On the share market some professional investors will short sell shares in companies based on their expectations that the share prices are likely to fall. For example investors may bet against a company on valuations grounds, or because they think it has dodgy accounts as we saw with Slater & Gordon Limited (ASX: SGH).

However, short sellers can also be spectacularly wrong in their guesses as to which way next for share prices, as we saw when the heavily shorted software business Aconex received a takeover bid from Oracle at a 47% premium to its then price.

So short sellers can be wrong or right, but it's still worth knowing about what companies they're betting particularly heavily against. Let's take a look at four below. All stats correct as at December 4, 2018, according to ASIC.

Orocobre Limited (ASX: ORE) is a lithium miner with its main mining operations in Olaroz, Argentina. It currently has 13.85% of its shares shorted despite reporting a statutory net profit of US$1.9 million in FY 2018. It also boasts that on an "underlying" or adjusted basis it posted a profit of US$25.7 million. With 261.4 million shares on issue it has a market value of $1 billion based on a share price of $3.83. Short sellers may be betting against its valuation, although it also has a healthy net cash balance.

Syrah Resources Ltd (ASX: SYR) has 16.3% of its shares shorted as speculators bet the graphite miner with tenements in Mozambique won't deliver on its claims that it will become profitable as one of the world's leading graphite miners. It has a market value around $550 million, but according to its latest quarterly cashflow report it earned no revenues and produced an operating loss of US$21.3 million for the quarter ending September 30, 2018.

Metcash Limited (ASX: MTS) now has 13.3% of its shares shorted, with short interest rising since the IGA store supplier and hardware business reported a weaker-than-expected profit result for the half-year ending October 31, 2018. Metcash's IGA stores are facing more competition as leading supermarket operators Woolworths (ASX: WOW) and Coles (ASX: COL) sacrifice margins in the pursuit of market share. This tough operating environment is probably encouraging Metcash's short sellers.

Speedcast International Ltd (ASX: SDA) has 9.2% of its shares short sold as speculators bet the $804 million satellite services operator could be in for a fall. As at June 30, 2018 Speedcast had net debt of US$430 million, which is 7x underlying EBITDA of US$60.4 million. This amount of leverage is probably giving short sellers confidence.

The post Why these 4 shares are being heavily shorted appeared first on The Motley Fool Australia.

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Losses on Australia's benchmark S&P/ ASX200 (ASX: XJO) share index are accelerating this afternoon as storm clouds gather in the eyes of some investors over the future of the Australian economy.

One serious issue is the accelerating falls in house prices across major capital cities like Melbourne and Sydney and the knock-on consequences double-digit house price falls might have for the broader economy.

Last week, Australia's GDP growth also came in weaker than expected, and global growth is also reportedly at risk due to tariffs being imposed as a result of the US / China trade dispute and ongoing problems in Europe around Italy's debt levels and the UK's brexit deal.

As a result the S&P/ ASX200 share index is now at 5,555 points, down 2.2% for the day and at levels last seen in December 2016.

Worse news is that some popular companies have tumbled more than 5% today, so let's take a look at some of the scoreboard damage.

The Platinum Asset Management Limited (ASX: PTM) share price is down 5.1% to $4.88 as the international equities manager's fate is strongly tied to the overall levels of equity markets. As they fall so can Platinum's funds under management and share price.

The BWX Limited (ASX: BWX) share price is down 7.7% to $2.77 as the Sukin natural beauty products retailer is sold by investors potentially worried about the outlook for household spending in Australia.

The Domino's Pizza Enterprises Ltd (ASX: DMP) share price is down 6.3% to $43.32 today as investor confidence in its Australian and international growth plans falters.

The Lend Lease Group (ASX: LLC) share price is down 5.5% to a 52-week low of $11.51 today on the back of poor sentiment and as the engineering and construction giant continues to fall on the back of its November 9 warning that its Engineering & Services business was seeing financial underperformance.

The IOOF Holdings Limited (ASX: IFL) share price is down 7% to $4.28 and nearly 40% in two trading days as investors rush for the exits on news the prudential regulator APRA is seeking to have its CEO and chairman disqualified from working for regulated superannuation businesses.

The Appen Ltd (ASX: APX) share price is down 6% to $12.63 as investors dump high-growth technology shares out of fears they may turn out to be overvalued if Australia's economy falls into recession.

The post S&P/ASX 200 at 2-year low: Here are 6 popular shares getting crushed today appeared first on The Motley Fool Australia.

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The Australia & New Zealand Banking Group (ASX: ANZ) share price is near a 52-week low of $24.68 this morning on rising concerns about the accelerating price of Australian house price falls and their potential impact on the wider economy.

Analysts are now worried that significant house price falls in major cities such as Melbourne and Sydney could lead the way in delivering Australia's longest housing downturn in history in a result that could have far-reaching adverse consequences for the broader economy.

For example falling house prices tend to equal falling rents as yields on investment properties adjust and this could lead to rising bad debts as over-leveraged investors are unable to cover their expenses.

If a wide recession were to hit Australia for the first time in 27 odd years then job losses could also equal a big rise in bad debts for the banks, as borrowers have no means to pay back loans whether across credit card, business or home loan lending.

