The Limeade Inc (ASX: LME) share price has seen some action in the green today. Shares are up around 2% in late afternoon trading after earlier posting gains of more than 15%.

This on a day where the All Ordinaries Index (ASX: XAO) is struggling to hold onto its 0.2% gains.

Below, we take a look at the employee wellbeing company's quarterly update for the period ending 30 September. For Limeade's accounting, that's Q3 FY21.

What was reported for the quarter?

The Limeade share price soared higher after the company reported it maintained its financial guidance for the full 2021 financial year (FY21).

That guidance was for revenue of $50-53 million, an earnings before interest, taxes, depreciation and amortisation (EBITDA) loss of $5-8 million, and a net loss after tax of $7-10 million.

Third quarter operating cash outflows were reported to be $4.1 million. Limeade says this reflects the timing effect of "a large upfront enterprise subscription" which it expected in Q3 but received in early October, at the commencement of Q4.

For the coming quarter, Limeade said it has "strong contract signings" and it expects growth in in its contracted annual recurring revenue (CARR) in H2 FY21 figures.

Looking ahead, the Limeade share price may also have gotten a lift after the company said it intends to launch a mid-market wellbeing offering in the current quarter.

Commenting on the results, Limeade's CEO Henry Albrecht said:

During the quarter we focused on serving our core enterprise wellbeing customers, integrating the TINYpulse acquisition and readying for the launch of an immersive wellbeing entry into the mid-market.

Whether a company has 2,000 or 200,000 employees, they seek to listen better and do more for their people to maximize business performance. We were very pleased at the acceleration of our late-stage enterprise sales pipeline to finalist and verbal stages as well, providing Limeade with a solid platform for growth in 2022.

The company ended the quarter with a cash position of $15.1 million and no drawn debt.

Limeade share price snapshot

The Limeade share price has struggled this year, down almost 65% in 2021. By comparison, the All Ords has gained 11% year-to-date.

Over the past month, Limeade shares are down 24%.

The post Limeade (ASX:LME) share price leaps higher on quarterly update appeared first on The Motley Fool Australia.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a solid gain. At the time of writing, the benchmark index is up 0.7% to 7,393.6 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are falling:

Limeade Inc (ASX: LME)

The Limeade share price is down 12.5% to 69 cents. Investors have been selling this HR technology company's shares after it lost a major contract. The US$1.9 million a year deal with American Airlines will terminate on 1 January. Limeade said the US$14 billion airline group was ending the contract due to cost-cutting.

Paradigm Biopharmaceuticals Ltd (ASX: PAR)

The Paradigm share price is down over 4% to $2.01. This morning the biopharmaceutical company's US clinical trial plans were hit with a further delay by the US FDA. The regulator has requested modifications to the company's adrenal screening and mitigation plan for its Investigation New Drug (IND) submission for pentosan polysulfate sodium (PPS) to treat knee osteoarthritis.

Sandfire Resources Ltd (ASX: SFR)

The Sandfire share price is down 12.5% to $5.44. This morning the copper miner announced the successful completion of the institutional component of its equity raising. Sandfire has raised $926 million at $5.40 per new share, which represents a 13.2% discount to its last close price. These funds are being used to acquire the Matsa mining complex in Spain.

Vita Group Limited (ASX: VTG)

The Vita share price is down 3% to 85.5 cents. This decline appears to have been driven by a broker note out of Ord Minnett. According to the note, the broker has downgraded the retailer's shares to a hold rating and cut the price target on them by 16% to 93 cents. This follows news that the company is selling its ICT stores to Telstra Corporation Ltd (ASX: TLS)

The post Why Limeade, Paradigm, Sandfire, & Vita shares are falling appeared first on The Motley Fool Australia.

The Limeade Inc (ASX: LME) share price is on watch after an early morning announcement from the US-based software company.

Why is the Limeade share price on watch?

Limeade is a Bellevue, Washington USA based employee software solutions group that currently boasts a $204.9 million market capitalisation on the ASX.

The Limeade share price will be one to watch after the software group's latest quarterly update for the period ended 31 March 2021 (Q1 2021). Limeade said "pent up demand" remains for employee experience (EX) software following the coronavirus pandemic.

