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In afternoon trade the S&P/ASX 200 Index (ASX: XJO) is on course to record another strong gain. At the time of writing the benchmark index is up 1% to 6,121.7 points.

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

The IOOF Holdings Limited (ASX: IFL) share price is up 2% to $3.65. This appears to have been driven by a broker note out of Ord Minnett. Its analysts have upgraded the financial services company’s shares to a buy rating with a $4.15 price target. Ord Minnett notes that IOOF will become the largest superannuation company following the acquisition of MLC Wealth.

The SKYCITY Entertainment Group Limited (ASX: SKC) share price is up 7.5% to $2.48. Investors have been buying the casino and resorts operator’s shares following its FY 2020 results. Included with the results was a surprisingly positive trading update. SKYCITY revealed that local gaming in Auckland and Hamilton was ahead of pre-COVID levels. Furthermore, local gaming in Adelaide is now consistent with pre-COVID 19 levels. In light of this, it expects to deliver profit growth in FY 2021.

The Starpharma Holdings Limited (ASX: SPL) share price has stormed 5% to $1.71. This morning the dendrimer products developer revealed that it has been awarded $1 million in funding from the Federal Government’s Medical Research Future Fund to develop a nasal spray for the treatment of COVID-19. The nasal spray will utilise its proprietary dendrimer, SPL7013.

The Telix Pharmaceuticals Ltd (ASX: TLX) share price stormed 6.5% higher to $1.82. This morning the clinical-stage biopharmaceutical company announced that has entered into a strategic collaboration agreement with Palo Alto-based Varian Medical Systems. The agreement will see the two parties evaluate the use of advanced prostate cancer imaging within Varian’s radiation treatment planning platform.

More reading

• Starpharma share price jumps 5% on funding for COVID-19 nasal spray
• ASX 200 up 1%: Big four banks charge higher, SKYCITY impresses, Xero tumbles
• SKYCITY share price on watch after FY 2020 result and positive trading update
• ASX 200 jumps 1.6%: Afterpay tumbles, IOOF crashes, CBA pushes higher
• Why Afterpay, IOOF, Redbubble, & Zip shares are dropping lower

James Mickleboro owns shares of TELIXPHARM DEF SET. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Starpharma Holdings Limited. The Motley Fool Australia has recommended Sky City Entertainment Group Ltd. and Starpharma Holdings 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 CV Check Ltd (ASX: CV1) share price stormed more than 35% higher in early trade today after the company released an operational update.  

Details on CV Check’s update

In the operational update, CV Check reported the company had been able to maintain solid order flow in July and August. CV Check said new customer wins, especially in the buy now, pay later (BNPL) sector, had allowed the company to offset impacts of the COVID-19 pandemic.

The company’s management said new client wins in the BNPL sector had helped CV Check regain momentum. In addition, CV Check also noted a strong rise in revenue for July and August from integrations with other HR platforms.

The company said its notable clients from the BNPL sector included Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P) and Openpay Group Ltd (ASX: OPY).

What does CV Check do?

CV Check offers online background screening and verification services. The company’s multi-check technology platform provides check products to employers, industry associations and individuals.

Late last month, CV Check released its annual report for FY20. The company reported a revenue of $12.4 million for the year, with a record $6.6 million generated in the first half of FY20. CV Check assured investors that new client wins through the final quarter of FY20 had led to a recovery in the company’s revenue.

For FY21, CV Check said the company was focused on driving organic growth from higher repeat business customers. Key macro drivers in the world economy had also been identified that could drive business. These factors include the shift to a digitally delivered service-based economy. CV Check said its $3.1 million capital raise in August 2019 would help the company accelerate business growth.  

The CV Check share price is currently trading more than 20% higher at the time of writing. Shares in CV Check were up more than 35% earlier today after hitting an intra-day high of 13 cents.

More reading

• Starpharma share price jumps 5% on funding for COVID-19 nasal spray
• ASX 200 up 1%: Big four banks charge higher, SKYCITY impresses, Xero tumbles
• Why Bubs, Perseus, WiseTech, & Xero shares are dropping lower
• 3 ASX growth shares to buy with $3,000
• Why the Bubs share price crashed 10% lower today

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 ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T 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.

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The Starpharma Holdings Limited (ASX: SPL) share price was up 5.52% at the time of writing to $1.72. This came after the company announced a funding award to develop a COVID-19 nasal spray. 

What was in the announcement?

Starphama said it had been awarded $1 million in funding from the Federal Government’s Medical Research Future Fund to develop a nasal spray for the treatment of COVID-19. The nasal spray would utilise its proprietary dendrimer, SPL7013.

