3 tempting ASX shares that rocketed after their results

These stocks shot up in August, but one expert reckons it’s not too late to get a pizza the action…
The post 3 tempting ASX shares that rocketed after their results appeared first on The Motley Fool Australia. –

The reporting season can make or break the fortunes of ASX shares.

Not only is the company’s performance for the 2021 financial year important, but the outlook for the current and future years will also set the tone for the stock price.

Here are 3 August results season winners that Shaw and Partners senior investment advisor Adam Dawes picked out this week:

Technology and market dominance will keep the pizzas hot

Shares for pizza chain Domino’s Pizza Enterprises Ltd (ASX: DMP) went gangbusters in August.

The stock has gained more than 30% in the past month after it pleased the market with a boost in sales, earnings, profit and dividend.

And Dawes reckons the upward movement has plenty of legs.

“Domino’s Pizzas has certainly done really well,” he told Switzer TV Investing

“Mainly because everyone’s stuck at home… People are sick and tired of cooking, and they may as well keep the kids happy by buying a couple of pizzas.” 

The business has strategically placed itself as a “no contact” and low-cost takeaway option, according to Dawes.

But if it’s such a COVID beneficiary, wouldn’t Domino’s shares plummet once Australia’s vaccination coverage is up and society re-opens?

After all, this ASX share has already more than doubled in the past 5 years.

While Dawes acknowledged that as a risk, he pointed out a couple of positive forces to cancel out any sales slowdown from Australians getting out of the house more.

“These guys are very technology-driven and I think that’s what’s separated them from a lot of the other pizza delivery people,” he said.

“Also, it’s the store dominance that they’ve got — they’re around most corners. They actually place themselves quite comfortably in lower socio-economic areas, also, because their pizzas are quite cheap.”

Wilson Asset Management portfolio managers Catriona Burns, Matthew Haupt, and Oscar Oberg last week were also glowing about Domino’s prospects.

“We remain positive on Domino’s Pizza, with key growth markets such as Japan, Germany, and France reaching an inflection point underpinning a robust organic growth profile, while latent capacity remains for further earnings accretive acquisitions.”

‘Standout business’

Construction materials business James Hardie Industries plc (ASX: JHX) has seen its shares rise by more than 14% over the past month, breaking all-time highs.

Hinting at its history of making asbestos, Dawes acknowledged James Hardie has “a chequered past”. But the August results revealed a booming US arm that was going too well to ignore.

“An upgrade that came from the US building and manufacturing business there has absolutely kicked a lot of goals,” he said.

“We’ve seen other companies like Boral Limited (ASX: BLD) try to go overseas and come back with their tail between their legs.”

Dawes noted that several Australia-only companies in the construction and materials sector had downgraded this August.

“So I think James Hardie is a really standout business, especially for that US growth and especially for the ability for them to run their business.”

Great results, ESG-proof and excellent business

Stocks for small-cap technology company Calix Ltd (ASX: CXL) have risen more than 31% in value in the past month.

According to Dawes, the business’ flagship technology removes the heat out of cement manufacturing to recycle into energy.

He admitted this ASX share is a riskier bet than James Hardie and Domino’s — but the $630 million business has much going for it.

“We’ve got a ‘buy’ [rating] on it at Shaw and Partners,” said Dawes.

“The ESG [environmental, social and governance] theme plus the royalties they’ll get from some of these European operations, I think, is a fantastic one… It’s a great business.”

It’s not just in August that Calix shares have had a good time. They’ve more than quadrupled in value in the 12 months.

The post 3 tempting ASX shares that rocketed after their results appeared first on The Motley Fool Australia.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of August 16th 2021

More reading

Why the Domino’s (ASX:DMP) share price is up 27% in August
NIB and Ampol share prices fall, new record for Domino’s. Scott Phillips on Nine’s Late News

10 ASX shares we’re overweight in right now: fund

2 ASX shares shining this results season

Revealed: The biggest shocker from results season

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!