Limeade reported quarterly cash receipts from customers of $23.6 million – a record result for the growing company. Net cash receipts after adjusting for payments to the sale of third-party products and services was down 8% in Q1 2020 to $17.1 million.

Third-party payments were down 6% in Q1 2020 to $6.4 million. However, that figure remains a 177% increase over December quarter figures posted by Limeade.

Limeade said headcount continued to track at a lower rate than prospectus forecasts due to efficiencies and a hiring reduction due to uncertainty during the COVID-19 pandemic.

The Limeade share price will be one to watch this morning with the company's valuation already falling 46.8% in 2021. 

Limeade reported a quarterly operating cash flow of $0.6 million, down 69% on Q1 2020 numbers. Overall year to date Net Revenue Retention was 98% as of 31 March 2021 according to the release.

On the balance sheet side, Limeade reported a $31.3 million cash balance while remaining debt-free during the quarter. One notable update for the quarter was the company reporting strong attendance for its fifth annual Limeade Engage conference. 

The conference was virtually held due to COVID-19 and attracted 275% more registrations compared to 2020. New customer prospects jumped 268% on the prior corresponding period to 545 registrants.

Limeade's total sales and marketing pipeline fell 19% versus Q4 2020 to $182.4 million as early stage qualifying leads declined.

FY2021 guidance

The Limeade share price is one to watch this morning after an update on guidance from the software solutions group. Limeade has maintained full-year guidance of US$50 million to US$53 million revenue with forecast earnings before interest, tax, depreciation and amortisation (EBITDA) loss of US$5 million to US$8 million.

The post Why the Limeade (ASX:LME) share price is on watch appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) is out of form on Wednesday and sinking lower. In afternoon trade, the benchmark index is down a disappointing 0.75% to 6,775.9 points.

Four ASX shares that are falling more than most today are listed below. Here's why these shares are tumbling lower:

Corporate Travel Management Ltd (ASX: CTD)

The Corporate Travel Management share price is down 5.5% to $21.00. Investors have been selling the corporate travel booker's shares after its CEO sold $31.5 million worth of shares. Although no explanation was given for the sale, the company notes that Jamie Pherous remains its largest shareholder with a 14.1% stake.

IGO Ltd (ASX: IGO)

The IGO share price is down 2% to $6.36. Investors have been selling the nickel producer's shares following the release of its annual mineral resource and ore reserve update. IGO revealed that its total attributable mineral resources from the Nova and Tropicana operations are an estimated 208kt nickel, 84kt copper, 7kt cobalt, and 2.3Moz gold.

Limeade Inc (ASX: LME)

The Limeade share price continues to be sold off by investors and is down 6.5% to 83.2 cents. This latest decline means that the employee experience software company's shares are now down over 60% from their 52-week high. A disappointing FY 2020 result and underwhelming guidance for the year ahead have been weighing on its shares. As has a large number of shares coming out of escrow recently.

ResApp Health Ltd (ASX: RAP)

The ResApp share price is down 6.5% to 7.3 cents. This appears to have been driven by profit taking from investors after some strong gains in recent trading sessions. In fact, prior to today, the ResApp share price was up an impressive 34% since last Thursday. A couple of positive announcements released this week were behind this strong gain.

The post Why Corp Travel Management, IGO, Limeade, & ResApp are tumbling lower appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) is having a very positive day on Tuesday. In afternoon trade, the benchmark index is up 1.2% to 6,856.4 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are sinking:

Advance Nanotek Ltd (ASX: ANO)

The Advance Nanotek share price is down 9% to $4.01. This may be due to profit taking after some strong gains recently. As the company creats ingredients that go into sunscreen products, investors may have been hopeful that demand will increase now that COVID-19 vaccines are being rolled out.

BHP Group Ltd (ASX: BHP)

The BHP share price is down 1.5% to $47.19. This is despite there being no news out of the mining giant today. However, while Goldman Sachs continues to rate BHP shares as a buy, this morning it warned that iron ore was likely to go from being in a deficit this year to a surplus in 2022. This is expected to put pressure on the price of the steel making ingredient.

