Category: Stock Market

The explosion of strong inflation has made things more complex in the investment world. But stock picking specific ASX shares could begin to deliver good returns again, going by recent moves of the Future Fund.

Before now, the Australian government’s sovereign wealth fund was investing in low-cost index funds, according to reporting by the Australian Financial Review. It had terminated its mandates with fund managers. But, the $200 billion Future Fund is now returning to stock pickers once again.

A key reason for the strategic change is that “central bank policies no longer dominate equity market returns, and stock pickers can truly add value”, according to the AFR’s reporting.

Future Fund backs stock picking

The Future Fund’s CEO Raphael Arndt told the AFR:

There’s a richer universe for active management. Equity market returns were largely responsive to central bank policies around either interest rate or quantitative easing or liquidity settings.

We continue to think that strategy makes sense at some level, but it’s also true that markets have become more sophisticated around those decisions, so you need a more dynamic approach.

As economic conditions change in the real world, then some companies will be in sweet spots where they can take advantage of that.

Other ones won’t be or will come under margin pressure because of more populist politics and more aggressive regulation.

This move will include the Future Fund investing in stock picking domestic small-cap funds as well.

Are economic conditions getting better?

The Future Fund is worried about the impacts of inflation and how this could impact economic growth. These could be good conditions for stock picking. Arndt said:

We still are concerned about a stagflation. In fact, it looks more likely than not that we’ll have a stagflation.

However, while interest rates have risen, they are still below the rate of inflation, so cash isn’t providing a strong enough return yet, Arndt continued:

Unfortunately, it’s still negative in a real sense. We felt like cash was expensive to hold because of inflation, so we have reduced that cash holding as a result of that.

The Australian Bureau of Statistics (ABS) has just delivered its quarterly inflation numbers, which showed that the consumer price index (CPI) rose by 1.4% in the three months to 31 March 2023, while over the 12 months, it showed a 7% rise.

Tertiary education and gas and other household fuels saw two of the largest gains, with rises of 9.7% and 14.3%, respectively.

So, while inflation has reduced from the most recent quarter – CPI annual inflation was 7.8% in the three months to December 2022 – it is still strong.

Time will tell whether inflation settles back towards the Reserve Bank of Australia (RBA) goal of 3% quickly or if it stays elevated for longer than hoped.

The post The importance of stock picking in an inflationary environment appeared first on The Motley Fool Australia.

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More reading

• How Coles shares could help ‘recession proof’ your portfolio
• Why did the Bank of Queensland share price just hit a new 52-week low?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Passive income alert! Experts say buy these ASX dividend shares with big and growing yields
• Buy these ASX growth shares right now: Goldman Sachs

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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Coles Group Ltd (ASX: COL) shares have strongly outperformed in 2023.

Since the opening bell on 3 January, shares in the S&P/ASX 200 Index (ASX: XJO) consumer staples retail stock are up 12%.

That’s more than twice the 5% year-to-date gains posted by the ASX 200.

And it doesn’t include the 36 cents per share fully franked dividend shareholders will have received on 30 March.

Now, here’s why investors concerned about a looming recession may want to run their slide rules over Coles shares.

Recession resilience

With its combined segments of Coles Supermarkets, Coles Express, and the Coles liquor division, the retail giant has a market cap of $24.6 billion.

And with the majority of its revenue derived from staple goods, Coles shares are well positioned to weather an economic downturn – or even a full-fledged recession – should stubbornly high inflation and rising interest rates send the Aussie economy into a tailspin.

After all, at the end of the day, we all need to eat and ensure our homes have the basic essentials.

For some idea of Coles shares’ defensive qualities, the company managed to post solid profits even during the height of the pandemic.

And the ASX 200 retailer’s latest half-year results revealed strong growth trends as Australia shakes off the last vestiges of those COVID times.

Among the highlights, Coles reported a 3.9% year-on-year increase in sales revenue, which reached $20.8 billion over the six months. And net profit after tax (NPAT) leapt 11.4% to $616 million.

The 36 cents per share interim dividend mentioned up top also represented a 9.1% increase from the prior corresponding half year. That continues the trend of Coles shares delivering an increased dividend every year since 2019.

Importantly, despite inflation running hot over the six-month reporting period, Coles’ gross profit margin increased by 0.43% to 26.5%.

The company also has a solid balance sheet.

Net assets as at 1 January were $3.38 billion, an increase of $370 million year on year. Net debt, meanwhile, decreased by $144 million. Net debt (excluding lease liabilities) at the half-year came in at $362 million.

