Month: October 2022

Why Cettire, Moneyme, Piedmont Lithium, and Superloop shares are racing higher
In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is fighting hard to stay in positive territory. At the time of writing, the benchmark index is up slightly to 6,672.4 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are racing higher:

Cettire Ltd (ASX: CTT)

The Cettire share price is up 2% to 85.2 cents. This follows the release of a first quarter update that revealed that the online luxury fashion retailer has started FY 2023 strongly. Cettire’s gross revenue grew 62% over the prior corresponding period to $84.4 million during the quarter. This was driven by the year over year doubling of its active customers to 287,626 and improvements in repeat customer spending.

Moneyme Ltd (ASX: MME)

The Moneyme share price is up 5.5% to 38.5 cents. Investors have been buying this digital consumer credit company’s shares following the release of a first quarter update. Moneyme revealed a 148% increase in gross revenue to $57 million and a 183% increase in gross customer receivables to $1.28 billion.

Piedmont Lithium Inc (ASX: PLL)

The Piedmont Lithium share price is up over 3.5% to 86.5 cents. This follows a strong night of trade for this lithium developer’s US listed shares on Wall Street. In addition, a number of battery materials shares are outperforming on Tuesday.

Superloop Ltd (ASX: SLC)

The Superloop share price is up 10% to 70 cents. After the market close on Monday, Superloop announced a mutual preferred network partnership agreement with Uniti Group. The broad-reaching partnership covers various retail, wholesale and network elements with Uniti to be offered through Superloop’s branded Consumer, Business and Wholesale segments. The agreement is expected to be immediately accretive to Superloop’s EBITDA in FY 2023.

The post Why Cettire, Moneyme, Piedmont Lithium, and Superloop shares are racing 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. has positions in and has recommended SUPERLOOP FPO. The Motley Fool Australia has recommended Cettire 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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11 October 2022
Could ASX 200 shares represent a ‘phenomenal opportunity’ right now?
S&P/ASX 200 Index (ASX: XJO) shares have seen plenty of ups and downs this year. Inflation and higher interest rates have surprised and worried investors.

But with all of the declines the market has seen this year, should investors be jumping at the chance to buy into some ASX 200 shares?

Bell Asset Management’s chief investment officer and portfolio manager Ned Bell is optimistic. This could mean good things for ASX 200 shares.

Time to be optimistic at these prices?

Talking to the Australian Financial Review, he noted that there are some uncertainties in some areas, along with changes in the economic outlook. He said:

Markets are mechanisms for pricing in what’s going to happen in the future, and this year has been the worst imaginable. It’s like we’ve had five years’ worth of bad news in one year.

When there’s a market drawdown, a crisis, there’s always an investment bank – the canary in the coal mine.

It’s usually Deutsche, but occasionally Credit Suisse comes from behind. With the volatility we’ve seen, particularly in the UK, it’s inevitable that [there’s] some hedge fund or pension fund that’s going to blow up.

But to be honest with you, I’m not of the view that there are a huge amount of corporate calamities on the horizon. Global corporates are actually in pretty good shape.

However, he thinks interest rate rises from the US Federal Reserve are starting to have the desired effect. You’d hope so, with many shares down heavily.

Bell said:

I think we’re getting to the point where inflation is starting to look better, and you’re starting to see a bit more weakness in the jobs market.

I think the Fed will be looking at that and thinking the violent impact of numerous rate rises is starting to have the desired effect. And once the market starts to realise that maybe the Fed is moving into a period whereby they’ll be tapping the brakes, not slamming on the brakes, I think that could be a big trigger for a sharp rally.

Are ASX 200 shares an opportunity?

According to reporting by the AFR, Bell is on a “buying spree” and he’s seeing good places to put money.

He said that extreme volatility means it’s a “phenomenal opportunity for long-term investors in quality companies”.

Bell pointed to a number of quality global shares that look good value.

But, I think that there are a number of ASX 200 shares that would also be worth looking at because of their price drops and their long-term prospects.

