Category: Stock Market

Accent Group Ltd (ASX: AX1) shares were too attractive for me to ignore late last year, so I decided to invest in the ASX retail distributor. I like the potential dividend income on offer and its much-reduced valuation.  

In late November, I bought some shares in Accent at an average price of around $1.74. This came just after the company’s annual general meeting (AGM) and a trading update that disappointed.

At the time I invested, the Accent share price was down 17.5% from 16 November 2023 and down close to 40% from April 2021.

The company acts as a distributor in Australia for global shoe brands, including Skechers, Vans, Kappa, Hoka, Dr Martens, Henleys, and Egg. Accent also has a number of its own brands, including The Athlete’s Foot, Stylerunner, Trybe, Nude Lucy and Glue Store.

Strong dividend income

Past dividends are not a guarantee of future dividends, be that the size of the payout or consistency of the dividend increases. However, if a business makes an effort to grow the dividend regularly, I think that’s a good sign that dividend growth is likely to continue in future (if the profit is there to fund it).

If we look at the last several years of dividends, Accent grew its dividend every year from 2018 to 2021. The company cut the dividend dramatically in 2022, but in 2023 paid a dividend that was 169% larger than in 2022 and 55% bigger than in 2021.

I’m not expecting the 2024 dividend will be larger than 2023. The current economic environment and inflation of the company’s costs are likely to mean a reduced payout.

The projection on Commsec suggests Accent could pay a dividend per share of 11.5 cents in FY24, which would be a grossed-up dividend yield of 7.9%. The payout could be smaller (or larger) than that. But, I’m thinking about the possible retail recovery in the subsequent years.

In FY25, the dividend per share could be 13.1 cents per share, according to Commsec, which would be a grossed-up dividend yield of 9%. The FY26 grossed-up dividend yield might be 10.25% if earnings recover.

Lower valuation

At a time when the cost of living has increased, households may have less money to spend. The company’s expenses are also increasing because of inflation of costs like wages. This combination is likely to translate into lower profit in FY24, but I think the Accent share price has fallen far enough to compensate for this, particularly if the retail weakness is only for a year or two.

If we use the current Accent share price and the earnings forecasts on Commsec, it’s priced at 16x FY24’s estimated earnings and 14x FY25’s estimated earnings.

I like the outlook for the company – it has a number of wonderful global brands and local shoe stores as part of its portfolio. I think it can continue to perform adequately in 2024, even if there is a downturn. We all need shoes!

The business continues to increase its total store network at an impressive rate. It’s planning to add dozens more stores to its network this year. I think its level of digital sales continues to impress. They come with a good margin because they don’t require the same store operation costs.

While I’ll make no prediction of how much the Accent share price may rise, I think a recovery in consumer sentiment (and spending) within two or so years could help the retailer (and shareholders).

The post Here’s why I invested in Accent shares for dividend income appeared first on The Motley Fool Australia.

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More reading

• Cheap and growing: The best bang for buck ASX shares I’d buy
• The Accent share price has sprinted ahead since June! Here’s how much you’ve made
• These ASX 300 dividend shares offer major upside and good yields
• Top ASX shares for beginner investors to buy in 2024
• I could generate an extra $200 a month by buying 21,622 shares of this ASX dividend stock

Motley Fool contributor Tristan Harrison has positions in Accent 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 recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Looking to secure a $1,000 passive income in 2024 by investing in National Australia Bank Ltd (ASX: NAB) shares?

We’ll look at just how much I’d likely need to invest today to achieve that goal below.

But first, a little background on the recent performance of NAB shares.

Targeting NAB shares for passive income

On the passive income front, the S&P/ASX 200 Index (ASX: XJO) bank stock has paid two annual, fully franked dividends every year for more than a decade now, making it a very reliable income stock.

And the bank had a very profitable FY 2023.

For the 12 months ended 30 September, NAB reported an 8.8% year on year increase in cash earnings to $7.7 billion. And with statutory net profit up 7.6% to $7.4 billion, the board pleased passive income investors with a 7.6% increase in the final dividend, which came out to 84 cents a share.

This saw NAB shares deliver a total of $1.67 apiece in fully franked dividends in FY 2023, up from $1.51 per share the prior year.

