Author: openjargon

Despite controversial murmurs of company-led spying, the Fortescue Ltd (ASX: FMG) share price is moving with a spring in its step today.

In afternoon trade, the iron ore miner’s shares are up 3.5% to $22.70. However, the exuberance is not isolated to the mining company Andrew Forrest founded in 2003. As this is being written, materials are leading the Australian share market, climbing 2.26%.

Yet, today’s rally is somewhat shrouded in contention as details of an investigation emerge.

Money spent on spies

In June, Fortescue launched legal action against Element Zero, a green metal startup started by former Fortescue employees Michael Masterman, Bart Kolodziejczyk, and Bjorn Winther-Jensen.

The case alleges that the ex-employees smuggled green iron intellectual property out of Fortescue and applied it at Element Zero, committing “industrial-scale misuse.” As such, Masterman and Kolodziejczyk have been the targets of an investigation to substantiate these allegations.

According to newly released court documents, Fortescue hired private investigators to ‘spy’ on its former employees (Masterman and Kolodziejczyk) and their families to obtain information needed to issue search warrants.

Fortescue hired the investigators, who followed the two executives, locating and photographing their homes, wives, and children.

The court documents show surveillance at Kolodziejczyk’s family home continuing after the Element Zero co-founder departed from the Melbourne airport, with the investigator’s notes reading:

In the meantime, surveillance continues at the Hadfield, Victoria residence, where Dr Kolodziejczyk’s wife and child are permanently residing.

Following the surveillance, both former employees were subjected to raids on their homes. The Element Zero co-founders were required to relinquish passwords to their devices — including those of their family members — for copies of their data to be taken.

Both men completely reject the claims made by Fortescue.

Iron ore reignites Fortescue shares

Fortescue investors seem to be more focused on the price of iron ore, with shares rallying today.

Following a rough month in June for the steel-making commodity and Fortescue shares, prices have been on the uptick this month. Iron ore is fetching around US$110 per tonne, rising nearly 4% from late June.

The revitalisation arrives amid stimulus measures announced by Beijing to support its struggling property sector. As part of the measures, people in China will see mortgage interest rates and the minimum down payment reduced.

Fortescue shares are closely linked to China’s property market. In 2022, approximately 88% of the company’s revenue was derived from the People’s Republic.

The post Fortescue shares red-hot as court reveals company espionage appeared first on The Motley Fool Australia.

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• Is the Fortescue share price too low to ignore?
• 3 ASX 200 mining shares just downgraded by top brokers
• Are Fortescue shares a contrarian buy after falling 20% in a month?
• Is the FY25 outlook for Fortescue shares compelling?

Motley Fool contributor Mitchell Lawler 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.

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

Shares of both Tesla (NASDAQ: TSLA) and Rivian (NASDAQ: RIVN) have struggled this year. Since 2024 began, Tesla stock has fallen 8% in value. Rivian shares, meanwhile, are down by roughly 25%.

What has gone wrong? Could this be a rare buying opportunity?

2 trends you should know about

There are a few statistics EV investors must be aware of. The first is that the EV market continues to grow, even if growth rates move around quite a bit. Last year, for instance, EV sales in the U.S. jumped 60%, from 1 million in 2022 to 1.6 million in 2023. To put all this into perspective, in 2016, only 200,000 EVs were sold in the U.S. — eight times fewer than the number sold annually today.

To be sure, gasoline vehicles continue to dominate, commanding around 75% of total U.S. vehicle sales. But so far in 2024, EV sales continue to climb. Why then, you might ask, are the share prices of EV makers like Tesla and Rivian down so much this year? The problem isn’t growth — it’s expectations.

According to S&P Global, despite “clear demand for EVs in the U.S., the rate of EV growth was slower than some automakers had anticipated.” This has caused many auto manufacturers to delay their EV introduction timelines by 12 to 18 months. “Slowing the development of vehicles and production capacity in 2024 and 2025 can reduce risk of having more inventory than the market wants, while being ready for presumed developing demand the last years of this decade,” S&P Global observes.

These two trends are the most important factors in the EV market today. Yes, sales are growing, and will continue to do so likely for another decade or more. But short-term sales growth has lagged expectations, causing EV manufacturers to reduce investment and new model timelines. It is this reset in expectations that has weighed heavily on EV stocks this year.

Is this a buying opportunity for Rivian and Tesla stock?

