Diversification can be done by investing in different types of securities. This strategy of diversification may be helpful for those investors who try to reduce their investment risk. Diversified stocks are the combination of stocks, resulting as fixed income assets, containing different types of commodities. A typical diversified portfolio of investors may help them to yield higher return with the least amount of risk.
- It helps in spreading the risks throughout a range of sectors so that the fluctuation in the economy may have a less impact on an individual investor.
- There is always uncertainty attached to the single investment, and diversification helps in balancing such surprises.
- Diversification provides the investor with an advantage of receiving positive returns when another market is giving the negative results.
Let us now discuss a few diversified stocks to invest in:
Pilbara Minerals Limited
Pilbara Minerals Limited (ASX: PLS) is the biggest producer of Australian lithium - tantalum, listed on Australian Stock Exchange. The company is considered in the top 200 companies in Australian ASX200 index. Also, Pilgangoora Lithium â Tantalum project is wholly owned by the PLS, which is located in Western Australia, Pilbara region.
On 5 September 2019, the company made an announcement that the suspension of trading in the securities of PLS had been be lifted, following the PLSâ release with regards to the capital raising.
Further, the company updated on the conclusion of A$36.5 million Institutional Placement.
A few highlights of the update are as follows:
- The Institutional Placement was considerably oversubscribed, which was supported by the old shareholders and new institutional investors.
- The placement under discussion would be followed by A$55.0 million strategic placement of CATL with an 8.5% ownership interest.
- CATL is the largest Chinese manufacturer for Electrical Vehicles.
- PLS would provide SPP or Share Purchase Plan to the eligible shareholders to raise ~A$20.0 million.
- This equity raising would boost the balance sheet of PLS and would be utilised in other undertakings of the company.
On 4 September 2019, PLS released a presentation on equity raising of A$91.5 million. The proceeds would be used to improve financial flexibility since the Pilgangoora Project is at ramp- up stage and provide funding to PLSâ preliminary ~21 percent investment in POSCO lithium chemicals joint venture and so forth.
Also, on 27 August 2019, the company notified that it had implemented binding terms sheet with POSCO to move ahead with the establishment of integrated Joint Venture in South Korea region to progress and manage a 40ktpa Conversion Facility.
Operation & Financial Summary for the FY 2019
The company announced the result for FY 2019 period closed 30 June this year, on 23 August 2019, and below are the few highlights of the results.
- During the period, PLSâ revenue from contracts with customers increased to $42.7 million compared to pcpâs $10.1 million.
- The Gross profit increased to $6.2 million from the pcpâs $3.9 million
- The net loss for the period increased to $28.9 million from $19.4 million in the pcp.
- The companyâs cash and cash equivalents at the end of the period stood at $63.5 million.
- The company has not declared the dividend for the period.
At the time of writing the report, on 6 September 2019, PLSâ stock was trading up by 3.077 percent at A$0.335 at 3.12 PM (AEST) with approximately 1.85 billion outstanding shares.
PainChek Limited (ASX: PCK) is engaged with providing products assessing pain and services that aids in enhancing the life quality of people who are in pain. The company has developed PainCheckÂ® tool which is used to identify the presence and level of pain. It also helps to oversee the effect of treatment to improve the complete care.
On 5 September 2019, the company announced the hiring of the Head of UK Business Development, Mr Pete Shergill for PainCheck UK Limited. This would aid the company to build the UK market presence. Mr Shergill has 10 years of experience in health care sector. Mr Pete Shergill would be issued with the incentive which include 3,000,000 options, in line, with the companyâs ESOP, which is exercisable at $0.21 and would expire in 4.5 years along with the vesting conditions.
Financial Summary for FY 2019
On 28 August 2019, PCK released full-year results closed 30 June this year, and some of the highlights of the period are as follows:
- The companyâs revenue increased by $215,424 from $50,647 compared to the previous corresponding year
- Loss before income tax stood at $3.26 million from $4.81 million in the pcp.
- The companyâs cash and cash equivalents at the end of FY 2019 was at $4.56 million
- Total liabilities of the company increased to $628,439 from $447,894 million.
