Day: 15 March 2023

Hoping to dig into the record IGO Ltd (ASX: IGO) dividend? You’d better be quick. 

S&P/ASX 200 Index (ASX: XJO) lithium share IGO jumped onto income investors’ radars on the last day of January after the company reported very strong half-year results, including a record dividend.

The record IGO dividend won’t be available for long

With lithium prices hitting all-time highs in the latter months of 2022, the IGO board declared a fully franked interim dividend of 14 cents per share, setting a new record for the lithium producer.

Commenting on the results at the time, acting CEO Matt Dusci said, “We are delighted to report a highly successful and profitable half-year result, with the strength of our lithium business helping drive record earnings, record net profit and declaration of a record interim dividend.”

Indeed, IGO’s half-year of underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of $834 million was up 269% from the $226 million reported in the first half of the 2022 financial year.

And net profit after taxes (NPAT) leapt 549% from the prior corresponding half-year to hit $591 million.

But we were talking about the IGO dividend.

Investors who want that payment to land in their bank account will need to own shares at the end of the day today.

IGO trades ex-dividend tomorrow, 16 March.

Eligible investors can expect to receive that payment on 31 March.

IGO share price snapshot

As you can see in the chart below, the IGO share price remains up 6% over the past 12 months, despite sliding from its late 2022 highs.

The post Hoping to dig into the record IGO dividend? You’d better be quick appeared first on The Motley Fool Australia.

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More reading

• 3 ASX 200 shares trading ex-dividend on Thursday
• Why are ASX 200 lithium shares falling so hard today?
• Top brokers name 3 ASX shares to buy today
• What’s happening with ASX 200 lithium stocks this week?
• Investing in ASX 200 lithium stocks? Here’s why this 6% decline in China matters

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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Many big-name S&P/ASX 200 Index (ASX: XJO) shares have fallen in the last week, but Xero Limited (ASX: XRO) shares have bucked the trend.

Xero (ASX: XRO) shares have soared 11.29% from $78.62 at market close Wednesday 8 March to $87.50 at last look today.

In comparison, the benchmark ASX 200 index has slid 3.75% in the same time frame.

Let’s take a look at how much I would have now if I had invested $5,000 in Xero shares a week ago.

How much would I make?

A week ago, Xero shares were fetching $78.62. This means if I had invested $5,000 into Xero at this price, I would have received 63 shares with $46.94 in cash left over.

Now, with Xero shares trading at $87.50, these shares would be worth $5,512.5. This means, my investment in Xero would have delivered more than $500 in gains in just a week.

Xero revealed this week that it had “no material exposure” to the Silicon Valley Bank (SVB) collapse. As my Foolish colleague James reported, Xero’s total exposure to SVB was about US$5 million, which represents less than 1% of Xero’s cash and cash equivalents as of 30 September 2022.

Meanwhile, on 9 March, Xero revealed it will cut staff by 700 to 800 globally to reduce costs and drive growth. This is designed to improve Xero’s operating profit.

Commenting on this news, CEO Sukhinder Singh Cassidy said:

We have made strong progress in executing our strategy. However as we aspire to build a higher performing global SaaS company and to enable Xeroʼs next phase of growth and drive better customer outcomes, we need to streamline and simplify our organisation.

The team at Morgans has recently placed an “add” rating on Xero shares with a $97 price target. This implies an upside of nearly 11% based on the current share price.

Morgans described Xero as a “high quality cash generative business” with “impressive customer advocacy and duration”. The broker added:

Over the last 12 months rising interest rates and competition have made things harder for Xero.

However, we see the current short term weakness as a rare opportunity to buy a high quality global growth company at a discount to the life time value of its current customer base.

Xero share price snapshot

Xero shares have slid 6% in the last year. However, in the past month, they have climbed 11.41%.

For perspective, the ASX 200 has shed 0.77% in the last 52 weeks.