The gloomy outlook has also sent shares in Commonwealth Bank of Australia (ASX: CBA) 2.8% lower to $68.70 today, with the  National Australia Bank Ltd (ASX: NAB) share price down 2.6% to $23.38 and the Westpac Banking Corp (ASX: WBC) share price down 3.2% to $24.91.

However, it's not quite nothing but bad news for ANZ Bank shareholders as the Fairfax press is reporting that analysts at JP Morgan reckon the bank may have enough financial firepower to buyback $3.3 billion worth of shares across FY 2019 and FY 2020.

The analysts are basing their assumptions on the belief that ANZ's capital adequacy buffer would still be sufficiently high to spend excess cash on a significant buyback.

The analysts have also reportedly factored in the potential for ANZ's sale of its OnePath financial planning group to not go ahead on the back of the severe regulatory problems at IOOF Holdings Limited (ASX: IFL).

Whether the analysts' forecasts for a buyback prove correct or not it might not make a big difference to ANZ's share price direction if Australia's house price falls turn into a house price crash.

The post The ANZ Bank share price nears 52-week low as analyst flags $3.3 billion buyback potential appeared first on The Motley Fool Australia.

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The S&P / ASX200 (ASX: XJO) has tumbled 1.9% to a 52-week low of 5,571 points in a terrible start to the week for investors on the back of fears about falling house prices in Australia and geopolitical problems including Brexit and the US / China trade dispute.

In fact many well known shares are now at 52-week lows, so let's take a look at what might be sending them lower.

The Perpetual Limited (ASX: PPT) share price is down 4% today to hit a 52-week low of $32.12 and the shares are now down around 33% over just 2018. Perpetual's core business is the management of large-to-mid-cap Australian equities and as these fall in value so will its funds under management and base fees. Perpetual has also struggled to grow FUM organically via net inflows and its share price is likely to loosely shadow the direction of Australian equity markets that are now also at 52-week lows.

The Clydesdale & Yorkshire Bank (CYBG PLC/IDR UNRESTR) (ASX: CYB) share price hit a 52-week low of $3.21 this morning and is now down 44% over just the course of 2018. Its primary problem is concern that the UK government will fail to negotiate a Brexit deal with the European Union before a March 29, 2019 deadline. If no deal is agreed UK-focused banks and its economy could face big problems. Clydesdale Bank is also still paying regulatory penalties as the result of its previous mis-selling of insurance products to consumers.

The Catapult Group Ltd (ASX: CAT) share price hit a 52-week l0w of 97 cents today as technology and software-as-a-service stocks come under pressure across the board. Catapult shares are now down 42% over just 2018 despite the sports analytics group posting some reasonable growth in subscriptions and annualised recurring revenues. Its principal problem is managing costs, and the shares are not expensive on conventional valuation metrics compared to many of its more popular software-as-a-service peers.

The IOOF Holdings Limited (ASX: IFL) share price crashed to a new 52-week low of $4.20 today in losing another 7% of its value after a share price rout last Friday that saw it lose one third of its value in a single day. This is because the prudential regulator APRA is seeking to have IOOF's CEO and chairman disqualified from management positions in the regulated superannuation sector. Today, IOOF announced its existing CEO and chairman would "step aside" from their positions while the case is ongoing. IOOF has internally appointed an acting CEO and chairman in their place.

The post Why Perpetual is among 4 shares at 52-week lows today appeared first on The Motley Fool Australia.

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The S&P / ASX200 (ASX: XJO) is down 1.7% at 5,586 points this morning as a number of fears over the housing market locally and US China trade war globally continue to encourage investors to hit the sell button.

There aren't many place to hide in the local market today, but these 4 shares are actually ahead this morning. So let's take a look at what might be supporting the buying.

The Newcrest Mining Limited (ASX: NCM) share price is 2.2% higher at $21.45 as the gold price sells for US$1,252 per oz as at 12.00pm AEST. The gold price is up 3% over the last month from a price around US$1,210, although is actually flat over the past year.

Newcrest like other gold miners is a beneficiary if the gold price rises on concerns that the global economy could fall into recession for example, as gold is seen as a 'flight to safety' trade. Newcrest is also a beneficiary of a falling Australian dollar as its mining costs are mainly in Australian dollars, but it sells its gold in US dollars.

BHP Billiton Limited (ASX: BHP) is another blue-chip share that is up 0.8% to $31.43 today despite the iron ore miner releasing no specific news to the market. BHP is about to pay out US$10.4 billion or A$14.4 billion to eligible shareholders in the form of a share buyback and special dividend payment. The special dividend amount will be US$5.2 billion (A$7.3b) divided by the number of shares on issue after a US$5.2 billion share buyback, with some analysts estimating the special dividend will be around A$1.40 per share. If the analysts are anywhere near correct this is a 4.4% yield alone based on today's share price.

The Northern Star Resources Ltd (ASX: NST) share price is up 3% to $8.45 this morning as it's another one of the ASX's best gold miners benefiting as investors bet global geopolitical problems over Brexit, Italy's debt levels, and the US / China trade dispute could send gold prices soaring as it's considered an asset that appreciates in bears markets. Today Southern Gold Limited (ASX: SAU) also announced it has struck an agreement to take over Northern Star's mining lease at the Cannon Gold Mine in WA.

