Shares in Meteoric Resources Ltd (ASX: MEI) jumped 50% in early trade on Thursday after the company announced a deal to be acquired by Lynas Rare Earths Ltd (ASX: LYC).

The deal would grant Meteoric shareholders 0.0207 Lynas shares for each of the shares they held, valuing the deal at 26.6 cents.

Meteoric shares jumped 50% on the news to 25.5 cents.

Does the deal fully value Meteoric shares?

While the deal would pay a solid premium to Meteoric shareholders, it falls well short of a price target for the company issued by Canaccord Genuity in a research note published in July, which said Meteoric was worth 40 cents per share.

At the time the broker was very positive on a deal which Meteoric had signed with Korean giant Posco, relating to the development of Meteoric’s Caldeira rare earths project in Brazil.

CG said regarding the deal:

POSCO is one of the world’s largest steel producers, having had long-standing and deep involvement in upstream mining and resource projects in Australia and Brazil. In addition to steel producing inputs, POSCO has a presence in critical minerals including lithium and rare earths. In our view, the proposed partnership with POSCO is a major positive for MEI, through not only offtake (and favourable pricing mechanisms which could improve economics relative to China benchmarks), but perhaps just as importantly through its scale and access to capital and what this means for project financing.

Lynas talks up benefits of scale

Lynas said on Thursday that Meteoric shareholders would benefit from its expertise in managing rare earths project.

The company said:

Meteoric shareholders benefit from a significant control premium and unlocking of Caldeira’s value through Lynas’ strong balance sheet and proven experience in developing and operating rare earth projects, while also receiving immediate exposure to the only commercial producer and supplier of light and heavy rare earth oxides outside of China. Lynas’ ownership also brings opportunities to develop downstream processing in Brazil.

The Meteoric board has unanimously recommended the deal in the absence of a better offer, and Tolga Kumova, Meteoric’s largest shareholder with a 6.7% stake, also supports the deal.

Lynas Chair John Humphrey said:

Lynas is very pleased with the potential to bring together the Caldeira deposit which is the largest known ionic clay rare earth Mineral Resource outside China reported in accordance with the JORC Code, and Lynas’ high grade Mt Weld deposit and leading rare earth operations. This will deliver on our Towards 2030 growth objective of adding resource and scale. Expanding our operations into a new country will help Lynas maintain its leading position in the global rare earths supply chain and meet increased customer demand for rare earth materials.

Lynas shares were 5.9% lower at $13.01.

The post Which junior ASX mining stock has surged 50% on big news? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Lynas Rare Earths Ltd. 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.

WiseTech Global Ltd (ASX: WTC) shares are starting October around $32.46.

Is this a good price to pay for the logistics technology company’s shares?

Here’s what I think.

Are WiseTech shares cheap?

At first glance, WiseTech shares do not look obviously cheap.

According to CommSec, consensus forecasts point to earnings per share (EPS) of $1.43 in FY27.

At $32.46, that puts the shares on a forward price-to-earnings ratio of roughly 23 times.

For a mature business, I would probably find that fairly unattractive. But WiseTech is not expected to stand still.

EPS is forecast to rise to $1.89 in FY28 and $2.29 in FY29. That would represent growth of around 32% in FY28, followed by another 21% increase the year after.

By FY29, earnings would be around 60% higher than the FY27 forecast.

That changes the valuation picture significantly. If the share price stayed where it is today, WiseTech would be trading on roughly 17 times FY28 earnings and just over 14 times FY29 earnings.

I think that starts to look quite attractive for a business expected to grow profits at that pace.

Why could earnings keep climbing?

The key for me is CargoWise.

WiseTech’s software sits at the centre of complex logistics operations, helping freight forwarders and other supply chain businesses manage areas such as customs, warehousing, transport, and compliance.

Once that software is embedded across a customer’s operations, there is scope for WiseTech to grow in more than one way.

It can win additional customers, expand the number of services existing customers use, and benefit as more logistics processes move onto digital platforms.