At yesterday’s closing price of $31.87, the big bank’s stock trades on a trailing yield of 5.2%, with potential tax benefits from those franking credits.

Now, to the maths…

How many shares do I need to buy for a $1,000 passive income?

There are two general metrics we can use here to give us a good idea of how many NAB shares will deliver that $1,000 passive income in 2024.

First, there’s the trailing yield, which we calculated above. This is backward-looking but based on hard data.

Second are forecast yields. These are forward looking, but based on analysts’ best guesses of what the coming year will bring.

As for the forecast yield, CommSec forecasts NAB shares will pay out a total of $1.68 in dividends in the year ahead.

Goldman Sachs is a bit more cautious, forecasting passive income investors will receive $1.62 a share.

With those figures in mind, I’ll stick with the trailing yield here, which falls somewhat in the middle of the two forecasts.

So, if NAB shares deliver $1.67 in dividends in 2024, I’d need to buy 599 shares today to secure my $1,000 in passive income.

At yesterday’s closing price of $31.84 a share, that means I’d need to invest $19,072 now to aim for that goal.

And, of course, I’ll be hoping to see the NAB share price outperform in 2024 as well.

The post How much would I need to invest in NAB shares now for $1,000 a month in passive income? appeared first on The Motley Fool Australia.

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More reading

• I’m buying cheap ASX shares to build my wealth in 2024 and beyond
• Lifetime income: 3 ASX dividend stocks I’m planning to never sell
• Here’s why I think NAB is a no-brainer ASX dividend stock
• What will my ASX 200 bank stocks be worth in 5 years?
• Are NAB shares the strongest ASX 200 bank option for dividend 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 no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The performance of Commonwealth Bank of Australia (ASX: CBA) shares over the past few months has been rather extraordinary.

It was only around three months ago, at the end of October, that the ASX 200’s largest bank stock was trading at approximately $96. That was dangerously close to CBA’s current 52-week low of $93.05.

But fast forward to January 2024, and we’ve not only seen the CBA share price climb 20% above those October lows but hit a new all-time record high in the process. Just yesterday, we covered the bank’s fresh new high of $116 a share.

At the time, my Fool colleague Bronwyn went into how expectations for continued growth in the home mortgage market could be responsible for this new bout of optimism with CBA shares.

However, some ASX experts aren’t celebrating this new record high for the CBA share price. In fact, they are ringing some alarm bells.

A recent report in the Australian Financial Review (AFR) quotes Jarden analyst Carlos Cacho’s views on CBA shares.

Cacho points to “the growing likelihood of a ‘soft landing’ for the economy and the possibility of rate cuts this year” to explain why investors continue to flock to the CBA share price this January. He also says that international funds are playing a role too:

If international investors are buying the bank, they will generally just buy CBA because it is the biggest bank down here.

However, that doesn’t mean that CBA is being priced fairly in Cacho’s eyes.

Noting that CBA’s price-to-book (P/B) ratio is sitting around 2.7, Cacho argued that this places the bank well above most of its peers, which are asking around 1.5 P/B.

“It is expensive”, the analyst was quoted as stating. “It is our least preferred of the big four”.

Is the CBA share price overvalued right now?

The report also shares the views of two additional analysts, Citi’s Brendan Sproules and Andrew Triggs of JPMorgan.

Sproules described the recent rally in the CBA share price as “disconnected from fundamentals” That assessment comes down to “the mortgage book has been in attrition, funding costs have continued to normalise, and credit quality continues to normalise”.

Triggs agrees. He labels CBA shares as a ‘sell’, and told the AFR that, “under any reasonable valuation framework, you can only really get the share price between $80 and $90 at best”.

However, he added this caveat on why CBA shares might not actually come down to those kinds of levels in the near future:

From a fund manager’s standpoint, it is easier to sleep at night owning CBA than say [Westpac Banking Corp (ASX: WBC)].

You are not taking significant execution risk when it comes to owning CBA. Whereas with Westpac, it is commencing a four-year transformation program that could go either way at this stage…

Maybe the catalyst for CBA’s share price to fall is one of the other banks greatly improving and providing a more valuable alternative to investors.

Cacho concurs. He told the report that while the valuation was stretched, he “did not see a credible reason for a re-rating” when it comes to CBA shares.

