Day: 28 November 2022

The S&P/ASX 200 Index (ASX: XJO) has lifted by around 12% since the end of September 2022. Delivering an annual return in just two months is quite the share market rally. But it could still be a good hunting ground for cheap ASX shares.

Some businesses still have low price/earnings (p/e) ratios despite investors pushing through a bit of a recovery for share prices.

The retail sector has gone through a tough time this year. Not only do higher interest rates hurt the valuation of companies, but lower demand by consumers could hurt businesses even more.

While there may be more volatility ahead, here’s why I think investing in the following two cheap ASX shares during this rally could make sense.

Adairs Ltd (ASX: ADH)

Adairs is a leading retailer of homewares and furniture through three different brands: Adairs, Mocka, and Focus on Furniture.

In terms of the Adairs share price, the ASX share has dropped by more than 40% this year to date. This puts the valuation at just 8x FY23’s estimated earnings.

I think that the cheap ASX share has plenty of long-term potential for returns. It has identified several locations where demographics would “clearly support” new stores, which will be larger ones.

The company hopes that more retail floor space will lead to stronger margins and more members. Management says there is a strong link between membership numbers and sales, as well as between store floor space and sales.

Mocka has been an online-only company, and sales have grown by between 30% to 35% in four of the last five years. But, it’s now expecting to establish a brick-and-mortar presence to leverage the benefits of an omni-channel strategy in time. There could be good synergies between Mocka and the acquired Focus on Furniture business. Mocka sales are expected to be at least $150 million annually within five years.

Adairs thinks Focus on Furniture can grow its store network from 23 to between 50 to 60 across Australia. This could “result in annual sales of circa $250 million” for the company when it generated $121 million in FY22.

The cheap ASX share could pay a grossed-up dividend yield of 11.4% in FY23.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop is another retail ASX share. It is a part of the $10 billion beauty and personal care market in Australia – this market is expected to grow to $12 billion by 2026. The company says that it sells some of the “most innovative and technically advanced products” in its categories.

Interestingly, in FY22, exclusive products generated more than 50% of sales and around 60% of gross profit.

The company wants to continue to expand its ranges and products on offer. It’s planning to expand its New Zealand store presence. The business also noted recently that it had a “clean” inventory position with no material supply chain concerns.

While online sales may dip, store sales have recovered as shoppers resume normal shopping behaviour.

According to Commsec, the Shaver Shop share price is valued at under 9x FY23’s estimated earnings. The cheap ASX share could pay a grossed-up dividend yield of 13.1% in the current financial year.

The post I’d drip-feed $500 a month into cheap ASX shares in this share market rally appeared first on The Motley Fool Australia.

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More reading

• Rio Tinto share price dips amid ‘important agreement’
• 3 ASX 200 shares that announced supersized dividends in November
• 5 things to watch on the ASX 200 on Monday
• If you bought $20,000 worth of Fortescue shares this year, here’s how much dividend income you’d have
• Brokers name 2 ASX dividend shares to buy next week

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 ADAIRS FPO. The Motley Fool Australia has positions in and has recommended ADAIRS FPO. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

There are few, if any, people whose names are associated with success in the stock market quite like Warren Buffett, and for good reason. With a net worth of more than $100 billion, Buffett has rightfully earned his spot among investing royalty. And one of the best things about his success is that it didn’t take some extravagant strategy to do it.

As we endure a bear market that has shrunk the value of many investors’ portfolios, here are some gems from Buffett that can help you better handle it and, indeed, use it as an opportunity.

There’s value to be found

Warren Buffett is the poster child for value investing, which is a strategy by which investors look to find stocks trading at prices lower than their intrinsic (true) value. Value investors aim to buy undervalued stocks and profit from the increase in their intrinsic value eventually. For example, if a stock is trading at $100, but an investor believes the intrinsic value is $120, they’d invest, hoping to, at minimum, profit from the 20% increase once the market realizes its true value.

During bear markets, investors can find many great companies trading at a ‘discount’ or whose stock price may have overcorrected. Let’s take Walmart, for example. From early April to mid-June 2022, Walmart’s stock price dropped by well over 20% to around $120 per share, which many investors would agree was below its intrinsic value. Investors who took advantage of that dip have made more than 25% returns since then.

Generally, when a stock’s price drops significantly, you must ask yourself why it’s happening. But, during a bear market, when prices are dropping across the board, many of these declines are just a byproduct of the greater economy and not an indication of something fundamentally changing with the business.