That is where I think the long-term opportunity becomes interesting.

Global supply chains are complicated, highly regulated, and increasingly dependent on software. As logistics businesses look to automate more tasks and manage operations more efficiently, I think CargoWise can keep becoming more important inside those organisations.

That gives WiseTech a credible path to growing revenue and earnings without relying on one short-term trend.

What am I paying for today?

This is the part I would focus on most in October.

At $32.46, investors are still paying for future growth. There is no getting around that.

But I think the better question is whether the current price looks demanding relative to the earnings WiseTech could generate in two or three years.

On that basis, I am much more comfortable.

If EPS reaches $2.29 in FY29, the current valuation would look far less expensive than it does today. And if the business is still growing strongly at that point, I think investors could be willing to pay more than 14 times earnings.

That gives me a reasonable margin for upside if execution remains strong.

Foolish takeaway

WiseTech still needs to deliver, but I think the current share price gives investors a much better setup than the headline valuation suggests.

The real appeal is how quickly earnings are expected to grow into today’s share price.

If that trajectory holds, I think $32.46 could prove to be a very good entry point for long-term investors.

The post Should I buy WiseTech Global shares in October? appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino 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 WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

October is here, and investors looking to put fresh money to work have plenty of Vanguard exchange-traded funds (ETFs) to choose from.

For me, the best choices do not all need to play the same role.

These are three Vanguard ETFs I would be happy to buy this month, each for a different reason.

Vanguard Diversified High Growth Index ETF (ASX: VDHG)

The VDHG ETF is probably the simplest choice of the three. Rather than giving investors exposure to one country or sector, it bundles together Australian shares, international shares, emerging markets, small caps, and bonds in one investment.

Vanguard currently targets 90% of the portfolio towards growth assets and 10% towards defensive assets. The fund ultimately provides exposure to more than 16,000 securities.

I like the Vanguard Diversified High Growth Index ETF for investors who want broad diversification without having to decide how much money should go into Australia, overseas markets, or fixed income themselves.

Vanguard also manages the rebalancing, so the ETF is designed to keep returning towards its target allocation over time.

For me, that makes the VDHG ETF a strong option for someone who wants a long-term investment that can largely look after itself.

Vanguard S&P 500 US Shares Index ETF (ASX: V500)

The V500 ETF gives investors exposure to around 500 of the largest Wall Street-listed companies, representing roughly 80% of the value of the American share market.

That means investors are putting money behind many of the businesses leading some of the biggest areas of global growth.

NVIDIA, for example, sits at the heart of the artificial intelligence (AI) infrastructure boom, while Microsoft has exposure to cloud computing, software, and AI. Both are among the ETF’s largest holdings.

Importantly, the fund extends well beyond technology. The S&P 500 also includes large healthcare, financial, industrial, and consumer businesses.

Vanguard FTSE Asia ex Japan Shares Index ETF (ASX: VAE)

The VAE ETF is the more targeted pick on my October list. It invests across Asian markets while excluding Japan, Australia, and New Zealand.

What I like is that this gives investors exposure to a part of the world that can look quite different from the US-heavy portfolios many Australians already own.

Technology is still an important part of the story. Taiwan Semiconductor Manufacturing Co, Samsung Electronics, and SK Hynix are currently the fund’s three largest holdings. Together, they give the VAE ETF meaningful exposure to the semiconductor industry that underpins AI, smartphones, data centres, and other areas of technology.

The ETF also reaches into other parts of the Asian economy, including Chinese internet and consumer businesses.

I think that makes the Vanguard FTSE Asia ex Japan Shares Index ETF a great way to add another source of long-term growth without simply buying more US shares.

Foolish takeaway

If I were adding to my ETF holdings in October, I would be looking for something that genuinely adds to what I already own.

That is why these three stand out to me. Each offers a different route to long-term growth, and I would be happy to own any of them for many years.

The post My top 3 Vanguard ETFs for October appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino 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 Microsoft, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool Australia has recommended Microsoft and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.