Author: therawinformant

The gold price has hit a new high of US$2028 per ounce, prompting a rally in ASX gold shares. Gold has been on the rise all year as the pandemic has helped drive a broad shift into safe haven assets. Gold has long been used as a hedge against uncertainty and a store of value. The gold price tends to be inversely correlated to the price of assets such as shares and bonds, meaning it provides diversification benefits. 

Australia is a leading global gold producer and the source of 17% of globally known gold resources. In 2019, Australia exported $23.3 billion worth of gold, making it the country’s fourth largest export commodity. There are 66 gold mines operating around the country which together produced 326 tonnes of gold last year, accounting for around 9% of global production. Here we take a look at three Australian ASX gold shares you can invest in for exposure to the rising gold price. 

3 ASX gold shares benefitting from surging gold prices

Newcrest Mining Limited (ASX: NCM) 

This ASX gold share is one of the world’s largest gold mining companies. It operates gold, silver, and copper mines in Australia, Canada, and Papua New Guinea. It reported a strong June quarter with gold production up 7% to 573,175 ounces. Full year production was 2,486,7389 ounces of gold, in line with guidance. Newcrest is also advancing exploration and development projects in Western Australia which are expected to add production ounces to its portfolio in due course. 

Evolution Mining Ltd (ASX: EVN) 

Evolution Mining is an Australian gold producer with five wholly owned mines. Four mines are located in Australia and the Red Lake mine is located in Canada. In the June quarter, Evolution produced 218,100 ounces of gold across its mines. This gave full year production of 746,463 ounces, above guidance of 715,000 ounces. Evolution has advised that the opportunity at Red Lake is greater than expected, with transformation of the mine progressing ahead of schedule. 

Saracen Mineral Holdings Limited (ASX: SAR)

Saracen Mineral Holdings mines gold in the Kalgoorlie region of Western Australia. Saracen produced 145,830 ounces of gold in the June quarter. This gave FY20 production of 520,414 ounces, ahead of guidance. In FY21 Saracen forecast production of 380,000 to 400,000 ounces of gold at an all-in sustaining cost of $1,200 – $1,300 per ounce. The ASX gold share is capitalising on the high gold price to ‘future-proof’ the business. Capital is being invested in the short term to de-risk production and allow for lower costs in future.

More reading

• ASX 200 down 1.15%: NAB downgraded, Telstra asset sale, gold miners rocket
• Leading fundie says the ASX gold share boom is just beginning
• 5 things to watch on the ASX 200 on Wednesday
• Should you buy ASX gold shares or FAANG stocks in August?
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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Calidus Resources Ltd (ASX: CAI) shares are up 1.75% at the time of writing to 58 cents. The increase in the Calidus share price came after the company announced it is set to commence construction at its Warrawoona gold project in Western Australia.

What was in the announcement?

According to the company, construction works at the Warrawoona project will begin next month. Initially, an access road and 240 person accommodation village will be constructed with the main project construction to begin in 2021. Calidus will use part of the proceeds from its recent $25 million placement, completed in July, to fund the initial construction. Environmental permits have been granted for the initial works, which are also subject to a final objection period.

Calidus Resources announced that it has appointed experienced mining executive, Don Russel, as its General Manager of Operations.

The company’s Managing Director, Dave Reeves, commented on the project, stating;

“The early works programme will ensure gold production starts as soon as possible at Warrawoona. Constructing access roads, the accommodation village and supplying communications to site paves the way for the main development works to kick off in earnest in the new year. As part of our development preparations, we are delighted to welcome Don Russel as General Manager for Warrawoona. Don has extensive operating experience at gold mines across Australia in his 30-year career and his skills will be invaluable as we move ahead with this project.”

About the Calidus share price

Calidus Resources is a gold exploration company that listed on the ASX in 2017 at a price of 2 cents per share. It controls the Warrawoona gold project in Western Australia. According to the company, the project is a 1.2 million ounce resource.

In its quarterly report to June 2020, Calidus set out that its updated pre-feasibility study demonstrated that the Warrawoona project is set to produce 85,000 ounces of gold per year at an all in sustaining cost of $1,251 per ounce. At 30 June, Calidus Resources held $5.7 million in cash and $1.4 million in listed investments.

The Calidus share price is up 2262% since its 52 week low of 2.1 cents and has returned 132% since the beginning of the year. The Calidus share price is up 71% since this time last year.