Don’t follow the crowd

There are many great investing quotes credited to Buffett, but none may be as relevant to today’s environment as: “Be fearful when others are greedy, and greedy when others are fearful.” Stock prices decline because investors begin selling more shares than people are buying, and demand drops. This is usually a sign that investors are fearful. Instead of following suit, it could be time to get greedy and turn it up a notch if you have the financial means.

History has shown us that bear markets are inevitable, and often necessary. The sooner you learn that the better because it helps you tune out the short-term noise and focus on the long term. It’s easy to invest consistently when prices are rising, but not so much when prices are seemingly dropping before your eyes. Slowing or stopping investing can set back your financial progress.

Since going public in December 1980, Apple‘s stock price has increased well over 100,000% yet during that span, it’s had negative returns in one-third of those years (including 2022 so far). Down years happen to even the best of companies; it’s virtually inevitable. However, if you’re focused on the long term, it shouldn’t matter too much if your portfolio fluctuates weekly, monthly, or yearly as long as the results are there in the long run.

Utilize dollar-cost averaging

Buffett has long been a proponent of dollar-cost averaging, stating, “If you like spending six to eight hours per week working on investments, do it. If you don’t, then dollar-cost average into index funds.” To dollar-cost average, you pick your stocks, determine how much you can invest, and then invest on a set schedule no matter what. The frequency isn’t as important as sticking to your preset schedule.

Dollar-cost averaging is good because it keeps you consistent as well as prevents you from trying to time the market — which investors tend to do during bear markets more so than bull markets. Think about it: If prices are dropping, why buy today when you can get it cheaper later on, right? In theory, yes. But the problem is that’s trying to time the market, which is essentially impossible to do consistently over the long run.

Dollar-cost averaging makes it easier to focus on the end goal without getting distracted.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post What Warren Buffett can teach us about handling bear markets appeared first on The Motley Fool Australia.

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More reading

• 74% of Warren Buffet’s portfolio is in these 5 stocks. Could this help guide which ASX shares to buy?
• Three comforting lessons for investors whose portfolio has been smashed versus the surprisingly good return of the ASX 200
• Warren Buffett owns these 5 value stocks
• Warren Buffett doesn’t follow his own advice – and it’s made him richer
• I’d use the Warren Buffett method to create a ‘best ASX shares to buy now’ list

Stefon Walters has positions in Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple, Berkshire Hathaway (B shares), and Walmart Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), long March 2023 $120 calls on Apple, short January 2023 $200 puts on Berkshire Hathaway (B shares), short January 2023 $265 calls on Berkshire Hathaway (B shares), and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple and Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Investors are selling down the City Chic Collective Ltd (ASX: CCX) share price again on Monday.

At the time of writing, the plus sized fashion retailer’s shares are down over 23% to a multi-year low of 76 cents.

This means the City Chic share price has now lost 45% of its value in just two trading sessions.

Why are investors selling down the City Chic share price?

Investors have been heading to the exits in their droves following the release of a dismal trading update at its annual general meeting last week.

Financial year to date, City Chic reported a 2% decline in revenue to $128.6 million. This was driven largely by a very poor performance in the United States despite the benefits of favourable currency movements.

As a comparison, Goldman Sachs was expecting 18% revenue growth for the first half.

Management revealed that this poor performance was driven by “the consumer is looking for promotion as a reason to buy.” This has led to the competitive landscape intensifying as retailers promote aggressively to capture the limited spending. This is also putting significant pressure on margins.

Another area that could be causing alarm for investors is the company’s inventory position. Management’s decision to load up on inventory in order to combat supply chain issues appears to have backfired spectacularly.

City Chic expects its inventory to be in the range of $168 million to $174 million at the end of the first half. That’s almost as much as its market capitalisation. Following today’s decline, City Chic now has a market capitalisation of approximately $185 million.

Broker response

According to a note out of Goldman Sachs, in response to the update, its analysts have retained their neutral rating but slashed their price target by almost a third to $1.10.

Goldman commented:

Both a weaker top line and gross margin pressure were key risks we had flagged in our initiation, particularly around US/UK/EMEA; however, the quantum of the downgrade was more severe than we had factored in our numbers. As a result, we revise our FY23/FY24/FY25 EPS down by -101%/-26%/-17% reflecting both revenue and gross margin downgrades and lower our 12m TP by 29% to A$1.10. With this offering 10% potential upside, we remain Neutral rated.