Limeade Inc (ASX: LME)

The Limeade share price has continued its slide and is down a further 2.5% to 88.5 cents despite a rebound in the tech sector. Investors have been selling the employee experience software company's shares since the release of its results last month. Particularly disappointing investors was its guidance for FY 2021. Management expects revenue of US$50 million to US$53 million. This is a decline on FY 2020's revenue of US$56.6 million. Falling customer numbers is weighing on its performance.

Metcash Limited (ASX: MTS)

The Metcash share price is down 3.5% to $3.40 following the release of its strategy update. At the event, the wholesale distributor also revealed that its strong sales momentum had continued for all business segments during the second half of 2021. Supermarket, hardware, and liquor sales have all experienced double-digit growth compared to the prior corresponding period. Investors may have been expecting an even stronger update.

The post Why Advance Nanotek, BHP, Limemade, & Metcash shares are sinking appeared first on The Motley Fool Australia.

It certainly has not been a good month to own ASX tech shares. As we reported this morning, the S&P/ASX All Technology Index (ASX: XTX) is way past being in a technical 'correction' (a drop of 10% from the most recent high). In fact, it is now on the edge of being in an actual bear market (a drop of 20%-plus), since it has fallen more than 18% since 10 February.

The phrase 'bear market' hasn't been in play on the ASX for almost a year now, so this is certainly a dramatic turn of fortune.

So which ASX tech shares have been hardest hit over the past month? 

10 of the hardest-hit ASX tech shares

1. Limeade Inc (ASX: LME) – Limeade is one of the worst-hit ASX tech shares, down around 43% from where it was a month ago. Limeade had a shocker last Monday in particular when investors made their feelings known about the company's full-year earnings results.
2. Nuix Ltd (ASX: NXL) – Nuix has also had a disastrous month, falling more than 42% since 9 February, despite rocketing close to 17% today. This company remains more than 30% down from its December 2020 IPO.
3. Tesserent Ltd (ASX: TNT) – Network security company Tesserent has lost around 32% of its valuation over the past month. This appears to have been accelerated by a poor reaction to this company's half-year earnings back on 1 March as well.
4. Afterpay Ltd (ASX: APT) – As a leading ASX growth share and a rocket of a performer for years now, Afterpay was always going to be caught up in any kind of growth or tech sell-off. And lo and behold, it came to pass. Afterpay shares are down just a tad over 30% over the past month.
5. Splitit Ltd (ASX: SPT) – Buy now, pay later (BNPL) player Splitit has had a rough month, losing 28.28% of its value since 9 February. BNPL companies (see above) have been especially hard-hit in this tech sell-off, and Splitit is no exception. As we reported this morning, trading volumes have been especially high this week.
6. Damstra Holdings Ltd (ASX: DTC) – Damstra shares have been on a slide for a few months now, but the past month has seen sellers step on the gas, sending the shares down almost 28%. Earnings may have played a role here, given Damstra reported an after-tax loss of $5.5 million last month.
7. Appen Ltd (ASX: APX) – WAAAXer Appen has seen its shares lose about 27% of their value since 9 February. Again, earnings didn't give investors a lot of confidence, but Appen has also been out of favour for months now since peaking in August last year.
8. ELMO Software Ltd (ASX: ELO) – Elmo shares are down close to 25% over the past month. Earnings weren't a factor here, so we can probably put this one down to general unenthusiasm for ASX tech shares. Interestingly though, Elmo insiders have been buying shares lately, as we reported last week.
9. Bigtincan Holdings Ltd (ASX: BTH) – Bigtincan has also copped a beating, down close to 25% over the month. This software-as-a-service (SaaS) company reported a seemingly strong set of earnings numbers last month, but that hasn't been enough to stop investors from hitting the sell button since then.
10. Zip Co Ltd (ASX: Z1P) – Zip is more of a bonus inclusion today. This BNPL company is 'only' down 8.8% over the past month, which doesn't seem too shabby compared to the ASX tech shares above. But if we go from 16 February rather than 9, we can see that Zip is down 37.5% from those highs. Ouch!

The post ASX tech correction? 10 of the worst-hit shares appeared first on The Motley Fool Australia.