As such, these ASX experts seem to have come to the slightly paradoxical conclusion that this ASX 200 bank is indeed overvalued, but not heading for a correction anytime soon. That probably won’t persuade too many investors to sell their CBA shares today, I’d wager.

The post ASX experts: CBA shares are overvalued appeared first on The Motley Fool Australia.

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More reading

• CBA shares smash new record amid 5% home price boost prediction
• Why I think CBA is one of the best ASX bank shares
• Top ASX shares to buy in 2024 instead of investing in a term deposit
• Forget term deposits and get rich with ASX shares the Warren Buffett way
• 3 ASX 200 dividend shares I think you could safely hold for decades

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 positions in and has recommended JPMorgan Chase. 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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On Wednesday, the S&P/ASX 200 Index (ASX: XJO) fought hard and managed to keep its winning streak alive. The benchmark index rose a fraction to 7,519.2 points.

Will the market be able to build on this on Thursday? Here are five things to watch:

ASX 200 expected to rise again

The Australian share market looks set to rise again on Thursday following a good night of trade on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 27 points or 0.35% higher this morning. In late trade on Wall Street, the Dow Jones is up 0.1%, the S&P 500 has risen 0.4%, and the Nasdaq is 0.7% higher.

Oil prices climb

ASX 200 energy shares including Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) will be on watch after a positive night for oil prices. According to Bloomberg, the WTI crude oil price is up 0.8% to US$74.99 a barrel and the Brent crude oil price is up 0.5% to US$79.92 a barrel. This was driven by news of a winter storm hitting production in the United States.

ResMed update

ResMed Inc (ASX: RMD) shares will be on watch on Thursday when the sleep treatment company releases its second quarter update. According to a note out of Citi, it is expecting ResMed to deliver a result comfortably ahead of consensus estimates. It has pencilled in earnings per share of US$1.92 for the quarter.

Gold price falls

ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could have a poor day of trade after the gold price fell overnight. According to CNBC, the spot gold price is down 0.5% to US$2,015.1 an ounce. Strong economic data in the United States has led to rate cut doubts. Traders believe the US Fed won’t be in a rush to reduce rates if the economy is booming.

Domino’s shares on watch

The Domino’s Pizza Enterprises Ltd (ASX: DMP) share price will be one to watch today after the pizza chain operator released a trading update after the market close on Wednesday. Domino’s revealed that its same store sales and total sales were up 1.3% and 8,8%, respectively, during the first half. And while its net profit before tax is expected to fall year on year to $87 million to $90 million (from $104.8 million), this will be ahead of the $74.4 million recorded during the second half of FY 2023.

The post 5 things to watch on the ASX 200 on Thursday appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Northern Star share price leaps higher on boosted earnings
• Why Karoon Energy, Kogan, Northern Star, and Pilbara Minerals shares are jumping today
• Woodside share price hesitant on $3.36 billion quarter
• 5 things to watch on the ASX 200 on Wednesday

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in Domino’s Pizza Enterprises, ResMed, and Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Domino’s Pizza Enterprises and ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. 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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Bitcoin (CRYPTO: BTC) received a major boost earlier this month when US authorities approved the first-ever exchange-traded funds (ETFs) that directly invest in the cryptocurrency.

These Bitcoin ETFs are different to previous funds that invested in the fortunes of the crypto because they directly represent the present “spot” value, rather than using indirect mechanisms like futures.

So the theory is that buying $1 of a spot ETF instantly means you hold $1 of Bitcoin.

Unsurprisingly, the value of Bitcoin shot up immediately due to this development.

Moomoo market strategist Jessica Amir reckons the positive impact of these new Bitcoin ETFs on the cryptocurrency would be long-lasting.

“The fact that investors can now buy into Bitcoin via an ETF, which is just like buying a share, will support its price higher, as it will be added to investment managers’ portfolios.”

The investment thesis will be further strengthened with the possibility that Bitcoin could come more into use in everyday life.

“Public companies like Tesla Inc (NASDAQ: TSLA) and Microsoft Corp (NASDAQ: MSFT) already accept Bitcoin as payment.

“Although it may be a long while before Bitcoin is fully assimilated into everyday life, it will likely put the 2022 crash behind it and hit new highs.”

But did you know there is one particular stock in the S&P/ASX 200 Index (ASX: XJO) that could also benefit from the rise in Bitcoin?