More reading

• De Gray Mining share price lifts on strong results
• These small cap ASX healthcare shares could be destined for big things
• Why Cochlear, NAB, Tabcorp, & Telstra shares are tumbling lower
• ASX stock of the day: Pharmaxis share price surges 8% as milestone payment brought forward
• Reliance Worldwide operations to continue in Victoria

Motley Fool contributor Chris Chitty has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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 Lynas Corporation Ltd (ASX: LYC) share price swung widely today after the miner provided an update on their Malaysian operations.

The Lynas share price jumped over 3% in early trade before giving up gains to trade 0.8% lower at $2.44. Shares in the rare earth miner was dragged down by deepening losses on the S&P/ASX 200 Index (Index:^AXJO) as COVID-19 cases in Victoria spiked to a new record high.

The state recorded 725 new cases on Tuesday and that sucked confidence from the market with only defensive and gold stocks making any gains.

ASX miners golden run

The Northern Star Resources Ltd (ASX: NST) share price surged 4.8% to $16.51 while the St Barbara Ltd (ASX: SBM) share price jumped 4.5% to $3.60 at the time of writing.

But the Lynas share price should also be following gold miners higher in my opinion as the market is under appreciating its defensive qualities.

One of the key risks facing the miner is abating after management noted comments from Malaysian Minister of Science, Technology and Innovation, Khairy Jamaluddin.

Lynas risk profile improving

He said that the Atomic Energy Licensing Board (AELB) approved the proposed site at Bukit Ketam for the construction of a Permanent Deposit Facility (PDF).

The approval is subject to completion of relevant studies and final approvals by regulatory authorities.

Lynas will apply for final regulatory approval in the coming months to start construction of the facility by early 2021.

“This is a further step towards satisfying the key conditions of the three-year Lynas Malaysia operating licence that was announced on 27 February 2020,” said the miner in an ASX statement.

Strategic value not in share price

The future of Lynas’ operations in the state was under a cloud due to some community opposition as Lynas’ plant will produce low-level radioactive waste.

The PDF should help turn Water Leach Purification (WLP) residue into phosphate that can be used as fertilizer or in the construction industry.

This is a positive step forward and reinforces my view that the strategic value in Lynas is not reflected in its current share price.

Re-rating opportunity ahead

Lynas is the largest rare earths miner in the world outside of China. Rare earths are used in a wide range of critical electronics and weapons.

China is turning the minerals into a weapon in itself as it squares off against the United States and its allies.

I can see a clear re-rating opportunity for Lynas if it secures US government funding to build its JV processing plant in Texas.

The probability of this is high, regardless of who wins the November US presidential election as the country won’t want to be beholden to Chinese suppliers.

While the Lynas share price has more than doubled since the March bear market low, but it’s still lagging significantly behind other miners since the start of 2020.

I am expecting the stock to rise to $3 over the next 12-months.

More reading

• Why Mesoblast, Northern Star, PointsBet, & Splitit shares are racing higher
• ASX 200 down 1.15%: NAB downgraded, Telstra asset sale, gold miners rocket
• Coronavirus: What does lockdown mean for ASX retail shares like JB Hi-Fi?
• Leading fundie says the ASX gold share boom is just beginning
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Brendon Lau owns shares of Lynas Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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) hasn’t been able to build on yesterday’s strong gains and is sinking lower on Wednesday. At the time of writing the benchmark index is down 0.9% to 5,984.8 points.

Four shares that have not let that hold them back are listed below. Here’s why they are racing higher:

The Mesoblast limited (ASX: MSB) share price is up almost 5% to $4.32. This is despite there being no news out of the company. However, one potential catalyst could be news relating to a competing COVID-19 treatment. According to CNBC, Novavax’s vaccine candidate delivered promising results, but there were concerns about its safety.

The Northern Star Resources Ltd (ASX: NST) share price has climbed over 3% to $16.25. Investors have been buying Northern Star and other gold miners on Wednesday after the gold price stormed to a new record high overnight. Traders were buying the precious metal amid optimism the U.S. will launch major new stimulus to safeguard the economy. At the time of writing the S&P/ASX All Ordinaries Gold index is up 2.3%.

The PointsBet Holdings Ltd (ASX: PBH) share price is up 2% to $6.11. This morning the sports betting company announced a multi-year agreement with Pacers Sports & Entertainment. This will see it become an official sports gaming partner of the Indiana Pacers of the NBA. As part of the agreement, PointsBet branding will be displayed along the out-of-bounds space between the baseline and the team bench. Management notes that this represents the first time a sports betting operator will occupy that space.

The Splitit Ltd (ASX: SPT) share price has jumped 10% higher to $1.50. This morning the buy now pay later company announced that it has received firm commitments to raise $90 million (before costs) in new equity. These funds will be raised via a fully committed two-tranche share placement to institutional, sophisticated, and professional investors. Splitit is raising the funds at a price of $1.30 per share, which represents a discount of 4.8% to its last close price. The proceeds from the equity raising will be used to accelerate its high-growth strategy.