Despite the attractive long term growth opportunity, we believe there is near term risk around (1) elevated inventory levels; (2) the macro environment for the middle-income consumer in the US and Europe which has proven to be weak; and (3) discount intensity with the competitive landscape highly promotional.

The post Why has this ASX All Ordinaries share crashed 45% in 2 days? appeared first on The Motley Fool Australia.

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More reading

• Why City Chic, Deep Yellow, Objective Corp, and Pilbara Minerals shares are falling
• What is driving the City Chic share price 21% lower on Friday?

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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An ASX dividend share offering a yield of over 14% is enough to catch almost any investor’s eye. After all, a yield that is almost triple what you can get from a typical savings account or a term deposit is a fine opportunity. Especially considering inflation is running at a hot 8% or so at the moment.

So let’s check out the Smartgroup Corporation Ltd (ASX: SIQ) share price today and see if this 14% dividend yield is worth a second look.

Smartgroup is an ASX 200 share that offers employee management services. Think salary packaging, vehicle leases, and payroll administration.

So let’s get right to it. Smartgroup has a fairly impressive record when it comes to paying out dividends. Back in 2015, this company’s maiden annual payout came to 14 cents per share. But by 2021, Smartgroup was forking out 49.5 cents per share.

And 2022 was a record year for payouts. For one, investors received a final dividend of 19 cents per share, fully franked, on 23 March this year. This was followed by an interim dividend of 17 cents per share, also fully franked, in September. That brought the annual total to 36 cents per share for 2022.

This alone would give Smartgroup a trailing dividend yield of 7.58% on the current share price of $4.75 (at the time of writing). That’s 10.82% grossed up with the full franking.

SIQ yield

But Smartgroup wasn’t done with those two payments in 2022. The company also paid out a special dividend this year. In conjunction with the March final dividend, Smartgroup also doled out a fully franked special dividend worth another 30 cents per share. This took its annual total for 2022 to a whopping 66 cents per share.

If we take this figure instead, we get to a trailing dividend yield of 13.89%. That’s a massive 19.84% grossed-up with full franking.

So is this too good to be true?

Let’s dig in.

This stupendously large trailing dividend yield comes from the payment of the special dividend.

Now Smartgroup, when announcing this special dividend, didn’t really state how it was funded or why management chose to pay it out. But due to its ‘special’ nature, it could be optimistic to assume it will be a regular feature of Smartgroup’s earnings.

Saying that, Smartgroup has paid out a special dividend before. In fact, it did so in both 2019 and 2021, as well as 2022.

As we discussed earlier, it has also been fairly steady in delivering annual dividend pay rises to investors as well.

Additionally, the company seems to be in rude financial health. in its last annual earnings report (covering 2021), which was delivered in February, Smartgroup declared a 3% rise in revenues and a 7% lift in net profits after tax, adjusted for amortisation.

Operating earnings before interest, tax, depreciation, and amortisation (EBITDA) were also up 8% over the previous year.

Is Smargroup well placed to continue its massive dividends?

So in light of this growth, it’s very possible that Smartgroup can continue to afford to fund its dividends at 2022’s levels going forward. That’s especially so if its full-year numbers for 2022 are even better than those delivered for 2021.

Dividend payments are never guaranteed on the ASX. But there are few warning signs we can point to that indicate Smartgroup is not in a position to build on the impressive dividends it has paid out this year.

The post 14% dividend yield! Should I buy this ASX 200 share for passive income? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Could this beaten-down ASX 200 share be packing nearly 20% upside now?
• Why Core Lithium, Invictus Energy, New Hope, and Smartgroup shares are sinking
• Why PolyNovo, Smartgroup, Star, and WiseTech shares are falling

Motley Fool contributor Sebastian Bowen 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 positions in and has recommended SMARTGROUP DEF SET. 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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ASX uranium shares haven’t joined in the broader energy stock rally in 2022.

Though 2023 could present a different picture.

Soaring fossil fuel prices have sent the S&P/ASX 200 Energy Index (ASX: XEJ) up 39% year to date.

Yet most ASX uranium shares remain in the red.

For example, in 2022:

• The Paladin Energy Ltd (ASX: PDN) share price is down 7%
• Bannerman Energy Ltd (ASX: BMN) shares are down 35%
• The Deep Yellow Limited (ASX: DYL) share price has lost 27%
• And Boss Energy Ltd (ASX: BOE) shares have fallen 2%

Now, it’s worth noting that all of the ASX uranium shares named above enjoyed very strong share price gains in 2021. Paladin shares, as one example, soared 267% over the full year. So a bit of a pause or retrace this year wasn’t entirely unexpected.

