an agreement after Scentre shuttered all of the Mosaic Brands stores nationally. 

The positive news in all of this is that shopping centres are starting to take back control of their assets. Not only that, but they are already beginning to lobby to avoid the code being extended to March, 2021. 

The future of ASX REIT shares

In its annual report, Scentre said it expects to lose between 300–500 shops. Moreover, the move to online shopping by consumers during the pandemic has been well documented. While it is unclear how much of this will remain after knockdowns, it is clearly an acceleration of a longer term trend.

In response to this, companies like Scentre, the owner of the Westfield shopping centres, have accelerated strategic initiatives. For example, Westfield Direct is a program to provide centralised, drive-though, click and collect services for its retailers. There are currently 14,000 products from 590 retailers. Another initiative is the app based loyalty program Westfield Direct. 

Services like click and collect are not possible without physical stores, and Scentre is embracing this trend. Meanwhile, ASX shares like Vicinity Centres (ASX: VCX) are doubling down on its core capability. Vicinity has embraced analytical technology, and has built an in-house platform to optimise tenant selection for leasing, and a retailer insights product to partner with retailers to drive performance and sales.

Foolish Takeaway

Scentre Group is trading at an estimated price to earnings (P/E) ratio of 8.3 based on FY19 earnings. It also has a current trailing 12-month dividend of 8.83. Vicinity Group is trading at a P/E of 4.42 with a trailing 12-month dividend of 11.7%.

Both of these ASX REIT shares have cancelled dividends in the near term. In addition, they still face 50 miles of hard road. Nevertheless, the sector looks like it is about to regain control of its assets. I think this is a very unique and limited chance to buy really good ASX REIT shares at very cheap prices.

More reading

• 4 ASX shares I would avoid for 2020
• ASX 200 plunges 3.1%, Afterpay suffers
• Quarterly rebalance: Coles and Fortescue added to ASX 20, Zip joins the ASX 200
• How household savings could boost these ASX share prices
• UBS picks the best and worst ASX stocks from the reporting season

Motley Fool contributor Daryl Mather 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 PointsBet Holdings Ltd (ASX: PBH) share price isn’t going anywhere on Monday and remains in its trading halt.

Why is the PointsBet share price in a trading halt?

PointsBet requested a trading halt on 2 September whilst it undertakes a major capital raising.

The sports betting company is aiming to raise approximately $353 million via a fully underwritten entitlement offer and an institutional placement.

These funds are being raised to strengthen its balance sheet in support its long term strategy.

This capital raising shows just how far the company has come in such a short space of time. In June 2019 PointsBet hit the ASX boards with a market capitalisation of ~$166 million. Now it is aiming to raise more than double this through its capital raising.

How is the capital raising tracking?

On Friday the company announced the successful completion of its institutional placement. It raised a total of $200 million at $11.00 per share, which represents a 19.6% discount to its last close price.

Management advised that the placement was strongly supported by both existing and new Australian and international institutional shareholders.

Next on the list is its entitlement offer. This morning the company launched the institutional component of the offer. Existing shareholders have the chance to pick up 1 share for every 6.5 shares they own for $6.50 per new share.

Retail investors will get their chance on Friday with the launch of its retail entitlement offer. These are on the same terms as the institutional component.

In addition, eligible shareholders will receive one new option for every two shares issued to them under the entitlement offer at no further cost. These new options will be exercisable at $13.00 and expire on 30 September 2022.

Use of funds.

PointsBet plans to use the funds raised largely on its US marketing costs in target states.

This follows its recent agreement with NBC Universal which included a committed marketing spend of US$393.1 million over five years.

It will also use the funds for technology and platform development and US business development. The latter includes market access and government licensing fees and sportsbook fit-out costs.

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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet 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.

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