What other recession resistant qualities do Coles shares have?

Another recession resistant aspect of Coles shares is the company’s ability to pass on any cost inflation to its customers.

Though management has noted it is seeing inflation pressures on its shelves begin to ease.

And, as The Australian reports, Coles is also working to lower costs via investments in automation.

This week, the retail giant unveiled its first automated distribution centre in Queensland. The centre will service 219 Coles supermarkets in Queensland and New South Wales.

Commenting on the investments in automation, outgoing Coles CEO Steven Cain said:

Modernising our operations is how we improve efficiency and availability in our stores and deliver higher service levels for our customers, team members and suppliers.

Our new automated distribution centres can process twice the number of cases and hold twice the number of pallets in half the footprint compared to our current distribution centres, leading to a more productive and sustainable business model.

Now no stock is likely to be wholly immune in the face of any lengthy recession down under.

But Coles shares have plenty of defensive qualities to help support their valuation through any upcoming economic downturns.

The post How Coles shares could help ‘recession proof’ your portfolio appeared first on The Motley Fool Australia.

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More reading

• 2 strong and defensive ASX 200 shares to buy: analysts
• 5 dividend shares I think are among the safest on the ASX
• 3 things ASX investors should watch this week
• Building wealth through dividend investing: 5 ASX shares to boost your income
• Could Coles shares be a market-beating buy for passive income right now?

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 positions in and has recommended Coles 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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The Bank of Queensland Ltd (ASX: BOQ) share price tumbled to its lowest point in recent memory on Thursday. At its lowest point of the session, stock in the S&P/ASX 200 Index (ASX: XJO) bank was swapping hands for just $5.78.

Not only did that mark a new 52-week low, it’s the lowest the stock has been since October 2020.

The Bank of Queensland share price has bounced slightly since posting its multi-year low. Right now, it’s trading at $5.79 – 2.53% lower than its previous close.  

For comparison, the ASX 200 is down 0.39% right now.

Let’s take a look at what might have been weighing on the Bank of Queensland share price lately.

What’s going wrong for the Bank of Queensland share price?

The Bank of Queensland share price has had a bad run as of late. Here’s how it’s been performing:

Time passed	BOQ share price movement
One week	-7%
One month	-9%
Year to date	-14%
One year	-26%
Five years	-40%

That’s a worrying breakdown for long-term investors. Though, much of it can be put down to recent happenings.

For instance, today’s tumble might have a bit to do with recent volatility facing New York-listed peer First Republic Bank (NYSE: FRC). Stock in the US$1 billion bank plummeted 49% on Tuesday before posting another 30% fall overnight.

Its suffering followed news the bank experienced US$105 billion of deposit outflows in the first quarter amid March’s ‘banking crisis’, which was spurred by liquidity issues.

The crisis itself also seemingly frightened Aussie investors, with the S&P/ASX 200 Financials Index (ASX: XFJ) falling 5% last month, likely dragging the Bank of Queensland share price down with it.

There is another major happening that appears to be behind the bank stock’s recent slog, however.

Bank of Queensland’s earnings appear to disappoint

Bank of Queensland dropped its first-half earnings last week, detailing a 98% tumble in statutory net profit after tax (NPAT), driven by a $60 million provision and a $200 million impairment.

Its cash earnings also slipped 4% to $256 million and its interim dividend was slashed 9% to 20 cents per share. Finally, the bank’s operating expenses lifted 7%.

The stock initially rose on its earnings release before plunging 5% in the following session.

Looking further back, the bank’s share price dumped 5.6% when it ousted its CEO in November and soared 11% when it released its financial year 2022 results in October.

Looking forward

Goldman Sachs is wary of Bank of Queensland shares considering the current economic landscape.

It says the bank has higher exposure to rate-sensitive housing than some of its ASX 200 peers, leaving it at greater risk of negative net interest margin (NIM) trends. The broker also noted inflation will likely lift the bank’s expenses, while costs associated with its digital transformation and legacy technology could weigh heavier than expected.

It remains neutral on Bank of Queensland shares, slapping them with a $6.45 price target – a potential 11% upside.  

The post Why did the Bank of Queensland share price just hit a new 52-week low? appeared first on The Motley Fool Australia.