Xero has a market capitalisation of about $13.1 billion based on the current share price.

The post If I’d invested $5,000 in Xero shares a week ago, here’s how much I’d have now! appeared first on The Motley Fool Australia.

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More reading

• Top ASX 200 tech shares to buy right now: Morgans
• ‘Top quality’: Expert picks 2 ASX 200 shares to buy at a nice discount
• Xero share price dips 3% amid Silicon Valley Bank fallout
• These ASX tech shares have exposure to the Silicon Valley Bank collapse
• Top brokers name 3 ASX shares to buy next week

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 Xero. The Motley Fool Australia has positions in and has recommended 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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It’s no secret that ASX lithium shares like Pilbara Minerals Ltd (ASX: PLS) and Core Lithium Ltd (ASX: CXO) have exploded in popularity over the past year or two on the ASX.

Investors are noticing that lithium is rapidly evolving into an essential industrial metal for the 21st century – being a key ingredient in the rechargeable batteries that will soon dominate our transportation system and the electrical grid. 

But just because a commodity is useful doesn’t mean that the companies that mine it are automatic wealth generators. Many oil companies have given investors lousy returns over time, despite the fact that most of us still have to fill up our cars.

So today, let’s look at two ASX lithium shares in Core Lithium and Pilbara Minerals, and see which one might be worth investing in.

Now, I have written before about my general lack of love towards lithium shares. I don’t own any in my portfolio, and I don’t expect to.

But that means I have missed out on some impressive gains.

Over the past 12 months, the Pilbara share price has risen by 42.8%. And over the past 2 years or so, investors have enjoyed a whopping 250% gain:

Core Lithium’s short-term performance hasn’t been quite as impressive. Over the past year, this ASX lithium share has lost 14% of its value. But over two years, investors have still enjoyed gains of 290% or thereabouts:

So both shares have been impressive performers and wealth generators for investors over recent years.

But if someone forced me to choose between investing in Pilbara Minerals and Core Lithium, how would I pick the winner?

Well, it would start and end with the fundamentals.

So let’s compare the recent half-year earnings reports that these two companies have recently released.

Pilbara vs. Core Lithium shares: Which would I choose?

Starting with Pilbara, this lithium share revealed its numbers for the six months to 31 December on 23 February last month.

As we covered at the time, this saw Pilbara report $2.18 billion in revenues, up 305% from the previous year’s report. This helped boost the company’s statutory net profit after tax (NPAT) to $1.24 billion, up an extraordinary 989%.

As a result, Pilbara was able to declare its first-ever dividend payment – an inaugural dividend of 11 cents per share, fully franked. 

Let’s see how that compares to Core Lithium.

So Core reported its own earnings earlier this month, on 9 March.

But it was a bit of a different picture. Firstly, Core Lithium made a loss of $9.2 million for the period. That was up from the loss of $3.3 million over the prior corresponding half.

That translated into an earnings per share (EPS) loss of 0.52 cents per share, up from the prior loss of 0.22 cents. Unsurprisingly, no dividend was declared here.

Now, it’s important to note that these results don’t include Core Lithium’s first sale of lithium from its Finiss project, which will be booked in the second half of FY2023.

But they do show that Core lithium and Pilbara share about as similar as chalk and cheese when it comes to business maturity.

So thanks to Pilbara’s healthy profitability and dividend-paying status, I would choose to invest in Pilbara shares over Core Lithium any day if I had to pick.

I like investing in companies that make money. And while Core Lithium might get to the same level of profitability as Pilbara in a few years, it’s not something I would be prepared to bet my capital on right now.

The post Pilbara Minerals or Core Lithium shares: Which would I buy? appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Down 24% in a month, is the Pilbara Minerals share price now a bargain buy?
• Why Bank of Queensland, Brainchip, Pilbara Minerals, and Yancoal shares are sinking today
• Here are the 3 most heavily traded ASX 200 shares on Monday
• Here’s why experts rate these ASX 200 growth shares as buys

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 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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Recent events in the United States involving Silicon Valley Bank have weighed heavily on the Australian banking sector and the Westpac Banking Corp (ASX: WBC) share price this month.