The Xero Limited (ASX: XRO) share price is down 50% in 2022 but the tech company keeps growing revenue. As well, it’s increasing its subscription prices and has a very high gross profit margin.

The Wesfarmers Ltd (ASX: WES) share price has fallen around 26% in 2022, however, the conglomerate is investing in its core businesses like Bunnings and Kmart Group, while also investing in new areas like health and lithium.

Pinnacle Investment Management Group Ltd (ASX: PNI) shares are down more than 45% in 2022, but the company’s portfolio of investment managers continues to perform well and Pinnacle recently expanded into Canada.

Finally, the Breville Group Ltd (ASX: BRG) share price has dropped over 40% this year, but the home appliance company is making investments for growth and is expanding geographically.

The post Could ASX 200 shares represent a ‘phenomenal opportunity’ right now? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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 PINNACLE FPO and Xero. The Motley Fool Australia has positions in and has recommended PINNACLE FPO, Wesfarmers Limited, and Xero. 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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11 October 2022
Looking to buy Rio Tinto shares? Here’s why this fundie says there is ‘something terribly wrong’
Rio Tinto Ltd (ASX: RIO) shares are in the green today, up 0.5% to $97.98 apiece.

That leaves the S&P/ASX 200 Index (ASX: XJO) miner, which also pays a dividend yield of some 10%, down 1.5% in 2022, handily beating the 12% loss posted by the benchmark index.

That’s today’s price action.

Now, here’s why this fund manager has let loose on the mining giant.

Why this fundie says there is ‘something terribly wrong’

Fund manager Willy Packer is less than pleased with the pressured resignation of Energy Resources of Australia Ltd (ASX: ERA) chairman Peter Mansell along with two independent directors, Paul Dowd and Shane Charles. The trio handed in their resignations last week.

As the Australian Financial Review reported, Packer said the situation “reeks of something terribly wrong”.

Rio Tinto is the majority shareholder in Energy Resources. The stoush centres around the Jabiluka uranium project and the Ranger uranium mine. Both projects are located in the Northern Territory’s Kakadu national park.

But any development is opposed by the local Mirarr people. That reality was said to be taken into account in the project’s independent valuation.

Packer was clearly disappointed by the resignations. And he questioned whether any mines in Australia can be properly valued when the traditional owners have not given their consent.

“All mining projects in Australia require traditional owner approval, therefore, are all highly prospective projects worth zero until approved?” Packer said.

According to the AFR, Rio Tinto had lost confidence in the ERA board members over the way they were attempting to raise funds.

Under a new loan agreement, the previous independent valuation of the project will be canned. ERA shareholders will now have to await a new valuation before any revised share issue takes place.

According to Packer, Rio Tinto “shot the messengers and the umpires” after the original ERA valuation of 15.9 cents to 24.3 cents was higher than it wanted.

Packer continued:

How can a second report be considered independent if its preparation is conditional on certain constraints? In any event, what firm would put its hand up in the future to write another valuation report knowing that if it does not appease Rio, it will have its reputation dragged through the mud.

Atop questioning what firms may be willing to take on a second valuation report for the project, Packer wondered if anyone would be “brave enough” to replace the outgoing board members at ERA:

Rio has created a toxic situation, and we question who would be brave enough to join the ERA board and take on the personal risks involved in carrying out director’s duties cognisant of the Corporation Act in relation to the oppression of minority shareholders.

How have Rio Tinto shares performed longer-term

On top of the regular, and growing, dividend stream, Rio Tinto shares have gained 43% over the past five years. That compares to a 15% gain posted by the ASX 200 over that same period.

The post Looking to buy Rio Tinto shares? Here’s why this fundie says there is ‘something terribly wrong’ appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben 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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11 October 2022
Why Baby Bunting, Calidus, Pointsbet, and South32 shares are falling
In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has given back its morning gains and dropped slightly into the red. At the time of writing, the benchmark index is down a fraction to 6,667.6 points.