You have used this ASX 200’s products, for sure

While the name Block Inc CDI (ASX: SQ2) may not be familiar to everyday Australians, they have certainly used their technology at one time or another, if not almost everyday.

“Block is the company behind the Square terminal that you may tap on to pay for a doctor’s visit, a coffee or a meal,” said Amir.

“It’s also the company that bought the buy now pay later app Afterpay and it has a mobile payment service, Cash App.”

Block Inc and its famous co-founder Jack Dorsey have been long-time fans of cryptocurrencies.

In fact, back in December 2021, days after Dorsey resigned as chief executive of Twitter, the company changed its name from Square to Block. 

The new name was partially a hat tip to the “blockchain”, the software structure on which cryptocurrency is built on.

Amir pointed out crypto has been integrated into the ASX 200 company’s consumer apps to promote and broaden its usage.

“Block’s revenue will also grow after it launched a Bitcoin mobile app that allows users to access, store and use their Bitcoin through an app and a hardware key. 

“With a diversified revenue stream, Block is one to watch amidst the Bitcoin hype.”

Professional investors are bullish on Block Inc. According to CMC Invest, all three analysts that cover the fintech are currently rating it as a strong buy.

The post The ASX 200 stock that could rocket now that Bitcoin ETFs are running appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 shares that could surge in 2024 if the RBA cuts interest rates
• Here are the top 10 ASX 200 shares today
• How I’d invest $300 a month in ASX shares to target $22,000 annual passive income!
• Got a spare $1,000? I’d buy 10 shares of this ASX 200 stock to aim for a million
• ‘Consistent alpha generation’: 3 ASX 200 shares sitting pretty for the long run

Motley Fool contributor Tony Yoo has positions in Bitcoin, Block, and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin, Block, Microsoft, and Tesla. The Motley Fool Australia has positions in and has recommended Bitcoin and Block. 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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A “sure thing” never exists in investing, so it would be wise to steer clear of anyone advising you as such. 

However, there is no doubt proper research can reduce the risk — or probability — of underperformance or even losses.

I think there are three ASX stocks that are stable businesses with reasonably certain demand for their products and services.

Plus the majority of professional investors seem to be bullish from this point on.

They are as close to “no brainer” buys right now before they soar in a bull market:

Old favourite could become a new favourite

CSL Ltd (ASX: CSL) shares made many Australians wealthy for decades, but the last few years have been disappointing.

The stock price is still 12.8% lower than its pre-COVID peak in February 2020.

And throughout that time experts have predicted a resurgence, as more Americans return as plasma donors with pandemic fears wearing off.

After two years of disappointment, the long-awaited share price revival could finally be happening.

CSL shares have rocketed more than 27% since 30 October.

Professional investors are now slobbering over the biotechnology giant, with 13 out of 15 analysts currently surveyed on CMC Invest rating CSL as a buy.

The ASX stock cashing in on the energy crisis 

In contrast, the MMA Offshore Ltd (ASX: MRM) share price has more than doubled over the past 12 months.

Despite this, Canaccord, Euroz Hartleys, Moelis Australia, PAC Partners, and Shaw & Partners all currently recommend the ASX stock as a strong buy, a CMC Invest survey shows.

The situation is that much of the world is scrambling for energy security after wars broke out in Ukraine and the Middle East.

This has shot up demand for energy producers in other jurisdictions, meaning more work on offshore oil and gas rigs.

And those companies are the clients that MMA Offshore provides marine services to.

With renewable energy infrastructure not ready to dominate for years yet, MMA is expected to see its work increase even further in the coming years.

The mining flavoured investment that isn’t cyclical

Commodity prices and mining activity often reflects the state of the economy.

And with western economies deliberately slowed to fight inflation and China combating deflation, it is not outrageous to suggest the world is at the low part of the cycle.

That’s why adding a mining technology provider RPMGlobal Holdings Ltd (ASX: RUL) might not be a bad move before a bull market begins.

As economies get going again, demand for resources will head up, and so will commodity prices and mining.

Unlike its cyclical clients, RPMGlobal is a growth stock. The past five years has delivered an impressive 215% return for investors.

According to CMC Invest, both Moelis Australia and Veritas Securities rate the ASX stock as a strong buy.

