Tag: Motley Fool

The Netwealth Group Ltd (ASX: NWL) share price is one to watch after reporting strong earnings growth in its FY20 annual results.

What did Netwealth announce?

The Netwealth share price could be on the move in early trade after today’s full-year results announcement.

For the year ended 30 June 2020 (FY20), Netwealth’s underlying earnings before interest, tax, depreciation and amortisation (EBITDA) climbed 24.8% to $64.8 million.

The group’s EBITDA margin totalled 52.3% for the year while underlying net profit after tax (NPAT) surged 21.7% to $43.8 million.

Total income increased by 25.5% to $123.9 million with Platform revenue of $121.3 million, up 25.9% on FY19 numbers.

The group’s operating expenses jumped 26.2% as part of Netwealth’s strategic investments in IT infrastructure, people and software to support further growth.

That includes adding 68 more employees to its team with a total headcount of 339 as at 30 June 2020.

Paying dividends

The Netwealth share price is one to watch this morning after announcing a fully-franked final dividend of 7.8 cents per share.

The group’s funds under administration (FUA) rocketed 35.0% higher to $31.5 billion. That included record FUA inflows of $9.1 billion during the year.

Funds under management (FUM) totalled $7.3 billion with Managed Account FUM of $5.8 billion at year-end.

Transaction fee revenue increased from 6% to 9% during the year as the group looks to diversify its earnings streams.

Platform revenue as a percentage of average FUA was down 4.4 basis points to 0.437% for the year. Average account size increased to $385,000 in FY20, up from $323,000 in FY19.

Looking ahead

In terms of outlook, Netwealth will launch the first of two new active funds on its wealth management platform. Those are the Magellan Global Specialist Series Infrastructure Fund and Magellan Global Specialist Series Global Fund.

Netwealth also noted transaction revenues may soften depending on market volatility and investor behaviour in FY21.

There were no firm updates on the coronavirus pandemic with Netwealth to “continue to assess and monitor any further impacts”.

How has the Netwealth share price performed this year?

It’s been a good year for shareholders as the Netwealth share price has surged 65.2% higher to $13.00 per share.

That’s a good result given the S&P/ASX 200 Index (ASX: XJO) has slumped 9.0% lower.

The wealth management platform provider has a market capitalisation of $3.1 billion and is trading just shy of its $13.44 all-time high.

More reading

• Is the Beach Energy share price a buy?
• Nextdc and 2 other thriving ASX tech shares to buy
• BHP share price on watch as final dividend slashed by 30%
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 drops 0.8%, JB Hi-Fi jumps 4.5%

Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Netwealth. 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 BHP Group Ltd (ASX: BHP) share price is on watch this morning after the Aussie miner slashed its final dividend by 29.5%.

What were BHP’s key takeaways?

The BHP share price will be worth watching after posting a broadly stable result across its various business units.

BHP reported underlying earnings before interest, tax, depreciation and amortisation (EBITDA) down 5% to US$22.1 billion. The Aussie miner’s underlying EBITDA margin came in at 53% for FY20.

In terms of segment performance, iron ore remains clearly the strongest contributor. Iron ore contributed US$14.6 billion (64%) of group EBITDA while copper (US$4.3 billion, 19%) was another strong contributor.

Metallurgical coal (US$1.9 billion, 9%) and petroleum (US$2.2 billion, 10%) edged lower compared to FY19 numbers due to cost, maintenance and pricing impacts.

Underlying EBIT fell 7% to US$15.9 billion with net profit totalling US$8 billion for the year. That saw underlying basis earnings per share edge 2% higher to US 179.2 cents while dividend per share fell 10% to 120 US cents.

The BHP share price will be worth watching in early trade following the dividend cut. The Aussie miner slashed its final dividend payment by 29.5% to US 55 cents per share.

Free cash flow totalled $8.1 billion with a return on capital employed (ROCE) of 17% for FY20. That was largely driven by the iron ore earnings which recorded a ROCE of 56% for the year.

Net debt of US$12.0 billion was at the lower of BHP’s target US$12–17 billion range. 