The company said its patented SPL7013 nasal spray had the potential to prevent both acquisition and transmission of SARS-CoV-2. In addition, its broad spectrum antiviral activity could also play a role for other respiratory viruses and preparedness for future pandemics. SARS-CoV-2 is the virus that causes COVID-19.

The product could be used as an additional line of defence in combination with personal protective equipment. It would have applications for the general public including frontline workers such as doctors and nurses along with those exposed to crowded and high risk environments including public transport, airlines and aged care.

Starpharma said that since the SPL7013 development program started in April, the nasal spray has been reformulated into several formulations and a manufacturer identified. In addition, pilot manufacturing has been undertaken and work has started on compiling regulatory documentation for submission. Additionally, the company is in confidential commercial discussions with interested pharmaceutical companies in a number of geographic markets.

Starpharma CEO Dr Jackie Fairley said the funding award to develop Starphama’s program recognised “its near term potential and the global relevance of the SPL7013 COVID-19 nasal spray”.

About the Starpharma share price

Starpharma is a biotechnology company that develops and licenses treatments for various common health problems. It has agreements with a number of pharmaceutical giants and has been listed on the ASX since 2000.

The Starpharma share price is up 177.4% since its 52-week low of 62 cents. It has returned 40.98% since the beginning of the year. The Starpharma share price is up 49.57% since this time last year. 

More reading

• Why Lendlease, Redbubble, SeaLink, & Starpharma shares are pushing higher
• Starpharma share price rockets to record high on DEP remdesivir COVID-19 news
• Starpharma share price rockets to 52-week high on full year update
• Starpharma share price bolts 14% on COVID-19 nasal spray
• The Starpharma share price jumps on new partnership deal

Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Starpharma Holdings Limited. The Motley Fool Australia has recommended Starpharma Holdings 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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At lunch on Thursday the S&P/ASX 200 Index (ASX: XJO) is on course to record its second consecutive day of gains. The benchmark index is currently up 1% to 6,121.9 points.

Here’s what is happening on the market today:

Big four banks charge higher.

The big four banks are all charging higher today and underpinning the ASX 200’s positive performance. At lunch, the best performer in the group has been the Australia and New Zealand Banking GrpLtd (ASX: ANZ) share price with a gain of over 2%. This follows news that Australia recorded a trade surplus of $4.6 billion in July, well ahead of expectations.

SKYCITY impresses.

The SKYCITY Entertainment Group Limited (ASX: SKC) share price is storming higher today after the release of its FY 2020 results and a surprisingly positive trading update. In respect to the latter, SKYCITY revealed that local gaming in Auckland and Hamilton was ahead of pre-COVID levels. Furthermore, local gaming in Adelaide is now consistent with pre-COVID 19 levels. In light of this, it expects profit growth in FY 2021.

Insider selling galore.

The founders of both WiseTech Global Ltd (ASX: WTC) and Xero Limited (ASX: XRO) have been selling a considerable number of shares. In respect to WiseTech, CEO Richard White offloaded $10 million shares over the last few trading days. As for Xero, the business and accounting software provider’s founder, Rod Drury, is understood to have offloaded almost $200 million worth of shares this week. Both WiseTech and Xero are trading lower at lunch.

Best and worst ASX 200 performers.

The best performer on the ASX 200 on Thursday has been the SKYCITY share price following its positive update with its full year results. The casino and resorts operator’s shares are up 8%. The worst performer has been the Spark Infrastructure Group (ASX: SKI) share price with a 5% decline. This morning the utility infrastructure company’s shares traded ex-dividend for its 7 cents per share interim dividend.

More reading

• Why Bubs, Perseus, WiseTech, & Xero shares are dropping lower
• WiseTech Global share price lower after CEO sells $10m of shares and plans even more sales
• SKYCITY share price on watch after FY 2020 result and positive trading update
• Why a recession shouldn’t matter for the ASX share market
• 5 things to watch on the ASX 200 on Thursday

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 WiseTech Global and Xero. The Motley Fool Australia has recommended Sky City Entertainment Group 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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In late morning trade the S&P/ASX 200 Index (ASX: XJO has followed the lead of U.S. markets and is charging higher. At the time of writing the benchmark index is up 0.5% to 6,096.2 points.

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

The Bubs Australia Ltd (ASX: BUB) share price has dropped 5.5% to 86.5 cents. Investors have been selling the infant formula company’s shares after it successfully completed its institutional placement. Bubs has raised $28.3 million (before costs) at a 12.5% discount of $0.80 per share. These funds are being used largely to support its growth plans in the China market. This includes buying an interest in a manufacturing facility in the country.

