Category: Stock Market

As a blue chip ASX 200 share, Woolworths Group Ltd (ASX: WOW) has long commanded a reputation as a healthy dividend payer. After all, Woolies consistently pays out two dividends per year, a habit it has spent more than three decades honing.

And it has been incredibly lucrative for shareholders. Back in 1994, Woolworth shares were paying out dividends worth 12 cents per share. Last year, investors enjoyed a total of $1.08 per share in dividend income. That’s a very pleasant runway.

But how does this illustrious history stand up today? Let’s check out how much dividend income an investor would have enjoyed from Woolworths shares in 2022.

How much dividend income do Woolworths shares pay today?

So let’s start out by assuming an investor bought $15,000 worth of Woolworths shares at the start of the year. Woolworths finished up 2021 at a share price of $38.01. So if an investor bought $15,000 worth of Woolies shares at that pricing, they would have received 394 shares with a little cash left over.

So Woolworths has again paid out two dividends over 2022. The first was an interim dividend that was paid out in April. This was worth 39 cents per share, fully franked– a significant drop from the 53 cents per share dividend that investors enjoyed in 2021.

Our 394 Woolworths shares would have resulted in a cash payment of $153.66 from this interim dividend.

Then, the company’s final dividend came in September. This was a fully-franked payment worth 53 cents per share, a small drop from the 55 cents per share investors enjoyed last year.

This dividend payment would have yielded a payment of $216.70.

All up, that is a total of $370.36 in dividend income from our $15,000 in 2022. That represents a yield on our cost of 2.47%, or 3.53% grossed-up with Woolies’ full franking.

On today’s Woolworths share price of $35 (at the time of writing), Woolworths has a trailing dividend yield of 2.63%, or 3.76% grossed-up.

The post If you bought $15,000 worth of Woolworths shares this year, here’s how much dividend income you’d have appeared first on The Motley Fool Australia.

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More reading

• Markets are nervous. Why waiting to buy these ASX 200 shares could prove expensive
• Add these ASX 200 shares to your retirement portfolio: experts
• Why is the Woolworths share price having such a wow of a time today?
• Are these the very best ASX 200 shares to buy for 2023?
• I’d use the Warren Buffett method to create a ‘best ASX shares to buy now’ list

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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record another decent gain. At the time of writing, the benchmark index is up 0.6% to 7,226.7 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are dropping:

Polynovo Ltd (ASX: PNV)

The PolyNovo share price is down 9% to $1.91. This has been driven by the medical device company completing a $30 million institutional placement at a discount of $1.90 per new share. The proceeds will be used to accelerate growth and fund the construction of a new co-located manufacturing, R&D, and office facility in Port Melbourne.

Smartgroup Corporation Ltd (ASX: SIQ)

The Smartgroup share price is down 4.5% to $4.67. This morning this fleet management and salary packaging company revealed that it expects to report a profit in the range of $60 million to $61 million for calendar year 2022. This appears to have fallen short of the market’s expectations.

Star Entertainment Group Ltd (ASX: SGR)

The Star share price is down 6% to $2.70. Investors have been hitting the sell button after Macquarie downgraded the casino operator’s shares to a neutral rating with a trimmed price target of $3.05. The broker made the move following the release of an update which revealed that trading has been softer than expected. Combined with remediation costs, Macquarie has made a sizeable reduction to its earnings estimates.

WiseTech Global Ltd (ASX: WTC)

The WiseTech share price is down 5% to $54.62. This follows the release of the logistics solutions company’s annual general meeting update. Investors appear disappointed that the company only reaffirmed its guidance at the event. WiseTech expects to deliver revenue growth of 20% to 23% and EBITDA growth of 21% to 30% in FY 2023.

The post Why PolyNovo, Smartgroup, Star, and WiseTech shares are appeared first on The Motley Fool Australia.