In late morning trade on Tuesday, the S&P/ASX 200 Index (ASX: XJO) is on course to record another solid gain. At the time of writing, the benchmark index is up 0.45% to 6,820 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are sinking:

Limeade Inc (ASX: LME)

The Limeade share price has continued its slide and is down a further 3% to 97 cents. Investors have been selling the employee experience software company's shares since the release of its full year results last week. Investors appear disappointed with its guidance for FY 2021. Management expects revenue of US$50 million to US$53 million. This is a decline on FY 2020's revenue of US$56.6 million. Falling customer numbers is weighing on its performance.

Oil Search Ltd (ASX: OSH)

The Oil Search share price is down 1.5% to $4.25. Investors have been selling the energy producer's shares following a pullback in oil prices overnight. It isn't just Oil Search that is under pressure today. The S&P/ASX 200 Energy index is down 1% at the time of writing.

Platinum Asset Management Ltd (ASX: PTM)

The Platinum share price has fallen 3.5% to $4.60. Today's decline has little to do with the fund manager's performance and is predominantly due to its shares trading ex-dividend this morning for its 12 cents per share fully franked interim dividend. Eligible shareholders can look forward to receiving this dividend in a couple of weeks on 18 March.

Whispir Ltd (ASX: WSP)

The Whispir share price is down 4% to $3.72. Investors have been selling the communications workflow platform provider's shares following the completion of a $45.3 million placement to new and existing institutional investors. Whispir raised the funds at an offer price of $3.75 per share, which represents a 3.6% discount to its last close price. The proceeds will be used to accelerate its growth strategy in key markets.

The post Why Limeade, Oil Search, Platinum, & Whispir shares are sinking appeared first on The Motley Fool Australia.

One of the worst performers on the Australian share market on Monday has been the Limeade Inc (ASX: LME) share price.

In afternoon trade the employee experience software company's shares are down a massive 32% to $1.01.

Why is the Limeade share price crashing lower?

Today's decline appears to be a delayed reaction to Limeade's underwhelming full year results release at the end of last week.

For the 12 months to 31 December, the company reported a 19.3% increase in revenue to US$56.6 million. This was driven by a 20.8% lift in recurring subscription revenue to $54.9 million.

While this was solid, its guidance for the year ahead has overshadowed its positive form in FY 2020.

FY 2021 outlook

Management expects its FY 2021 revenue to be in the range of US$50 million to US$53 million. This implies a 6.4% to 11.5% year on year decline.

Management explained that COVID-19 was the reason for the weak guidance.

It said: "COVID-19 slowed new customer growth in 2020 and therefore impacted revenue outlook when coupled with 2021 forecast churn… Growth in new 2021 customer acquisitions will continue to be seasonal, accelerating in H2 and contributing to revenue growth in 2022."

Customer numbers decline

One metric which appears to have worried investors and could be weighing on the Limeade share price today is its customer numbers.

Management notes that COVID-19 "slowed new customer growth in 2020." However, it did more than slow its growth. Hidden away in its report, the company reveals that its customer numbers actually fell 13.3% from 173 in FY 2019.

Furthermore, that was actually the second year in a row of declining customer numbers. In FY 2018, Limeade had 187 customers. And judging by its outlook, there's a risk that it could make it three years of declines in a row in FY 2021.

Shares coming out of escrow

Also weighing on the Limeade share price today could be a massive 164 million shares that have come out of voluntary escrow.

Today is the first day that owners of these shares have been able to trade them. And judging by the Limeade share price performance, it appears as though many wanted to offload some of them.

Is the Limeade share price selloff a buying opportunity?

Analysts at Macquarie see value in the Limeade share price at the current level.

This morning the broker retained its outperform rating but cut the price target on its shares to $1.73.

Based on the current Limeade share price, this price target implies potential upside of ~71% over the next 12 months.

The post Here's why the Limeade (ASX:LME) share price is crashing 32% lower appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) is back on form and racing higher on Monday afternoon. At the time of writing, the benchmark index is up 1.45% to 6,770.1 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here's why they are sinking:

Fortescue Metals Group Limited (ASX: FMG)

The Fortescue share price is down 6% to $22.64. Today's decline has been driven by the the iron ore giant's shares trading ex-dividend this morning for its fully franked interim dividend of $1.47 per share. When a share goes ex-dividend, it trades without the rights to an upcoming dividend. In light of this, a share will tend to drop to reflect this. Eligible shareholders can look forward to receiving this dividend on 24 March.