But with nations across the world revisiting nuclear power as a reliable baseload source with negligible carbon emissions, ASX uranium shares could shine brightly again in 2023 and the years ahead.

Could this new UK plan help boost ASX uranium shares?

The United Kingdom doesn’t make the list of nations with the most nuclear power plants in the pipeline. That honour goes to China, which has some 17 large-scale nuclear power stations under construction.

However, the UK is eager to extricate itself from the global energy crisis while moving away from coal and gas-fired power.

As The Times reports, Business secretary Grant Shapps is this week expected to announce the proposed creation of a new body called Great British Nuclear.

Great British Nuclear intends to develop 20 to 30 small modular nuclear reactors, built by Rolls-Royce.

The modular reactors are significantly cheaper to develop than traditional large-scale plants, with each reported to be able to power a million homes.

Australia’s uranium trove

On completion, the modular reactors will need uranium to provide that power, as will the score of large-scale reactors being constructed in China and other nations the world over.

And with Australia sitting on the world’s largest proven uranium reserves, ASX uranium shares could see the good times of 2021 come knocking once more.

The post Could this new UK plan help boost ASX uranium shares in 2023? appeared first on The Motley Fool Australia.

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More reading

• Why City Chic, Deep Yellow, Objective Corp, and Pilbara Minerals shares are falling
• Feed and yellow cake: Fundie’s 2 ASX shares to buy that you’ve not thought about
• Why has the Paladin Energy share price surged 11% in a month?

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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The market may be starting the week in the red but that hasn’t stopped a couple of ASX mining shares from surging higher.

Here’s why these mining shares are starting the week on a high:

Nico Resources Ltd (ASX: NC1)

The Nico Resources share price has jumped 25% to 77.5 cents.

Interestingly, this is despite there being no news out of the nickel focused mineral exploration company on Monday, which could mean it gets hit with a price query from the ASX later.

It seems that some investors are keen to get hold of the company’s shares ahead of the release of an updated mineral resource estimate in early 2023 for the Central Musgrave Project.

Management recently stated that more detailed geological and grade modelling is expected to result in an uplift in the projects high-grade tonnage, which is expected to contribute positively to the project economics and payback period for the project.

Odyssey Gold Ltd (ASX: ODY)

The Odyssey Gold share price is up 18% to 4.6 cents this morning.

This follows the release of an update on drilling activities at the Highway Zone at the gold explorer’s Tuckanarra JV Project.

According to the release, the company made an exceptional bonanza-grade gold oxide intersection during recent drilling. It also revealed that high grades were intersected in a predicted high grade shoot.

Managing Director, Matt Briggs, commented:

This stunning result continues to confirm the extent of wide, high-grade mineralisation which has already been intersected in the adjacent drill holes, again highlighted by this exceptional intercept of 43m @ 8.3g/t Au from 41m.

Extensive mineralisation of this grade and width further establishes the Highway Zone as a broad structure that reinforces the project’s potential for open pit mining.

The post 2 ASX mining shares flying over 18% higher on Monday appeared first on The Motley Fool Australia.

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More reading

• 5 ASX shares for investing in the fastest growing Aussie companies of 2022
• 2 reasons to buy Amazon before 2023 and 1 reason to sell
• Why is the Liontown share price sinking 9% on Monday?
• Vulcan share price gains on lithium project update
• Pilbara Minerals share price higher on ‘game changer’ project with Calix

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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Looking to invest in ASX growth shares? Well, we have good news for you.

Australia’s fastest growing companies of 2022 have been identified and they include a few names Aussie investors are likely familar with.

So, which ASX shares have been posting massive growth lately? Keep reading to find out.

Fastest growing Aussie companies of 2022 crowned

It’s been a big year for some notable ASX stocks – they’ve been included in the 2022 AFR Fast 100 list, with two coming in among the top 10 fastest growing Aussie companies of 2022.

The list is presented by the Australian Financial Review in association with Pemba Capital Partners and PwC. It encompasses 100 companies boasting a compound annual growth rate (CAGR) of as much as 330% between financial year 2020 and financial year 2022.

5 ASX shares among Australia’s fastest growers

Which ASX share will give investors exposure to the fastest grower on the Aussie bourse this year? It’s WISR Ltd (ASX: WZR).

The company has been crowned the fastest-growing ASX-listed entity, coming in seventh place on the AFR Fast 100 List. The fintech stock provides consumer finance products.