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More reading

• Bought $2,000 of Bank of Queensland shares five years ago? If so, here’s how much dividend income you’ve earned
• Lowest ASX bank yield: Are CBA shares still worth it?
• Are Bank of Queensland shares a buy following the latest results?
• Why Bank of Queensland, Lithium Power, Piedmont Lithium, and Rio Tinto are falling
• Why Bank of Queensland, Link, Silk Laser, and Zip shares are pushing higher

Motley Fool contributor Brooke Cooper 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 Goldman Sachs Group. 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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It’s been a bit of a sad Thursday for the S&P/ASX 200 Index (ASX: XJO) so far this trading session.  After what was a shaky day yesterday, investor sentiment seems to have taken a turn for the worse today thus far.  

At the time of writing, the ASX 200 is down by a weighty 0.47%, dragging the Index down to just over 7,280 points.

But rather than dwelling on those sobering numbers, let’s instead check out the stocks that are at the peak of the ASX 200’s share trading volume charts at the moment, according to investing.com. 

The 3 most traded ASX 200 shares by volume this Thursday

Telstra Group Ltd (ASX: TLS)

First up this Thursday is the telecommunications blue chip Telstra. So far today, a chunky 13.57 million Telstra shares have been rung up for trading. We did get a little piece of news out of Telstra this morning, with the telco announcing a new bond placement, worth 500 million Euros.

But this volume probably has more to do with Telstra’s share price performance today. This Thursday has seen the telco gain a healthy 0.35%, as well as hit a new 52-week high of $4.37 a share. With this news, it’s perhaps no surprise to see so many Telstra shares flying around.

South32 Ltd (ASX: S32)

Next up we have ASX resources share South32. This ASX 200 miner has had a decent 13.74 million of its shares dug up and sold at this point of the day. We haven’t had any news out of South32, save for a routine share buyback notice. The ongoing buybacks are probably boosting trading volumes alone. But South32 has also had a bit of a bouncy day.

The miner started off strong this morning, rising as high as $4.22 a share soon after market open. But investors seem to have gotten a case of cold feet, with the company now down a meaty 1.1% at $4.12 a share. It’s this indecisive share price performance that has probably resulted in the high number of shares trading.

Sayona Mining Ltd (ASX: SYA)

Finally this Thursday, let’s check out ASX 200 lithium stock Sayona Mining. So far, a scintillating 14.35 million Sayona shares have swapped shop as it now stands this session. We haven’t had any news out of Sayona either.

But the company has shed a nasty 4% of its value today regardless, putting the company down to 19.2 cents a share at present. It’s this sizeable sell off that seems to explain Sayona’s spot on this list right now.

The post Here are the 3 most heavily traded ASX 200 shares on Thursday appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX 200 healthcare stock just made a ‘powerful’ AI acquisition
• ‘Well placed for strong growth’: 3 ASX 200 shares that hit the spot right now
• Buy Telstra and this ASX 200 dividend share for passive income: brokers
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Wednesday

Motley Fool contributor Sebastian Bowen has positions in Telstra 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 positions in and has recommended Telstra 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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Are you searching for ASX dividend shares to buy? If you are, then the two named below could be worth checking out.

Both have been named as buys by analysts and tipped to provide attractive yields. Here’s what you need to know about them:

Charter Hall Long WALE REIT (ASX: CLW)

The first ASX dividend share that has been named as a buy is Charter Hall Long Wale REIT.

It is a property company focused on high quality real estate assets that are leased to corporate and government tenants on long term leases. And when I say long, I mean it!

For example, the team at Citi is positive on Charter Hall Long Wale REIT due to its “low risk income stream with c. 12 year WALE and 99.9% occupancy.”

The broker expects this to underpin dividends per share of 28 cents in FY 2023 and 29 cents in FY 2024. Based on the current Charter Hall Long Wale REIT share price of $4.30, this will mean yields of 6.5% and 6.7%, respectively.

Citi currently has a buy rating and $5.00 price target on its shares.

Dicker Data Ltd (ASX: DDR)

Another ASX dividend share to look at is Dicker Data. It is one of the largest technology hardware, software, and cloud distributors in the ANZ region.

While trading conditions have been a bit mixed for the company over the last 12 months, there are signs that headwinds are easing. This bodes well for the company’s growth in the coming years, which will be supported by the digital transformation megatrend, recent acquisitions, and the expansion of its warehouse.

Morgan Stanley is positive on the company’s outlook. It recently retained its outperform rating and $10.00 price target on its shares.

As for dividends, the broker is forecasting fully franked dividends per share of 43.8 cents in FY 2023 and 48.8 cents in FY 2024. Based on the latest Dicker Data share price of $8.10, this will mean yields of 5.4% and 6%, respectively.