The group continues to reinvest in future projects with US$5.7 billion earmarked for organic development across efficiency management, exploration and major projects.

How has the BHP share price performed this year?

All eyes will be on the BHP share price following this morning’s full-year results announcement.

The Aussie miner still managed an FY20 total dividend of US 120 cents (A$1.66) per share. Based on yesterday’s closing price of A$39.86, that represents more than a 4% dividend yield at present.

Shares in the Aussie iron ore miner are up 2.3% for the year while the S&P/ASX 200 Index (ASX: XJO) is down 9.2%.

More reading

• Is the Beach Energy share price a buy?
• Nextdc and 2 other thriving ASX tech shares to buy
• Netwealth share price on watch as net profit surges 22%
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 drops 0.8%, JB Hi-Fi jumps 4.5%

Motley Fool contributor Ken Hall 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 Cochlear Limited (ASX: COH) share price will be on watch on Tuesday following the release of its full year results for FY 2020.

How did Cochlear perform in FY 2020?

For the 12 months ended 30 June 2020, the hearing solutions company reported sales revenue of $1,352.3 million, which represents a 6% decline on a reported basis or 11% in constant currency. This revenue comprises Cochlear implants revenue of $817.9 million (down 3%), Services revenue of $395.5 million (down 7%), and Acoustics revenue of $138.9 million (down 20%).

Management advised that this decline was caused by difficult trading conditions in the second half because of COVID‐19‐related surgery deferrals. Cochlear implant unit sales fell 7% over the 12 months, having been up 13% during the first half.

On the bottom line Cochlear reported an underlying net profit after tax of US$153.8 million, which was down 42% year on year. This follows a collapse in its profits during the second half because of the aforementioned surgery deferrals. Second half profit fell 84% on the prior corresponding period.

On a reported basis, Cochlear recorded a net loss of $238.3 million. This includes $416.3 million in patent litigation expenses and $24.2 million in innovation fund gains after‐tax.

In light of the above, the company has unsurprisingly decided against declaring a final dividend in FY 2020.

Trading update.

Management advised that while elective surgeries have resumed, there is still a risk that second waves could result in new restrictions, complicating recovery plans and timing.

It also recognises that the surgeries currently occurring, particularly for adults and seniors, include a catch up of delayed surgeries from March to May. And while the majority of clinics have re‐opened, many are still running below capacity as they recommence operations carefully and follow social distancing disciplines.

As a result, the company expects there to be some impact on the number of patient assessments for cochlear and acoustic implants until clinic throughput normalises.

Nevertheless, the company’s direct‐to‐consumer activities have been aimed at providing additional support to candidates, and potential candidates. It hopes these activities may assist in more quickly rebuilding the candidate pipeline once things normalise.

Outlook.

Due to the uncertain timing of a global recovery from the pandemic, management acknowledges that it cannot reliably estimate its FY 2021 revenues. As a result, it will not be providing guidance at this stage.

However, it intends to provide a trading update with its annual general meeting in late Octover.

Until then, the company “will be focused on market growth activities and strengthening our competitive position, while continuing to limit non‐essential spending until we have greater confidence in the outlook. There are a number of cost base considerations for FY21, which may be adapted if trading conditions materially change.”

Looking further ahead, management is confident on the future prospects of the company.

It commented: “As we look to the future, we remain confident about the opportunity to grow our markets. There remains a significant, unmet and addressable clinical need for cochlear and acoustic implants that is expected to continue to underpin the long‐term sustainable growth of the business.”

The company also notes that the arrival of telehealth solutions during the pandemic could be a big positive for its business.

“The pandemic has also driven the rapid adoption of telehealth and telemedicine which may lead to faster than expected structural changes in healthcare delivery. We experienced this first hand with the FDA fast‐tracking the approval of our Remote Check solution in the US.”

“We have been investing in connected care solutions for many years and believe they provide the opportunity to open up access to our products and optimise outcomes for recipients by transforming the care model while delivering efficiencies to clinics,” it added.

