Is Market Bucking COVID-19 Based Initial Trends: 4 ASX 200 Shares under spotlight

Summary

  • First wave of COVID-19 was like a preparatory phase for companies to learn new ways for business continuity amid the pandemic.
  • During the second wave, success stories are coming up in terms of new milestones and financial achievements.
  • Several companies like JBH, WTC and NWL have declared robust financial results amid the pandemic.

Australia handled the first wave of COVID-19 well with Federal Government's timely lockdown and strict guidelines to control the spread of deadly virus. Owing to these measures, the country could restart economic activities before expected. The first wave prepared businesses to operate in the COVID -19 era and reshaped industries like never before. All sectors learnt to follow social distancing, strict hygiene and mask-wearing while performing their business activities.

When it seemed like Australia was almost out of the crisis, the second wave of infections dashed the government hopes to revive a crippled economy by easing most of the restrictions. Victoria, which accounts for one quarter of the country’s economic output, is under tough new lockdown guidelines, including stage 4 restrictions in metropolitan Melbourne.

Also read: Lockdown II: Sydney Airport, Transurban Shares Under Discussion

Several businesses have faced the impact of COVID-19 pandemic; however, there are businesses that witnessed opportunities in the wake of crisis. Since March lows, equity markets have been experiencing a decent run, with businesses that managed the crisis efficiently continuing delivering better-than-expected performance.

That said, let us discuss recent developments of four ASX 200 listed companies that are performing well amid the second wave.

JB Hi-Fi Limited (ASX:JBH)

JBH recently released its full-year report for the period ended 30 June 2020, highlighting strong financial metrics.

  • Total sales were up by 11.6 per cent to AUD 7.9 billion
  • Underlying EBIT surged by 30.5 per cent to AUD 486.5 million
  • Underlying net profit after tax (NPAT) increased by 33.2 per cent to AUD 332.7 million
  • Underlying EPS was up by 33.2 per cent to 289.6 cps
  • Final dividend increased by 76.5 per cent to 90 cps and total FY20 dividend up 33.1 per cent to 189 cps.

Other highlights included:

  • Total online sales grew by 48.8 per cent to AUD 597.5 million, representing 7.5 per cent of total sales. Online sales in Q4 was up by a massive 134 per cent on the pcp.
  • Ongoing investment in the digital and online offerings including the launch of new platform for JB HI-FI in Australia
  • Over AUD 4 million raised as part of Workplace Giving Programs and Bushfire support.

On 24 August (AEST 01:57 PM), JBH stock was trading at AUD 51.550, up by 1.197 per cent. The stock price grew by more than 16 per cent in the last one month.

Good Read: 4 ASX Stocks Under the Spotlight Last Week- JB Hi-Fi, Suncorp, Nearmap & Redbubble

WiseTech Global Limited (ASX:WTC)

WTC delivered robust financial outcome amid the pandemic environment, with FY20 highlights including:

  • Revenue increased by 23 per cent and EBITDA up by 17 per cent – in line with guidance
  • CargoWise revenue up by 20 per cent to AUD 263.0 million
  • Revenue attributable to acquired businesses of AUD 166.4 million, up by 29 per cent
  • EBITDA margin substantial at 30 per cent, reflecting continued revenue growth and 2H20 cost savings
  • Underlying NPAT flat on FY19 at AUD 52.6 million despite a 66 per cent increase in depreciation and amortisation
  • NPATA up by 3 per cent at AUD 64.6 million
  • Balance sheet, cash flow and liquidity strengthened with operating cash flow up by 16 per cent to AUD 146.3 million
  • Cash at 30 June 2020 of AUD 223.7 million with undrawn debt facility of AUD 190.0 million in place
  • Fully franked final ordinary dividend 1.60 cents per share, payable on 2 October 2020.

In last one month, the stock grew by 26.13 per cent. On 24 August (AEST 01:58 PM), WTC stock was trading at AUD 27.990, up by 0.323 per cent.

Netwealth Group Limited (ASX:NWL)

On 18 August 2020, NWL declared its FY20 results, highlighting:

  • EBITDA of AUD 64.8 million, increased by 24.8 per cent year on year, with EBITDA margin of 52.3 per cent
  • NPAT stood at AUD 43.8 million, up by 21.7 per cent, while total income increased by 25.5 per cent to AUD 123.9 million.
  • Total operating expenses grew by 26.2 per cent to AUD 59.1 million, and headcount increased by 68 to 339.
  • Operating net cash flow pre-tax stood at AUD 64.5 million, 99.4 per cent cash conversion from EBITDA.
  • Fully franked final dividend noted at 7.8 cents per share, payable on 24 September 2020, totalling AUD 18.5 million for 2H2020.
  • Funds Under Administration (FUA) stood at AUD 31.5 billion at 30 June 2020, an increase of 35 per cent. Record FUA net inflows of AUD 9.1 billion for FY20.

On 24 August (AEST 02:01 PM), NWL was trading at AUD 14.090, up by 2.622 per cent. Last one-month performance of the stock reflected a 17.85 per cent growth.

Related: Netwealth Group Net Profit Soars 22%

Goodman Group (ASX: GMG)

GMG declared strong FY20 results, remaining resilient and continuing to execute its long-term strategy during the period.

  • Operating profit of AUD 1,060.2 million, up by 12.5 per cent, with operating earnings per share (EPS) of 57.5 cents, increased by 11.4 per cent
  • Statutory profit of AUD 1,504.1 million
  • Net tangible assets (NTA) of AUD 5.84 per security, up by 9.4 per cent
  • Total assets under management (AUM) of AUD 51.6 billion, and external AUM of AUD 48.0 billion – both increased by 12 per cent.
  • AUD 2.9 billion of revaluation gains across the Group and Partnerships
  • Development work in progress (WIP) of AUD 6.5 billion across 46 projects, with a proposed yield on cost of 6.5 per cent
  • Average Partnership total returns of 16.6 per cent

On 24 August (AEST 02:13 PM), GMG stock was trading at AUD 18.175, down by 0.629 per cent. In the last one month, the stock price grew by 13.96 per cent.


 


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