The post Passive income alert! Experts say buy these ASX dividend shares with big and growing yields appeared first on The Motley Fool Australia.

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More reading

• Buy Woolworths and this ASX share for your retirement portfolio: experts
• Want passive income? Forget term deposits and buy these high yield ASX dividend shares: brokers
• Are these ASX All Ords shares ready to buy at fundamentally fire sale prices?
• Get a passive income boost from these ASX dividend shares: analysts
• Need passive income? Turn $5,000 into $25 every month with these ASX shares

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Dicker Data. The Motley Fool Australia has positions in and has recommended Dicker Data. 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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Investors looking for ASX growth shares to buy might want to look at the three listed below.

These shares have been named as buys and tipped to climb meaningfully from current levels by analysts at Goldman Sachs. Here’s what you need to know:

Life360 Inc (ASX: 360)

Goldman Sachs is a fan of this location technology company. The broker believes Life360 is on the verge of becoming very profitable, which it feels the market is overlooking. As a result, it sees a lot of value in its shares at the current level. It highlights that “the company is well capitalised, will be cash flow positive from 2Q23, and stands to generate significant earnings growth in coming years; all of which look underappreciated by the market as implied by the current share price.”

Goldman has a buy rating and $7.90 price target on its shares.

Readytech Holdings Ltd (ASX: RDY)

Another ASX growth share that Goldman Sachs is bullish on is Readytech. It is a leading provider of mission-critical software-as-a-service (SaaS) solutions for the education, employment services, workforce management, government and justice sectors. Goldman highlights its attractive valuation and exposure to government software. It notes that the latter “has been a pocket of strength and resilience” and expects it to help “deliver mid-teens organic growth at an expanding profit margin through the cycle.”

Goldman has a buy rating and $4.40 price target on its shares.

REA Group Limited (ASX: REA)

A final ASX growth share to look at is REA Group. It is the leading player in online real estate listings in the Australian market with its realestate.com.au website. This is the dominant force in Australia, with the company reporting that 12.1 million people visited its website each month on average during the first half of FY 2023. This is 55% of Australia’s adult population. Furthermore, its average monthly visits of 117.6 million was 3.3 times greater than its nearest competitor.

Goldman Sachs has a buy rating and $164.00 price target on its shares.

The post Buy these ASX growth shares right now: Goldman Sachs appeared first on The Motley Fool Australia.

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More reading

• Buy these cheap ASX tech shares offering huge potential returns: Goldman Sachs
• Top brokers name 3 ASX shares to buy today
• If house prices have bottomed, should I buy property-related ASX shares?
• This ASX 200 share can hit a new 52-week high: Goldman Sachs
• Analysts say buy these ASX 200 tech shares before it’s too late

Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360 and ReadyTech. The Motley Fool Australia has recommended REA Group and ReadyTech. 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 All Ordinaries Index (ASX: XAO) is down 0.4% while these three companies are shooting the lights out. Each one is enjoying more than a 10% boost to their share price today.

Let’s find out why this trio of All Ords stocks is screaming higher today.

Blackmores Ltd (ASX: BKL)

The Blackmores share price is currently $93.53, up 21.8%. Earlier in the session, the All Ords stock hit $94, 22.4% higher than yesterday’s closing price.

The health supplements manufacturer is flying high today on news of a $1.9 billion takeover bid.

As my Fool colleague Bernd reports, Blackmores has entered into a scheme implementation deed with Kirin Holdings Company.

Kirin wants to acquire 100% of Blackmores shares for $95 per share, less a fully franked special dividend of $3.34 that the board has announced it will pay if the takeover proceeds.

The Blackmores board has unanimously recommended the scheme, subject to standard conditions.

CEO Alastair Symington said:

Today is an important day in the history of Blackmores … Importantly it also confirms the significant opportunity that lies ahead for our employees and other key stakeholders of Blackmores as both companies come together to combine their focus on growing Kirin’s health science business across the world.

Symbio Holdings Ltd (ASX: SYM)

The Symbio share price is currently $1.90, up 13.4%. Earlier in the session, the All Ords stock hit $1.95, 16% higher than yesterday’s close.

The ASX tech share is on the rise after the voice communications software provider lodged a Q3 FY23 trading update with the ASX and confirmed its full-year FY23 guidance.

The company expects FY23 earnings before interest, tax, depreciation and amortisation (EBITDA) in the range of $26 million to $28 million.