More reading

• Cochlear share price drops following patent infringement case update
• Why Aurizon, Cochlear, Magellan, & Westpac shares are pushing higher
• Top brokers name 3 ASX shares to sell next week
• 3 outstanding ASX shares to buy in August
• Top brokers name 3 ASX shares to sell today

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia has recommended Cochlear 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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Yesterday’s market reaction to a 90.5% drop in the profits of BlueScope Steel Limited (ASX: BSL) was to send the Bluescope share price up by 2.32%. Yes, you read that correctly. Investors sent a strong vote of confidence in the company’s strategy and ability to execute it, even after Bluescope posted a FY20 net profit after tax of $97 million, $919 million lower than in FY19.

Largely this was due to damage from the coronavirus. Specifically, a 2-month shutdown in US automakers, mandated closures throughout Asia, and the government enforced shutdown in New Zealand. The company also highlighted low steel prices, high energy costs, and a $197 million write-down of its New Zealand division. 

However, the company also unveiled a lot of good news for the coming financial year, including results from current cost cutting and its plans for the future, which could bode well for the Bluescope share price moving forward.

Bluescope Steel’s future

The company is well positioned for the post-covid world in a number of ways, including the swing to local supply chains. Bluescope remains focused on serving Australian markets first. However, it also has local steel production capability in the USA, Asia and New Zealand. There are a number of areas where Bluescope’s managing director and CEO, Mr Mark Vassella believes the company will benefit. 

First, Bluescope Steel believes that people will move away from public transport towards cars. This will drive an increased steel demand, particularly in North America where car manufacturing takes up 14% of all production.

Second, the company is likely to benefit from Australian stimulus spending. This will also apply to stimulus spending in Asia and the United States. In fact, US construction accounts for 23% of all production, while Australian construction accounts for 32% of all production. 

Thirdly, Mr Vassella is on record talking about the increase in demand for housing, likely because discretionary funds previously used for travel are being used for home renovations. Moreover, he noted that this spending has increased in detached or low density housing, a core area of the company’s product focus.

Additionally, the company plans to invest in its US operations to increase capacity to meet the growing demand. For instance, many high-cost legacy blast furnaces are reducing output within 215 miles of its US operations. This will leave a current deficit of 5.75 million tonnes a year, without factoring in stimulus growth.

Cost controls

Bluescope Steel also plans to exit loss-making products in New Zealand. Accordingly, this is likely to cause a large number of roles become redundant. The one-time cost here is likely to be between $30–$50 million. This will continue as the company reviews costs against carbon policy uncertainty, and excessively high electricity costs. Total group operating cash flow for the year, after capital expenditure, was $238 million. In addition, at 30 June 2020, Bluescope held $79 million net cash on the balance sheet.

Foolish takeaway

The coronavirus pandemic has hit Bluescope Steel pretty hard. Nevertheless, it stands to benefit in the post-covid world from trends such as the move away from public transport, the move towards detached housing, and government stimulus spending. Moreover, the company is spending approximately $700 million to expand its US operations. This is at a time when steel production within its immediate vicinity is reducing due to obsolete manufacturing technologies.

The current Bluescope share price gives the company a market capitalisation of $6.21 billion, and a price-to-earnings ratio of 11.3. I believe Bluescope Steel presents an interesting opportunity for steady share price growth over the next 2–3 years. 

More reading

• The next ASX stocks to beat expectations during this reporting season
• Why AGL Energy, Alumina, BlueScope, & BWX shares are dropping lower
• Why the BlueScope share price is outperforming today
• ASX 200 down 0.5%: Sydney Airport and South32 updates, HUB24 delivers record Q4

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 S&P/ASX 200 Index (ASX: XJO) may have been out of form on Monday, but that didn’t stop some ASX shares from pushing higher.

In fact, some shares even managed to climb to new 52-week highs or better.

Three that achieved this feat are listed below. Here’s why they are flying high right now:

Codan Limited (ASX: CDA)

The Codan share price stormed to a new record high of $9.13 on Monday. Investors have been fighting to get hold of the electronic products manufacturer’s shares in 2020 after a spike in the gold price. This is expected to support the very strong demand Codan has been experiencing for its metal detectors. This certainly was the case in the first half of FY 2020 when Codan delivered revenue of $171 million and EBITDA of $54 million. This was a 33% and 42% increase, respectively on the prior corresponding period.

