Category: Stock Market

The Woodside Energy Group Ltd (ASX: WDS) share price is outperforming on Monday amid rising oil prices.

The black liquid’s value is gaining on news a major United States pipeline will remain closed following an incident, Russia’s response to a price cap on the nation’s exports, and relaxing COVID-19 restrictions in China.

Right now, the Woodside share price is up 2.31% at $34.97.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) has slumped 0.41%, and the S&P/ASX 200 Energy Index (ASX: XEJ) is up 1.17%.

Let’s take a closer look at what might be going on with the ASX 200 oil giant on Monday.

What’s driving the Woodside share price higher today?

The Woodside share price is out in front this afternoon, placing the company among the ASX 200’s top-performing stocks as oil spends a day in the green.

As of the time of writing, Brent crude futures are up 0.6% at US$76.56 a barrel, and WTI crude futures have lifted 0.82% to US$71.60 a barrel.

That’s likely good news for oil fans. Particularly as the energy commodity hit a 2022 low just last week.

It comes after the major North American Keystone Pipeline System was shut down last week after oil was confirmed to have leaked into a creek.

TC Energy – the company operating the pipeline – provided an update overnight. It said the product was contained, but it hadn’t confirmed a timeline for restarting the service.

Meanwhile, it’s been just days since Russian President Vladimir Putin said Russia may cut oil production in response to a US$60 per barrel price cap on the nation’s oil agreed upon by Western powers, Reuters reports.

Finally, the energy commodity’s price might be rising amid expectations that China’s recent lifting of COVID-19 restrictions, as SBS covers, could bolster demand for the black liquid.   

As an oil producer, Woodside’s bottom line mainly depends on the energy commodity’s value. The higher the oil prices, the more profit the company can rake in.

Thus, its climbing oil prices are behind the Woodside share price’s Monday gains.

The post Why is the Woodside share price smashing the ASX 200 on Monday? appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Monday
• Is Xero a ‘safe’ ASX share?
• One ASX 200 share I’m buying for passive income before 2022 is over
• A bull market is coming: 3 ways Warren Buffett is preparing
• 3 ‘strong’ ASX 200 dividend shares for 2023 revealed: expert

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 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 Origin Energy Ltd (ASX: ORG) share price is taking a beating today, down 8% in afternoon trading.

Shares in the S&P/ASX 200 Index (ASX: XJO) energy company closed on Friday trading at $7.80 and are currently trading for $7.18.

That sees the Origin Energy share price sharply underperforming the ASX 200, which is down 0.6% at this same time.

The utilities sector, however, is broadly facing some stiffer headwinds on Monday. The AGL Energy Limited (ASX: AGL) share price is down 2.3% and the S&P/ASX 200 Utilities Index [ASX: XUJ] down 4%.

Here’s what ASX 200 investors are considering.

Energy price caps could become law on Thursday

On Friday prime minister Anthony Albanese announced the government’s planned rollout of price caps for domestic coal and gas sales. An announcement likely pressuring the Origin Energy share price today.

Parliament will meet this Thursday to vote on the proposal. If passed, it will see gas prices in the domestic market capped at $12 per gigajoule. Thermal coal, which is used to generate electricity, will be capped at $125 per tonne within Australia.

Commenting on the government’s rationale for the price caps, Albanese said (quoted by ABC News):

Extraordinary times call for extraordinary measures. And we know with the Russian invasion of Ukraine, what we’ve seen is a massive increase in global energy prices. And because of Australia not investing in enough of our own energy assets, what we have is a vulnerability to those international price movements.

Energy minister Chris Bowen added, “It’s Australian gas, under Australian soil and Australians should not be paying elevated war prices for that gas.”

The price caps and coal and gas won’t be levelled on exports, or on new gas fields. Bowen said if energy companies “want to make money from exports, that’s okay”.

But with the Origin Energy share price and other energy providers already facing some headwinds, the government’s plan doesn’t enjoy unanimous support.

“What the government needs to do is drive more supply of gas into the marketplace,” opposition leader Peter Dutton said.

Australian Petroleum Production & Exploration Association CEO, Samantha McCulloch, also sounded off against the price caps.

According to McCulloch (courtesy of ABC News):

A gas price cap will force prices higher for households and businesses because it will kill investment confidence and reduce future supply…

This heavy-handed, radical intervention has been conducted with no prior consultation with industry to consider specific measures and warn of potential risks to Australia.