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

Baby Bunting Group Ltd (ASX: BBN)

The Baby Bunting share price has crashed over 21% to $3.07. This follows the release of a trading update at the baby products retailer’s annual general meeting. Although Baby Bunting delivered double-digit sales growth financial year to date, its earnings have fallen due to significant gross margin weakness. This has been partly driven by intense price competition and rising inflation.

Calidus Resources Ltd (ASX: CAI)

The Calidus Resources share price is down a further 23% to 36.5 cents. Investors have been selling this gold miner’s shares this week following a disappointing update. That update revealed softer than expected gold production during the latest quarter.

Pointsbet Holdings Ltd (ASX: PBH)

The Pointsbet share price is down 8% to $1.94. This is despite there being no news out of the sports betting company on Tuesday. However, it is worth noting that a number of tech shares are falling today after a poor night of trade on the NASDAQ index. This has seen the S&P/ASX All Technology Index drop 0.8% this afternoon.

South32 Ltd (ASX: S32)

The South32 share price is down 2% to $3.70. Investors have been selling this mining giant’s shares following the release of a broker note out of Goldman Sachs. According to the note, the broker has downgraded South32’s shares to a neutral rating and cut the price target on them by 22% to $3.70. This follows a sharp reduction in its earnings estimates to reflect lower commodity price forecasts.

The post Why Baby Bunting, Calidus, Pointsbet, and South32 shares are falling 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 positions in and has recommended Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Baby Bunting and Pointsbet Holdings Ltd. 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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11 October 2022
Why is the Piedmont Lithium share price having such a stellar run on Tuesday?
The Piedmont Lithium Inc (ASX: PLL) share price is charging higher on Tuesday.

In afternoon trade, the lithium developer’s shares are up 4% to 87 cents.

This compares favourably to the ASX 200 index, which is trading flat at the time of writing.

Why is the Piedmont Lithium share price charging higher?

Investor have been buying Piedmont Lithium’s shares despite there being no news out of the company.

However, it is worth noting that it isn’t the only lithium share rising today. A good number are outperforming the market today thanks to a strong showing in the battery materials sector.

This has seen the likes of Allkem Ltd (ASX: AKE) and Core Lithium Ltd (ASX: CXO) record gains of over 3% this afternoon.

What else?

It is also worth pointing out that Piedmont Lithium shares are now listed on the NASDAQ index as well as the Australian share market.

In fact, you could argue that the former is now the more important listing, with its Australian shares having a tendency to follow their lead.

So, with the Piedmont Lithium share price lifting 4% on the NASDAQ overnight, they have followed suit on the local market today.

Investors were buying its US shares on Monday night after lithium shares such as Albemarle, Livent and SQM rose on Wall Street. This was despite the rest of the market taking a bit of a tumble.

Investors appear to believe that supply constraints and strong demand for lithium will keep prices elevated for longer, putting these companies in a position to profit greatly over the coming years.

The post Why is the Piedmont Lithium share price having such a stellar run on Tuesday? appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro owns Allkem shares. 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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11 October 2022
3 ASX mining shares rocketing higher on project developments
These three ASX mining shares are exploding higher than the S&P ASX 200 Materials Index (ASX: XMJ) today.

Kuniko Ltd (ASX: KNI), Dundas Minerals Ltd (ASX: DUN) and Element 25 Ltd (ASX: E25) shares are all rocketing ahead today. The ASX 200 Materials Index is up 0.94% today.

So why are these ASX mining shares having such a stellar day?

Kuniko

Kuniko shares are soaring 11% today. The company is exploring the Skuterud Cobalt project in Norway. Drill assay results showed “significant cobalt mineralisation”. Copper was also identified. Kuniko plans to conduct further drilling at the site to unlock the “promising upside” of the project.

Commenting on the news, CEO Antony Beckmand said:

We are increasingly confident the results are supporting the potential for identifying cobalt-copper rich zones at a large scale.

Element 25

Element 25 shares are soaring 17% today. The company updated investors on plans to produce high purity battery grade manganese sulphate from the company’s Butcherbird Project. A feasibility study is on schedule for completion in December. Element 25 is also in discussions with potential offtake partners. Furthermore, the company highlighted how it could qualify for clean energy and electric vehicle incentives in the USA Inflation Reduction Act.

