Day: 11 January 2022

The Syrah Resources Ltd (ASX: SYR) share price has been a very strong performer on Tuesday.

At one stage today, the graphite producer’s shares were up 12% to a multi-year high of $2.10.

The Syrah share price has since given back some of these gains but remains up 8% at $2.01.

Why is the Syrah share price surging higher?

Today’s rise in the Syrah share price comes despite there being no news out of the company today.

However, it is worth noting that the company’s shares have been on fire over the last few weeks thanks to the release of a very positive announcement before Christmas that revealed that Syrah has signed a deal with electric vehicle giant Tesla.

According to the release, the company has signed an offtake agreement with Tesla for the supply natural graphite Active Anode Material (AAM) from its vertically integrated AAM production facility in Vidalia, USA.

The release explains that Tesla will offtake the majority of the proposed initial expansion of AAM production capacity (8kt pa of 10kt pa) at Vidalia at a fixed price for an initial term of four years. This will commence from the achievement of a commercial production rate, subject to final qualification.

The offtake obligation is conditional on the parties agreeing the final specifications of AAM by no later than 31 December 2022 and achieving final qualification of AAM to Tesla’s satisfaction by no later than 31 May 2025. The agreement may also be terminated if production has not started by 31 May 2024.

Why is this a big deal?

Management commented on the deal, explaining why it has big consequences for the company’s future.

It said: “The importance and materiality to Syrah of the agreement with Tesla is that it provides a foundation to proceed with the initial expansion of Vidalia’s production capacity, as stated in the announcement of 23 December 2021.”

“The terms of the Agreement including volume, pricing and term will assist Syrah in finalising its investment decision in relation to Vidalia. Syrah plans to make a final investment decision for construction of this expanded facility in January 2022, subject to financing commitments,” it added.

Following today’s gain, the Syrah share price is now up almost 80% over the last 12 months.

The post Why did the Syrah (ASX:SYR) share price jump 12% to a multi-year high today? appeared first on The Motley Fool Australia.

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• Syrah (ASX:SYR) share price higher after new Tesla update

Motley Fool contributor James Mickleboro 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Medibank Private Ltd (ASX: MPL) share price hit a 52-week high today. This comes despite calls for the government to provide greater oversight of how health funds return COVID-19 savings to members.

At the time of writing, Medibank shares are up 0.42% from yesterday’s close, currently swapping hands at $3.56.

Let’s take a look at what may be impacting the health insurer’s shares today.

What’s happening at Medibank?

In early trading today, the Medibank share price surged to $3.74, a 52-week high, before retreating to its current level.

Investors appear to be unphased by calls for more government oversight on health insurance payouts to members. The pandemic fuelled a rise in net profits in the private health insurance sector of $1.8 billion last year.

In late December, Medibank returned $135 million in COVID-19 net claims savings to customers by holding off its premium increase for five months.

However, The Australian reported Private Hospitals Association chief executive Michael Roff questioned the transparency of how funds returned COVID-­related savings. He commented:

There needs to be some formal government monitoring of health fund balance sheets to determine how much money they’re collecting that they thought they’d pay out – and how do we actually ensure that that gets back to members.

To date, there’s been no process and it’s been less than transparent.

The Medibank share price gained 11% throughout the course of 2021, despite the uncertainty caused by the pandemic.

As my Foolish colleague Aaron reported yesterday, the company recently released its calendar for the 2022 financial year.

Medibank is expected to reveal its half-year results for FY22 on 25 February.

Share price snap shot

The Medibank share price has gained almost 20% in the past year.

Shares in Medibank are up around 6% in the past week, while they are up more than 5% in the past month.

The company has a market capitalisation of about $9.8 billion based on the current share price.

The post Medibank (ASX:MPL) share price shrugs off further questions over profit paybacks appeared first on The Motley Fool Australia.

More reading

• Own Medibank (ASX:MPL) shares? Here are some key dates to watch in 2022
• How did the Medibank (ASX:MPL) share price perform in 2021?
• Here are the top 10 ASX shares today
• Why Afterpay, BrainChip, Medibank, and WiseTech shares are racing higher
• ASX 200 (ASX:XJO): Woolworths withdraws API proposal, tech shares rebound

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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The National Australia Bank Ltd. (ASX: NAB) share price shot the lights out last year, cementing one of its best performances since 2013.