JB Hi-Fi Limited (ASX: JBH)

The JB Hi-Fi share price continued its positive run and hit a new all-time high of $51.33 yesterday. Investors were buying the retail giant’s shares after the release of a strong full year result for FY 2020. During the 12 months, JB Hi-Fi delivered an 11.6% increase in total sales to $7.9 billion and a 33.2% lift in underlying net profit after tax to $332.7 million. This led to JB Hi-Fi increasing its full year fully franked dividend by 33.1% year on year to 189 cents per share. Strong demand for household goods during the pandemic underpinned its growth in FY 2020.

Kogan.com Ltd (ASX: KGN)

The Kogan share price hit a record high of $22.15 on Monday before tumbling lower. The catalyst for this was the ecommerce company’s full year results release. For FY 2020, Kogan reported a 39.3% increase in gross sales to $768.9 million and a 57.6% increase in adjusted EBITDA to $49.7 million. This was driven by the accelerating shift to online shopping during the pandemic which underpinned a 35.7% increase in active customers to 2,183,000. Management notes that a “retail revolution [is] taking place” and believes Kogan is well-positioned to benefit.

More reading

• ASX 200 drops 0.8%, JB Hi-Fi jumps 4.5%
• What recession? These ASX retail shares are raking it in
• What experts are saying about JB Hi-Fi’s profit results as the stock surges to record
• These 3 ASX stocks just got upgraded by top brokers to “buy” today
• ASX 200 down 0.85%: JB Hi-Fi impresses, Altium shoots higher, Bendigo and Adelaide Bank sinks

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

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On Monday the S&P/ASX 200 Index (ASX: XJO) started the week in a very disappointing fashion. The benchmark index fell 0.8% to 6,076.4 points.

Will the market be able to bounce back from this on Tuesday? Here are five things to watch:

ASX 200 expected to rebound.

The benchmark ASX 200 looks set to rebound on Tuesday. According to the latest SPI futures, the ASX 200 is poised to open the day 33 points or 0.55% higher this morning. This follows a positive start to the week on Wall Street, which saw the Dow Jones fall 0.2%, but the S&P 500 rise 0.3% and the Nasdaq jump 1%. The latter could be good news for locally listed tech shares which tend to follow its lead.

Westpac quarterly update.

All eyes will be on the Westpac Banking Corp (ASX: WBC) share price this morning when it releases its latest quarterly update. The main focus will be on its loan deferrals and impairment charges. These metrics were not as bad as many expected when two of its big four rivals released updates this month.

Oil prices jump.

It could be a good day for energy producers such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) after oil prices jumped higher overnight. According to Bloomberg, the WTI crude oil price is up 2% to US$42.84 a barrel and the Brent crude oil price has risen 1.2% to US$45.33 a barrel. News that China is planning to boost its U.S. oil imports helped drive prices higher.

Gold price surges higher.

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) are likely to be on the rise on Tuesday after the gold price surged higher. According to CNBC, the spot gold price is up 2.2% to US$1,993.40 an ounce. Weakness in the U.S. dollar and robust sentiment have given the precious metal a big boost.

Coles FY 2020 results.

The Coles Group Ltd (ASX: COL) share price will be in focus this morning when it releases its highly anticipated full year results. According to a note out of Goldman Sachs, its analysts expect Coles to deliver total sales of $37.5 billion in FY 2020. This will be a 7.1% year on year increase. It is also forecasting Coles to report EBIT of $1392.4 million. This represents a 5.1% year on year increase.

More reading

• ASX 200 drops 0.8%, JB Hi-Fi jumps 4.5%
• If you invested $10,000 in Afterpay shares in March, this is how much you’d have now
• Telstra share price hit by broker downgrade today
• The Starpharma share price jumps on new partnership deal
• What experts are saying about JB Hi-Fi’s profit results as the stock surges to record

Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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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ASX dividend shares are some of the best ways to generate income from your money.