Origin Energy share price snapshot

Despite today’s fall, the Origin Energy share price (as seen in the chart below) remains up 42% over the past 12 months.

The post Why is the Origin Energy share price dumping 8% on Monday? appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Monday
• Why Bigtincan, Nanosonics, Origin, and Tyro shares are sinking today
• 3 ‘boring’ ASX shares with returns over 25% in 2022
• Why Air New Zealand, Chalice, Evolution, and Origin shares are rising today
• ASX index beaters: 5 shares that have supercharged portfolios in 2022

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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Some may have launched into 2022 thinking it might be the year the travel sector rebounds. With COVID-19 restrictions gradually easing in late 2021 and pent-up Aussies desperate for a holiday, many investors might have cast their eyes on the Flight Centre Travel Group Ltd (ASX: FLT) share price.

Alas, such hopes for 2022 did not come to fruition. The Flight Centre share price has fallen more than 20% so far this year to trade at $14.78 today.

For comparison, the S&P/ASX 200 Index (ASX: XJO) is down 5% year to date. Beyond that, stock in travel peers Webjet Limited (ASX: WEB) and Qantas Airways Limited (ASX: QAN) have jumped 14% and 19%, respectively, this year.

So, with hopes of a 2022 recovery dwindling, could the Flight Centre share price be a 2023 turnaround story? Let’s take a look at what experts think.

Could 2023 be a better year for the Flight Centre share price?

Unfortunately, a major turnaround for the Flight Centre share price in the new year seems unlikely, according to many brokers and experts that tip the ASX 200 travel stock a hold.

One major factor dictating their concern is the company’s revenue margin, which remained steady over the first four months of this financial year at 9.8% despite its total transaction value (TTV) leaping 246%.

The company’s revenue margin was weighed down by reduced front-end commission payments from certain airlines. While it’s working to offset such changes, it predicts they will drag on its Australian leisure margins by around 1%.

Qantas was among the first to slash commissions, dropping those for international flights from 5% to 1% earlier this year.

Top broker Goldman Sachs responded to the company’s latest earnings update, adding:

While there are undoubtably temporary factors impacting [margins recovery] … we remain concerned regarding longer term structural move towards online, which are weaker margin channels.

The broker has a neutral rating and a $16.10 price target on Flight Centres shares.

Barrenjoey and JPMorgan are also among those with hold or equivalent ratings on the stock, the Australian Financial Review reports, while Jarden has slapped it with an overweight rating. The trio expect it to rise to $17.90, $16.50, and $21.20, respectively.

The latter broker has said the business could provide greater returns in the future, being larger once it recovered from the pandemic and offering an attractive balance of risk versus reward.

However, short sellers might disagree. Flight Centre is the most shorted share on the ASX, as it has been for most of this year. More than 14% of its stock was in the hands of short sellers at last count.

The post Will the Flight Centre share price have a better year in 2023? appeared first on The Motley Fool Australia.

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More reading

• Why this one top fund manager is optimistic about 2023, and one little-known IPO that has hit it out of the park
• Here are the 10 most shorted ASX shares
• Here are the 10 most shorted ASX shares
• Why did the Flight Centre share price take a flogging in November?
• Here are the 10 most shorted ASX shares

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. 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 JPMorgan Chase. The Motley Fool Australia has recommended Flight Centre Travel 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 S&P/ASX 200 Index (ASX: XJO) seems to be proving how it doesn’t really like Mondays. Last week was a rather disappointing one for ASX 200 shares, and today, it doesn’t look like that sentiment is going away.

At the time of writing, the ASX 200 has lost a depressing 0.5%, which leaves the index at just under 7,180 points.

But rather than dwelling on all of that, let’s instead have a look at the ASX 200 shares that are currently topping the share market’s trading volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume this Monday

Origin Energy Ltd (ASX: ORG)

First up today is ASX 200 energy utility share Origin. This Monday has seen a sizeable 13.75 million Origin shares trade hands as it currently stands. This is almost certainly a result of the torrid share price drop Origin has endured so far today.

At present, the company’s shares are down by a nasty 7.56% to $7.21 each. This looks like a consequence of the news that the federal government is planning on imposing a price cap on coal and gas.