Genworth Mortgage Insurance Australia Ltd (ASX: GMA)

The Genworth share price has sunk 7% to $2.39. This morning the company revealed that major shareholder Genworth Financial has entered into an agreement to sell its ~52% stake in the company. If the sales agreement completes successfully, Genworth Financial will no longer own any shares in Genworth Mortgage Insurance Australia.

Limeade Inc (ASX: LME)

The Limeade share price has crashed 32% lower to $1.01. This appears to be a delayed response to the company's full year results release on Friday. Investors appear very disappointed with the employee experience software company's guidance for FY 2021. Management expects revenue of US$50 million to US$53 million. This is a decline on FY 2020's revenue of US$56.6 million.

Northern Star Resources Ltd (ASX: NST)

The Northern Star share price is down 2.5% to $9.96. Investors have been selling this gold miner's shares following a pullback in the gold price on Friday. On Friday night, the spot gold price sank 2.6% to US$1,728.80 an ounce. Rising US bond yields and a strengthening US dollar sent the precious metal to an eight-month low.

The post Why Fortescue, Genworth, Limeade, & Northern Star shares are sinking appeared first on The Motley Fool Australia.

The Limeade Inc (ASX: LME) share price is having a rather wild day today (well, mildly wild).

At the time of writing, Limeade shares are flat at $1.50 apiece. But that's a ways away from where the software solutions provider opened this morning at $1.56 a share (up 4% at the time). Just after open, the company dropped to the current share price, so it seems investors can't quite make up their mind on the results of Limeade's earnings report that was released this morning.

The report covers Limeade's full 2020 financial year (which runs from January to December).

What did Limeade report this morning?

It was an unquestionably strong set of numbers that Limeade delivered today. The company reported revenues grew to US$56.6 million, up 19.3% from the US$47.4 million Limeade reported for 2019. Of that US$56.6 million, US$54.9 million came from recurring subscription revenue, a 20.8% rise over 2019.

Limeade also helpfully pointed out that between 2015 and 2020, revenues grew at a compounded annual growth rate (CAGR) of 24%.

Having said that, Limeade's cost of revenue also rose 12.6%, from US$11.1 million in 2019 to US$12.5 million in 2020.

Total operating expenses also rose 11.4% to US$43.1 million, up from the US$38.7 million from 2019. The largest component of this rise in expenses was research and development costs, which rose 14.2% to $16.8 million. An increase in staff count (from 236 in 2019 to 271 in 2020) also didn't help.

Even so, the company reported a gross profit of US$44.1 million, up 21.3% from 2019's $36.4 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) came in at US$1.2 million. That was a 160.3% improvement on 2019's earnings loss of US$2.1 million. Gross margins were also up 1.3% to 77.9%.

On the net profits after tax (NPAT) metric, the company still recorded a net loss of US$0.3 million, but that was a 92.1% improvement on 2019's NPAT loss of US$3.4 million.

The company's cash position sits at US$31.5 million, with no net debt.

Looking forward to 2021

Limeade has given some pre-emptive guidance for the 2021 financial year as well today. The company tells us that it expects US$50-53 million in revenues for the year. It also expects to lose between $5-8 million in EBITDA and to lose US$7-10 million on the NPAT metric.

Here's some of the commentary the company gave regarding this guidance:

COVID-19 slowed new customer growth in 2020 and therefore impacted revenue outlook when coupled with 2021 forecast churn… Growth in new 2021 customer acquisitions will continue to be seasonal, accelerating in H2 and contributing to revenue growth in 2022.

The post Why Limeade (ASX:LME) shares are bouncing around today appeared first on The Motley Fool Australia.

The Limeade Inc (ASX: LME) share price is pushing higher on Friday following the release of its half year results.

At the time of writing the employee experience software company's shares are up 2% to $1.50.

How did Limeade perform in the first half?