Element 25 had this to say regarding the news:

Importantly for Element 25 investors, qualifying FTA countries include Australia and qualifying critical minerals include manganese.

Dundas Minerals

Dundas shares are soaring 45% today. Earlier today, the company’s share price exploded 100%. Dundas is exploring nickel, copper, cobalt and gold in Western Australia. Drilling at the site intersected with massive and disseminated sulphides along with sulphidic quartz veins.

Commenting on the news, managing director Shane Volk said:

Given the results from hole 1, we’d expect to intercept sulphides again in hole 2.

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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 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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11 October 2022
Broker says Webjet shares are one of its best buy ideas this month
Webjet Limited (ASX: WEB) shares are having a tough year.

Since the start of 2022, the online travel agent’s shares have dropped over 10% to $4.86.

This leaves the Webjet share price trading within sight of a 52-week low of $4.55.

Are Webjet shares trading at an attractive level?

The good news for shareholders is that one leading broker is tipping Webjet shares to rebound over the next 12 months.

In fact, its conviction is so strong that it has the travel share on its best ideas list for October.

These are the shares that the broker thinks offer the highest risk-adjusted returns over a 12-month timeframe and are supported by a higher-than-average level of confidence.

What is the broker saying?

According to a note out of Morgans, its analysts have an add rating and $6.40 price target on the company’s shares.

Based on where Webjet’s shares are currently trading, this implies potential upside of almost 32% for investors over the next 12 months. Morgans is also expecting a modest dividend yield of almost 1%, increasing the total potential return slightly.

The broker is positive on Webjet shares due to their valuation and the company’s cost reductions. It expects the latter to lead to the company being a much more profitable business when trading returns to normal.

It explained:

Based on our forecasts, WEB is trading on an FY24 recovery year PE which is at a discount to its five-year average PE (pre-COVID). Its WebBeds (B2B) business is highly leveraged to the northern hemisphere summer holiday season which is forecast to be strong. Webjet OTA is leveraged to ANZ domestic and international travel. Management also wasted a crisis and cost reduction initiatives will reduce its cost base by 20% across the group once the business returns to scale.

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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 Webjet Ltd. 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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11 October 2022
Macquarie says Zip share price has further to fall
The Zip Co Ltd (ASX: ZIP) share price is dipping lower today, down 0.8%.

The ASX buy now, pay later (BNPL) stock closed yesterday at 63 cents and is currently swapping hands for 62.5 cents per share.

That’s a far cry from the $12.35 the Zip share price hit back in-mid February last year.

But even after that long, hard fall, analysts at Macquarie Group Ltd (ASX: MQG) believe the payments company is still overvalued.

What did Macquarie report?

Macquarie analysts have run their slide rule across the most recent app traffic data for a range of BNPL shares.

And, as The Australian Financial Review reported, Zip didn’t come out on top.

According to Macquarie, Zip was among the “BNPL operators [that] have recorded moderating or declining growth during CY22”.

The analysts hit the stock with an underperform rating, with a 60-cent target for the Zip share price. That suggests another 4% decline from the current price.

What’s been happening with the Zip share price?

It’s been a tough year across the BNPL space, and the Zip share price has certainly been no exception.

Pressured by fast-rising inflation and interest rates, shares are down a painful 85% year-to-date.

With the company’s market cap having tumbled to some $440 million, Zip was booted from the S&P/ASX 200 Index (ASX: XJO) on 19 September as part of the S&P Dow Jones Indices September quarterly review. The Zip share price has tumbled 24% since its exit from the benchmark index.

Trading outside of the ASX 200 can throw up some tailwinds for shares. That’s partly because a lot of fund managers are limited to trading the top 200 stocks, and won’t be able to buy shares anymore. Those fund managers already holding Zip shares prior to the company’s exclusion from the benchmark index may have been forced to sell them.

While Zip still does receive a fair amount of media attention, stocks within the ASX 200 tend to get superior analyst coverage and are more likely to make mainstream media headlines.