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More reading

• Why is the WiseTech share price wilting 5% on Wednesday?
• Why is the PolyNovo share price sinking 7% today?
• 5 things to watch on the ASX 200 on Wednesday
• Why is the Polynovo share price on ice today?
• 5 things to watch on the ASX 200 on Tuesday

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 POLYNOVO FPO and WiseTech Global. The Motley Fool Australia has positions in and has recommended SMARTGROUP DEF SET and WiseTech Global. 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 I’d snapped up $5,000 worth of National Australia Bank Ltd (ASX: NAB) shares on the first session of 2022, I’d be pretty happy with my buy right now. Here’s how my investment would have worked out so far.

NAB shares outperform in 2022

If I had bought $5,000 worth of NAB shares on 4 January, I likely would have bought 170 shares in the S&P/ASX 200 Index (ASX: XJO) bank for $29.40 apiece.

That would have started off as a winning buy. The NAB share price launched upwards to a 52-week high in April, topping out at $33.75.

At that point, my initial $5,000 investment would have held a value of $5,737.50 – not too shabby for just four months.

However, the high didn’t last long. The bank’s stock plummeted to a low of $25.43 in mid-June amid the Reserve Bank of Australia’s first 0.5% rate hike.

At that moment, my imagined 34 shares would have commanded just $4,323.10 on the market.

Fortunately, things have since turned around for the NAB share price. It’s trading at $31.28 at the time of writing.

That means my figurative investment would be worth $5,317.60 right now. That’s a decent 11-month return and we haven’t even considered dividends yet.

What about dividends?

NAB has declared two dividends in 2022.

The first, its interim dividend, was worth 73 cents per share and was paid in July.

The bank announced its final dividend -worth 78 cents per share ­– earlier this month. That will be paid out in December.

That means an investor who held 170 shares in NAB this year will likely receive a total of $256.70 in dividends this year.

What might the future bring for NAB shares?

While past performance doesn’t guarantee future performance, the outlook for NAB shares is bright, according to Goldman Sachs.

The broker thinks the bank can pay out $1.73 per share in dividends this fiscal year and $1.78 in the next.

It also tips the stock to lift to $35.41 – a potential 13% upside – and slapped it with a buy rating.

Thus, if I had invested $5,000 in NAB shares at the start of 2022, I’d still be holding onto my investment today.

The post If I’d bought $5,000 of NAB shares at the start of this year, guess how much I’d have now appeared first on The Motley Fool Australia.

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More reading

• Will ASX 200 shares bottom before the year is out? Here’s Macquarie’s ‘best guess’
• 4 quality, undervalued ASX 200 shares in an earnings upgrade cycle revealed: fund manager
• Are ASX 200 bank shares a buying opportunity hiding in plain sight?
• 3 reasons why I think it’s time to snap up NAB shares
• Why these 3 ASX 200 shares have done ‘particularly well’ and remain top holdings into 2023: fund manager

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. 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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Despite the recent gains of the S&P/ASX 200 Index (ASX: XJO), there’s little doubt that the share market is still going through 2022 on a wary footing.

Yes, the ASX 200 has bounced back rather spectacularly over the past six weeks or so, rising around 12% since the start of October. But the ASX 200 still remains down by 4.55% year to date.

This year has also seen the ASX 200 seesaw rather violently. In April, the index was over 7,500 points. But by June, it was back under 6,500 points – a swing of 15% in just two months. Inflation, war, and rising interest rates have all played their part in denting investor confidence this year.

Although many ASX 200 shares have performed admirably this year – I’m thinking of BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), and Woodside Energy Group Ltd (ASX: WDS) – many have not.

Take Telstra Group Ltd (ASX: TLS). Telstra shares remain down by more than 6.5% in 2022. Woolworths Group Ltd (ASX: WOW) shares have lost close to 9% over the same period, while Macquarie Group Ltd (ASX: MQG) and Wesfarmers Ltd (ASX: WES) shares are down by 15.5% and 18.4% respectively.

And that’s just the blue chips. Domino’s Pizza Enterprises Ltd (ASX: DMP) sales are down more than 47% this year. The Xero Limited (ASX: XRO) share price has lost more than 54% of its value. REA Group Ltd (ASX: REA)? It’s nursing a 30% loss.

There are many ASX investing favourites out there whose valuations have been bulldozed this year.

So perhaps investors should sit on the sidelines with these shares and wait for a recovery before buying in.

What would Buffett do?