This has left the banking giant’s shares trading at $21.58, which is almost 13% lower than their 52-week high.

Is the Westpac share price good value right now?

In order to know if the Westpac share price is good value, we will have to find a way to undertake a valuation. Luckily, the team at Goldman Sachs has provided its valuation model to help us on our way.

Firstly, many investors like to use price to earnings ratios when valuing shares. However, this is not something that Goldman uses for bank shares. And there are strong arguments out there that this is the correct approach when looking at the sector.

Instead, its analysts use a “DCF & P/NTA vs. ROTE” valuation methodology. Don’t worry if that doesn’t make a lot of sense, I’ll take you through it now.

The DCF stands for discounted cash flow. This is essentially the sum of all future cash flows, discounted to take account of the time value of money. On a per share basis, Goldman Sachs estimates that Westpac has a value of $29.27 on a DCF basis.

However, this only makes up 50% of its valuation methodology. So, we still have to throw in the second part: P/NTA versus ROTE.

This is the price to net tangible assets versus its sustainable return on tangible equity. The latter is the same as return on equity but excludes intangibles such as goodwill. Goldman estimates the bank’s sustainable ROTE to be 12%.

In light of this ROTE, the broker believes Westpac’s shares deserve to trade at 1.4x NTA. Which, based on its NTA estimate of $18.70 per share in FY 2023, equates to a figure of $26.20 per share. This will make up the remaining 50% of its valuation.

If we combine the two together, we get a valuation of $27.74 for the Westpac share price.

And with its shares currently fetching $21.58, this implies material upside of greater than 28% over the next 12 months. No wonder Goldman has the bank’s shares on its conviction list with a buy rating!

The post Here’s how to value the Westpac share price appeared first on The Motley Fool Australia.

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More reading

• Is the Westpac share price a buy below $22?
• ASX 200 bank shares punished again on US bank fallout
• ASX 200 bank shares: Are they better prepared than Silicon Valley Bank?
• S&P 500 futures lift as regulators shore up SVB deposits
• Buy Westpac and this ASX dividend share next week: analysts

Motley Fool contributor James Mickleboro has positions in Westpac Banking. 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 Westpac Banking. 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 for an ASX growth stock offering a healthy passive income stream? 

You may wish to run your slide rule over Adairs Ltd (ASX: ADH).

You’ve likely heard of Adairs. The company is one of Australia’s leading home furnishings specialist retail stocks. It has three store brands – Adairs, Mocka and Focus on Furniture.

The ASX growth stock has a strong record of value creation, with an experienced management team and a growing e-commerce footprint.

And Adairs has an admirable record of paying two, fully franked dividends per year.

So, how much stock do you need to buy for $1,5000 in annual dividends?

8,333 shares in this ASX growth stock for $1,500 in annual dividends

First, bear in mind we’re looking at trailing dividends here.

Future dividends from this ASX growth stock could be higher or lower.

With that said, Adairs reported some strong half-year results for the six months ending 31 December.

Highlights included record sales of $324 million, up 34% from the prior corresponding half-year. Statutory net profit after tax (NPAT) leapt 24% to $22 million, while net debts came down by 13% over the prior six months, to $81 million.

Looking ahead, management reaffirmed sales guidance of $625 million to $665 million for the full 2023 financial year.

Citing elevated supply chain costs, management reduced its earnings before income and taxes (EBIT) guidance by $5 million to the range of $70 million and $80 million.

The board also declared a fully franked, interim dividend of 8 cents per share, in line with the previous year.

Adding in the 10 cents per share final dividend (paid out on 23 September) and this ASX growth stock offers a fully franked trailing yield of 7.9% at the current share price of $2.27.