Pilbara Minerals Ltd (ASX: PLS)

Next up we have the ASX 200 lithium giant Pilbara Minerals. So far today, a hefty 15.98 million Pilbara shares have found a new owner. There’s been no new news out of Pilbara this week so far. So this volume could be in response to the share price moves that Pilbara is experiencing.

This company is defying the broader market today and has surged 2.35% higher to $4.58 a share. That’s despite Pilbara opening in the red this morning.

Core Lithium Ltd (ASX: CXO)

Third and finally this Monday, we have another ASX 200 lithium share in Core Lithium. This session has had a notable 19.91 million Core shares find their way across the ASX boards. There hasn’t been any fresh news out of Core either. But that hasn’t stopped this company from having a fairly wild day of trading.

Core shares are presently up by 0.6% to $1.18 each. But the company has been bouncing around dramatically all day, going as low as $1.14 and as high as $1.19 a share. All this volatility has probably prompted the high volumes on display here.

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

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More reading

• What’s weighing on the Core Lithium share price today?
• Why Bigtincan, Nanosonics, Origin, and Tyro shares are sinking today
• Is Xero a ‘safe’ ASX share?
• One ASX 200 share I’m buying for passive income before 2022 is over
• A bull market is coming: 3 ways Warren Buffett is preparing

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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It hasn’t been a great start to the week for the S&P/ASX 200 Index (ASX: XJO) so far this Monday. At the time of writing, the ASX 200 has shed another 0.6%, leaving the index at around 7,170 points. But it’s been even worse for the Woolworths Group Ltd (ASX: WOW) share price.

Woolworths shares are really having a clanger today. The ASX 200 supermarket giant has lost a painful 1.1% so far this session, leaving it at $34.08 a share:

So why is the Woolworths share price underperforming so dramatically this Monday?

Well, it’s not really clear. There hasn’t been any ASX news or announcements out of the company directly today that would conveniently explain this loss.

However, we can note that Woolies isn’t the only ASX 200 consumer staples share feeling the pain today. The company’s arch-rival Coles Group Ltd (ASX: COL) is also feeling the heat. The Coles share price is presently down by just under 1%.

Metcash Limited (ASX: MTS), the owner of the IGA network, has lost 0.7%. So not a great day for consumer staples shares in general, it would seem.

However, there are some rumours flying around today that do involve Woolworths. These could well be influencing the sell-off we are seeing with the company’s shares.

Why is the Woolworths share price waning today?

As my Fool colleague James flagged this morning, there is speculation that Woolies could be about to make a major new acquisition. The company is reportedly “close to signing an agreement” to acquire pet supplies company Petstock.

This would be a massive shakeup for Woolworths, and will likely come with a big price tag as well, considering Petstock’s established presence in the pet supply market.

So this could well be influencing Woolworths shares today as well. If that is true, it seems investors aren’t too enthused. But we shall have to wait and see if anything concrete comes from these rumours.

One ASX expert licking their lips over the falling Woolworths share price today could well be Goldman Sachs.

As we covered this afternoon, Goldman has recently come out with a conviction buy rating on Woolworths shares, complete with a 12-month share price target of $41.70. If realised, that would result in an upside of more than 22% from the current share price.

Goldman reckons Woolies has a “clear growth pathway” over the next few years and is looking attractive at the current share price, particularly after the falls we have seen recently.

So no doubt this ASX broker is greeting the falls we are seeing today with excitement.

At the current Woolworths share price, this ASX 200 consumer staples giant has a price-to-earnings (P/E) ratio of 27.4, with a trailing dividend yield of 2.7%.

The post Why is the Woolworths share price lagging the ASX 200 on Monday? appeared first on The Motley Fool Australia.

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More reading

• Goldman Sachs names 2 ASX 200 blue chip shares to buy
• 5 things to watch on the ASX 200 on Monday
• What’s impacting the Woolworths share price on Thursday?
• 10 ASX shares to buy in 2023
• 5 popular ASX 200 stocks I’m avoiding, plus one that still looks dirt cheap

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 positions in and has recommended Coles Group. 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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S&P/ASX 200 Index (ASX: XJO) shares haven’t had the best of years so far.

On the back of fast-rising inflation and the resulting steep interest rate hikes, the ASX 200 is currently down 4% in 2022.

That’s after the benchmark index posted a very impressive 13% gain in 2021.

So, will 2023 see the ASX return to positive momentum, or can investors expect another tough slog ahead?

