2 low cost ASX 200 shares that made big moves last week

Flexigroup Limited (ASX: FXL) and G8 Education Limited (ASX: GEM) share prices have risen upwards of 9% over the past week and can still be picked up for under $3.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

FlexiGroup Limited (ASX: FXL) and G8 Education Ltd (ASX: GEM) are 2 ASX 200 companies that might have caught the eye of investors looking for lower cost shares with upward movement last week, with the share prices of both companies rising more than 9% since last Monday.

Flexigroup and G8 Education's share prices now sit at $1.84 and $2.48, respectively (at the time of writing). Considering that buying one share in either of these companies will essentially only cost you a handful of pocket change, let's take a closer look at their recent performances.

Flexigroup

Flexigroup Limited is a financial services group offering consumer and commercial leasing, interest free finance products and no interest ever products. 

The group's FY19 results have been met with overwhelming positivity from the market. Customers are up 8% to 1.76 million, 5,000 additional retail partners have been added and NPAT is $76.1 million. Flexigroup's shares are currently trading at $1.84, which is a 28% increase in value since last Monday's opening.

Flexigroup also announced a suite of new products through its Buy Now Pay Later, Credit Cards and SME lending businesses. These new activities coupled with the top level marketing strategies conveyed at the presentation provided a real sense of momentum.

Investors looking for dividends should also note Flexigroup's 5.9% gross dividend yield.

G8 Education

G8 Education is the nation's largest for-profit childcare service with additional operations in Singapore. 

G8 Education's recently announced half-year results were a mixed bag. NPAT was down 20% and licensing delays impacted the opening of several new centres. Perhaps the most concerning aspect of the announcement was the lower occupancy rate at 71% across all centres. This reduction in occupancy rates may have also had an impact on the underperformance of a number recently opened large format centres.

On the positive side, the company confirmed its strategic growth program is on track, listing a number of activities and achievements including:

  • Centre turnaround focus group established and on track to complete 25 turnarounds in CY19, encompassing team, assets and curriculum
  • Rollout of pilot labour scheduling and rostering system set for January 2020, with benefits from CY20 H2
  • Committed CY19 centre pipeline, with 17 greenfield centres and 2 brownfield centres.

Investors responded to the announcement by selling off G8 shares, but by mid-last week we saw a rebound of sorts with a 9% increase in share value. This could be an indication that the immediate response to the company position has settled. Investors may again be contemplating a more long-term view of G8 Education.

Shares have dropped around 2% in today's trade and are currently priced at $2.48 per share, with a fully franked gross dividend yield of 7.59%. This price is still a distance away from February's 52-week high of $3.63. The current lower price might interest some potential investors; however, others might take a wait-and-see approach and monitor how G8 Education responds to the challenges ahead.

Foolish takeaway

Flexigroup and G8 Education are great examples of how you can invest in solid companies with a modest initial outlay. Just a few hundred dollars will get you decent sized parcel of shares and then you're on your way to setting up your dream retirement.

Motley Fool contributor JWoodward has no position in any of the stocks mentioned. The Motley Fool Australia has recommended FlexiGroup 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.

More on Share Market News

Scared, wide-eyed man in pink t-shirt with hands covering mouth
Share Market News

These are the 10 most shorted ASX shares

Let's see which shares short sellers are targeting this week.

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Broker Notes

This ASX 200 stock's 'compelling valuation' makes it a strong buy

Goldman Sachs thinks a 50% return could be on the cards for investors.

Read more »

A man looking at his laptop and thinking.
Share Market News

5 things to watch on the ASX 200 on Monday

Will Aussie investors have a good start to the week? Let's find out.

Read more »

A miner stands in front oh an excavator at a mine site
Opinions

3 reasons ASX uranium stocks can keep charging higher into 2025

I think the recent sell-down in ASX uranium stocks has been overdone. Here’s why.

Read more »

Red buy button on an apple keyboard with a finger on it representing asx tech shares to buy today
Broker Notes

Top brokers name 3 ASX shares to buy next week

Brokers gave buy ratings to these ASX shares last week. Why are they bullish?

Read more »

A businessman sits on a chair looking at a pile of chairs stacked up to the ceiling of a white empty room.
Share Market News

Here's how the ASX 200 market sectors stacked up last week

Consumer discretionary shares led the ASX 200 market sectors last week with a 0.36% gain.

Read more »

A man holding a cup of coffee puts his thumb up and smiles while at laptop.
Opinions

3 reasons to be positive on ASX 200 shares in FY25 (and 3 to be wary)

Vinay Ranjan from Airlie Funds Management says we should ignore market noise and buy quality stocks.

Read more »

A woman uses her phone to pay at the counter, with a queue of more customers behind.
Share Market News

Where Aussies are spending their money, and the ASX shares that could benefit

Households are still opening their wallets on certain categories.

Read more »