Shares in the big four banking constituent surged 27.6% to $28.84 by the end of 2021. For comparison, the S&P/ASX 200 Index (ASX: XJO) gained 13%. Based on this information, shareholders of the 40-year-old enjoyed a substantial outperformance of the benchmark even before dividends.

So, what transpired in 2021 to give NAB shares an extra boost above the rest?

Earnings rebound puts NAB share price back on the menu

NAB shares bounced back strongly early into last year as economies kicked back into action. The National Australia Bank wasn’t alone in witnessing this economic trend, other major banks also caught the wave of economic improvement.

The first quarter of FY21 provided the initial indication of better times for the NAB share price. In its release, NAB posted a $1.7 billion unaudited statutory net profit. Additionally, credit impairment charges fell 98% compared to the second half of FY20. This removed a large, lingering, and gloomy cloud over the major bank — helping improve sentiment towards NAB shares.

Yet, the rebound in earnings did not end with the first quarter. Instead, each of the succeeding quarters in 2021 resulted in NAB’s 12-month trailing earnings rising. By the time the 2021 full-year results came around in November, NAB was back to pre-pandemic revenue and profits.

In specific terms, the second-largest major bank reported cash earnings of $6,558 million in FY21. Impressively, this represented a 76.8% increase on the previous year.

Banking on a bigger future

Last year also involved a couple of notable acquisitions for ASX-listed NAB. In January, the NAB share price was in focus after the bank announced its agreement to acquire Australian neobank 86 400. The move is in line with the bank’s mission to develop a leading digital bank.

The 86 400 acquisition received approvals from the courts and regulatory bodies in May. From there, the scheme became effective from 12 May 2021, with implementation on 19 May. For reference, NAB paid $220 million for the digital banking land grab.

Backing this up was another acquisition announced in August last year. This time it was the Australian consumer business of Citigroup. The deal valued at $1.2 billion sent the NAB share price higher upon release to the share market.

The post What made the NAB (ASX:NAB) share price so appealing in 2021? appeared first on The Motley Fool Australia.

More reading

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• Here’s why this top ASX broker picks NAB shares out of the big four banks
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• Could NAB (ASX:NAB) shares be a dividend gold mine this year?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Mitchell Lawler 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The SDI Limited (ASX: SDI) share price is having a rocky day on the market despite the company announcing record sales in a trading update today.

Despite the sales boost, shares in the dental manufacturer dropped as low as 16% before rebounding in early afternoon trade

At the time of writing, the SDI share price is down 10.19% at 92.5 cents apiece.

Resumption in dental work a key driver of sales

Today’s trading update announced a 26% increase in unaudited global sales for the six months ending 31 December 2021 to $46.2 million.

That compares to $36.8 million in sales for the same period last year and represents a record first-half performance for the company.

SDI believes the resumption of normal trading conditions last year were a key driver of the sales increase, with the exception of the New South Wales and Victorian markets due to their extended COVID-19 lockdowns.

But the company reported it has been affected by higher logistics costs in the first six months of FY22 due to the disruption in global freight activities. SDI says this has impacted gross product margins by 7%.

Despite strong sales in its Australian direct exports and in Brazil, up 65% and 66% respectively, these are lower margin regions for the company.

Overall, total gross product margins for the first half of FY22 fell by 12% to 53%, compared to 65% for the prior corresponding period.

It seems investors reacted negatively to news of an expected fall in net profit. SDI reported its net profit (after tax) for the period will be between $2.5 to $3 million, compared to $4.6 million for the same time the year prior.

The company’s half-year results will be released on 17 February.

SDI is a Victorian-based manufacturer of specialised dental equipment sold in more than 100 countries.

SDI share price snapshot

Over the last 12 months, the SDI share price has increased by 26% although it has dropped almost 10% in the past month.

The company has a market capitalisation of $112 million and a price-to-earnings ratio (P/E) of 21.11.

The post Why the SDI (ASX:SDI) share price is falling 10% today appeared first on The Motley Fool Australia.