And to garner $1,500 in annual dividends, you’d need to buy 8,333 shares.

Adairs share price snapshot

When looking for ASX growth stocks to provide regular passive income, you ideally want to invest in companies that are also delivering capital gains.

As you can see in the chart below the Adairs share price has dropped 20% over the past year.

But the share price has stabilised in 2023. And Goldman Sachs, despite having a neutral rating on the stock, has a target price of $3.10. That’s almost 37% above the current share price.         

The post Buy 8,333 shares in this ASX growth stock for $1,500 in annual dividends appeared first on The Motley Fool Australia.

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More reading

• Investing as little as $25 a week could help me retire with $104,000 a year in passive income!
• The highest-paying term deposit right now offers 4.5% interest. Here are 3 ASX dividend shares paying way more
• These 3 ASX 300 shares are dividend dynamos!
• I’d aim for $1 million, thanks to just a few ASX shares
• Invest in this 7%+ ASX 300 dividend stock for passive income

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 Adairs. The Motley Fool Australia has positions in and has recommended Adairs. 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 200 Index (ASX: XJO) is back on form on Wednesday. In afternoon trade, the benchmark index is up 0.4% to 7,038.7 points.

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

29Metals Ltd (ASX: 29M)

The 29Metals share price is down almost 16% to $1.17. This follows the release of an update on its troubled Capricorn Copper operation. Last week, the company revealed that heavy rainfall was expected to take the operation offline for three-to-four weeks. However, things have been worse than feared and the disruption is “now expected to be more significant.” So much so, the operation could be out of action for upwards of four months.

Eagers Automotive Ltd (ASX: APE)

The Eagers Automotive share price is down 3.5% to $13.18. This has been driven by the auto retailer’s shares going ex-dividend this morning for its final dividend. Last month, Eagers Automotive declared a record fully franked final dividend of 49 cents per share. This will be paid to eligible shareholders on 31 March.

Northern Star Resources Ltd (ASX: NST)

The Northern Star share price is down almost 2% to $11.04. Investors have been selling gold shares on Wednesday following a pullback in the price of the precious metal overnight. Though, it is worth noting that Northern Star’s shares are still up 7% since this time last week.

Woodside Energy Group Ltd (ASX: WDS)

The Woodside share price is down 1.5% to $32.73. This follows a sharp decline in oil prices during overnight trade. Both Brent and WTI crude oil prices fell heavily after US inflation was in line with expectations. This means the US Federal Reserve is likely to follow through with its rate hike plans, which some fear could cause economic turmoil and hurt demand for oil.

The post Why 29Metals, Eagers Automotive, Northern Star, and Woodside shares are dropping today appeared first on The Motley Fool Australia.

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More reading

• Woodside share price sinks as oil remains under pressure
• What’s the forecast for the oil price in 2023?
• 5 things to watch on the ASX 200 on Wednesday
• Down 12% in a week, has the Woodside share price got further to fall?
• Why is everyone suddenly talking about ASX 200 gold stocks again?

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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If you haven’t heard of Warren Buffett, you’re either brand new to ASX shares investing, or you’re just not doing enough research.

He’s the most iconic global investing legend of our times, who has amassed a fortune worth more than US$100 billion over 80 years of investing.

Why should you care?

Because he’s living proof of successful investing and, as amateur investors, we don’t need to reinvent the wheel to achieve the same.

It’s far easier to just copy his strategy — or that of any other great investor who inspires you, right?

Helpfully, Buffett is willing to share his investing strategies and thoughts on the health of the markets. He does media interviews and writes an annual newsletter that is very instructive for us amateur investors.

Secondly, the investment company he runs, Berkshire Hathaway Inc, is listed, which means we get a regular look at the books, providing insights as to the investment decisions Buffett is making.

Berkshire Hathaway released its Q4 and full-year results late last month.

Some analysts are seeing a warning in them for ASX shares investors.

Let’s investigate.