Despite subdued EV demand growth this year, expect continued new product launches, including an entry-level Cadillac EV and Volvo’s EX30 SUV. These product launches — most of which were given the green light when EV demand growth was soaring — will continue to add pricing and inventory pressure on existing manufacturers. “The increased model count will have a negative impact on volume per model in most cases, which will affect profit margin for the lower-volume vehicles,” advises S&P Global. “It also increases costs, as marketing, sales and service are more expensive when those costs are spread across more models.”

What will ultimately drive EV demand growth higher isn’t necessarily more models, but more affordable models. “EV demand growth has slowed sharply in 2024, likely due in part to affordability,” explains a recent report from Bank of America. The bank doesn’t forecast enough affordable EVs hitting the market to drive growth higher until 2027.

How should you be investing in light of this bleak multi-year forecast? The biggest factor is simply to have patience. EV growth is still healthily in the double digits. The U.S. charging network, meanwhile, continues to grow by leaps and bounds. Recent research from The Motley Fool shows that Tesla’s supercharger network, for example, now covers huge swaths of all 50 states. And due to technological advancements, prices continue to get closer and closer to mass adoption levels. By 2030, Bank of America expects nearly one-third of all U.S. vehicle sales to be electric.

If you’re willing to wait through the pain, now might be a great time to capitalize on some rare EV stock bargains. Over the past 12 months, the price-to-sales ratios for Tesla has fallen by roughly 30%. Rivian’s multiple, meanwhile, has been cut in half. Patient investors may be able to secure bargain prices until the adoption curve picks back up in 2026 and 2027.

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

The post 2 EV trends Tesla and Rivian investors should understand now appeared first on The Motley Fool Australia.

More reading

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• Why Tesla stock continued to surge higher today
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• Is Tesla the best EV stock for you?
• Why Tesla stock jumped today

Bank of America is an advertising partner of The Ascent, a Motley Fool company. Ryan Vanzo 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 Bank of America and Tesla. 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.

Women talk. But are we talking about the right things? Growing up in the 80s (I’m showing my age) my family didn’t talk about finance, budgets or mortgages – I wish we had. 

I finished school with no responsibilities. I had no outgoings except for the $25 a week my parents asked me to pay as “board” (I remember thinking at the time it was daylight robbery!).

I remember my first “big” paycheque – I spent it all on one outfit and told mum and dad I would pay them the following week. I was young (but old enough to know better). As I said, I had no responsibilities… no debt, but no savings. That pattern continued for quite some time. And then I moved out of home and across the country with a one-way ticket. I had to find a job, a place to live and work out how I was going to survive. And although the safety net was gone it was the best thing that happened to me.

I maxed out a credit card… and had to work two jobs to pay it off.

Then I did it again!

And then… I got rid of it.

I started trying to put away the extra money I had been using to pay the debt. I didn’t want to get into a situation where something would happen, and I didn’t have the funds to deal with it because I knew that I would look for a credit card…again.

I was reminded of all this earlier today when I met a friend for our morning run. Neither of us had much energy and we ended up walking (and talking). We were talking about how our boys were both living week to week and have so little care for tomorrow. It’s a point of frustration in my house, especially because I’ve been there…

I don’t have all the answers – I really wish I did. But we have the conversations – we talk about debt, we talk about saving, we talk about a lot of things really…

But here’s something they (and you!) can do, today – and it’s quite simple really.

They need to start thinking about putting aside some funds for a rainy day (the car will break down; the washing machine will stop working – both of which happened to me in the past three years – and don’t get me started on the dental bill from when the then-13 year old’s front teeth collided with a snooker ball).

As we all know, sometimes life can take an unexpected path… and I hope they are prepared for if (when) that happens.

Of course, 18 year old me probably wouldn’t have listened if my parents tried to warn me of the dangers of credit cards. Which is why I have those conversations with my boys. They will make their mistakes but I hope they can learn from mine…

As for saving for a rainy day, I wish I’d started early, but I started.  And, I’m glad I did because it was the first step in my journey to financial freedom… believe me, I’m not there… not even close if I’m being honest, but I’m on the way.

That journey to financial freedom is a life-long one (I can’t stress this enough!) and it would be impossible to give you all the tools in one email because there is a lot to learn.

But I’m hopeful that, over time, I can help. 

Fool on!