While there are many, many pieces to that puzzle, part of the answer might be found in the current level of rather bearish investor sentiment.

Why bearish investor sentiment may be good news for the ASX 200

Investor sentiment, as you’d expect, tends to ramp up (like a bull) when markets are running higher and turn bearish when markets are losing ground.

While the ASX 200 is down 4% this year, markets in the United States have fared far worse.

As of last night’s close, the S&P 500 Index (SP: .INX) is down 18% year to date. There is a range of factors why the S&P 500 has fallen more than four times as hard as the ASX 200. Part of that sits with the relative performance of the two indexes the prior year.

US equities broadly exploded in 2021, which saw the S&P 500 finish the year up 27%, more than double the gains posted by the ASX 200. Meaning it had a good bit more ground to yield this year.

With that said, you can see why US investor sentiment remains in the doldrums.

According to eToro’s proprietary composite sentiment indicator, 42% of US retail investors are still bearish, despite the market’s strong performance in November.

The eToro sentiment indicator is made up of:

• Equity mutual fund and ETF flows
• The long-running American Association of Individual Investors sentiment survey
• VIX index of expected S&P 500 volatility
• S&P 500 put/call ratio, measuring the proportion of put buying (option to sell in future) versus calls (to buy in future)

Of these, only the VIX indicates less bearish investor sentiment. But that appears to be the exception.

“The rebounded VIX captures attention, but it’s the outlier, with other sentiment indicators remaining very low,” said Ben Laidler, global markets strategist at eToro.

Laidler continued:

Bad investor sentiment has been a contrarian help to the recent rally and it remains a key support. If everyone is bearish, there are few left to sell, and many could buy. It means a little ‘less-bad’ news goes a long way.

Sentiment is off its lows but still depressed and it’s only been this low a handful of times.

Now, we’re talking about US stock markets here.

But looking back at the charts, time and again, when US stock markets rebound, the ASX 200 historically enjoys a healthy boost as well.

Meaning 2023 may just surprise to the upside.

The post Why ‘depressed investor sentiment’ could be good news for the ASX 200 in 2023 appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX All Ords company founder just bought up 127,000 new shares in their company
• Goldman Sachs names 2 ASX 200 blue chip shares to buy
• What’s weighing on the Core Lithium share price today?
• Founder selling $60m of shares in this ASX All Ords company not a concern … yet: fundie
• Why Arafura, Megaport, Nitro, and Sayona Mining shares are storming higher today

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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It’s always ASX news when a founder of an All Ordinaries Index (ASX: XAO) share buys up stock of their own company. For one, All Ords investors love to know these kinds of things. When a founder buys shares in the company they started and run, it is an implicit vote of confidence in the company’s future.

Investors appreciate when the people running the companies they own have skin in the game. Increasing said skin improves the alignment of shareholders with management. When investors feel that their own financial fortunes rise and fall alongside the people in charge, it’s simply good for morale.

So let’s talk about Humm Group Ltd (ASX: HUM). Because we just got some news from Humm along these lines.

Humm is of course one of the All Ords’ remaining buy now, pay later (BNPL) shares. It’s also one of the oldest BNPL shares on the share market, even predating the old BNPL pioneer Afterpay, which is now part of Block Inc (ASX: SQ2).

Like most All Ords BNPL shares that remain on the ASX, 2022 has been a very rough year for Humm. Since the start of the year, Humm shares have gone from 92 cents each to the 56 cents we see today. That’s a drop worth a nasty 39.7%.

Since Humm’s last all-time high, which saw the company approach $2.50 a share, back in 2019, Humm shares are now down around 78%, as you can see below:

So shareholders could really use some good news right about now. Well, they might just have it.

Humm directors are buying up shares hand over fist

According to an ASX filing this morning, Andrew Abercrombie has just picked up 127,685 new shares in Humm in an on-market purchase. This purchase, which occurred on 8 December, cost Abercrombie close to $70,000 and takes his total holdings in Humm Group to just over 118 million shares.

Abercrombie is a founding director of Humm, and today serves as the company’s chair. He has been involved with Humm since its founding in 1991.

This isn’t the only purchase he has made of Humm shares in recent times either. Abercrombie also picked up an additional 101,352 shares on 7 December – a parcel worth just over $55,000. Another director, Robert Hines, picked up 100,000 shares of his own on 21 November last month.