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Motley Fool contributor Bernd Struben 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 ZIPCOLTD FPO. The Motley Fool Australia has recommended Macquarie Group 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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11 October 2022
Guess which ASX mining share just rocketed 100% on a new discovery
Can you guess which little-known ASX mining share rocketed 100% on open after announcing a new discovery this morning?

If you said Dundas Minerals Ltd (ASX: DUN), go to the front of the class.

The ASX mining share has given back some of those opening gains but remains up an impressive 50% at the time of writing.

So, what’s piquing investor interest?

What did Dundas Minerals report?

Investors are bidding up the junior ASX mining share after it announced promising results from the first diamond drill hole at its Central exploration target.

Dundas is exploring for nickel, copper, cobalt and gold in the prospective Albany-Fraser Orogen, located in Western Australia.

The first drill hole was reported to have successfully intercepted a mafic-ultramafic complex. This includes extensive zones of massive, semi-massive, highly disseminated and disseminated sulphides.

If that’s all a bit technical for you, you’re not alone.

The ASX mining share noted that the geological setting at Central is complex. While Dundas does not yet have a sufficient understanding of the geology based on the single diamond drill hole, the miner said the environment is “conducive to an intrusive Ni-Cu-Co type deposit, plus gold and silver”.

The company is currently awaiting assay results to confirm mineralisation. It was planning four additional diamond drill holes at the site, with a total drill program of some 2,000 metres intended. But following on the strong results of the first hole, Dundas said it is likely to expand that drill program.

Commenting on the results, Dundas Minerals managing director Shane Volk said:

Whilst we were always quietly confident of the geophysical data modelling… to see it transpire as it has is extremely rewarding for the small Dundas Minerals team, actually it’s an outstanding result.

We now very much look forward to receiving the assay results from Hole 1 and to the drilling of our second hole at Central, which will be almost vertical…. to a depth of more than 500 metres. Given the results from Hole 1, we’d expect to intercept sulphides again in Hole 2.

How has this ASX mining share been tracking?

The Dundas Minerals share price is on a tear this year.

Since the opening bell on 4 January, the ASX mining share has leapt 811% higher. That’s over the same period that the All Ordinaries Index (ASX: XAO) has fallen 13%.

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- 3 ASX lithium and battery minerals ASX shares going gangbusters today
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11 October 2022
South32 share price drops on broker downgrade
The South32 Ltd (ASX: S32) share price is having a subdued day.

At the time of writing, the mining giant’s shares are down over 1% to $3.72.

This compares unfavourably to the S&P/ASX 200 Materials sector, which is up 1.4% currently.

Why is the South32 share price underperforming?

The South32 share price has come under pressure today after the company lost one of its biggest bulls.

According to a note out of Goldman Sachs, its analysts have downgraded the miner’s shares to a neutral rating and cut the price target on them by 21% to $3.70.

This price target is broadly in line with where the company’s shares trading at present.

Why did Goldman downgrade its shares?

Goldman made the move after reducing its earnings estimate materially through to FY 2025.

The broker’s EBITDA estimates have been reduced by 29% in FY 2023, 26% in FY 2024, and 34% in FY 2025 to reflect lower base metal price forecasts. It explains:

Downgrade S32 to Neutral (from Buy) based on our revised lower NAV valuation of A$3.78/sh and PT of A$3.7/sh on the back of our base metal price downgrades resulting in a modest FCF yield of just 3% in FY23E.

[W]e forecast a ~80% drop in EBITDA in FY23 on lower base metals prices and a FCF yield of just 3% despite a forecast ~10% increase in Cu Eq production, but an attractive 16% FCF yield in FY24 driven mostly by our expected recovery in base metal prices. For FY23, we forecast a sharp contraction in aluminium EBITDA from over US$1bn in FY22 to just ~US$300mn in FY23 on lower prices and elevated costs at the Hillside and Mozal smelters.

In light of this, the broker sees more value in fellow diversified miners BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (AX: RIO) and is recommending them as buys.

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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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11 October 2022