The post When $25 for board was daylight robbery appeared first on The Motley Fool Australia.

More reading

• 2 EV trends Tesla and Rivian investors should understand now
• Why is the New Hope share price plunging today?
• Why Arafura Rare Earths, Magellan, Metro Mining, and Santos shares are racing higher
• Inflows: Magellan shares spike 7% as institutions pile in
• Why Dimerix, New Hope, Pro Medicus, and West African Resources shares are sinking today

Motley Fool contributor Erin Bouwmeester 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.

The New Hope Corp Ltd (ASX: NHC) share price is taking a tumble today.

Shares in the S&P/ASX 200 Index (ASX: XJO) coal miner closed yesterday trading for $5.26. In early afternoon trade on Thursday, shares are swapping hands for $5.04 apiece, down 4.2%.

For some context, the ASX 200 is up 0.98% at this same time.

Here’s why the New Hope share price looks to be catching headwinds today.

What’s sinking the New Hope share price?

This morning, New Hope announced it has successfully priced $300 million of 4.25% senior unsecured convertible notes. After transaction fees, the company foresees net proceeds of just over $293 million.

The miner expects settlement of the notes next Friday, 12 July. The notes will then mature on 12 July 2029 unless redeemed earlier, repurchased or converted in accordance with the terms and conditions.

As the name suggests, the notes are convertible into New Hope shares. New Hope also has the option to settle them for cash. The initial conversion price of the notes is $6.63 a share. That’s more than 30% above the current New Hope share price.

So, why is the ASX 200 coal stock under pressure today?

Well, it’s likely got to do with some derivative transactions.

According to the release:

In connection with the issuance and pricing of the Notes, New Hope intends to purchase certain privately negotiated cash-settled call options (Capped Call Transactions) from one or more financial institutions…

In connection with the Capped Call Transactions, the Capped Call Counterparties are expected to enter into various derivative transactions involving Ordinary Shares at their discretion, which could affect the market price of Ordinary Shares or the Notes otherwise prevailing at that time.

What did management say?

While the New Hope share price is taking a fall today, the $293 million in new funds should support the miner’s longer-term operations and growth plans.

Commenting on the fresh funds, New Hope CEO Rob Bishop said:

The capital provided by this global investor base at favourable terms will be instrumental to our pursuit of initiatives that are consistent with our strategy to maximise shareholder returns.

New Hope CFO Rebecca Rinaldi added, “This transaction represents another important milestone for New Hope in cementing a resilient and flexible balance sheet.”

With today’s intraday losses factored in, the New Hope share price remains up just over 3% in a year.

Shares in the ASX 200 miner also trade on a fully franked trailing dividend yield of 7.5%.

The post Why is the New Hope share price plunging today? appeared first on The Motley Fool Australia.

More reading

• Why Dimerix, New Hope, Pro Medicus, and West African Resources shares are sinking today
• Here are the top 10 ASX 200 shares today
• Why are ASX 200 coal shares smashing the market today?
• Which ASX dividend shares are predicted to have the highest yields in FY25?

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.

The S&P/ASX 200 Index (ASX: XJO) is on form again and having a strong session on Thursday. In afternoon trade, the benchmark index is up a solid 1% to 7,816.4 points.

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

Arafura Rare Earths Ltd (ASX: ARU)

The Arafura Rare Earths share price is up 6.5% to 19.2 cents. This has been driven by news that the rare earths developer has secured funding from the German government. It revealed that the government has issued conditional approval for up to US$115 million (AU$173 million) in Untied Loan Guarantees from Euler Hermes. The funds would support debt financing for Arafura’s rare earths Nolans Project and will secure neodymium and praseodymium (NdPr) supplies for German-based companies.

Magellan Financial Group Ltd (ASX: MFG)

The Magellan share price is up 6% to $9.09. Investors have been buying this fund manager’s shares following the release of its monthly update. In June, Magellan revealed that net flows were flat. This comprised net retail outflows of $0.2 billion and net institutional inflows of $0.2 billion. It also revealed that it will be entitled to estimated performance fees of approximately $19 million for the year ended 30 June 2024.

Metro Mining Ltd (ASX: MMI)

The Metro Mining share price is up 6% to 5.4 cents. This follows the release of a trading update from the bauxite producer. Management advised that it has established a new second quarter shipment record of 1.42 million wet metric tonnes. This is up 12% year on year. This is despite the quarter being classed as the “commissioning quarter” for the new 7 million wet metric tonnes per annum expansion project.