The TPG Telecom Ltd (ASX: TPM) share price is up 0.5% to $7.41 today after the telco announced its joint venture with Vodafone Hutchinson Australia (VHA) called Mobile JV Pty Ltd had secured $263.3 million worth of 5G spectrum in a recent government auction. Today, Telstra Corporation Ltd (ASX: TLS) also announced it had won $386 million worth of 5G spectrum. The battle for market share in the 5G mobile space is shaping up to be crucial to the future direction of these telcos.

The post Why Newcrest Mining is among 4 ASX shares rising today appeared first on The Motley Fool Australia.

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The S&P /ASX200 (ASX: XJO) is up 0.5% in lunchtime trade today as local investors gain some confidence from a strong finish to trade on Wall Street on hopes the US Fed may delay its rate hiking cycle.

On the local market shares in the technology, finance and healthcare sectors are pacing the index higher, so let's take a look at some leading blue-chips shares moving higher today.

The Macquarie Group Ltd (ASX: MQG) share price is up 1.5% to $114.50 despite the investment bank releasing no specific news to the market. Macquarie is now forecasting profit growth up to 15% in FY 2019 after it agreed the sale of its interest in the oil and gas company Quadrant Energy. Macquarie shares are rising today, as sentiment improves alongside other major banks on the local stock market.

The Bravura Solutions Ltd (ASX: BVS) share price is 2% to $3.90 today as the ASX's best technology shares catch a bid on the back of gains on the tech-heavy NASDAQ index in the US. Financial services software business Bravura grew its net profit 27% to $27 million on revenue of $221.5 million in FY 2018. It also managed to pay dividends per share of 9 cents, which puts it on a trailing yield of 2.3%. The company has nearly tripled in value since its November 2016 initial public offering and looks a profitable, junior software business for the watch list.

The Coles Group Ltd (ASX: COL) share price is up 3.6% to $12.53 today despite the supermarkets operator releasing no news to the market. Professional analysts have delivered a wide range of different opinions as to the value of Coles shares, with the stock falling from $13.11 on November 26 to just $11.49 on December 4. The selling the result of some legacy Wesfarmers shareholders choosing to divest minor ownership stakes. The Coles share price is probably rising today on the back of bargain hunters buying in.

The CSL Limited (ASX: CSL) share price is 2.6% to $183.80 as investors continue to digest its investor presentation on its research and development pipeline this week. CSL has around 30 different new treatments in the product pipeline and also reported that a cell-based flu vaccine it sells had been found to be far more effective than more traditional egg-based flu vaccines. The company also has CSL 112 in development, a drug it hopes could spin big profits if it's successful in helping treat heart attack victims. CSL is guiding for profit growth between 10%-14% in FY 2019.

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The S&P / ASX200 (ASX: XJO) is up 0.7% in lunchtime trade today on the back of a strong finish to trade on Wall Street overnight as investors position themselves ahead of important jobs data in the US tonight that may impact the pace of the US Fed's rate hiking cycle.

However, there are a few shares falling fast in the wrong direction today for differing reasons. So let's take a look at what might be sending them lower.

The IOOF (ASX: IFL) share price is down 33% to $4.77 today on the shock news that the prudential regulator APRA has initiated legal proceedings to have its CEO, chairman, CFO and Company Secretary disqualified from working at superannuation businesses regulated by APRA. IOOF insists it intends to vigorously defend the allegations. IOOF is also in the process of buying Australia & New Zealand Bank's (ASX: ANZ) OnePath financial planning business, with ANZ executives announcing that they were concerned about the news today.

The Janus Henderson Group (ASX: JHG) share price is down 5.3% to a record low of $29 today despite the international equities and fixed income or bonds manager releasing no news to the market. Janus Henderson has some significant exposure to European and British equities, which are exposed to a potential slowdown if the UK cannot agree a Brexit deal with the EU. Global equities have also been on a significant downturn recently which is not helping the Janus Henderson share price.

The G8 Education Ltd (ASX: GEM) share price is down 1.4% today despite the child care aggregator releasing no specific news to the market. G8's share price fell over most of 2018 after the group warned that occupancy rates had been lower-than-expected for various reasons. However, in November 2018 it told investors that occupancy growth was now slightly ahead of management expectations.

The Fastbrick Robotics Ltd (ASX: FBR) share price is down 7.4% to 12.5 cents today as its valuation continues to fall after the group admitted that construction giant Caterpillar Inc. would no longer work in partnership with it under the terms of a memorandum of understanding. Caterpillar will also sell its 2.13% shareholding in Fastbrick. The robot-powered bricklayer is yet to generate any revenue and looks speculative.

The post Why IOOF is among 4 shares tumbling today appeared first on The Motley Fool Australia.

