The New Hope Corporation Limited (ASX: NHC) share price was on form again on Friday.

The coal miner’s shares continued their impressive run with a 3% gain to $6.33.

That’s despite the ASX 200 index falling 1.9% following a broad market selloff.

Today’s gain means that the New Hope share price is now up a remarkable 173% since the start of the year.

Can the New Hope share price keep rising?

One leading broker believes the New Hope share price is now seriously overvalued following its strong run.

According to a note out of Goldman Sachs, its analysts have put a sell rating and $3.80 price target on the coal miner’s shares.

This implies potential downside of 40% for investors over the next 12 months.

What did the broker say?

Goldman was pleased with New Hope’s full year results release from earlier this week. It commented:

NHC reported FY22 underlying EBITDA of A$1.58bn (vs. unaudited $1.56bn pre-disclosed) for FY22 and NPAT of A$1.0bn, in-line with GSe and 1% ahead of VA consensus of A$992mn. […] NHC paid a final dividend of A56cps (incl. A25cps special), slightly below GSe of ~A60cps and took total payout to ~70% of NPAT. NHC stated they expect to continue paying special dividends but are also assessing share buybacks as they believe NHC stock is undervalued.

However, the broker doesn’t agree with management on the New Hope share price being undervalued. It explained:

We rate NHC a Sell on: 1. Valuation: The stock is trading at c.2.0x NAV (A$3.00/sh) and is discounting a long-run thermal of >US$145/t (real) vs. our US$75/t estimate (based on our view of long run global marginal costs).

2. Only modest near term production growth: while NHC operates the low cost high margin 10Mtpa Bengalla thermal coal mine in NSW, the company has only modest production growth potential at Bengalla (which we already model), and its 5Mtpa New Acland Stage 3 (NAC3) project is still pending the final approval of the Associated Water Licence. At full production Malabar will only deliver 0.9Mtpa of met coal to NHC.

It is also worth noting that Goldman Sachs doesn’t expect coal prices to remain as high as they are for too much longer. This could put pressure on its shares if its prediction proves accurate. It commented:

NHC expect thermal coal prices to remain at current/elevated levels (>US$400/t) for at least the next 6-12 months (vs. GSe US$200/t for CY23) and noted the upcoming Northern hemisphere winter as a driver.

The post Goldman Sachs warns that the New Hope share price could crash 40% 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. 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 Scott Phillips.

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The S&P/ASX All Ordinaries Index (ASX: XAO) closed in the red on Friday, down 1.9% to just below 6,789 points. But as is often the case, a few ASX All Ords shares defied the index and ramped higher today.

Let’s take a look.

KMD Brands Ltd (ASX: KMD)

The first All Ords share we’ll take a look at today is KMD Brands. Formerly known as Kathmandu Holdings, KMD Brands is the mob behind popular retail brands Kathmandu, Rip Curl, and Oboz. Today the KMD Brands share price had a 1.66% bump to 92 cents. There was no news from the company today. However, on Tuesday it released its FY22 full-year results and announced a final dividend of 3 NZ cents per share.

KMD Brands reported a 6.5% bump to its gross underlying profit, compared to FY21, at NZ$576.7 million. But operating expenses were 12.2% higher, contributing to a 33.7% dip in underlying net profit after tax (NPAT). Given the impact of COVID lockdowns on ASX retail shares, perhaps the market expected worse and that’s why KMD shares have risen by almost 4% this week.

Myer Holdings Ltd (ASX: MYR)

Myer had a rocking day on the market closing up 3.5% to 59 cents. This one is a bit of a mystery though. There’s been no price-sensitive news from the All Ords retail giant today, or even this week.

Last week Myer dropped its FY22 full-year report, in which the company revealed an NPAT of $60.2 million, 103.8% higher than FY21 (adjusted for Jobkeeper). It declared a final dividend of 2.5 cents per share. So far in FY23, CEO John King says Myer has had “… our best sales start to a financial year since 2006”.

Paradigm Biopharmaceuticals Ltd (ASX: PAR)

This ASX biotech share was another star performer amongst the All Ords shares today. The Paradigm Biopharmaceuticals share price rose by 1.6% to $1.27. While today’s price movement is also a mystery, we note that a change of director’s interest notice was filed on Monday for CEO and Founder Paul Rennie.