The post 3 no-brainer ASX stocks I’d buy before a bull run appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy today
• Is now the right time to buy CSL shares? Here’s my take
• I’m buying cheap ASX shares to build my wealth in 2024 and beyond
• Experts tip very big returns from these outstanding ASX 200 blue chip shares
• $10,000 in excess savings? I’d buy 5,181 shares of this ASX stock to aim for $3,500 in passive income

Motley Fool contributor Tony Yoo has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and RPMGlobal. The Motley Fool Australia has recommended CSL, Mma Offshore, and RPMGlobal. 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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Despite already being a massive company in 2014, Apple Inc (NASDAQ: AAPL) shares have rocketed since then.

The computing giant has impressively come up with new innovations consistently to keep the demand for its products perpetually growing.

Ten years ago, the Apple share price was hovering around the US$18 mark.

If you had the foresight to buy US$20,000 of stock at that price, just 10 years later, it would now be worth US$216,866.

That’s better than a 10-bagger in the space of just a decade. A decade in which Apple spent a significant time as the largest company in the world.

Just amazing.

So is there an ASX growth stock that could emulate Apple?

Let’s check out Camplify Holdings Ltd (ASX: CHL).

Australia’s version of AirBnB?

Camplify is an online platform for owners of recreational vehicles to lend them out to strangers, generating cash when otherwise they would sit unused.

In simple terms it has been described as Airbnb Inc (NASDAQ: ABNB) for RVs.

The company listed on the ASX in June 2021 after an initial public offering (IPO) that saw shares sold at $1.42 each.

Camplify shares are now going for around $2.17.

Why does it have potential to be a multibagger in the coming years?

The business is growing rapidly.

Check out these numbers from the 2023 financial year compared to the year before:

• Revenue up 126%
• Net loss down 66%
• Cash flow per share improved from negative 13.1 cents to positive 4.8 cents

And professional investors are bullish on Camplify.

According to CMC Invest, both Canaccord Genuity and Morgans rate the ASX growth stock as a strong buy.

Can it become a 10-bagger over the next decade though?

Of course, no one can definitively answer that.

But what I can tell you is that over the past 10 years, Apple has never grown its revenue 126% in the space of just one year.

Camplify, at a much earlier stage of its life, has the potential to do anything.

The post Could buying this ASX growth stock at $2.17 be like investing in Apple in 2014? appeared first on The Motley Fool Australia.

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More reading

• I’m buying cheap ASX shares to build my wealth in 2024 and beyond
• Here’s how the ASX 200 market sectors stacked up this week
• Which Nasdaq company just overtook Apple as the world’s largest by market cap?

Motley Fool contributor Tony Yoo has positions in Camplify. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Camplify. The Motley Fool Australia has recommended Apple and Camplify. 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 ASX income stock dividend yields have jumped higher amid the higher interest rate environment. While investors can get a better return from savings accounts these days, the yields on offer look too good to ignore.

When share prices fall, it means we can buy businesses at a cheaper valuation. It has the bonus effect of pushing up the yield on offer. For example, if a business has a 6% dividend yield and the share price drops 10%, the yield becomes 6.6%!

Why do interest rates matter?

Legendary investor Warren Buffett once explained the importance of interest rates very well:

The value of every business, the value of a farm, the value of an apartment house, the value of any economic asset, is 100% sensitive to interest rates because all you are doing in investing is transferring some money to somebody now in exchange for what you expect the stream of money to be, to come in over a period of time, and the higher interest rates are the less that present value is going to be. So every business by its nature…its intrinsic valuation is 100% sensitive to interest rates.

With that in mind, these two ASX income stocks trading at lower prices look exciting for income investors.

Charter Hall Long WALE REIT (ASX: CLW)

This is a real estate investment trust (REIT) that owns a variety of different properties, all of which are on long leases.

Let’s start with the potential income. The business has guided that it’s going to pay a distribution per security of 26 cents, which translates into a forward yield of 7.2%.

The ASX income stock has a weighted average lease expiry (WALE) of 11 years and an occupancy rate of 99.9%, so it’s generating a lot of long-term rental income, which is good for investors wanting stable income.

Its properties include telecommunications exchanges, service stations, high-quality office and retail, Bunnings buildings, logistics and so on.