More reading

• Why ARB, Inghams, James Hardie, and SDI shares are sinking

Motley Fool contributor Alice de Bruin 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 SDI Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) is having a tough day on Tuesday. In afternoon trade, the benchmark index is down 0.6% to 7,400.9 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are sinking:

ARB Corporation Limited (ASX: ARB)

The ARB share price is down 12% to $46.61. Investors have been selling the 4×4 parts company’s shares after it was downgraded by analysts at Credit Suisse. According to the note, Credit Suisse has downgraded its rating to underperform with a price target of $38.00. While the broker is predicting a strong result in February, it expects margin pressure and slower growth thereafter.

Inghams Group Ltd (ASX: ING)

The Inghams share price is down 6% to $3.31. This follows the release of a disappointing trading update this morning. According to the release, the poultry producer revealed that COVID-19 and elevated feed costs are impacting its performance. Management also warned that it is not currently possible to predict how long this disruption will continue.

James Hardie Industries plc (ASX: JHX)

The James Hardie share price is down 3% to $49.37. This decline may have been driven by a broker note out of Morgan Stanley. Its analysts have downgraded the company’s shares to an equal weight rating and cut the price target on them to $58.00. The broker made the move in response to the surprise exit of its CEO and slowing US housing.

SDI Limited (ASX: SDI)

The SDI share price has tumbled 10% to 92.5 cents following the release of a trading update out of the dental products company. While SDI expects to report a 26% increase in half year revenue to $46.2 million, it warned that its margins have been impacted by supply chain issues. As a result, first half net profit is only expected to be between $2.5 million and $3 million. This is down from $4.6 million a year earlier.

The post Why ARB, Inghams, James Hardie, and SDI shares are sinking appeared first on The Motley Fool Australia.

More reading

• Why the SDI (ASX:SDI) share price is falling 10% today
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Motley Fool contributor James Mickleboro 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 ARB Corporation Limited and SDI Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. At the time of writing, the benchmark index is down 0.5% to 7,406.9 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are pushing higher:

BrainChip Holdings Ltd (ASX: BRN)

The BrainChip share price is up 7% to $1.10. This morning the artificial intelligence technology company responded to a speeding ticket from the ASX. BrainChip suggested that its incredible rise in 2022 may have been driven by recent media coverage. This includes the reports that the company’s Akida chip has been used in a Mercedes concept car.

PointsBet Holdings Ltd (ASX: PBH)

The PointsBet share price is up 5% to $6.51. Investors have been buying the sports betting company’s shares after it announced a deal with the NHL Alumni Association (NHLAA). PointsBet Canada has become the exclusive sports betting partner of the NHLAA in Canada and also an official partner of the association in the United States.

PolyNovo Ltd (ASX: PNV)

The PolyNovo share price has rocketed 25% higher to $1.79. This follows the release of a first half sales update from the medical device company. According to the release, following a strong second quarter, PolyNovo expects to report first half group sales growth of 45% to A$16.28 million (excluding Barda revenue). A strong performance in the US underpinned this growth.

Syrah Resources Ltd (ASX: SYR)

The Syrah share price has jumped 11% to $2.06. This is despite there being no news out of the graphite producer. However, investors have been buying the company’s shares in recent weeks after it announced a deal with electric car giant Tesla. The Syrah share price hit a multi-year high just after lunch.

The post Why BrainChip, PointsBet, PolyNovo, and Syrah shares are pushing higher appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended POLYNOVO FPO and Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Many of Australia’s top brokers have been busy adjusting their financial models again, leading to the release of a large number of broker notes this week.

Three ASX shares brokers have named as buys this week are listed below. Here’s why they are bullish on them:

A2 Milk Company Ltd (ASX: A2M)

According to a note out of Citi, its analysts have retained their buy rating and $7.30 price target on this infant formula company’s shares. The broker remains positive on A2 Milk due to its strong brand health in China and improved inventory position. Citi is also optimistic that management’s new strategy will support its performance in the coming years. Particularly if other struggling foreign brands decide to exit China. The A2 Milk share price is trading at $5.51 on Tuesday.

Costa Group Holdings Ltd (ASX: CGC)

A note out of Macquarie reveals that its analysts have retained their outperform rating but trimmed their price target on this horticulture company’s shares to $3.41. While the broker has reduced its earnings estimates to reflect new leases, it isn’t enough to change its positive view. Macquarie continues to believe that weakness in the Costa share price in 2021 is a buying opportunity this year. The Costa share price is fetching $2.97.