It posted $7 million of revenue in FY20, growing that to $59 million in FY22. Not to mention, it surpassed $1 billion in loan originations over the three months ended March 2022.

Next up is ASX digital marketplace operator Camplify Holdings Ltd (ASX: CHL). It came in as Australia’s ninth fastest-growing company. The company connects owners of recreational vehicles with hirers.

Camplify’s shares hit the ASX in June 2021. It boasted nearly $3 million of revenue in FY20. That figure grew to $16 million in FY22.

Another ASX newbie has joined Camplify on this year’s list, with telco and internet service provider Pentanet Ltd (ASX: 5GG) taking out spot number 25. Pentanet floated on the exchange in January 2021.

The company brought in $5 million of revenue in FY20, growing that to $16.8 million in FY22.

Just two spots lower lies Credit Clear Ltd (ASX: CCR). The company is in the fintech business, providing receivables management solutions.

In FY20, the company brought in $11 million. By FY22, that had grown to $21 million.

Finally, drone detection software provider DroneShield Ltd (ASX: DRO) has been crowned Australia’s 37^th fastest-growing company of 2022.

It posted around $11 million of revenue for the 12 months ended 31 December 2021. That was up from $5.6 million in the prior period.

The post 5 ASX shares for investing in the fastest growing Aussie companies of 2022 appeared first on The Motley Fool Australia.

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More reading

• 2 reasons to buy Amazon before 2023 and 1 reason to sell
• Why is the Liontown share price sinking 9% on Monday?
• Vulcan share price gains on lithium project update
• Pilbara Minerals share price higher on ‘game changer’ project with Calix
• One of the world’s richest investors just sounded a big-time warning for Wall Street

Motley Fool contributor Brooke Cooper 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 Camplify Holdings Limited and DroneShield Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pentanet Limited. The Motley Fool Australia has recommended DroneShield 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon (NASDAQ: AMZN) is one of the most well-known e-commerce companies on the planet. Investors watched its market value soar to more than $1.8 trillion during the earlier days of the pandemic. And over time, the company has delivered a lot more than groceries or books to your doorstep. It’s also delivered top-notch earnings growth and share performance.

This year, though, the stock is heading for a 44% decline. Why? Amazon isn’t immune to the pressures hurting the entire retail sector. I’m talking about higher inflation and general economic woes. Now, as we head toward 2023, you may be wondering what to do about this beaten-down stock. Let’s check out two reasons to buy Amazon — and one reason to sell.

1. A steal on a monster margin business

When we think of Amazon, we may focus on e-commerce. But the company’s biggest moneymaker is actually its cloud computing business. That’s Amazon Web Services, or AWS. Last year, AWS made up more than 70% of Amazon’s total operating income. That’s huge.

But here’s what’s even better. AWS’s margins are enormous. Operating margin averages about 30% each quarter. How does that compare to Amazon’s e-commerce margins? In the earlier days of the pandemic, as revenue surged, Amazon’s e-commerce operating margin came in at about 4%.

So, not only is AWS generating revenue in the billions of dollars — but it’s also making a good deal of profit from every dollar sold.

In even more good news, if you buy Amazon shares right now, you’ll get all of this growth for a steal. The stock trades at only 1.9 times sales right now. That’s its lowest by this measure since 2015.

2. Prime is getting stronger

Amazon’s e-commerce business has seen better days. Rising inflation is hurting it in two ways. First, it’s pushed Amazon’s costs — fuel to transport goods, for example — higher. Second, it’s weighing on customers’ wallets. So, they may spend less on Amazon.

But before we give up on Amazon’s e-commerce business, it’s key to look at the growth of its Prime subscription program. In the most recent quarter, Amazon said Prime Video release The Lord of the Rings: The Rings of Power spurred more new Prime subscriptions than any other Amazon original. And the first broadcast of NFL Thursday Night Football sparked the three-biggest hours of Prime signups ever.

Amazon also said this year that members are spending more — and relying more on Prime than ever before.

Prime already includes more than 200 million members worldwide. The recent growth, along with longtime members, should translate into more revenue growth in the coming year. And that could lead to positive share performance.

Reason to sell: Amazon isn’t out of the woods yet.

Today’s economic woes won’t disappear overnight. And neither will the impact they’ve had on Amazon’s earnings. Amazon’s operating income dropped by almost half year over year in the third quarter. And free cash flow has shifted to an outflow over the trailing 12-month period. Amazon’s return on invested capital also is falling. 