Santos Ltd (ASX: STO)

The Santos share price is up 5% to $8.04. This has been driven by reports that the energy producer could be a takeover target again. According to Bloomberg, both Saudi Aramco and the Abu Dhabi National Oil Co are considering takeover bids for Santos. Bloomberg notes that these energy companies were looking to increase their international gas exposure. The media outlet’s sources also suggested that “other potential buyers” could be interested in acquiring the ASX 200 energy giant. However, at present, there has been no comment from Santos, Abu Dhabi National Oil Co, nor Saudi Aramco. Last year, Woodside Energy Group Ltd (ASX: WDS) failed in its attempt to acquire its rival.

The post Why Arafura Rare Earths, Magellan, Metro Mining, and Santos shares are racing higher appeared first on The Motley Fool Australia.

More reading

• Inflows: Magellan shares spike 7% as institutions pile in
• Santos share price smashing the benchmark amid new takeover rumours
• Why did the Arafura share price just leap more than 11%?
• Are Woodside shares a better buy than rival Santos?
• Why Arafura Rare Earths, Ora Banda, Superloop, and Whitehaven Coal shares are rising today

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. 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.

Magellan Financial Group Ltd (ASX: MFG) shares have surged by 7% on Thursday and are currently swapping hands at $9.12 per share at the time of writing.

The spike follows an update on the company’s funds under management (FUM) for June.

Magellan shares have been in an uptrend in the last month. They lifted off their monthly lows of $8.13 on 17 June and have advanced more than 12% since then.

This rally is accompanied by a trailing dividend yield of over 8%, based on the company’s trailing dividend of 59 cents per share. Let’s take a closer look.

Magellan shares higher on FUM update

The primary driver behind the rise in Magellan shares today is its FUM and performance fee update for June 2024. Money flows are integral to the performance of Magellan shares.

In it, the company advised that new flows of money into and out of its funds were flat on the prior month.

Magellan said that retail investors pulled a net $0.2 billion out of the fund in June. Money managed for retail clients hit $17.1 million for the month.

But institutional flows – those investments and redemptions made from institutional investors, which are entities such as Super funds, mutual funds, hedge funds, and other large-scale asset managers – were a net positive $0.2 billion.

As a result, institutional funds under Magellan’s management came to $19.6 billion at the end of the month.

Aside from that, the fund will “pay distributions (net of reinvestment) of approximately $0.2 billion in
July”. This could be another catalyst behind the movement in Magellan shares today.

Magellan also said it was entitled to estimated performance fees of approximately $19 million for FY24.

The firm’s June FUM flows see it now managing $36.7 billion of client money, slightly up from $36.3 billion in April.

Additionally, the trend in Magellan’s FUM has been turning more positive in 2024. This has been positive for its shares lately.

In its May FUM update, Magellan experienced net outflows of $0.1 billion, consisting of $0.2 billion in net retail outflows and $0.1 billion in net institutional inflows.

April flows, on the other hand, were positive, rising by 2.5%.

Director transactions and analyst views

A significant point of interest is that insiders have been buying and selling Magellan shares recently. Deputy chair and non-executive director Hamish McLennan recently sold nearly $545,000 of his shares in recent filings, over 60% of his interest in the listed investment company.

The sale was tendered at an average price of $8.515 per share. A month prior, director Cathy Kovacs purchased $100,000 of Magellan shares.

Analysts also have mixed views on Magellan shares. According to my colleague Bronwyn, UBS remains bullish on Magellan with a buy rating and a target of $10.25.

But Macquarie has an underperform rating with a price target of $8.40, while Morgans rates the stock as a hold with a target of $9.67.

Magellan shares in focus

Magellan shares have spiked during Thursday’s session following an update on the company’s June FUM and money flows. In the last 12 months, the stock is down 6%.

The post Inflows: Magellan shares spike 7% as institutions pile in appeared first on The Motley Fool Australia.

More reading

• Why Arafura Rare Earths, Magellan, Metro Mining, and Santos shares are racing higher
• Here are the top 10 ASX 200 shares today
• Which ASX 200 company director just sold $545,000 in shares?
• 2 top ASX 200 passive income stocks I’d buy now to boost my retirement

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.