Cash in the bank is hardly earning anything any more because of how low the RBA interest rate is.

ASX shares can generate solid profit each year and pay out pleasing dividends even during COVID-19.

That’s why I think each of these ASX dividend shares could be buys for income:

WAM Global Limited (ASX: WGB)

WAM Global is a listed investment company (LIC) which invests in global shares. The LIC is run by Wilson Asset Management (WAM).

One of the main benefits of LICs is that they can turn investment returns into a steady and growing dividend for shareholders. That’s exactly what the ASX dividend share has been doing.

The ASX dividend share has grown its dividend strongly over the past 12 months. A year ago it paid a dividend of 2 cents per share, six months ago it paid 3 cents per share and it just declared a full year dividend of 4 cents per share. It has doubled its final dividend over the past year.

Global shares are a great place to find quality businesses that have good growth potential. Some of its largest holdings include: Tencent, CME Group, Dollar General, EA, Hasbro, Hello Fresh, Intuit, Lowe’s and Microsoft.

At the current WAM Global share price it’s trading at a 12% discount to the pre-tax net tangible assets (NTA). It offers a grossed-up dividend yield of 4.9%. I think that’s a solid starting yield for a ASX dividend share. 

Brickworks Limited (ASX: BKW)

Brickworks is a diversified property company. It’s well-known for being a building products business that produces bricks, paving, masonry, roofing and so on. It’s actually the largest brick supplier in Australia. Brickworks is the market leader in the north east in the US after making three acquisitions.

It generates reliable earnings from two of its other divisions. Brickworks owns a 50% stake of an industrial property trust with Goodman Group (ASX: GMG). Industrial properties are in higher demand with more ecommerce and the increasing importance of logistics. The property trust is currently working on building a huge warehouse for Amazon.

Brickworks also owns a large amount of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) shares. Soul Patts is a diversified investment conglomerate which invests in defensive and contrarian assets like telecommunications, resources, agriculture and swimming schools. Soul Patts itself is a defensive ASX dividend share. 

Brickworks hasn’t cut its dividend for over 40 years. It currently has a grossed-up dividend yield of 5.1% at the current Brickworks share price.

Vitalharvest Freehold Trust (ASX: VTH)

Vitalharvest is a real estate investment trust (REIT) which owns farmland. Citrus fruit and berry farms are the only assets that it owns. But under new management it has plans to diversify with other food properties including food processing, food storage and food logistics.

Not only does the ASX dividend share generate fixed rental income from its farms but it also has a profit share agreement with the farms that are rented to Costa Group Holdings Ltd (ASX: CGC).

Farm earnings don’t necessarily follow the same path as the economy, so Vitalharvest can offer a fairly uncorrelated distribution. Using the trailing distribution, at the current Vitalharvest share price it offers a yield of 6%. If Vitalharvest returned to 2019 profitability then it could offer a distribution yield of 7.1%.

New acquisitions could unlock more reliable income for Vitalharvest. I’m excited about the direction that Vitalharvest could go in the future. The Vitalharvest share price is trading at a 16% discount to the net asset value (NAV) at 31 December 2019

Foolish takeaway

I really like each of these ASX shares for dividend income. WAM Global clearly offers the most diversification, but Brickworks could offer the most reliable income with its defensive assets.  

More reading

• 3 ASX dividend shares offering big yields
• 4 ASX shares to profit from booming ecommerce
• 3 ASX shares trading at crazy cheap prices
• 2 ASX shares that every investor should own
• Top ASX dividend shares to buy in August 2020

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, COSTA GRP FPO, and Washington H. Soul Pattinson and Company 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 S&P/ASX 200 Index (ASX: XJO) fell by 0.8% today to 6,076 points.

Reporting season continued today and it was another impressive day by retailers:

JB Hi-Fi Limited (ASX: JBH)

The JB Hi-Fi share price rose by 4.5% today after reporting an impressive FY20 result.

Total sales increased by 11.6% to $7.9 billion. Underlying earnings before interest and tax (EBIT) rose by 30.5% to $486.5 million and underlying net profit after tax (NPAT) grew by 33.2% to $332.7 million. Statutory NPAT went up by 21% to $302.3 million.