On 6 August 2019, the company notified the market that it received a Singapore regulatory clearance. Further, it announced that it had inked a deal with Allium Healthcare Holdings Pte Ltd, which develops and operates Allium Care Suites.
After the close of business, on 06 September 2019, PCKâs stock was valued at A$0.27, up by 3.846 per cent, with a market cap of A$237.68 million and ~914.16 million outstanding shares. In the last three and six months, it has delivered enormous returns of 67.74 per cent and 504.65 per cent, respectively.
Strike Energy Limited
Strike Energy Limited (ASX: STX) is an Australia based exploration company engaged in oil and gas (independent) exploration work. The companyâs mainly concentrate on the commercialisation of the gas resources. STX contains two key onshore assets situated in oil and gas areas, namely - the Perth Basin in West Australia and Copper Basin in Southern Australian region.
On 5 September 2019, the company had announced on the trading halt on its securities pending a release of an announcement associated with West Erregulla-2 well report.
However, on 6 September 2019, STX notified the market that Strike-Warrego Energy limited (ASX: WGO) Joint Venture had demonstrated major gas discovery in the High Cliff sandstone, as a portion of the West Erregulla-2 drilling work. Further, gas saturated High Cliff with 10 metres of net pay and porosities were up to 16 percent. The gross High Cliff gas column was at least of 22 metres. STX also mentioned that the drilling work in the well has now been concluded at 5,100 metres.
On 2 September 2019, the company announced that WE-2 has now been intercepted and is drilling through High Cliff sandstone. Also, Strike kept on drilling 6-3/4 inches section through Bit Basher Shale and have intercepted the High Cliff sandstones at 4,928 metre.
The company holds 50% stake in the joint Venture in EP469 and the other 50% is held by WGO. STX would continue drilling High cliff formation till they reach the Holmwood Shale.
On 27 August 2019, the company announced that Strike â Warrego JV has made a gas discovery in Kingia sandstone, which is a part of West Erregulla â 2 drilling work.
After the close of business, on 06 September 2019, STX stock was at A$0.230, with a market cap of A$420.16 million and ~1.56 billion outstanding shares. In the last three and six months, it has delivered enormous returns of 280.28 per cent and 275.00 per cent, respectively.
Zip Co Limited
Zip Co Limited (ASX: Z1P) is a fintech company that offers a variety of retail finance solutions to small and medium scale firms. Z1P provides a 100 percent cloud-based platform that utilises the companyâs technology.
On 6 September 2019, Z1P through S&P Dow Jones Indices announcement, updated that Z1P was included in S&P/ASX 300 index, w.e.f 23 September this year.
The company further updated the market that it had inked a deal to acquire the Australian and New Zealand businesses- Spotcap ANZ of international SME or small and medium-sized enterprise lending provider Spotcap Global, offering substantial capability in the SME area.
On 26 August 2019, Z1P announced that it had priced the first issuance of Zip Master Trust. This was the biggest issuance in the Australian fintech space and a considerable achievement for Z1P.
According to Peter Gray, CCO & Co-founder of the company, the transaction would help to provide strong validation toward its proprietary credit and fraud decision platform. It would act as an important milestone for Zip. The deal settlement was expected to conclude on September 5, 2019.
Financial Summary of FY 2019
On 22 August 2019, Z1P declared annual report closed 30 June 2019. A few highlights of the same are mentioned below:
- The companyâs revenue increased by 108% to $84.2 million compared to last year.
- The receivables of the company increased by 116% to $682.6 million
- The customers increased by 80% to 1.3 million.
- Retail partners increased as well and stood at 16.2k, rising up by 53% last year.
After the close of business on 06 September 2019, Z1Pâs stock last traded flat at A$3.890, with a market cap of A$1.37 billion and ~352.14 million outstanding shares. In the last three and six months, it has delivered enormous returns of 23.10 per cent and 126.16 per cent, respectively.
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With the pandemic continuing to affect the globe, healthcare companies are evaluating their lead compounds for COVID-19 treatment. Future revenue for these stocks depends on the probability of launching an approved treatment in the market.