More reading

• Why this ASX miner that’s missing the rally is one of my key picks for FY21
• ASX 200 down 1.15%: NAB downgraded, Telstra asset sale, gold miners rocket
• PointsBet share price jumps 4% on new US deal
• Why the Splitit share price is zooming 20% higher today
• Leading fundie says the ASX gold share boom is just beginning

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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 e-commerce sector is booming right now. In this article we look at two of the leading providers in this segment: Temple & Webster Group Ltd (ASX: TPW) and Kogan.com Ltd (ASX: KGN).

Here’s why both of these ASX shares are in my buy zone right now:

Temple & Webster

Temple & Webster has evolved to become the leading online retailing platform for furniture and homewares. This is not a product category traditionally associated with online shopping. However that is now changing, as the online shopping channel further evolves.

The trend towards the online channel for retail shopping has definitely accelerated during the coronavirus pandemic. And Temple & Webster is an online retailer that has proven to be highly successful during this period. This is reflected in the online retailer’s recent financial results. Total revenue for FY 2020 for Temple & Webster grew by 74% to $176.3 million. Revenue growth during the second half was particularly strong, up by 96%. The Temple & Webster share price has also risen strongly recently, up from $1.52 in late March to now be trading at $8.08.

I am particularly attracted to Temple & Webster as an online retailer because it is a capital light business – about 80% of its online sales don’t require the company to hold any inventory in its warehouses.

I am confident that Temple & Webster is well-placed to tap further into the shift towards the online retail channel for furniture and homewares over the next few years. This I believe, will lead to above average share price returns.

Kogan.com

Kogan is another e-commerce retailer that has seen a surge in sales during the coronavirus pandemic. The company recently revealed that gross sales climbed by more than 95% during the final quarter of 2020, compared to the prior corresponding period. Gross profit was up 115%, while EBITDA surged by 149%. There has been particularly strong demand for office and education-related equipment such as PCs and laptops. Kogan’s fast-growing Kogan Marketplace in particular continues to be a strong  performer.

This strong growth has been reflected in a surging share price, up from below $4 in mid-March to now be trading at nearly $19.

Kogan has now cemented its market position as a leading local pure online retailer catering for a broad range of items, in a similar fashion to how Amazon operates on a global basis. I believe that Kogan is well-placed to make further market inroads in the years to come. It is now also a more diversified company catering for a  broad range of verticals such as internet, mobile, energy and credit cards.

Foolish Takeaway

Temple & Webster and Kogan are 2 ASX shares that have successfully tapped into the growing demand for online shopping in recent months. I am confident that both are well-placed to continue their growth trajectory over the first few years.

More reading

• 3 ASX shares I’d buy if the ASX crashes again
• ASX shares that could get a boost from Victoria’s shutdown
• Reporting season metrics to watch for JB Hi-Fi
• This is the only ASX sector tipped to report earnings growth this reporting season
• How will Victoria’s stage 4 lockdowns impact ASX shares?

Phil Harpur owns shares of Kogan.com ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia has recommended Kogan.com ltd and Temple & Webster Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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At lunch on Wednesday the S&P/ASX 200 Index (ASX: XJO) is on course to give back a lot of yesterday’s gains. The benchmark index is currently down 1.15% to 5,968.5 points.

Here’s what is happening on the market today:

Big four banks tumble.

The big four banks’ rebound was only short-lived. After recording some very strong gains on Tuesday, they are giving them back today and weighing down the index. The worst performer in the sector has been the National Australia Bank Ltd (ASX: NAB) share price with a 2.8% decline. Its shares were downgraded by analysts at Macquarie today. The broker downgraded NAB all the way from outperform to underperform with a $17.50 price target.

Telstra asset sale.

The Telstra Corporation Ltd (ASX: TLS) share price has dropped lower with the market today despite announcing a major asset sale. According to the release, Telstra has entered into an agreement to sell its data centre complex in Clayton, Victoria, to Centuria Industrial REIT (ASX: CIP) for a total of $416.7 million. Telstra’s CEO, Andrew Penn, notes that the sale is part of the company’s T22 strategy which is cutting costs and simplifying its business.

Gold miners rocket higher.

One area of the market which is booming on Wednesday is the gold sector. The likes of Evolution Mining Ltd (ASX: EVN), Newcrest Mining Limited (ASX: NCM), and Northern Star Resources Ltd (ASX: NST) are all storming higher after the gold price smashed through US$2,000 an ounce and hit a record high overnight. At the time of writing, the S&P/ASX All Ordinaries Gold index is up a sizeable 3%.