The ASX 200 company reported total online sales grew by 48.8% across the company.

The FY20 result was so strong that JB Hi-Fi decided to increase the final dividend by 76.5% to 90 cents per share. The total FY20 dividend grew by 33.1% to 189 cents.

JB Hi-Fi CEO Richard Murray said: “This is a strong result in the most challenging of times. We are pleased to report strong sales and earnings for FY20 and importantly, we have provided our customers with the products they required as they spent more time working, learning and seeking entertainment at home, and kept our team members in jobs with an absolute focus on health and safety.

In July 2020 the company saw 42.1% sales growth for JB Hi-Fi Australia, 40.4% sales growth for The Good Guys and 9.1% sales growth for JB Hi-Fi New Zealand. However, the company didn’t provide earnings guidance for FY21.

Altium Limited (ASX: ALU)

Altium also reported its FY20 result today. The Altium share price went up by 1.3%.  Revenue grew by 10% to US$189.1 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 13% to US$75.6 million.

Profit before income tax rose by 12% to US$64.6 million, but profit after tax declined 42% to US$30.9 million. There was a taxation change that will allow Altium to take advantage of a tax deduction in FY21 and lower its effective tax rate. The one-time revaluation change of the deferred tax assets and the deferred tax liabilities caused an accounting charge of US$16.4 million. Normalised earnings per share (EPS) grew by 5% to 42.45 cents.

Altium’s board decided to increase the final dividend to AU19 cents per share, which brought the full year dividend to AU39 cents per share, an increase of 15%.

In terms of guidance, the ASX 200 business said it’s still on track to achieve 100,000 subscribers by 2025. However, due to COVID-19, it may take an extra six to twelve months to reach its 2025 goal of US$500 million in revenue. 

Kogan.com Ltd (ASX: KGN)

The online business announced an impressive FY20 report today.

Gross sales went up by 39.3% to $768.9 million and revenue grew by 13.5% to $497.9 million. Its active customer base increased by 35.7% to 2.18 million people. Kogan.com’s gross profit increased by 39.6% to $126.5 million.

Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 57.6% to $49.7 million and net profit after tax (NPAT) jumped by 55.9% to $26.8 million.

The ecommerce business saw accelerated growth in the second half of FY20 compared to the prior corresponding period. Growth sales increased by 62.5%, gross profit went up 68.3% and adjusted EBITDA rose by 74.1%. 

In July 2020 the company saw continuied strong growth. Gross sales grew by more than 110% year on year, gross profit went up by more than 160% year on year and adjusted EBITDA for the month was more than $10 million.

The company said it was going to continue to invest in its platform and it’s looking for acquisition opportunities.

The Kogan.com share price fell by 6% today, though it is up 440% since 16 March 2020. I imagine it’s close to entering the ASX 200.

More reading

• If you invested $10,000 in Afterpay shares in March, this is how much you’d have now
• 3 reasons the Altium share price is in the buy zone
• Telstra share price hit by broker downgrade today
• What recession? These ASX retail shares are raking it in
• The Starpharma share price jumps on new partnership deal

Tristan Harrison owns shares of Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd. The Motley Fool Australia has recommended Kogan.com ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re looking to invest $1,000 into the share market this week, then there are a lot of quality options to choose from.

Three ASX shares which I think would be smart choices currently are named below. Here’s why I like them:

Aristocrat Leisure Limited (ASX: ALL)

I think this gaming technology company could be a great option for a $1,000 investment. Current trading conditions for its land-based pokie machine business are tough because of the pandemic, but with many casinos now open again, I believe the worst is now behind the company. And while it will take time until sales from this business return to previous levels, I’m optimistic that its digital business will offset some of the weakness. This business has millions of daily active users generating significant recurring revenues. And due to new releases and the growing popularity of social and mobile gaming, I expect this strong form to continue for the foreseeable future. This should drive strong profit growth over the medium term once both businesses are pulling together.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

Another top option for a $1,000 investment is Domino’s. I think it is a great long term option due to its store expansion plans and its positive sales targets. Management intends to grow its global store network by 7% to 9% per annum for the next 3 to 5 years. At the same time it is aiming to grow its same store sales by 3% to 6% per annum. If Domino’s can maintain or even expand its margins, this should underpin strong earnings growth over the next five years. 