Symbio said stabilised market conditions are driving organic growth and cost-cutting initiatives are expected to create a lower cost run-rate in FY24.

Symbio’s expansion into Singapore, Malaysia and Taiwan has led to a 170% bump in the company’s total addressable market (TAM). The company now estimates its TAM to be 100 million people by 2024.

Co-founder and CEO Rene Sugo said:

We continue to see demand improving from our customers both domestically and globally. The
business has also been focussed on execution of key projects around automation, system
optimisation and improving customer experience through self-service portals and APIs.

Kogan.com Ltd (ASX: KGN) 

The Kogan share price is currently $4.30, up 11.4%. Earlier in the session, the All Ords stock reached $4.32, 11.9% higher than yesterday’s closing price.

The ASX retail share appears to be riding high on the back of yesterday’s Q3 FY23 business update. Kogan shares closed the session yesterday up 7.2%.

As my Fool colleague Monica reports, investors appear to be pleased with the Q3 numbers and supportive of plans for a buyback of up to 10% of stock, commencing in May.

The company reported three consecutive months of positive EBITDA and ended the quarter with $49.1 million in net cash.

CEO and founder Rusian Kogan said:

The journey to get here has been one of the toughest in our 17 year history, but also one of our most rewarding. It goes without saying – we are a far stronger company today than ever.

The post 3 All Ords stocks rocketing over 10% on Thursday appeared first on The Motley Fool Australia.

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More reading

• Why Allkem, Blackmores, Helloworld, and St Barbara shares are charging higher
• Blackmores share price rockets 22% on $1.9 billion takeover bid
• 2 ASX 300 shares going gangbusters on Wednesday
• Why Core Lithium, Kogan, Northern Star, and Pointsbet shares are storming higher
• Kogan share price jumps 10% amid plans for share buyback cash splash

Motley Fool contributor Bronwyn Allen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Kogan.com and Symbio. The Motley Fool Australia has positions in and has recommended Kogan.com and Symbio. The Motley Fool Australia has recommended Blackmores. 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 Syrah Resources Ltd (ASX: SYR) share price is having a tough session on Thursday.

In afternoon trade, the graphite producer’s shares are down 11% to $1.26.

Why is the Syrah Resources share price sinking?

The Syrah Resources share price is sinking on Thursday after the company released its quarterly update and announced a major funding package.

In respect to the former, Syrah reported flat quarter on quarter natural graphite sales due to a volatile sales order performance from Chinese anode customers.

Also disappointing investors was the operating performance of its Balama operation. Its production and C1 costs were impacted by maximum inventory positions and minor operational issues.

This ultimately led to Syrah reporting 30kt natural graphite sold and shipped, 41kt produced at Balama, and C1 cash costs of US$668 per tonne. The latter was above its weighted average sales price of US$636 per tonne.

In light of the above, the company has decided to moderate its production until trading conditions improve.

This appears to have overshadowed the release of a definitive feasibility study (DFS) confirming that the expansion of Vidalia to a 45ktpa active anode material (AAM) production capacity is technically viable, financially robust, and expected to generate significant value for Syrah.

Convertible notes

In other news, this morning Syrah announced a $150 million capital raising through the issue of new convertible notes to AustralianSuper.

Management explained its decision to raise funds:

The Chinese anode market conditions are expected to be volatile over the near-term and forward sales orders for Balama products have weakened in this market from the higher levels in 2022. This, and the availability of significant finished product inventory, has led Syrah to announce today that it will moderate production from Balama until demand conditions and sales orders at economic prices warrant higher capacity utilisation.

The New Convertible Notes will provide the Company with additional liquidity to manage near-term demand volatility for Balama natural graphite and optimise its sales and operations strategy to achieve improved commercial outcomes for Syrah, and support the continuous progression of its downstream strategy.

The Syrah Resources share price is now down almost 50% over the last six months.

The post Why is ASX 200 mining stock Syrah Resources tumbling 11% today? appeared first on The Motley Fool Australia.

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• Why Adbri, Champion Iron, Core Lithium, and Syrah shares are dropping today
• Here are the top 10 ASX 200 shares today
• It ain’t all about lithium: 2 other ASX shares exposed to the EV trend
• Here are the top 10 ASX 200 shares today
• Why Block, Novonix, Piedmont Lithium, and Syrah shares are racing higher

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

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. The benchmark index is currently down 0.45% to 7,282.6 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Adbri Ltd (ASX: ABC)

The Adbri share price is down 6.5% to $1.53. This follows the release of an update on the Kwinana upgrade. Adbri revealed that the cost of its construction could now be more than double previous estimates. Management estimates that its cost will be $385 million to $420 million, which is up from the original estimate of approximately $200 million.