Around half of its leases are linked to CPI inflation, while the other half of leases have (for FY24) a fixed 3.1% rental increase. This creates a solid growth rate of the rental income for the company, helping offset the higher debt cost.

Metcash Ltd (ASX: MTS)

Metcash supplies many independent retailers with food and drink. Its customers include IGA, Cellarbrations, The Bottle-O, IGA Liquor, Porters Liquor, Thirsty Camel, Big Bargain Bottleshop and Duncans.

What excites me most is the hardware division which owns brands including Mitre 10, Home Timber & Hardware and Total Tools. It also supports independent operators under the small format convenience banners Thrifty-Link Hardware and True Value Hardware.

The company is committed to a dividend payout ratio of 70% of underlying net profit after tax (NPAT). According to Commsec, the ASX income stock is expected to pay a grossed-up dividend yield (including franking credits) of 8.2% in FY24.

I believe the food and liquor divisions offer defensive earnings which can help fund its large dividend. The hardware division faces the most headwinds in the short term because of the wider economy, but a reduction of interest rates could reignite stronger demand in 2025 or 2026.

The post Top tier ASX income stocks I’d consider buying in January! appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Metcash. 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 Metcash. 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 post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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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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Most companies inside the S&P/ASX All Ordinaries Index (ASX: XAO) pushed higher on Wednesday. However, one ASX All Ords stock failed to gain traction following the release of its second-quarter activities report for FY2024.

More peculiar is that this company is coming under selling pressure despite posting a significant increase in revenue. The negative reception hints at another facet within the figures weighing on investors’ minds.

As we tick past the closing bell, shares in Chrysos Corporation Ltd (ASX: C79) have shed 5.5% to $7.21. The mining technology company has had a ripper run since debuting on the ASX in 2022. However, today’s report appears to have poured some cold water on the excitement.

Delays dampen a good quarter

Before we dive into the thick of it, here are several key figures from the quarter:

• Total revenue up 57% year on year to $10.1 million
• Sample volume up 29% year on year to 1 million
• Deployed PhotonAssay units up 71% year on year to 24
• Minimum monthly assay payments up 77% to $8.9 million

By no means was the second quarter a failure for this ASX All Ords stock. The company responsible for an innovative alternative to fire assays — a way of determining the concentration of minerals inside ore — is growing rapidly as it continues to roll out its testing units to customers.

Chrysos is making in-roads with major gold miners, such as Barrick Gold, an achievement highlighted by the managing director and CEO Dirk Treasure. Commenting on the noteworthiness, Treasure stated:

The second Quarter of FY24 was a significant period for Chrysos, marked by the continuing validation of our PhotonAssay technology by one of the world’s largest gold miners, Barrick Gold, as well as our increased funding facility with the CBA, and the successful completion of our $75m institutional Placement, which received strong support from new and existing investors.

Yet, the enthusiasm among shareholders appears to have been pacified by a hindered outlook for FY24.

The full-year FY2024 revenue is tracking at the lower end of the originally forecasted range of $48 million to $58 million.

Furthermore, there is an ’emerging risk’ of failing to achieve the company’s goal of at least 18 PhotonAssay deployments in FY24. The cause is ‘customer site readiness and contractor availability’ challenges.

Fortunately, management expects delayed deployments to be picked up in the first quarter of FY25.

What about the valuation of this ASX All Ords stock?

Despite the rapid growth rate, there is a chance onlookers were hoping for even more.

The Chrysos share price has ascended 96% over the past year as the market potential began to resonate. As a result, the company’s market capitalisation has swollen to $875 million, reflecting a forward price-to-sales (P/S) ratio of nearly 17 times, based on FY24 estimates.

It can be challenging to value any company during such a high-growth period. Sometimes, it can lead to expectations getting ahead of reality. Perhaps investors were pondering this very thought today when looking at the stock price of this ASX All Ords company.

Shares in Chrysos Corporation are now down 14% for the year.

The post Why did this ASX All Ords stock sink 6% after a high growth quarter? appeared first on The Motley Fool Australia.

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• Why Adriatic Metals, Chrysos, Coronado, and Nanosonics shares sinking today
• 6 shares that could be destined for the ASX 200 in 2024

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 positions in and has recommended Chrysos. The Motley Fool Australia has positions in and has recommended Chrysos. 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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