The Perseus Mining Limited (ASX: PRU) share price has tumbled 4.5% to $1.39. The catalyst for this decline appears to have been a pullback in the spot gold price overnight. The price of the precious metal dropped lower amid a strengthening U.S. dollar and optimism over the global economic recovery. At the time of writing, the S&P/ASX All Ordinaries Gold index is down 1.1%.

The WiseTech Global Ltd (ASX: WTC) share price has fallen 2% to $28.79. Investors have been selling the logistics solutions company’s shares after it revealed that its CEO and Founder, Richard White, was selling down his stake. Mr White has offloaded $10 million worth of shares in the last few days and plans to keep selling through to 31 December. He remains the company’s largest shareholders by some distance.

The Xero Limited (ASX: XRO) share price has dropped 3.5% lower to $99.25. This also appears to have been driven by insider selling. Although the business and accounting software company has yet to confirm it, there are reports that its founder, Rod Drury, has offloaded almost $200 million worth of shares. According to the AFR, the shares were believed to have been offered at a 3.9% discount of $99.00 per share.

More reading

• Why the Bubs share price crashed 10% lower today
• WiseTech Global share price lower after CEO sells $10m of shares and plans even more sales
• 5 things to watch on the ASX 200 on Thursday
• Some ASX winners and losers from a high Aussie dollar
• Xero share price higher after chairman buys $400k worth of shares

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 BUBS AUST FPO, WiseTech Global, and Xero. The Motley Fool Australia has recommended BUBS AUST 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.

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If you have $3,000 to invest into ASX growth shares, then I would suggest you consider putting these funds into the ones listed below.

Here’s why I think they could provide strong returns for investors over the next decade:

BetaShares NASDAQ 100 ETF (ASX: NDQ)

If you would like to invest in a group of high quality growth shares in a single investment, then you might want to consider the BetaShares NASDAQ 100 ETF. This popular fund gives investors access to 100 shares trading on the legendary NASDAQ 100 index. Among its holdings you’ll find the likes of Amazon, Apple, Facebook, Microsoft, Netflix, and Google parent, Alphabet. I believe these companies have very bright futures ahead of them. This bodes well for the performance of Nasdaq 100 over the 2020s.

Nearmap Ltd (ASX: NEA)

Nearmap is a leading aerial imagery technology and location data company. It gives businesses instant access to high resolution aerial imagery, city-scale 3D datasets, and integrated geospatial tools. This means that users of its software can undertake site visits from the comfort of their home or workplace, which can offer significant time and cost savings for users. Thanks to the quality of its offering, particularly its latest AI product, I believe it is well-placed to capture a growing slice of this fragmented market over the next decade.

NEXTDC Ltd (ASX: NXT)

Another top growth share to consider buying is NEXTDC. It is an innovative data centre operator which owns a collection of world class centres in key locations across Australia. NEXTDC has experienced very strong and growing demand for its services in recent years. This has underpinned solid earnings growth over the last few years. This was particularly the case in FY 2020 when NEXTDC delivered a 23% increase in EBITDA to $104.6 million. Pleasingly, with demand expected to continue growing at a rapid rate for some time to come due to the cloud computing boom, I expect more of the same from NEXTDC over the next decade.

More reading

• Why we’re on track for more record ASX share prices
• Why it makes sense to invest in ASX tech shares
• Top ASX Stock Picks for September 2020
• Leading brokers name 3 ASX shares to buy today
• Why Costa, Harvey Norman, NEXTDC, & Splitit shares are charging higher today

James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of BETANASDAQ ETF UNITS and Nearmap Ltd. The Motley Fool Australia has recommended BETANASDAQ ETF UNITS and Nearmap 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 Bubs Australia Ltd (ASX: BUB) share price has come under pressure today after returning from its trading halt.

In morning trade the infant formula and baby food company’s shares fell as much as 10% to 82 cents.

They have since recovered slightly and are down 6% to 86 cents at the time of writing.

Why was the Bubs share price in a trading halt?

Bubs requested a trading halt at the start of the week while it undertook another capital raising.

This morning it revealed that it has successfully completed its institutional placement, raising $28.3 million (before costs) at a 12.5% discount of $0.80 per share.

The company advised that the placement was strongly supported by existing institutional shareholders as well as several new institutional and sophisticated investors in Australia and in certain overseas jurisdictions.

Bubs will now push ahead with its share purchase plan, which aims to raise a further $10 million. Though, the company will consider increasing this to $11.7 million depending on shareholder interest.