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The Jumbo Interactive Ltd (ASX: JIN) share price is up 9% to $8.39 in trade today after the lottery operator and online ticket seller told investors to expect a strong first half to the fiscal year ending December 31, 2018. Below is a summary of what Jumbo told the market:

• First half profit should be up 123% to $11.8 million
• First half EBITDA should be up 66% to $32.3 million
• First half revenue should be up 55% to $29.9 million
• First half total transaction value should be up 64% to $145.8 million
• Forecast number of large jackpots $15 million or more 21 – an increase of 17%

"The strong performance in the first half is driven by continual improvements in our software platform and online marketing that have engaged existing customers and as well as acquired new customers, taking advantage of the favourable jackpot activity, " commented Mike Verveka CEO and founder of Jumbo Interactive.

Jumbo is the group behind the popular OZ Lotto and Powerball lotteries and in its profit upgrade today acknowledged that the more large jackpots (>$15 million or more) available the more inclined people are to take a chance on buying tickets. This in turn drives sales or total transaction value, with the fact that sales rise faster than relatively fixed costs meaning profits rise even quicker.

In response to this bright news the share price hit a record high of $8.75 today and the question for investors is whether the $460 million company has more fuel in the tank.

A lot of Jumbo's growth strategy is based around attracting new players to its ozlotteries.com offerings via internet marketing and new technologies like mobile applications for the iPhone or Google Voice. Its ozlotteries.com website is operated in partnership with betting king Tabcorp Holdings Ltd (ASX: TAH) that is also in a battle with rivals to win market share as gambling activity shifts online from traditional over-the-counter methods.

The post Why the Jumbo Interactive Ltd (ASX: JIN) share price hit a record high today appeared first on The Motley Fool Australia.

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The IOOF Holdings Limited (ASX: IFL) share price is down 32% to $4.85  today after the financial advice and superannuation business shocked the market this morning by revealing that the prudential regulator APRA wants to disqualify its managing director Chris Kelaher, chairman George Venardos, chief financial officer David Coulter,  company secretary Paul Vine, and general counsel Gary Riordan from working in the APRA regulated superannuation industry.

The proceedings seeking disqualification orders against pretty much the entire leadership team of IOOF are related to alleged breaches of the Superannuation Industry (Supervision) Act 1993. 

IOOF has stated that it's "disappointed" in APRA's decision to bring proceedings and intends to vigorously defend them in court.

In its market announcement IOOF did not disclose what alleged breaches the proceedings were related to, but did report "that the historical matters the subject of proceedings were disclosed to APRA a number of years ago".

Back in 2015 IOOF admitted to not reporting "significant" breaches to the regulator of operational policies and procedures that affected clients, and at the time agreed it would put in place significant remediation procedures.

In its announcement today IOOF also claimed it "has already addressed" or "is addressing" the historical matters "and has been constructively working with APRA to this end".

In other bad news IOOF also admitted APRA is seeking to impose license conditions on IOOF's APRA regulated entities which at a minimum probably means rising risk, compliance and monitoring costs.

Recently, IOOF Holdings completed the $1 billion acquisition of Australia & New Zealand Bank's (ASX: ANZ) OnePath financial planning and advice business.

If its senior management team is disqualified from running APRA regulated businesses it could be disastrous for the group as a whole, which is why the company has lost around one third of its value on this news.

The increased regulatory heat in Australia is also related to the recent Hayne Royal Commission into financial services where IOOF was also grilled about its approach to financially compensating unitholders in a super fund that were adversely affected by an operating error.

The post Why the IOOF Holdings Limited share price cratered 32% today appeared first on The Motley Fool Australia.

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It's been a terrible few months for investors in high-growth finance, technology or healthcare shares. As they have fallen across the board in the US, Europe and Australia.

At home for example leading technology shares such as Wisetech Global Ltd (ASX: WTC) and Appen Ltd (ASX: APX) are now down around 29% and 21% respectively from their August highs. Healthcare leader CSL Limited (ASX: CSL) is also off around 23% from its August share price highs.

Another leading internet business in Carsales.Com Ltd (ASX: CAR) is now down from $16.25 a share in August to $11.47 today, which is a fall around 29%.

The online classifieds business has not released any negative news to the market over that period though, which leaves the question are the shares a bargain. Let's take a look at a few arguments for and against:

For

• Carsales has a very impressive track record of long term revenue, profit and dividend growth. This is because its core Australian business carsales.com.au has a big competitive advantage and strong network effect as buyers and sellers of vehicles always gravitate towards the site with the most vehicles, and best prices to buy or sell.
• EBITDA has grown at a compound annual growth rate of 14.8% over the past 5 years
• Carsales is forecasting moderate revenue, EBITDA and profit growth in FY 2019 for its core Australian business
• Carsales is forecasting strong revenue and profit growth for its Brazilian business Webmotors.
• Carsales is forecasting "solid" local currency revenue and earnings growth for its SK Encar South Korean business.
• Carsales offers a healthy trailing dividend yield of 3.86% plus full franking credits

Against

• After the SK Encar acquisition, Carsales now carries net debt of $390 million as at 30 June 2018, on a high leverage ratio of 1.9x FY 2018 EBITDA
• Carsales faces a potentially tough macro environment in Australia in 2019 as consumer confidence falls leading less consumers to buy new cars. Already, Automotive Holdings Group Ltd (ASX: AHG) has blamed falling house prices for a profit downgrade as dealership sales slow. A lot of Carsales' revenue comes from dealer advertising.
• Carsales faces competition from US social media giants with far bigger network effects than Carsales that now let people advertise vehicles for sale for free.
• Carsales trades on 22x trailing earnings per share, which is not conventionally cheap, although it is 29% off recent highs

As can be seen there are some some strong arguments for and against buying Carsales shares at today's price. It's worth some further research at least.