Limeade was a strong performer in the first half and appears to have navigated through the pandemic with minimal disruption.

According to the release, for the six months ended 30 June 2020, the company recorded a 26% increase in subscription revenues to $27.4 million.

Also heading in the right direction was its gross margin, which improved by 1 percentage point to 77.1%. Management advised that this reflects positive customer mix attributes, higher value contracts, and operational efficiencies.

Pleasingly, operating expenses grew slower than its revenue. They increased 19% on the prior corresponding period to $22.3 million. Combined with its gross margin improvement, this ultimately supported a significant improvement in its earnings.

Limeade posted a pro forma earnings before interest, tax, depreciation and amortisation (EBITDA) loss of $0.7 million. This was an improvement of 58% on the prior corresponding period.

At the end of the period the company had a strong balance sheet with cash of $28.4 million and no debt.

Management commentary.

Limeade Founder and CEO Henry Albrecht said, "Despite the global COVID-19 pandemic and recession, customer retention remains strong and long-term demand for our employee experience solutions has grown significantly. I'm thrilled to see the blue-chip enterprise Limeade customer base – and expert market influencers – recognize Limeade as a pioneer in accelerating both the digital and cultural transformation of work."

"We play in a huge, global market where modern technology is needed more than ever. And we have built a highly resilient and purpose-driven culture – one that innovates and delivers real customer value in all economic climates," he added,

Outlook.

Management revealed that its total pipeline is up 61% from 30 September 2019 to $219 million. Of its qualified pipeline, $18 million sits within the 'Finalist & Verbal' pipeline and $57 million in 'Develop & Prove' pipeline.

Together with its first half performance, this has given the company confidence to maintain its FY 2020 guidance. It continues to forecast revenues of $56.1 million, an EBITDA loss of $5.5 million to $6.5 million, and a net loss after tax of $7 million to $8 million.

The post Tech company Limeade pushes higher following half year update appeared first on The Motley Fool Australia.

This could be the best investment opportunity that Australian investors have had in a decade.

Those are the words of portfolio managers from Perennial Value Management.

According to its latest monthly report, the investment company's portfolio managers, Sam Berridge and Andrew Smith, have been very busy buying shares following the coronavirus crash.

They commented: "Seeing what we believe as the best investment opportunities in a decade we have moved close to fully invested with 1.2% cash at month end with 65 positions in the portfolio."

How is Perennial investing during these turbulent times?

Although the money managers have been busy buying shares, they haven't just been buying everything that has been sold off.

Perennial quickly adjusted its portfolio and cut loose the shares which it believes will be vulnerable in this environment and loaded up on stocks that are likely to experience strong demand.

Two of the shares the company has been buying are meal kit company Marley Spoon AG (ASX: MMM) and biotech company Genetic Signatures Ltd (ASX: GSS). The latter has an efficient test for COVID-19 which has recently been approved in Europe.

This has proven to be an astute move by the money manager. Both Marley Spoon and Genetic Signatures have been very strong performers since the start of March with gains of 326% and 69%, respectively.

Where should you invest now?

Perennial has taken advantage of share price weakness to buy the likes of payments company EML Payments Ltd (ASX: EML), ecommerce company Kogan.com Ltd (ASX: KGN), investment company Navigator Global Investments Ltd (ASX: NGI), and telco Uniti Group Ltd (ASX: UWL).

It expects Uniti Wireless to benefit from strong broadband demand and sees Kogan as well placed given it is a pure online retailer.

Outside this, the company has been putting capital to work in existing investments which have been caught up in the selling but have more defensive attributes that are poorly understood by the market.

One of these is Limeade Inc (ASX: LME). It believes the employee experience software solutions provider is well-placed to benefit from the work from home initiative and notes that it has a strong balance sheet.

Perennial's portfolio managers also see opportunities in the mining sector and have added equipment rental company Emeco Holdings Limited (ASX: EHL) and engineering company SRG Global Ltd (ASX: SRG).

They explained: "Our discussions with numerous industry participants and our read of government policy leads us to believe the Australian mining sector will not be subjected to a compulsory shutdown of operations."

"Innovations to avoid the spread of COVID-19 by the miners and their contractors have been impressive to date. As a result we view the large selloff in mining services as another attractive area to invest capital," they added.