What’s the warning for ASX shares investors?

Between 30 June 2022 and the end of the year, the value of Berkshire Hathaway’s cash, cash equivalents, and treasury securities (bonds) grew from US$105.4 billion to US$128.7 billion.

Translation: Buffett has just moved US$23.3 billion (AU$35 billion) from the market into cash.

This has prompted a lot of conjecture among analysts and commentators about whether this is a warning to investors all over the world.

Should ASX shares investors be doing the same?

There are a few ways to interpret Buffet’s movement into cash.

The scariest interpretation is that Buffett sees a market correction or crash coming.

Buffett is a value investor, and market downturns provide an opportunity to do what he likes doing best. That is, buying great quality companies below their intrinsic worth. To do that, you need cash reserves.

But Buffett likes to keep a good amount of cash on hand at all times, not just when corrections are coming, so I’m not sure we can draw any firm conclusions from this AU$35 billion move into cash.

In his annual newsletter released on 25 February, Buffett says:

As for the future, Berkshire will always hold a boatload of cash and U.S. Treasury bills along with a wide array of businesses.

We will also avoid behavior that could result in any uncomfortable cash needs at inconvenient times, including financial panics and unprecedented insurance losses.

Although Buffett primarily lists in US stocks and is therefore making decisions with that in mind, we all know that what happens to US shares flows on to ASX shares. Like, overnight.

Personally, I think Berkshire Hathaway’s recent increase in cash holdings simply provides a timely reminder of two important things.

Reminder no. 1 for ASX shares investors

Firstly, if you’re a long-term value investor like Buffett, then you want to buy companies that are going to do well in all sorts of macroeconomic conditions because your intention is to hold them for decades.

Buffett says:

… we own publicly-traded stocks based on our expectations about their long-term business performance, not because we view them as vehicles for adroit purchases and sales.

That point is crucial: Charlie and I are not stock-pickers; we are business-pickers.

Reminder no. 2 for ASX shares investors

It’s possibly not a bad idea to keep some cash on hand, so you can increase your holdings in the great companies you already own when the market goes south. That’s called dollar-cost averaging.

Or, you can buy other ASX shares that are trading down simply due to sentiment. That’s value buying.

Is a share market correction coming?

Tricked you with that heading. No one can answer that question, not even Buffett himself.

What we do know is that rising inflation and interest rates can be a recipe for a recession if central banks stuff up the management of these economic headwinds.

We’re yet to see how this current economic situation will play out and, meantime, ASX shares are volatile.

Check this out.

Last year, interest rates in Australia started rising for the first time since 2010 in May.

The market knew it was coming, so share prices were already volatile. In the six months from 1 January to 30 June 2022, the S&P/ASX 200 Index (ASX: XJO) lost 12%.

Then investors got used to the situation and started buying ASX shares at a great discount. Cue upswing.

In the seven months from 1 July 2022 to 31 January 2023, the ASX 200 went up by 13.8%.

Now, the market is on the way back down again.

As we reported yesterday, the ASX 200 began the year at about 6,950 points. It rose to about 7,560 in early February, and just six weeks later, ASX 200 shares are back down to 7,028 points.

In other words, not far off from where they started the year.

I guess the question here is, how stressed do you want to get over these short-term share price movements?

If you’re a long-term investor like Buffett, and you own great quality businesses, then you probably shouldn’t be too perturbed by recent fluctuations in the value of your ASX shares.

That’s a comforting message for uncomfortable economic times.

We’ll get some more investing insights from Buffett at Berkshire’s annual general meeting on 6 May.

The post Warren Buffett’s $35 billion warning to investors appeared first on The Motley Fool Australia.