Eligible shareholders will be able to apply for up to $30,000 of new Bubs shares at an offer price of $0.80 per new share, without incurring brokerage or other transaction costs.

Why is Bubs raising funds again?

The proceeds are to be used to support the company’s global growth initiatives.

This includes the acquisition of an ownership interest in a Beingmate manufacturing facility in China and the in-market SAMR application for Bubs Infant Formula products.

The funds will also be used to support its international market expansion, the launch of its Vita Bubs vitamin brand, new product innovation in emerging high value goat dairy segments, and the extension of its production capability to include a production line for single-serve sachets.

Bubs’ Founder and CEO, Kristy Carr, said: “Our first priority will be to progress our announced strategy to accelerate SAMR registration for China manufacture of Bubs Goat Infant Formula made from 100 percent Australian goat milk. This ‘Created by Bubs’ localisation strategy is capable of replication into other markets with similar barriers to entry.”

“We are now well positioned to maintain the operational momentum, strength and agility established during the year, to execute on strategy, and capture new opportunities while ensuring we continue to implement key marketing strategies that respond to the challenges of the current macro environment, including consequences of COVID-19,” concluded Mrs Carr.

More reading

• Why Bubs, Perseus, WiseTech, & Xero shares are dropping lower
• Some ASX winners and losers from a high Aussie dollar
• Bubs share price halted following FY 2020 results and capital raising plans
• 3 small cap ASX growth shares to buy right now
• Why Afterpay, Bubs, Fortescue, & Zip Co shares are charging higher

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 BUBS AUST FPO. The Motley Fool Australia has recommended BUBS AUST 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.

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The Eclipx Group Ltd (ASX: ECX) share price is pushing higher on Thursday after the release of a business update.

At the time of writing the salary packaging and fleet management company’s shares are up 1% to $1.52.

What did Eclipx announce?

This morning Eclipx released an update on its Simplification Plan ahead of its appearance at the Macquarie Group Ltd (ASX: MQG) Emerging Leaders forum.

According to the release, the company’s Simplification Plan has now largely been delivered on.

It has divested all non-core businesses, operating expenses have been reduced, gross corporate debt has been reduced, and it is now solely focused on developing its core fleet business and strategy.

In respect to its operating expenses, Eclipx was targeting an annualised $15 million reduction in its core fleet operating expense base from $99.5 million in FY 2019 to $84.5 million by the end of FY 2021. On a run-rate basis, its operating expense target has now been achieved.

As for its debt, the company was targeting a gross corporate debt reduction from $350 million to $175 million. As at 31 August 2020, gross corporate debt had dropped below its target and stood at $170 million.

Management also notes there is significant headroom under the revised corporate debt covenants, which were further improved in May 2020.

Total liquidity is currently ~$180 million, including ~$105 million in undrawn capacity under the corporate debt facility.

Trading update.

Eclipx also revealed that its business performance is improving again.

At the end of August, new business writings in corporate operating leasing was tracking at ~70% to 80% of average pre-COVID-19 levels (October 2019 to February 2020 average).

It notes that this reflects the desire of some clients to seek lease extensions as a substitute for renewals or new business writings. Similarly, novated monthly volumes are tracking above 80% of average pre-COVID-19 levels.

In addition, end of lease car sales have continued to show positive momentum since mid-April 2020. As a result, management expects end of lease income in the second half to be about 90% of first half end of lease income.

More reading

• Why Bubs, Perseus, WiseTech, & Xero shares are dropping lower
• 3 ASX growth shares to buy with $3,000
• Why the Bubs share price crashed 10% lower today
• 3 small cap ASX shares I’d buy with $1,000
• Forget gold and Bitcoin. I think dirt-cheap stocks can make you rich

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.

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Investors often turn to small cap ASX shares for hidden gems or significant growth opportunities. While navigating through smaller, more volatile companies can be challenging, here are 3 small cap ASX shares poised for a blockbuster FY21. 

1. SelfWealth Ltd (ASX: SWF) 

SelfWealth is Australia’s fastest-growing share trading platform for retail investors. It leads the market on price and simplicity, with $9.50 flat-fee ASX trading and no monthly account fees.

In its FY20 results, the company highlighted a 313% increase in revenue to $8.6m. Active traders were up 235% to 45,445, and $147,000 cash burn down from $3.4m. The company notes that ultra-low interest rates have turned wealth creation on its head as term deposits are no longer attractive. This is transforming a generation of savers into a generation of investors.