Foolish takeaway.

I think Perennial Value Management is spot on with its assessment and now is a great opportunity to start investing in the share market.

The post This could be the best investment opportunity for ASX investors in a decade appeared first on The Motley Fool Australia.

It's been a difficult first week for the new S&P/ASX All Technology Index (XTX), which made its debut on Monday. A perfect storm of lacklustre results and coronavirus fears has resulted in the index finishing its first week down more than 10% at 1807.5 points. 

Launched to much fanfare, the new All Technology Index is designed to be a broader, more inclusive index than the existing S&P/ASX 200 Information Technology Index, reflecting the broad range of ASX-listed companies in the technology sector. The current S&P/ASX 200 Information Technology Index only covers ASX technology companies in the S&P/ASX 200 Index (INDEXASX: XJO). 

How did individual shares perform?

Major ASX technology shares included in the index fared poorly this week. Index leader Xero Limited (ASX: XRO) ended the week down 15% at $73.65.

The remaining top 5 ASX shares on the index also performed poorly: Computershare Limited (ASX: CPU) was down 11% to $15.32, Afterpay Ltd (ASX: APT) fell 15% to $33.17, REA Group Limited (ASX: REA) declined 14% to $98.32, and Altium Limited (ASX: ALU) dropped 10% to $30.80. 

Nonetheless, the All Technology Index is expected to be highly investable, with returns from investing in technology exceeding returns on the benchmark ASX 200 in recent years.

As ASX General Manager of listing services Matt Cunningham recently told ITnews, "over the last three years the S&P ASX 200 annualised total return has been around 10% – while over the same period the technology companies who would have been in this index of it had existed, would have returned over 20%." 

How does the All Tech Index work?

The All Technology Index includes 46 ASX technology shares currently, but does not have a set number of stocks. To qualify for inclusion in the Index, ASX technology shares must have a market capitalisation of at least $120 million and have a minimum $120,000 of shares traded each day. 

The number of technology stocks listed on the ASX has more than doubled in the last 5 years, from 100 to over 200. There are now roughly 20 tech companies on the ASX with market capitalisations over $1 billion. The new index is part of an effort by the ASX to encourage overseas-based technology companies to list in Australia. 

Six overseas-based shares are currently included in the index, being Ireland-based FINEOS Corporation Holdings PLC (ASX: FCL), New Zealand-based Xero, Pushpay Holdings Ltd (ASX: PPH), and Volpara Health Technologies Ltd (ASX: VHT), and US-based Life360 Inc (ASX: 360) and Livetiles Ltd (ASX: LVT). 

New listings Tyro Payments Ltd (ASX: TYR), Nitro Software Ltd (ASX: NTO) and Limeade Inc (ASX: LME) will also likely join the Index, although are not included yet due to the rule that a company must have liquidity measures tracked over at least 3 months to qualify. Tyro, Nitro, and Limeade all listed in December. 

Foolish takeaway

Currently, information technology is the eighth largest sector on the ASX in terms of value, and the fourth largest in terms of volume.

While the All Technology Index may have had a rough start, ultimately it will make it easier to track the performance of the Australian technology sector and bring more attention to smaller listed tech companies. 

The post ASX All Technology Index ends first week on a low note appeared first on The Motley Fool Australia.

The new ASX All Technology Index is set to commence operation today after launching on Friday. The index, with the code XTX, will have a combined market capitalisation of more than $100 billion and include many of Australia's best known tech companies. 

The new index is designed to be a broader, more inclusive index than the existing S&P/ASX 200 Information Technology Index, reflecting the broad range of ASX-listed companies in the technology sector. The current Information Technology Index only covers ASX technology companies in the S&P/ASX 200 (INDEXASX: XJO). 

Based on Friday's market capitalisations, the index is expected to be topped by accounting software provider Xero Limited (ASX: XRO). Computershare Limited (ASX: CPU) is next in line with the top 5 rounded out by Afterpay Ltd (ASX: APT), REA Group Limited (ASX: REA), and Altium Limited (ASX: ALU). 