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More reading

• Woodside share price sinks as oil remains under pressure
• 5 things to watch on the ASX 200 on Wednesday
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why has the Newcrest share price leapt 7% in under a week?
• ASX 200 dives 2%, wiping out last of 2023 gains

Motley Fool contributor Bronwyn Allen 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 Berkshire Hathaway. The Motley Fool Australia has recommended Berkshire Hathaway. 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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CSL Limited (ASX: CSL) shares have been one of the stronger performers over the past five years in the S&P/ASX 200 Index (ASX: XJO), rising by around 70%. But, can the ASX healthcare share generate attractive dividend income for investors?

The business has been paying dividends to investors for a number of years, with strong dividend growth.

In 2010 the business paid 80 cents per share for the whole financial year. In 2022 the annual dividend was more than $3 per share.

But, while the dividend growth has been good, the CSL share price growth has been so strong that it has pushed down the CSL dividend yield.

Dividend breakdown

At the current CSL share price, the ASX biotech share has a trailing dividend yield (excluding franking credits) of around 1.2%.

Even before interest rates rose, that would count as a low dividend yield. So, investors are going to need to apply a good amount of money to achieve the target.

CSL shares don’t pay a dividend every month – they pay every six months. So, I think it’s better to think of the $300 monthly target as an annual goal of $3,600.

To generate a $3,600 annual income with a 1.2% dividend yield would require a $300,000 investment.

However, there is potentially a way where less money would be needed. I’m referring to that strong dividend growth, which is predicted to continue over the next few years.

According to Commsec, CSL is predicted to pay an annual dividend per share of $4.72 in FY25. That’s 34% higher than what the FY23 dividend is projected to be.

This means the FY25 dividend yield is expected to be 1.7% at the current CSL share price.

At that yield, investors would need to invest $212,000 in CSL shares for the target. While that’s substantially less than $300,000, it’s certainly still a large commitment.

Why is it such a large investment?

The problem is that CSL shares have a high price/earnings (P/E) ratio. According to Commsec, it’s valued at 34 times FY23’s estimated earnings.

It also has a fairly low dividend payout ratio, meaning that it doesn’t pay out much of its profit each year.

The combination of those factors means that CSL has a low dividend yield.

With that in mind, I wouldn’t invest in CSL with dividend income in mind. It’s much more about whether the company’s profit, growth and impressive research and development pipeline are good enough, which is a different question.

The post Here’s how much I’d need to invest in CSL shares to generate a $300 monthly income appeared first on The Motley Fool Australia.

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More reading

• 5 ASX 200 shares that inflation can’t touch: expert
• Here’s how I would secure monthly dividends in the 2024 financial year with these ASX stocks
• Morgans names 3 more of the best ASX shares to buy in March
• Why is the CSL share price on the slide today?
• Should I buy CSL shares while they’re under $300?

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 CSL. 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 200 Index (ASX: XJO) is staging a tentative recovery so far this Wednesday after the carnage we saw on the share market yesterday. At the time of writing, the ASX 200 has gained a decent 0.33%, putting the Index back over 7,030 points. 

However, this optimism is not entirely reflected in the share prices of some of the big ASX bank shares.

The main loser is Commonwealth Bank of Australia (ASX: CBA). CBA shares are currently in the red, down by 0.27% at just over $95 each.

Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB) and ANZ Group Holdings Ltd (ASX: ANZ) shares are all doing better. But they are still being eclipsed by the share price performances of some of their smaller, regional banking rivals.

The regional ASX 200 banks are on fire today. Take Bendigo and Adelaide Bank Ltd (ASX: BEN) for example. Bendigo Bank shares are currently smashing the market, up a pleasing 2.1% at present to $9.08 a share:

 It’s a similar story with Bank of Queensland Ltd (ASX: BOQ). Bank of Queensland shares are only just behind Bendigo, currently up by 2.09% at $6.60 a share right now.

So why are these smaller banks smashing both their larger ASX 200 banking share rivals and the broader market, this Wednesday?

Why are the smaller ASX 200 regional banks smashing the big four today?

Well, to understand what’s going on, let’s first look at the week that these smaller banks have had. As most of us would be aware of, Monday and Tuesday’s sessions this week were rather brutal affairs.