COVID-19 has further accelerated tailwinds for broker platforms, and SelfWealth is well-positioned to capture the uptick. Looking ahead, SelfWealth will launch US trading in the December quarter. The US market is the most popular international market with Australian investors. At a market capitalisation of just $155m and significant growth tailwinds at hand, SelfWealth is the small cap ASX share to watch in FY21. 

2. BetMakers Technology Group Ltd (ASX: BET) 

BetMakers is involved in data and analytic products for the wagering market and production of racing content. Its clients include racing bodies, racing rights holders and wagering operators such as Pointsbet Holdings Ltd (ASX: PBH), William Hill and Sportsbet. Its FY20 results highlighted a 34% increase in revenue to $9.2m, $31.6m in cash and zero debt.

Sports betting is undergoing a significant growth opportunity with its legalisation in the US. BetMakers sees racing as a key component of the US sports betting market. It believes operators will need a racing solution to fit alongside its sports offerings.

The company has already signed an exclusive 10-year deal to manage Fixed Odds betting on horse racing in New Jersey. It’s also working with other horsemen groups and regulatory bodies. ASX shares in the sports betting space have seen significant price gains in the last 12 months. I believe BetMakers is positioned to benefit. However its share price may need some time to cool off following its recent surge. 

3. 5G Networks Ltd (ASX: 5GN) 

5G Networks is a telecommunications carrier engaged in the supply of cloud-based solutions, managed services and network services. The company’s success has been underpinned by a number of strategic acquisitions. These include new data centre locations and data centre sales providers. Its FY20 performance was solid, with an earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 96% on FY19.

One of the main takeaways from its FY20 report was its significant infrastructure capacity. Services including metro-fibre network, national/international data, data centres and managed services have a utilisation of less than 50%. There is a significant revenue opportunity given its capacity. 5G Networks sits in the same boat as BetMakers where investors should watch closely for a buying opportunity. 

More reading

• Top ASX Stock Picks for September 2020
• Betmakers share price on watch as revenues rocket 39%
• Analysts think 5G Networks shares could be a post-COVID-19 winner
• My top 5G ASX share to buy right now
• Selfwealth share price soaring after 313% increase in revenue

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 Pointsbet Holdings Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends 5G NETWORK FPO. 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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Buying dirt-cheap stocks after the market crash could be a sound means of generating high returns in the long run. Undervalued shares have historically offered strong capital gains as the stock market recovers from its lows.

Although other assets such as Bitcoin and gold have risen sharply in price over recent months, the risk/reward opportunity from stocks could be more appealing. Over time, the stock market could help you to improve your financial situation.

Dirt-cheap stocks

Buying dirt-cheap stocks and holding them for the long term is a relatively simple investment strategy. However, it could prove to be highly effective in generating impressive returns.

The stock market has a long history of experiencing ups-and-downs that provides an opportunity for investors to buy stocks when they are undervalued, and sell them when they are overvalued. Clearly, executing that strategy is likely to be more difficult than it sounds in theory, since low points in the stock market’s performance generally coincide with higher risks.

As such, buying dirt-cheap stocks will not necessarily produce positive returns in the short run. It may even mean paper losses if the economy’s outlook deteriorates further. However, at the present time, valuations on offer across the stock market suggest that investors are pricing in difficult operating conditions for many businesses. This could mean that the margins of safety on offer are sufficiently wide to merit investment. Over the long run, this may translate into high profits for investors.

Value investing

Of course, buying dirt-cheap stocks does not mean that investors should overlook their attributes. In other words, it is far better to buy stocks that are not necessarily the cheapest around, but rather are those that offer the best value for money.

For example, paying more for a stronger business within an industry could a worthwhile move. It may be better placed to overcome short-term risks that are currently facing the economy. It could also become more dominant in the long run, and generate higher profits, if it can outlast weaker peers. This may translate into higher returns for investors – even though they may have initially paid a higher price compared to other stocks in the same sector.

A long-term hold

While dirt-cheap stocks may be outperformed by other assets such as gold and Bitcoin in the short run, over the long run they could produce more attractive returns. The track record of the stock market shows that a sustained bull market is likely following a market crash.

Therefore, by purchasing stocks while they are good value for money in many cases, you can potentially enjoy improving investor sentiment and rising profitability for many listed companies. Over time, this may lead to strong capital gains that improve your financial position.

More reading

• 3 small cap ASX shares I’d buy with $1,000
• WiseTech Global share price lower after CEO sells $10m of shares and plans even more sales
• Where I would invest my BHP dividends in September
• Is the Kogan.com share price a strong buy?
• Why Brainchip and these ASX shares just surged to new highs

Motley Fool contributor Peter Stephens 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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