The post Down 29% since August: Is the Carsales.com share price a buy? appeared first on The Motley Fool Australia.

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The S&P / ASX200 (ASX: XJ) is down 0.5% in lunchtime trade as US futures point to another session heavily in the red on Wall Street tonight. News wires  even reported that the Chicago futures exchange briefly suspended trading due to violent moves lower potentially triggered by algorithmic or robot-style trading.

On the ASX there are plenty of well knowN companies tumbling lower. So let's take a look at what might be behind the share price action.

The Appen Ltd (ASX: APX) share price is down 4.2% to $13 today as investors globally worry about the valuations of tech shares that trade on huge multiples of sales and profits. If interest rates in the US rise as expected analysts will start to use higher discount rates to calculate the net present value of companies. Therefore those with most long-term growth priced in are vulnerable to the steepest downward revisions of the value of their future cash flows.

The Pendal Group Ltd (ASX: PDL) share price is down 5% to $8.10 today as equity markets continue to drop around the world. Pendal is the former BT Investment Management Group part owned by Westpac Banking Corp (ASX: WBC). It also operates the JO Hambro international equities management business and in total has around 20% of its assets invested in British pound denominated assets. As such it's vulnerable to a falling British pound as the country runs out of time to agree a Brexit deal with the EU.

The Carsales. Com (ASX: CAR) share price is down 2.7% to $11.49 today despite it releasing no specific news to the market. The shares are now down more than 25% from highs hit just back in August 2018. Investors are probably worried about the macro outlook for the Australian economy, with weaker-than-expected GDP growth reported yesterday. House prices are also falling in Sydney and Melbourne which is one factor major car dealership Automotive Holdings Group (ASX: AHG) has already blamed for a recent profit downgrade.

The Medibank Private Ltd (ASX: MPL) share price hit a 52-week low of $2.36 today as investors worry that tougher economic times for Australians may see more of them take their chances with free or discounted public healthcare services before private healthcare. Medibank also recently warned it had lost a major contract with the Australian Defence Force that carried an operating profit of around $30 million.

The post Why Appen Ltd is among 4 shares tumbling today appeared first on The Motley Fool Australia.

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The S&P /ASX 200 (ASX: XJO) is down 0.5% in morning trade as investors continue to worry about the US / China trade dispute and the inversion of the yield curve that many worry is a sign of tough economic times ahead for the US and global economy.

Despite the worries there are a few shares moving higher on the local market today. So let's take a look why.

The Lynas Corporation Limited (ASX: LYC) share price is up 2% to $1.70 after losing around 23% of its value yesterday on the back of a ruling by a Malaysian government inquiry that the Malaysia-based rare earths miner must follow more stringent procedures for the disposal of waste that contains radioactive materials.

This process would reportedly involve Lynas having to construct a new waste disposal facility at a significant cost if it is to maintain its operating license in Malaysia. Today's share price rebound is probably the result of bargain hunters thinking the stock has been oversold.

The Computershare Limited (ASX: CPU) share price is up 3% to $17.92 today despite the share registry business releasing no specific news to the market. This morning widely followed research house Morningstar reportedly raised Computershare shares to a "hold" rating. Computershare has a very impressive long-term track record of growth backed up by its strong competitive position. In FY 2019 it is forecasting earnings per share growth around 10%.

The AGL Energy Ltd (ASX: AGL) share price is up 2% to $19.52 today, despite the electricity retailer releasing no specific news to the market. AGL shares are actually down around 20% over the past year however, as investors discount its lofty valuation partly on concerns around changing government energy policy and the regulatory framework. The high and rising electricity bills of consumers are in the sights of the federal government that is already moving to force power prices down.

The Asaleo Care Ltd (ASX: AHY) share price is up 30 cents or 48% to 92 cents today after the group revealed it has agreed a deal to sell its Australian consumer tissue business for $180 million. The fast moving consumer goods group will keep its consumer tissue business in New Zealand and the Pacific Islands, B2B, and other Australian personal care operations. It reports that investors can expect rising profit margins as a result of the sale.

The post Why the Lynas Corporation Limited share price is among 4 shares rising today appeared first on The Motley Fool Australia.

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The NAB (ASX: NAB) share price could receive a short-term sugar hit sometime in 2019 if the bank makes a success of its plans to sell or float on the stock exchange its financial planning and insurance business MLC Group.

According to reports in The Australian newspaper today executives at NAB are now considering a private sale of the business valued at around $4 billion ahead of the possibility of an initial public offering in which NAB would probably retain a relatively small stake.

