Trent Primmer
- Oct 7, 2020
- 5 min read
5 ASX Stocks for Your Portfolio - October 2020
Does your portfolio look like Today or Tomorrow?
Following on from our September stocks, here's 5 stocks to compliment your investment portfolio this October.
Here are 5 stocks on our radar that we believe will fall on the positive side of the ledger throughout the coming months.
Bingo Industries Ltd (ASX: BIN)
Bingo Industries Ltd is a full-integrated recycling and waste management company that has seen strong financial performance as consumer-trends and federal/state policies are shifting towards a more environmentally friendly stance that recognises the importance of recycling. NPAT has elevated by 196% and EBITDA has increased from $108M to $152.1M in the most recent reporting, paralleling company guidance.
We believe BIN’s robust balance sheet focus on cash preservation backed by plant and equipment of $700M displays its operational flexibility, whilst the company’s future plan for low capex and future funding shows the ability of Bingo in tackling future obstacles. In FY21, BIN is forecasting infrastructure activity to increase by 10% while residential construction falls 15%. Bingo is well positioned to benefit from fast-tracked fiscal stimulus.
Kogan.com Ltd (ASX: KGN)
Kogan (KGN) is a leading Australian consumer brand renowned for price leadership through digital efficiency and leverage of their purely online business model that has seen astronomical growths with changes in consumer trends.
Whilst in the last few years we had seen the gradual digitisation of previous brick and mortar stores, COVID-19 has accelerated this trend and have grown Kogan’s EBITDA by more than 466% and active customers to 2,461,000 – an increase of 152,000 in their most recent August business update. Kogan has strong growth potential as online shopping has surged in recent months due to COVID-19, with people on tighter budget constraints pushing down demand for premium products to value goods that Kogan focuses on.
In addition, their diverse product range, white-labelling and significant gross profit margins are what makes this stock a must-have in every investor’s portfolio.
ResApp Health (ASX: RAP)
RAP is a leading digital health company developing smartphone applications for the diagnosis and management of the respiratory disease. RAP’s machine learning algorithms use sound to diagnose and measure the severity of respiratory conditions without the need for additional accessories or hardware. RAP’s regulatory-approved and clinically validated products include ResAppDx, a smartphone-based acute respiratory disease diagnostic test for use in tele-health, emergency department and primary care settings; and SleepCheck, a smartphone application which allows consumers to self-assess their risk of sleep apnoea.
Despite recording a $8.47m loss for FY20, a significant portion was attributed to R&D for its suite of diagnostic apps for smart devices and developing its tele-health platforms as RAP seeks further regulatory approvals and commercialisation of its products, particularly in the US and EU to expand its potential market. RAP is currently trading at a two-year forward P/E of 11.1x.
Vmoto Limited (ASX: VMT)
Vmoto Limited is a global scooter manufacturing group that specialises in high quality electric two-wheeled vehicles. VMT’s strong operational performance, recording a 501% growth in profit on previous corresponding period for half-year ended 30 June 2020, was driven by strong demand from existing distributors and ride-sharing customers, in addition to the signing of new commercial and distributor agreements that will continue to fuel the significant demand for the scooter manufacturing company.
With a number of European governments implementing initiatives, including subsidies for purchase of two-wheel vehicles to support green mobility in the COVID-19 post-lockdown phase, VMT is well-positioned to take advantage of favourable industry tailwinds.
Zoono Group Limited (ASX: ZNO)
ZNO is a global biotech company that develops, manufactures, and distributes a suite of scientifically validated, long-lasting and environmentally friendly antimicrobial solutions including sprays, wipes and foams suited for skin care, surface sanitisers, and mould remediation treatments. ZNO’s products are highly effective, and tests have confirmed that ZNO’s Z-71 Microbe Shield are >99.99% effective against COVID-19.
As one of the only producers for products >99.99% effective against COVID-19, demand for their products have dramatically increased during the pandemic, evident from an increase in revenue from NZ$1,777,156 in FY19 to NZ$38,329,69 in FY20. ZNO looks to expand their growth globally as the company continues to secure new distribution agreements in areas including Middle East. They look to take control of the US market, sourcing new distributors to mirror the success of the UK operation. Additionally, ZNO’s sales in veterinary and animal health sector grow as new regulatory approvals and field studies on poultry have shown
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