The notice showed Rennie participated in the company’s recent entitlement offer by purchasing 100,410 shares through a personal investment trust and another 133,435 shares through his superannuation fund. The total consideration was more than $300,000. The entitlement offer raised $66 million. The capital raise will be used to support the company’s phase 3 clinical program and other activities through to 2024.

The post 3 ASX All Ords shares that marched higher on Friday appeared first on The Motley Fool Australia.

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ASX 200 retail shares JB Hi-Fi Limited (ASX: JBH) and Harvey Norman Holdings Limited (ASX: HVN) had a rough end to the week.

JB Hi-Fi shares fell 4.36% on Friday, while Harvey Norman shares descended 4.66%. For perspective, the S&P/ASX 200 Index (ASX: XJO) slipped nearly 1.9% on Friday.

Let’s take a look at what may have impacted ASX 200 retail shares.

Interest rate rise

ASX 200 shares, including retail shares, struggled on Friday following grim news out of the United States. The US Federal Reserve lifted interest rates by 0.75%. More rate hikes are planned and there are fears of a recession.

Higher interest rates not only increase borrowing costs for companies, they can also dampen retail spending as consumers have less available cash.

The Reserve Bank of Australia often takes its lead from the US Federal Reserve. Commenting on the prospect of the RBA lifting rates in the Australian Financial Review, BetaShares chief economist David Bassanese said:

It now seems more likely than not that the RBA will lift rates by 0.5 per cent in October.

Meanwhile, AMP’s Shane Oliver is predicting retail sales will rise “just 0.1% in August” after lifting 1.3% in July, the publication reported.

Share price snapshot

The JB Hi-Fi share price has fallen nearly 16% in a year, while Harvey Norman shares have slipped nearly 19%.

For perspective, the ASX 200 has fallen nearly 11% in the past year.

The post 2 ASX 200 retail shares ravaged following US rate decision appeared first on The Motley Fool Australia.

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More reading

• What’s the outlook for ASX 200 retail shares as inflation begins to bite?
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Motley Fool contributor Monica O’Shea has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Harvey Norman Holdings Ltd. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd. The Motley Fool Australia has recommended JB Hi-Fi Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Shares of Domino’s Pizza Enterprises Ltd (ASX: DMP) have faltered in 2022. Domino’s shares now rest at 52-week lows to finish the week of trade.

After an impressive run, shares in the pizza giant reached all-time highs in September 2021, before tumbling in vertical fashion, much like many other ASX shares.

Domino’s now rests at $53.25 per share, more than 67% off the previous high of $161.98.

What’s happened to Domino’s shares?

It’s been a series of unfortunate events for the pizza giant. Most prominently, the broad sell-off in equity markets has been unkind to the share.

With the shift away from risk assets this year, more safe-haven assets such as the US dollar have flourished, leaving shares well behind.

Spurring the downside has been two central themes – inflation, and rising interest rates. Neither are good for retailers such as Domino’s and their shares.

As such, the stage was already set for a difficult year come 2022.

Then, the global pizza brand came in with a weak set of numbers in its FY22 results. It grew sales 4.6% globally year over year to $3.92 billion. However, this carried through to a 12.5% decrease in after-tax profit to $165 million.

This is classic of the impacts of inflation – greater revenues, due to the higher price of units sold, however, these costs are also recognised at the margin level for the company.

As a result of its FY22 performance, investors haven’t been keen to nibble at each consecutive drop in its share price.

Despite this, brokers still advocate buying the stock. Seven out of 14 analysts recommending it’s a buy, and the remaining seven saying to hold, per Refinitiv Eikon data.

The consensus price target from this list is $79.57, down from $89.35 in June. Nonetheless, the price target suggests a correction in the Domino’s share price, should they be right.

Citi certainly feels it’s a buy, and remains positive on the medium- to long-term outlook for the company. Consequently, it feels investors could be getting shares at a good price when fishing at its 52-week lows.

Citi values the company at $84.40, well above the consensus target.

Alas, we will have to wait and see the next moves yet, and if the analyst’s projections eventually are reflected in Domino’s share price.

The post Down 65% from its all-time high, are Domino’s shares a deliciously-priced buy? appeared first on The Motley Fool Australia.

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More reading

• Why Block, Brainchip, Domino’s, and Vulcan shares are sinking today
• Why did the Domino’s share price just slump to a two-year low?
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• Top brokers name 2 ASX growth shares to buy now
• Own Domino’s shares? Get ready for a delivery

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Zach Bristow 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 Scott Phillips.

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