NAB's CEO recruited ex-Perpetual Limited (ASX: PPT) CEO, Geoff Lloyd, to head up the restructure and divestment of the MLC business probably because Lloyd's CV has extensive experience and success from Perpetual in cost cutting and restructuring businesses with the help of consultants such as Bain & Co.

Currently it's possible to loosely describe that NAB runs two existing businesses.

Its retail and institutional banking business, and its wealth management arm that includes MLC's financial planning, life insurance wealth management, platform and superannuation services, JB Were private wealth management, and nabtrade that is NAB's Australian and international stock broking business for retail and institutional investors.

Its strategic plan is to only retain JB Were and NAB trade from its wealth management operations, which is no surprise given the MLC business is in the firing line of the string of scandals revealed during the Royal Commission about practices in the financial planning, life insurance, and advice industry over 2018.

If NAB were to get a sum in the region of $4 billion for MLC and then only operate its core banking, JB Were and nabtrade operations it would look a better business.

The JB Were HNW wealth management and NAB private banking businesses are also natural bedfellows for the group to retain.

Another likely positive outcome for NAB and its shareholders is that the group's return on equity, as a measure of profitability, would rise on the back on an MLC sale.

Recently we have also seen Australia & New Zealand Banking Group (ASX: ANZ) move to sell its financial advice and planning business OnePath to IOOF Holdings Limited (ASX: IFL) for similar reasons.

The post Why the NAB share price could lift on its MLC sale appeared first on The Motley Fool Australia.

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Different investors will have different investment objectives, for example retirees not receiving a pay check every fortnight anymore will probably want big dividends to maintain an enjoyable lifestyle in retirement.

While those in the work force with a 5 to 10-year investment horizon should be more focused on capital growth by finding companies that reinvest operating cash flows into new growth projects.

So here's a couple of picks that offer investors a decent dividend yield in one case, and the potential for capital growth and dividends in the other case.

The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price is up 78% over the last 5 years from $3.82 to $6.78 and that's not including the beneficial effects of big dividend payments for income seekers.

In fact the airport offers a current yield of 5.5% based on its own estimates for dividends per share of 37.5 cents over calendar year 2018. In 2015 the monopoly-like asset paid just 25.5 cents per share in dividends.

It's also a big beneficiary of rising passenger growth as this helps it grow aeronautical fees as more planes leave and arrive. More passengers also mean more non-aeronautical fees such as parking and retail rents.

Much of the passenger growth is coming about due to the rise of the Chinese and wider Asian middle class that is increasingly visiting Australia. This looks like a long-term trend and helps the airport grow the earnings that pay the dividends.

Debt is a risk at 6.7x EBITDA, alongside rising interest rates due to the debt. While it's also a possible an economic slowdown or 'act of god' sends the shares into a tailspin. However, for dividend seekers it looks a good bet.

CSL Limited (ASX: CSL) is the healthcare business that sells blood product treatments, and influenza vaccines to the public and private healthcare sector around the world. Its shares are up 166% over the past 5 years.

CSL is a success because it does not pay all its cash flows out in dividends, rather it invests a lot of it in developing new products that will help it grow profits over the medium term. In 2018 it invested $702 million in research and development while still paying out around A$2.28 per share in dividends.

Today it presented to investors on dozens of new drugs it has in development including CSL 112 which is commonly touted as a potentially blockbuster new drug in treating heart attack patients. Net debt to EBITDA is 1.3x and the business is at risk from competition. It's also highly valued, but for investors focused on longer term capital growth it looks a good bet.

The post 2 of the best ASX shares every investor should own appeared first on The Motley Fool Australia.

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The S&P / ASX200 (ASX: XJO) is down 1.5% in morning trade as major indices on Wall Street fell more than 3% overnight due to a multiple of worries over issues such as Brexit, the US China trade dispute and the flattening of the yield curve in the US. There's not many places to hide for investors on the local market today, but there are a couple of shares moving higher, so let's take a look at why some shares are catching a bid.

The APA Group Ltd (ASX: APA) share price is up 2.7% to $8.93 today as the gas pipeline business adjusts to public life after the federal government blocked its proposed takeover at $11 a share by Chinese group CKI Consortium. On November 21 APA informed the market that it still expects to post between $1,550 million to $1,575 million profit in FY 2019. It also expects to still pay a partly franked 46.5 cents per share in dividends over the year placing it on a yield of 5.2%.

The Kogan.Com Ltd (ASX: KGN) share price is up 1.9% to $3.31 despite the online retailer releasing no specific news to the market. The buying might be the result of bargain hunters moving into a stock that has collapsed in half over 2018 ahead of the key Christmas selling season. Kogan is also attempting to diversify into financial services via credit cards and home loan products.

The BC Minerals Ltd (ASX: BCI) share price is up 7.4% to 14.5 cents today despite the iron ore miner releasing no specific news to the market. Recently BCI announced it will sell its Kumina iron ore project to Mineral Resources Limited (ASX: MIN) for $35 million. BCI is also planning to diversify into salt and potash mining in order to capitalise on what it reports is rising Asian demand.