Yesterday, for instance, saw the Bank of Queensland share price hit a new multi-year low. In fact, both Bendigo Bank and Bank of Queensland fared far worse than the major banks earlier this week.

As we discussed yesterday, this was probably due to fears that these banks are less resilient to financial shocks as the major ASX 200 banks, simply due to their reduced size and scale.

To illustrate, CBA shares fell by 0.41% on Monday. But Bank of Queensland shares dopped by a far more dramatic 1.91%.

So now that investors clearly feel the worst has passed with the market jitters (at least so far this Wednesday), it makes sense that Bank of Queensland and Bendigo Bank shares are rising by more than the big four banks today.

The post Why are the smaller ASX 200 banks rebounding so strongly on Wednesday? appeared first on The Motley Fool Australia.

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More reading

• Why did the Bank of Queensland share price just hit a multi-year low?
• Why Bank of Queensland, Brainchip, Pilbara Minerals, and Yancoal shares are sinking today
• ASX 200 bank shares: Are they better prepared than Silicon Valley Bank?
• 5 things to watch on the ASX 200 on Monday
• Why are ASX 200 bank shares like CBA being annihilated today?

Motley Fool contributor Sebastian Bowen has positions in National Australia Bank and Bank of Queensland. 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 Bendigo And Adelaide Bank. The Motley Fool Australia has recommended Westpac Banking. 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 Woodside Energy Group Ltd (ASX: WDS) share price is in the red today.

Woodside shares are currently down 1.39%, fetching $32.74 apiece. For perspective, the S&P/ASX 200 Energy Index (ASX: XEJ) is sliding 0.39% today. In contrast, the S&P/ASX 200 Index (ASX: XJO) is climbing 0.29%.

Let’s take a look at what could be impacting the Woodside share price today.

What’s going on?

Shares in the major oil and gas producer have shed 13% in the past week alone.

As my Foolish colleague James reported this morning, the WTI crude oil price fell 4.7% to US$71.29 a barrel overnight and the Brent Crude oil price fell 4.2% to US$77.39 a barrel.

A supply update from the Organization of the Petroleum Exporting Countries (OPEC) as well as broader economic concerns appeared to weigh on the oil price. In a research note, ANZ economist Kishti Sen said:

Crude oil remained under pressure as concerns of weaker economic activity sparked by Silicon Valley Bank’s failure reverberated through the market.

The negative sentiment was aided by OPEC forecasting a modest surplus to remain in place during Q2. The producer group said it will pump around 28.92mb/d, or about 300kb/d more than it expects will be needed. 

Commenting on the recent oil price slide, Oanda senior market analyst Ed Moya said “energy traders can’t find a reason to buy this dip until we get past the next round of inventory data”. According to Bloomberg, he added:

Rising stockpiles are expected and that could keep oil vulnerable over the next 24 hours.

However, the oil price has since recovered this morning. Brent Crude is now up 0.65% to US$77.95 a barrel, while WTI Crude Oil is lifting 0.81% to US$71.91 a barrel, according to Bloomberg Energy.

Woodside reported a record underlying NPAT of US$5.23 billion for the 2022 calendar year. The company lifted its final dividend by 37% to US$1.44 per share. This is due to be paid on 5 April.

Woodside share price snapshot

Despite the heavy losses of the past week, the Woodside share price has climbed almost 6% in the last year.

For perspective, the ASX 200 has dropped 0.9% in the past 12 months.

Woodside has a market capitalisation of about $62 billion based on the current share price.

The post Woodside share price sinks as oil remains under pressure appeared first on The Motley Fool Australia.

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More reading

• What’s the forecast for the oil price in 2023?
• 5 things to watch on the ASX 200 on Wednesday
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why has the Newcrest share price leapt 7% in under a week?
• Down 12% in a week, has the Woodside share price got further to fall?

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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