IDP Education Ltd (ASX: IEL)

A final ASX share to consider investing $1,000 into is IDP Education. As with Aristocrat Leisure, IDP Education has been hit hard by the pandemic. As a leading provider of international student placement services and English language testing services, it has experienced a sudden and severe decline in demand. While this is disappointing, I believe it is more than reflected in its share price now. In light of this, its strong balance sheet, and positive long term growth potential, I think now could be an opportune time to invest.

More reading

• 2 ASX growth shares to buy with $2,000
• 3 ASX shares that could grow rapidly during the 2020s
• 50% off: 2 dirt cheap ASX shares to buy today
• Why I would buy ResMed and these ASX growth shares
• Earnings preview: What to expect from the Domino’s Pizza FY 2020 result

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 Idp Education Pty Ltd. The Motley Fool Australia has recommended Domino’s Pizza Enterprises 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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How much would a $10,000 investment in Afterpay Ltd (ASX: APT) shares in March be worth today?

Well, 2020 has been a bumpy ride so far (to say the least!). The S&P/ASX 200 Index (ASX: XJO) started the year off at 6,690 points, rose to 7,162 by mid-February, fell to 4,546 points by mid-March and is back up to 6,076 points at the time of writing.

But the Afterpay share price makes that rollercoaster ride look like a Seine river cruise.

Afterpay shares started 2020 at $30.63. By February, the company was pushing $40 a share, but Afterpay was walloped in the March crash and was slammed down to roughly $8 a share in rapid time. But the recovery was just as kind as the crash was savage — even more so. Between 23 March and 26 March, Afterpay shares were back up 118% from this low. A month after that, up another 42%. Add another month and another 63%.

You get the idea.

The bottom line: between 23 March and today, Afterpay has rewarded its shareholders with a ~730% rise.

That means that anyone who bought $10,000 worth of Afterpay shares on 23 March for $8.01 would have acquired 1,248 shares and left with some change. Those 1,248 shares would today be worth… $92,077 on current prices.

Cue violins for us mere mortals who missed out on this extraordinary return.

Why did Afterpay shares shoot the moon?

Afterpay shares have benefitted from a number of tailwinds since the lows in March. Back then, the full extent of the coronavirus crisis (and the lengths that governments would go to assuage it) wasn’t clear. As a quasi-credit provider, investors were fearful that Afterpay would be faced with a wave of defaults and an exodus of users. The opposite has proven true. Afterpay has managed to increase its customer base by 116% to 9.9 million in FY2020 compared to the previous year.

Additionally, the company announced in May that Chinese e-commerce giant Tencent Holdings had acquired a 5% stake in Afterpay. That sent Afterpay shares up even higher when it was announced.

Is there still time to buy Afterpay?

Unfortunately, I think any upside that was in the Afterpay share price has been well and truly absorbed by the market. That means a buy today is a bullish bet on the company’s future growth, rather than a ‘fair value today’ kind of investment.

If you think Afterpay has what it takes to continue to shake off competition and spread into the markets it has yet to conquer, then today’s price might still be cheap. Afterpay’s current market capitalisation is around $20.67 billion, which still looks pretty good compared with a payments giant like Visa Inc. (with a ~US$418 billion market cap) if you think it can rival companies like this one day.

For me though, the current Afterpay share price is still a little frothy, so I’m happy to wait until a better buying opportunity presents itself.

More reading

• ASX 200 drops 0.8%, JB Hi-Fi jumps 4.5%
• Telstra share price hit by broker downgrade today
• The Starpharma share price jumps on new partnership deal
• What experts are saying about JB Hi-Fi’s profit results as the stock surges to record
• Are BNPL shares like Afterpay officially recession proof?

Sebastian Bowen owns shares of Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Visa. 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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