The Coles Group Ltd (ASX: COL) share price is up 27 cents or 2.3% to $11.76 today after a series of share price falls since its November 21 listing. Some analysts have put negative ratings on the shares and it even has 1.7% of its shares shorted as at November 29. However, today analysts at Macquarie Group Ltd (ASX: MQG) reportedly put an "outperform" rating on Coles shares, which may be helping the Coles share price higher today.

The post Why Coles Group Ltd is among 4 shares rising today appeared first on The Motley Fool Australia.

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The CSL Limited (ASX: CSL) share price may be down today, but the future looks good after it revealed a huge pipeline of new products it's working on commercialising over the next three years or more.

In a 116 page presentation to investors this morning the company boasted of some recent clinical successes and a new product pipeline that could generate big profits for investors in the years to come.

So let's take a look at some of the key products it has in the works and when they might be commercialised:

• CSL 112 – is a therapy to help heart attack vitamins with potential commercialisation from 2022, more on this below (Categorised as a potential 'breakthrough' medicine by CSL)
• CSL 312 – a "monoclonal antibody" at Phase II stage in development "for use in multiple indications including as a subcutaneous therapy for HAE" (hereditary angioedema) (Categorised as a potential 'breakthrough' medicine by CSL)
• CSL 346 – "A humanised mAb that antagonises VEGF-B and is administered via subcutaneous injection either as a standalone therapy or in combination with other agents for the potential treatment of diabetic nephropathy, or other conditions associated with aberrant lipid metabolism". (Categorised as a potential 'breakthrough' medicine by CSL)
• CSL 730 – a "novel recombinant human Fc multimer for treatment of patients with immune complex-mediated autoimmune diseases. Developed in collaboration with Momenta Pharmaceuticals."
• CSL 346 – "A humanised mAb that antagonises VEGF-B and is administered via subcutaneous injection either as a standalone therapy or in combination with other agents for the potential treatment of diabetic nephropathy, or other conditions associated with aberrant lipid metabolism."

According to its website and today's presentation CSL currently has a total of 30 different products at the pre-clinical, clinical trial,  or product registration / launch stage, with $702 million invested in research and development over 2017-2018.

Its CSL 112 trial to help prevent secondary heart attacks in patients is recruiting more than 17,000 patients and it's investing more than US$500 million in total on the CSL 112 trials, with the interim efficacy result of the trial expected in April 2021.

If the trial meets its clinical endpoints then CSL hopes to have the treatment commercialised by 2022.

Source: CSL investor presentation, December 5, 2018

What the financial benefits of CSL 112 may be is unclear, but according to management it's a potentially transformational therapy with huge potential. Then again the trial may flop, so investors should be cautious.

In other positive news for investors today CSL also reported one of its cell-based flu vaccines sold under its Sequiris division showed better rates of immunisation for patients compared to more traditional egg-based flu vaccines.

CSL looks a good long-term bet for investors and the share price is well off recent highs.

The post CSL share price falls as it reveals blockbuster new product pipeline appeared first on The Motley Fool Australia.

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It's another tough day on the S&P / ASX200 (ASX: XJO) after Wall Street indices plunged 3% overnight on the back of multiple concerns over Breixt, the US China trade dispute and a flattening yield curve. The local market is down 1.% this morning after giving up 1% yesterday so let's take a look at some of today's worst performers.

The Wisetech Global Ltd (ASX: WTC) share price is down 2.6% to $18.50 today as tech stocks sink across the board. Tech shares are also vulnerable to a changing macro-environment as if benchmark US interest rates rise analysts will start to use higher discount rates to calculate the net present value of shares. Shares with the most growth priced into them are the most vulnerable to downward revisions of valuation as assessments of longer term risk free rates rise.

The Macquarie Group Ltd (ASX: MQG) share price is down 3% to $113 after famous investment banks on Wall Street like Goldman Sachs and JP Morgan lost 3.8% and 4.4% overnight. These kind of investment banks are losing ground on concerns about the flattening of the US yield curve – that represents the difference between short and long term borrowing rates – with long term rates now lower than some short term rates. This is considered an unhealthy sign for the economy and banks as it suggests bond markets are worried about the medium term outlook.

The National Australia Bank Ltd (ASX: NAB) share price is down 1.6% to $24 as investors worry about the outlook for bank shares globally due to the flattening yield curve and because Australian banks have plenty of homegrown problems. These include the Royal Commission findings likely to lead to higher costs, the bank levy, upcoming federal election and falling house prices.

The Coca-Cola Amatil Ltd (ASX: CCL) share price is down 2.8% to $8.74 despite the fizzy drinks bottler releasing no news to the market. On November 30 Coca-Cola's CEO warned investors that Australian beverage volumes over the 6-month period to December 31 2018 were tracking below the prior corresponding half. The CEO also warned investors not to expect much improvement in 2019 as the group continues to invest for growth it is struggling to find.

The post Why Macquarie Group Ltd is among 4 shares tumbling today appeared first on The Motley Fool Australia.

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Shares in dual-listed Trade Me Group Ltd (ASX: TME) are up 3.1% to NZ$6.24 in morning trade after the New Zealand internet giant received an alternative takeover offer from San Francisco-based private equity group Hellman & Friedman at NZ$6.45 per share.