Champion Iron Ltd (ASX: CIA)

The Champion Iron share price is down 2.5% to $6.34. Investors have been selling this iron ore miner’s shares following the release of its quarterly update. That’s despite Champion Iron reporting record quarterly production of 3.1M wmt and annual production of 11.2M wmt. The latter represents a 41% increase year-on-year.

Core Lithium Ltd (ASX: CXO)

The Core Lithium share price is down 4.5% to 95 cents. This morning, analysts at Goldman Sachs responded to the lithium miner’s quarterly update by reiterating their sell rating on the company’s shares with an 80 cents price target. The broker continues to believe that its shares are overvalued compared to peers.

Syrah Resources Ltd (ASX: SYR)

The Syrah Resources share price is down 10% to $1.27. This morning, Syrah released its quarterly update and also announced a $150 million capital raising. The latter is through the issue of new convertible notes to AustralianSuper.

The post Why Adbri, Champion Iron, Core Lithium, and Syrah shares are dropping today appeared first on The Motley Fool Australia.

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More reading

• Buy or sell? What this broker is saying about Core Lithium shares
• Here are the top 10 ASX 200 shares today
• Why Core Lithium, Kogan, Northern Star, and Pointsbet shares are storming higher
• Core Lithium share price pops on Q3 report
• Why are ASX lithium shares powering higher today as the resource sector bleeds?

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

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It’s been a fairly lousy day for the All Ordinaries Index (ASX: XA) and most ASX shares so far this Thursday. At the time of writing, the All Ords has tanked by a meaningful 0.38%, dragging the Index to below 7,480 points. But it’s been even worse for the BrainChip Holdings Ltd (ASX: BRN) share price.

This All Ords artificial intelligence (AI) share has had a shocker today. It’s more of a symbolic shocker rather than a massive share price slump. But investors probably don’t care to make the distinction right now anyway.

Brainchip shares opened at 38 cents each this morning. But soon after, Brainchip dropped down to 37.5 cents a share. That’s a new 52-week low for this company. It’s also the lowest share price Brainchip shares have traded at since December 2020:

Time for some uncomfortable statistics. So in 2023 alone, the Brainchip share price has shed a nasty 48.7% of its value. That rises to just over 58% over the past 12 months. And since the all-time high of around $1.80 a share that we saw in early 2021, investors have watched Brainchip lose a whopping near-80% of its market capitalisation.   

Ouch.

Considering this cacophony of bad news, what could be next for the Brainchip share price?

Where to next for the Brainchip share price?

Well, Brainchip seems to have the odds stacked against it. As my Fool colleague reported earlier this month, the company has featured regularly on the list of ASX’s most short-sold shares. This means that there are significant sums of money out there that are being wagered on the Brainchip share price falling from its current levels.

Clearly, investors are not too excited about this company’s prospects. And it’s not hard to see where they might be coming from.

Back in February, Brainchip reported that its second-half revenues for 2022 came in at just US$250,000, down from US$4.8 million for the first half of the year. As my Fool colleague James pointed out, that’s less revenue than many cafes pull in.

But even on today’s pricing, this company still commands a market capitalisation of $680.3 million. So this could be what the short sellers are eyeing off in betting that the Brainchip share price has further to fall.

Could they be right?

Well, only time will tell. But Brainchip is due to report its quarterly finances at the end of this month. Depending on what the company has to say, this could well be the catalyst for a recovery or a further fall.

If revenues bounce back strongly, then the Brainchip share price could bounce off of these new multi-year lows that we are currently seeing – especially if the bounce is powerful enough to induce a short squeeze. But things could get even uglier if investors aren’t impressed with what the company has to say. 

Let’s fetch the popcorn while we wait and see what happens.

 

The post BrainChip share price sinks to multi-year low. What now? appeared first on The Motley Fool Australia.

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More reading

• How ASX short sellers have been cashing in on BrainChip shares in 2023
• Why Brainchip, Domain, Star, and Tietto shares are dropping today
• Capital deities and destroyers: The best and worst at putting money to work among ASX 200 shares
• These are the 10 most shorted ASX shares this week
• Why did the Brainchip share price crash 36% in the first quarter of 2023?

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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