The top 10 is expected to include Carsales.Com Ltd (ASX: CAR), WiseTech Global Ltd (ASX: WTC), Link Administration Holdings Ltd (ASX: LNK), Nextdc Ltd (ASX: NXT), and Appen Ltd (ASX: APX). 

As reported in ITnews, Federal Minister for Science and Technology Karen Andrews said the index would "play a big role in increasing the tech sector's visibility and will make it easier for everyday Australians to invest in tech companies, and share in their success."

The first ETF to track the index is set to launch shortly thanks to Betashares, and will trade under the ticker ATEC. This is expected to be an attractive proposition for investors. As the executive general manager of listings, issuer services and investment for the ASX Matt Cunningham told ITnews, "over the last three years the S&P ASX 200 annualised total return has been around 10% – while over the same period the technology companies who would have been in this index if it had existed, would have returned over 20%." 

The All Technology index is likely to boost the number of tech IPOs this year, following a fall in the number and value of IPOs in 2019. Tech stocks represented the highest number of new listings on the ASX in 2019, according to the Australian Financial Review. Notable tech IPOs in 2019 included Tyro Payments Ltd (ASX: TYR), Moneyme Ltd (ASX: MME), Openpay Group Ltd (ASX: OPY) and Limeade Inc (ASX: LME)

Cunningham told The Australian that the ASX is expecting at least 6 new sizeable technology company listings before the end of June, including companies from the US, Singapore, New Zealand, and Israel. 

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The new S&P/ASX All Technology Index (XTX) is set to launch today at a ceremony at the exchange in Sydney. The index, envisioned as a 'mini NASDAQ' will give investors a chance to invest in one of the fastest growing market sectors on the ASX in a single trade. 

The new index is designed to be a broader, more inclusive index than the existing S&P/ASX 200 Information Technology Index (INDEXASX: XIJ), reflecting the broad range of ASX-listed companies in the technology sector. The current S&P/ASX 200 Information Technology Index only covers ASX technology companies in the ASX 200. 

Representatives from each of the WAAAX shares – WiseTech Global Ltd (ASX: WTC), Afterpay Ltd (ASX: APT), Appen Ltd (ASX: APX), Altium Limited (ASX: ALU), and Xero Limited (ASX: XRO) – are expected to be in attendance at the opening. The index will go live from Monday, providing a smaller, localised version of the NASDAQ composites index. 

What will the ASX All Technology Index look like?

The All Technology Index, or ASX All Tech, is expected to be highly investable, with returns from investing in technology exceeding returns on the ASX 200 in recent years. Xero is understood to be heading the index, with the top 5 also including Computershare Limited (ASX: CPU), Afterpay, REA Group Limited (ASX: REA) and Altium.

The number of technology stocks listed on the ASX has more than doubled in the last 5 years, from 100 to over 200. There are now 20 tech companies on the ASX with market capitalisations over $1 billion. The ASX All Tech will include 46 ASX technology shares at commencement, but does not have a set number of stocks. 

To qualify for inclusion in the index, ASX technology shares must have a market capitalisation of at least $120 million and have a minimum $120,000 of shares traded each day. 

The new index is part of an effort by the ASX to encourage overseas based technology companies to list in Australia. Six overseas-based shares are included in the index: Ireland-based Fineos Corporation Holdings PLC (ASX: FCL); New Zealand-based Xero, Pushpay Holdings Ltd (ASX: PPH), and Volpara Health Technologies Ltd (ASX: VHT); and US-based Life360 Inc (ASX: 360) and Livetiles Ltd (ASX: LVT). 

New listings Tyro Payments Ltd (ASX : TYR), Nitro Software Ltd (ASX: NTO) and Limeade Inc (ASX: LME) will also likely join the index, although are not included at inception due to the rule that a company must have liquidity measures tracked over at least 3 months to qualify. Tyro, Nitro, and Limeade all listed in December. 

What impact could the index have?

Currently, IT is the 8th largest sector on the ASX in terms of value, and the 4th largest in terms of volume. The ASX All Tech will make it easier to track the performance of the Australian technology sector and bring more attention to smaller listed tech companies. It may also boost the number of tech IPOs this year, with tech stocks representing the highest number of new listings on the ASX last year. 

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