Incitec Pivot Ltd (ASX: IPL)

Analysts at Morgan Stanley have retained their overweight rating and $4.30 price target on this agricultural chemicals company’s shares. This follows news that the company is acquiring European rival Titanobel. Morgan Stanley believes this is a good move by management. And while the European market is not a quick-growing one, the broker expects the synergies to boost its earnings. The Incitec Pivot share price is trading at $3.43 this afternoon.

The post Leading brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

More reading

• Why you shouldn’t expect the A2 Milk (ASX:A2M) share price to bounce back in 2022
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Motley Fool contributor James Mickleboro 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 A2 Milk and COSTA GRP FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The BHP Group Ltd (ASX: BHP) share price is moving sideways today despite news about the company’s latest investment.

At the time of writing, shares in the world’s second-largest miner are swapping hands for $44.93, up 0.35%. It’s worth noting that in the past month, the company’s shares have climbed 12% following a rebound in iron ore prices.

Let’s take a look at the company’s latest announcement.

BHP capitalises on African nickel mine

In a joint release, BHP has entered into an agreement to invest up to US$100 million in the Kabanga Nickel project in Tanzania.

Yet, it seems the company’s move to invest in the nickel and cobalt project has had minimal impact on the BHP share price.

Located in western Tanzania, the Kabanga Nickel project is considered as the largest development-ready nickel sulphide deposit in the world. The site is estimated to contain nickel equivalent resources of 1.86 million tonnes with a grade of 3.44%.

First production is anticipated to begin sometime in 2025. Kabanga is targeting minimum annual production of 40,000 tonnes of nickel, 6,000 tonnes of copper, and 3,000 tonnes of cobalt.

The deal between BHP and UK registered private company Kabanga Nickel Limited will see the accelerated development of the Kabanga Nickel Project. An initial investment of US$40 million has so far been made by the Australian-based mining giant.

In addition, BHP will also pour US$10 million into Lifezone Limited to advance the roll-out of its patented hydrometallurgical technologies. This mining tech company is seeking a more cost-efficient and environmentally-friendly way to produce battery-grade metals than smelting.

With the first US$50 million allocated to getting the project online, BHP’s investment in Kabanga will stand at 8.9%.

A second tranche of US$50 million in unsecured convertible securities is subject to Kabanga Nickel achieving certain milestones. If this goes ahead, then BHP’s stake will jump to 17.8% in the UK-based company, valuing the project at US$658 million.

Clearly, BHP is thinking ahead by increasing its exposure to the shifting trend from fossil fuels to cleaner energy. Nickel is a key element needed to make lithium-ion batteries which are used to power of electric vehicles.

BHP share price summary

Since the beginning of the year, the BHP share price has accelerated to post a gain of around 8% for its shareholders. However, when looking at the past 12 months, the company’s shares have lost around 3% in value.

This is a stark contrast from when its shares were tracking almost 30% higher in August, reaching an all-time high of $54.55.

Based on today’s price, BHP presides a market capitalisation of roughly $132 billion and has approximately 2.95 billion shares outstanding.

The post Own BHP (ASX:BHP) shares? Here’s the lowdown on the miner’s latest nickel play appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor Aaron Teboneras 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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The ARB Corporation Limited (ASX: ARB) share price is plummeting today after reaching a 52-week high last week.

At the time of writing, ARB shares are down 8.92%, swapping hands at $48.11 apiece. For comparison, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.36% to 7,420.5.

Let’s take a look at what may be weighing on the four-wheel-drive accessories company’s shares.

What’s going on at ARB?

There’s been no news out of the company since November. However, investors may be reacting to two new broker tips on the ARB share price released today.

Credit Suisse has downgraded its recommendation on the share price to underperform with a price target of $38 per share. That’s 21% less than the ARB share price at the time of writing.

Meanwhile, the team at JP Morgan has upgraded its share price guidance to underweight today with a price target of $35. This is more than 27% lower than the current price.

In the list of analysts covering ARB provided by Bloomberg Intelligence, 40% have the company as a buy, 40% have it a sell, and 20% have it as a hold.