So Humm’s directors seem to think that their own company’s shares are too cheap to ignore at the current price. No doubt Humm investors will be delighted with this news. Perhaps this is why the Humm share price has risen a healthy 1.83% so far this Monday to 56 cents a share.

 

The post Guess which ASX All Ords company founder just bought up 127,000 new shares in their company appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX All Ords share is leaping 22% on ‘significant progress towards profitability’

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 Block. The Motley Fool Australia has positions in and has recommended Block. The Motley Fool Australia has recommended Humm 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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If you are looking to strengthen your portfolio with some blue chip ASX 200 shares, you may want to look at the two listed below that have been named as buys by Goldman Sachs.

Here’s why these blue chip shares are highly rated by its analysts right now:

REA Group Limited (ASX: REA)

The first ASX 200 blue chip share to buy according to Goldman Sachs is REA Group. It is the digital advertising company that operates Australia’s leading property website, realestate.com.au. In addition, REA operates a number of complementary businesses in the Australian market and internationally.

While the housing market downturn is expected to weigh on listing volumes in the near term, Goldman Sachs remains positive on its outlook. It said:

Listings remain a headwind for REA through FY23 with 2Q weekly listings remaining soft – although 2H23 remains uncertain, we now forecast -8% total listings declines in FY23E, driving small downward revisions to REA/DHG (-2% EBITDA in FY23E), but we expect [this] will ultimately be recovered, with +13% upside to our estimated mid-cycle listings volumes.

The broker has a buy rating and $159.00 price target on its shares.

Woolworths Limited (ASX: WOW)

Another blue chip ASX 200 share that Goldman Sachs rates highly is Woolworths. It is the retail conglomerate behind businesses including Woolworths, Countdown, Everyday Rewards, and Big W.

The broker believes its shares are trading at an attractive level after recent weakness. Particularly given its positive outlook through to FY 2025.

It recently commented:

Despite a noisy and softer 1Q23, we remain confident that WOW is the superior operator within AU supermarkets with a clear growth pathway to deliver ~3% sales and ~9% NPAT FY22-25e CAGR. WOW is trading at 22.1x FY24E P/E vs our TP implied 27.8x and historical average of 23.2x, providing a value entry point to a quality player in our view. Reiterate Buy (on CL).

Goldman Sachs has a conviction buy rating and $41.70 price target on the company’s shares.

The post Goldman Sachs names 2 ASX 200 blue chip shares to buy appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Monday
• What’s impacting the Woolworths share price on Thursday?
• Top brokers name 3 ASX shares to buy today
• 10 ASX shares to buy in 2023
• 5 popular ASX 200 stocks I’m avoiding, plus one that still looks dirt cheap

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 recommended REA 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 Core Lithium Ltd (ASX: CXO) share price is slightly in the red today.

Core Lithium shares are down 0.43% and are currently trading at $1.17. For perspective, the S&P/ASX 200 (ASX: XJO) is down 0.52% today.

Let’s take a look at what is going on at Core Lithium.

What’s going on?

Lithium explorers are having a mixed day on the market today. The Lake Resources N.L. (ASX: LKE) share price is falling 2.93%. However, Pilbara Minerals Ltd (ASX: PLS) shares are up 2.35% and Sayona Mining Ltd (ASX: SYA) shares are rising 3.49%.

Morgan Stanley has cut the lithium sector to “underweight”, The Australian reported today.

Core Lithium is exploring the Finniss Lithium Project in the Northern Territory. Core Lithium shares have fallen 10% since market close on 7 December.

A broker note out of Goldman Sachs appeared to impact the Core Lithium share price late last week.

Goldman placed a “sell” rating on Core Lithium shares with a $1 price target. Analysts highlighted Core Lithium will be Australia’s “next lithium producer”. However, analysts raised concerns about production cost risks and the potential for lithium prices to decline in the future. Analysts said:

Core Lithium’s Finniss project will be Australia’s next lithium producer, with spodumene production scheduled for 1H CY23, where we factor in an average ~175ktpa production over a ~12-year M&I resource life.

However, while resource upside looks likely, the required magnitude to support the capacity expansion/life extension/future downstream that is currently priced into the stock looks significant, in our view, particularly given the upside case is unlikely to be achieved before lithium prices decline (GSe from 2H CY23).