Investors may wait for significant earnings improvement before returning to the Amazon story. And if this happens, the stock may slip further — or stagnate in the new year. Some investors who already have gained over time on their Amazon position may be tempted to sell — and invest in a company less sensitive to today’s economic environment.

Should you buy or sell?

The reasons to buy Amazon outweigh the reason to sell this great, long-term stock. It’s impossible to guarantee Amazon stock will recover next year. But today, valuation looks good considering the long-term picture.

AWS’s strength and Prime’s growth may give the stock reason to climb — as soon as next year. And investors who get in on the shares now would benefit.

What if Amazon takes longer to recover? That’s OK too. The company’s leadership in the growth markets of e-commerce and cloud computing mean Amazon stock is very likely to thrive. And that could equal enormous returns over time.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post 2 reasons to buy Amazon before 2023 and 1 reason to sell appeared first on The Motley Fool Australia.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Adria Cimino has positions in Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Liontown Resources Ltd (ASX: LTR) share price is starting the week much like it finished the last one.

In morning trade, this lithium developer’s shares were down as much as 9% to $1.82.

This meant that the Liontown share price was down 17% over the last two weeks.

Why is the Liontown share price sinking?

Investors have been hitting the sell button in the lithium industry again amid ongoing concerns that lithium prices could be about to pullback.

This follows bearish notes out of Credit Suisse and Goldman Sachs recently and soaring COVID cases in China. The latter has led to concerns that demand for lithium from the key market could soften and put pressure on prices.

On Wall Street on Friday, the Sociedad Quimica y Minera de Chile (SQM) share price dropped almost 7%, the Livent Corp share price fell almost 9%, the Lithium Americas share price dropped 7%, and the Albemarle dropped close to 4%.

Is this a buying opportunity?

One broker that is likely to see this as a buying opportunity is Macquarie. Earlier this month, the broker retained its outperform rating and lifted its price target on the lithium developer’s shares to a lofty $3.40.

Based on the current Liontown share price, this implies potential upside of almost 90% for investors over the next 12 months.

While the broker sees economic slowdowns and rising COVID cases in China as a headwind for the lithium market, it still expects sky high prices to remain.

The post Why is the Liontown share price sinking 9% on Monday? appeared first on The Motley Fool Australia.

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• Here are the 3 most heavily traded ASX 200 shares on Friday
• 5 ASX lithium shares to buy: brokers
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• Why is the Lake Resources share price smashing the ASX 200 on Monday?

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 Vulcan Energy Resources Ltd (ASX: VUL) share price is in the green as investors digest the progress of its zero-carbon lithium project.

Vulcan shares closed on Friday trading for $7.08 and are currently trading for $7.14, up 0.85%.

Here’s what’s driving investor interest in the ASX lithium stock.

What did the ASX lithium stock announce?

The Vulcan share price is in the green after the company updated the market on progress at its Zero Carbon Lithium Project in the Upper Rhine Valley brine field, located in Germany.

Vulcan reported it has started 3D seismic survey works on the ground at one of its planned Phase 2 lithium and geothermal energy development areas in the Mannheim district. The company signed a renewable heat offtake agreement with MVV Energie, the utility for the city of Mannheim, in April 2022.

The ASX lithium stock also reported that its lithium pilot plant has produced all the data needed for its definitive feasibility study (DFS). The pilot plant recently confirmed the production of the highest grade, lowest impurity lithium hydroxide to date.

Commenting on the update sending the Vulcan share price higher today, CEO Francis Wedin said:

The Vulcan team is working hard towards developing renewable heating production on a mass scale for Central Europe, combined with sustainable, domestic lithium production for the auto industry, from our Zero Carbon Lithium Project in the Upper Rhine Valley, the largest lithium resource in Europe.

Wedin added:

It is encouraging to see timely approvals for, and execution of, our works on the ground, as we systematically execute very large 3D seismic surveys across the region. These surveys allow us to visualise the sub-surface, to employ industry best-practice modelling and planning for our well developments, which are targeting dual geothermal energy and lithium production.

Vulcan share price snapshot

The Vulcan share price is down 34% in 2022. That compares to a year-to-date loss of 6% posted by the All Ordinaries Index (ASX: XAO).

Longer term, Vulcan shares are up 216% over two years.

The post Vulcan share price gains on lithium project update appeared first on The Motley Fool Australia.

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More reading

• Skin in the game: The ASX share in my portfolio I’m most excited about
• Vulcan share price storms higher on lithium extraction update
• What’s going on with the Vulcan share price today?

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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