This comes after Wilsons gave the shares an overweight rating with a price target of $57 back in October.

Today’s fall comes after the ARB share price hit a 52-week high of $54.53 last week on January 4.

Looking at the wider market, the S&P/ASX200 Consumer Discretionary Index (ASX: XDJ) is currently down 0.3%, while the S&P/ASX200 Consumer Staples Index (ASX: XSJ) is down 1.63%.

ARB share price snapshot

In the past 12 months, the ARB share price has soared by around 54%. The share price low during that time was $31.10 on 15 January 2021.

ARB shares are down 7.2% in the past week, and 6.7% in the past month.

ARB commands a market capitalisation of roughly $4.3 billion at the time of writing.

The post Why is the ARB Corporation (ASX:ARB) share price sliding 9% today? appeared first on The Motley Fool Australia.

More reading

• Why the Ramsay (ASX:RHC) share price is outperforming the ASX today
• The Afterpay (ASX:APT) share price has plummeted since the Block takeover. How does the deal now stack up for shareholders?
• Dividend beasts: 5 ASX 200 shares with the highest dividend yield
• ‘Stop viewing cash as a safe investment’: Ray Dalio
• These were the top 5 ASX 200 bank shares in 2021

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 ARB Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Ramsay Health Care Limited (ASX: RHC) share price is beating the market gloom this morning after striking a new agreement with the UK’s National Health Service.

Shares in the hospital operator jumped 1.7% to $68.38 during lunchtime trade. That stands in contrast to the 0.6% dive by the S&P/ASX 200 Index (ASX: XJO).

Ramsay announced after the market closed yesterday that it reached a new volume-based agreement with NHS England (NHSE).

Ramsay share price bolstered by NHSE agreement

Like the previous agreement, the ASX-listed hospital group can continue providing private patient activity. This is a relief to investors as I will explain later.

The difference is the NHSE may trigger a “Peak Surge Period” on seven days’ notice if it requires Ramsay to help manage a spike in COVID-19 cases. Should that happen, Ramsay will be paid on a cost recovery basis.

This agreement comes into effect from today and runs till 31 March. It may be extended by mutual agreement on or before 15 March.

COVID restrictions crimps the Ramsay share price

The surge in COVID cases is bad news for Ramsay’s earnings as hospitals tend to make bigger profits from elective surgeries.

This is why the Ramsay share price has been under pressure recently. Its hospitals in New South Wales had to stop performing non-urgent treatments in response to the flood of patients with the Omicron COVID variant being admitted to hospitals.

Ramsay announced on Friday that the NSW Ministry of Health has put restrictions on overnight Category 2 and Category 3 elective surgery.

No light at the end of COVID tunnel

The move follows Victoria’s Department of Health and Human Services (DHHS) decision to suspend non-urgent elective procedures.

Unlike the deal struck with NHSE, the restrictions imposed by NSW and Victorian health authorities have no end date. Ramsay and shareholders don’t know when it can return to “business as usual”.

The only silver lining is that January tends to be the quietest month for Ramsay Australia. Elective surgery patients rather lie in the sun than in hospital beds till after the school holidays end.

Foolish takeaway

Nonetheless, Ramsay has warned investors that it is expected to take a $55 million hit to earnings before interest and tax in the first quarter of this financial year.

This could change depending on how long the restrictions last and if NHSE triggers the Peak Surge Period.

Looks like it’s too early to hope that the COVID cloud will start to dissipate in 2022.

The Ramsay share price is lagging behind other medical facility operators. Over the past 12-months, its shares have gained around 12%. But the Healius Ltd (ASX: HLS) share price and Sonic Healthcare Limited (ASX: SHL) share price have gained around 30% each.

This is because the latter two run COVID tests, something Australians can’t seem to get enough of.

The post Why the Ramsay (ASX:RHC) share price is outperforming the ASX today appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: PolyNovo rockets, Inghams sinks
• 5 things to watch on the ASX 200 on Tuesday
• 2 ASX healthcare shares to give your portfolio a boost
• Why is the Ramsay (ASX:RHC) share price so volatile today?
• Ramsay (ASX:RHC) share price falls 6% amid reports of COVID battle plan

Motley Fool contributor Brendon Lau 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 Ramsay Health Care Limited and Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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