This is subsequent to a November 21 bid from New York-based private equity group Apax Partners at $6.40 per share as the potential for a takeover battle will please existing Trade Me investors.

On receipt of the Apax offer Trade Me agreed to provide Apax due diligence access to  its books, with a caveat that it could also provide other third parties access if it received any unsolicited proposals. Therefore Trade Me has informed the market that it will also grant Hellman & Friedman access to its books.

Trade Me is a popular asset due to its strong competitive position in New Zealand across the e-commerce space, with the strong US dollar also making overseas assets like Trade Me cheaper on an FX-adjusted basis for US investors.

The post Trade Me Group Ltd receives improved takeover offer, shares soar again appeared first on The Motley Fool Australia.

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A lot of growth shares in the technology and consumer-facing sectors saw huge price falls over October including the likes of WiseTech Global Ltd (ASX: WTC), Treasury Wine Estates Ltd (ASX: TWE) and The A2 Milk Company Ltd (ASX: A2M).

One of the worst performers of all has been Tasmania-based infant formula retailer Bellamy's Australia Ltd (ASX: BAL). Its shares are down from $16.80 to $8.04 today in just 6 months. So is Bellamy's share price now a bargain or value trap?

Let's take a look at a few arguments for and against.

For 

• Bellamy's has a very strong brand amongst its target market of parents who are prepared to pay premium prices to get 'the best' organic formula and baby food for this children
• Total revenue is still on a strong upward trajectory, growing from $125 million in FY 2015 to $329 million in FY 2018. Also, adjusted EBITDA or operating income has grown strongly from $14 million in FY 2015 to $71 million in FY 2018
• In FY 2019 the group is forecasting its Australian label sales will grow up to 10% and its adjusted EBITDA margin should grow marginally to 22%-25%. Rising sales and margins are commonly a 'buy signal' for professional investors.

However, Bellamy's has a few risks as well.

Against

• Bellamy's sales growth forecasts for FY 2019 exclude Chinese label sales as the group is still waiting for regulatory approval in China to sell its Chinese label products in the "offline" channel that it says represented 6% of FY 2018 revenue. It has no idea on the potential timing of any approval. While the China market is attractive, it comes with a lot of uncertainty.
• Bellamy's has a mixed track record as a listed company with shares falling under $4 in January 2017 after the group was suspended from ASX trade for nearly a month as it frantically renegotiated supply agreements in an attempt to avoid insolvency.
• Baby formula businesses have low barriers to entry in that it's not hard to source and supply the powder for sale, with powerful multi-nationals like Danone and Nestle in the space. There's no patent protection either for example, therefore investors are relying on Bellamy's brand strength.

Foolish takeaway

Bellamy's earned 39.2 cents per share in FY 2018, which places it on 21x trailing earnings. This is moderately expensive, but the shares are still trade at a big discount to prices over the past 6 months. If you buy into the China growth story and Bellamy's success in Australia it could still offer investors strong long-term returns.

The post Down 52% in 6 months: Is the Bellamy's Australia Ltd (ASX:BAL) share price a buy? appeared first on The Motley Fool Australia.

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The S&P / ASX 200 (ASX: XJO) is down 0.5% in lunchtime trade today after European markets and Wall Street jumped higher overnight on the back of renewed optimism about the chances of a trade deal between the US and China. On the local market there are a number of shares heading higher as well.

So let's take a look at what might be behind the buying today.

The Ramsay Health Care Limited (ASX: RHC) share price is up 2% to $55.87 today despite the private hospital operator releasing no specific news to the market. Ramsay has plenty of organic and acquisitive growth opportunities but due to short-term challenges is only forecasting core earnings per share growth up to 2% in FY 2019. The group currently trades on 20x trailing earnings, with a trailing yield of 2.6% plus franking credits. Healthcare shares in the US have also been on a strong run, the sector reportedly rising 6% over over November alone.

Soul Pattinson and Co. Ltd (ASX: SOL) share price is up 2% to $26.80 today after some relatively heavy falls from a closing price of $27.57 on November 29. The shares have probably fallen after news broke on December 3 that major shareholder Brickworks Limited (ASX: BKW) sold around 2 million shares for gross proceeds of $52 million. Brickworks and Soul Patts have significant cross-ownership stakes in each other, with Brickworks still owning 39% of Soul Patts.

The Nanosonics Ltd (ASX: NAN) share price is up 2.7% to $3.24 despite the hospital disinfectant business releasing no news to the market. Health care shares on Wall Street reportedly posted a gain of 6% in November 2018 and healthcare shares on the local market are now starting to outperform in response. Nanosonics is rated highly as one of the best junior healthcare shares on the ASX by many professional analysts.

The St Barbara Ltd (ASX: SBM) share price is up 3.4% to $3.42 today with the gold price at US$1,240 as at 13.40pm, AEST. Yesterday St Barbara presented at the PNG Oil and Mining Conference held in Sydney where it reported on its Simberi open pit gold mining project in PNG. The strong share price gains suggest investors like what they heard.

The post Why Ramsay Health Care Ltd is among 4 shares rising today appeared first on The Motley Fool Australia.

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