With production/cost risks as the project moves between mining configurations, and the stock trading well above peers at 1.5x NAV (~US$2,400/t LT spodumene) on the lowest average operating FCF/t LCE, we initiate on CXO with a relative Sell rating and a 12-month PT of A$1.00/sh, implying 23% downside.

In an AGM presentation in late November, Core Lithium highlighted it is trucking direct shipping lithium ore to Darwin Port. The company said it would “commence shipping to China in coming weeks”.

Construction at Core Lithium’s DMS processing plant is on track for commissioning in the first quarter of 2023, with first concentrate scheduled for the first half of 2023.

Core Lithium share price snapshot

Core Lithium shares have soared 134% in the last year. In the year to date, Core Lithium shares have jumped 98%.

Core Lithium has a market capitalisation of about $2.15 billion based on the current share price.

The post What’s weighing on the Core Lithium share price today? appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why Bigtincan, Core Lithium, Pinnacle, and Warrego shares are dropping today
• Why are ASX 200 lithium shares taking another beating on Friday?
• Has the Core Lithium share price ‘run ahead of fundamentals’?
• Here are the 3 most heavily traded ASX 200 shares on Thursday

Motley Fool contributor Monica O’Shea 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 share price of All Ordinaries Index (ASX: XAO) online luxury retailer Cettire Ltd (ASX: CTT) has tumbled since the company announced its founder and CEO had offloaded $60 million worth of its stock.

But one fundie is unbothered, nay, encouraged by the sale … for now.

The Cettire share price is $1.51 today. That’s 10.7% lower than it was before the company’s boss Dean Mintz sold 41 million shares for $1.46 apiece under a block trade last month.

For comparison, the All Ords has gained 0.24% over the period.

Let’s take a closer look at why EGP Capital chief investment officer Tony Hansen is giving Mintz a pass on his most recent sale.

Insider selling of All Ords share not worrying, yet: fundie

While Cettire remains among the top holdings in the EGP Concentrated Value Fund as of the end of November, Hansen is unbothered by Mintz’s decision to sell a whopping 10.8% stake in the company.

The fundie commented in the fund’s November update, saying:

[I]t is not unreasonable for a founder who finds perhaps 99% or more of their net worth tied up in a single business … to wish to crystallise some of that wealth …

Investors more broadly clearly feel … that the sale indicates a lack of faith in the longer-term prospects of the business.

I am willing to give the benefit of the doubt for now, in his position I feel I would have done something similar.

Hansen pointed to Nathan Tinkler as an example of what can happen when an insider fails to comply with “personal risk management.”

Tinkler famously became a self-made billionaire in the 2010s after successful forays in coal.

He ultimately sold a hefty chunk of Whitehaven Coal Ltd (ASX: WHC) shares in 2013 in a bid to pay off debt, seeing him tumbling from rich-lister fame.

The former billionaire’s holding in Whitehaven “would still be worth in the region of $1 billion had he not been forced to sell to repay debts,” Hansen wrote, continuing:

The fact that Dean Mintz is clearly more conservative than someone like Nathan Tinkler is incredibly pleasing to me, it shows a streak of prudence I hope all our CEO’s possess.

But the fundie mightn’t be so forgiving in future

Looking forward, however, the fundie doesn’t see a reason Mintz would need to sell any more shares in the All Ords retailer.

The founder has now liquidated more than $100 million worth of shares this year – $60 million last month and $47 million in March.

Hansen noted that while “taxes have surely eaten a hole in that figure” he believes “our CEO should now have more liquid wealth than he is ever likely to need”.

Additionally, the fundie pointed out that Cettire is now delivering profitable growth. It posted adjusted earnings before interest, tax, depreciation, and amortisation (EBTIDA) of $5.5 million on a delivered margin of over 20% last quarter.  

Thus, Mintz, with a 45.9% stake in the All Ords company’s shares, could benefit from dividends. Hansen tips that even a payout ratio of 30% to 40% could “generate a significant annual income”.

The post Founder selling $60m of shares in this ASX All Ords company not a concern … yet: fundie appeared first on The Motley Fool Australia.

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More reading

• Why Best & Less, Cettire, Life360, and Paradigm shares are sinking today
• Why A2 Milk, Cettire, Coronado, and Perpetual shares are dropping
• Guess which All Ords insider is selling a whopping $60m worth of their company’s shares
• 3 ASX All Ordinaries shares having a cracker session on Thursday

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Cettire. 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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