Best and worst ASX 200 performers.

The best performer on the ASX 200 on Wednesday has been the Mesoblast limited (ASX: MSB) share price with a gain of almost 7%. This may be due to news that a competing COVID-19 treatment delivered promising but not overly convincing trial results. The worst performer has been the Pro Medicus Limited (ASX: PME) share price with a 4% decline. This is despite there being no news out of the leading health imaging company.

More reading

• Why this ASX miner that’s missing the rally is one of my key picks for FY21
• Why Mesoblast, Northern Star, PointsBet, & Splitit shares are racing higher
• 3 ASX shares I’d buy if the ASX crashes again
• ASX shares that could get a boost from Victoria’s shutdown
• Telstra share price on watch after major asset sale announcement

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. and Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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There are some ASX shares that I’d buy if the ASX crashes again.

Some shares have performed really strongly since the worst of the crash in March 2020. I think they may be too expensive to buy now, but could be great buys if the share market dropped again.

Here are my three picks that I’d buy if the ASX drops again:

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is a high-flying ecommerce business. It’s an online seller of furniture and homewares. Customers are flocking to the online retailer for the large range, fast shipping and good prices.

The FY20 result of the ASX share was impressive in my opinion. Full year revenue was up 74% to $176.3 million. FY20 second half revenue was up 96% and the fourth quarter revenue grew by 130%. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 466% to $8.5 million.

The Temple & Webster share price has risen by 410% since 23 March 2020. Its growth has certainly accelerated since the COVID-19 lockdowns started. But I’d prefer to buy it at a cheaper price.

How much cheaper? Well that depends how much the ASX share is going to fall in this theoretical crash. I’d love to buy shares for under $2 but who knows if it will ever go under that price again. At this stage I think I’d be happy to buy shares under $6.

Kogan.com Ltd (ASX: KGN)

Kogan.com is another online retailer that has seen enormous growth since March 2020. Both Kogan.com’s share price and earnings are soaring.

Kogan.com sells a large range of different products like devices, appliances and furniture. It also offers other services like insurance, mobile, telecommunications, energy and superannuation.

A couple of weeks ago the ASX share announced some of its growth numbers for the fourth quarter of FY20. Gross sales grew by more than 95%, gross profit rose by over 115% and adjusted EBITDA increased by around 150%.

The Kogan.com share price is up almost 400% since 16 March 2020. It has been a very strong performer – but can things continue?

Will sales continue to be as strong as jobkeeper starts to tail off and lockdown effects lift in some of the country? Time will tell, but I don’t think I’d want to buy shares above $12.50 with how much uncertainty there is about retail conditions.

Pro Medicus Ltd (ASX: PME)

I think that Pro Medicus is one of the highest-quality ASX shares around. It’s a medical technology business that provides radiology information systems.

It has clients from across the world with recent major wins in both Europe and the US.

The company was one of the ASX 200 shares to fall the hardest during the first COVID-19 crash. It dropped to under $15 on 19 March 2020. It then just about doubled to around $30 at the end of May, but it has slid back to $22.60 at the time of writing.

Aside from providing remote training to clients using screen-share technology etc, the ASX share said its operations haven’t really changed because most of the work was done remotely anyway.

Pro Medicus is in a very strong position. It had cash on the balance sheet of $38.8 million at 31 December 2019 with no debt, so its balance sheet isn’t in any danger. In the FY20 half-year result it reported an earnings before interest and tax (EBIT) margin of 50.2%, which is one of the highest on the ASX.

It’s worth holding the best ASX shares in your portfolio, it just needs to be at the right price. I’d actually be happy to buy a small parcel of Pro Medicus today, but if it dropped below $20 I’d be willing to load up for the long-term with how low interest rates are right now.

Foolish takeaway

I think all three of these ASX shares look like they could continue to be winners over the next decade, but we need to ensure we pay the right price for them. Today, I’d buy Pro Medicus shares, but I think all three would fit into a growth portfolio if the ASX crashed again.

More reading

• 2 of the best online shopping ASX shares to buy in August
• ASX 200 down 1.15%: NAB downgraded, Telstra asset sale, gold miners rocket
• ASX shares that could get a boost from Victoria’s shutdown
• Reporting season metrics to watch for JB Hi-Fi
• This is the only ASX sector tipped to report earnings growth this reporting season

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd and Temple & Webster Group Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia has recommended Kogan.com ltd and Temple & Webster Group Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. 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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