Well, one could do that. But here’s why I think sitting on the sidelines is a terrible idea. It might feel better to buy a share when everyone else is buying it and it is rising in value. We humans do love some positive reinforcement.

But according to the legendary investor Warren Buffett, this might just be the exact wrong time to buy in.

Buffett once told us that, “Long ago, Ben Graham taught me that ‘price is what you pay; value is what you get’. Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down.”

Buffett also once said this: “First, widespread fear is your friend as an investor, because it serves up bargain purchases. Second, personal fear is your enemy.”

So Buffett is saying that the best time to buy a top company is when its shares are feared by the market for no good reason.

Companies like REA and Xero haven’t seen their revenues or profits collapse by 30% or 54%. In fact, Xero grew its revenues by 19% in FY2022, and its earnings by 11%.

REA Group’s annual general meeting earlier this month revealed the company is on track to record a 26% rise in revenues and a 25% surge in net profits.

Yet we have seen devastation in these companies’ share prices. If REA and Xero keep growing next year and the year after that, then today’s share prices could be a bargain in hindsight. And Buffett does warn that share price sales don’t last forever.

So waiting until these sorts of share prices recover could be an expensive mistake for investors to make.

The post Markets are nervous. Why waiting to buy these ASX 200 shares could prove expensive appeared first on The Motley Fool Australia.

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More reading

• 3 dividend-paying ASX growth shares I would buy to retire rich
• Looking to buy ANZ shares? Here’s why the ASX 200 bank is hitting headlines
• Guess which ASX 200 bank share just upped its final dividend by 580%
• Are these ASX 200 lithium shares about to become dividend machines?
• 3 ASX 200 shares with enormous insider ownership

Motley Fool contributor Sebastian Bowen has positions in Telstra Corporation Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Telstra Corporation Limited, Wesfarmers Limited, and Xero. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited, Macquarie Group Limited, and REA Group Limited. 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 WiseTech Global Ltd (ASX: WTC) share price is having a tough time on Wednesday.

At the time of writing, the logistics solutions company’s shares are down 5% to $54.88.

This compares unfavourably to the S&P/ASX 200 Index (ASX: XJO), which is up 0.8% this afternoon.

Why is the WiseTech share price falling?

The weakness in the WiseTech share price today appears to have been driven by the company’s annual general meeting update.

Over the last few years, WiseTech has gained a reputation for under-promising and over-delivering. This has seen the company upgrade its guidance countless times when giving updates.

And given that the company’s CEO has been selling shares periodically over the last few months, the market was pretty certain WiseTech was at least on track to achieve its guidance in FY 2023. After all, it wouldn’t be a good look if a CEO sells a large number of shares just before a guidance downgrade.

However, investors betting on a guidance upgrade at today’s event have been left disappointed, with management reiterating its previous FY 2023 outlook.

What is expected in FY 2023?

WiseTech’s CEO, Richard White, revealed that the trading has been in line with expectations during the first half. He said:

The business is tracking in line with expectations, and I am happy to reconfirm our FY23 guidance. We expect to deliver 20 to 23% FY23 total revenue growth to between $755 million and $780 million, with CargoWise revenue expected to grow by approximately 30 to 35%, excluding FX. In terms of FY23 EBITDA we expect to deliver 21 to 30% growth equating to $385 million to $415 million, based on no material change in market conditions.

This represents a further expansion of our EBITDA margin by between 1 and 3 percentage points, demonstrating the continued operating leverage we’re able to generate as we scale. We’re delighted with the continued momentum we’re seeing across the business and confident in our longer-term outlook.

The post Why is the WiseTech share price wilting 5% on Wednesday? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Guess which ASX 200 tech insider has sold $12.9m of their company’s shares in just 2 weeks
• 8 All Ords shares that soared 10% or more today
• Here are the top 10 ASX 200 shares today
• 3 ASX 200 tech shares booming 10% or more on Friday

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 WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. 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 CSL Limited (ASX: CSL) share price cracked the $300 threshold for only the third time in 2022 this morning. The ASX healthcare share is up 1.53% at $301.38 in early morning trading.

There is no news out from the health giant itself today.

However, according to the Australian Financial Review (AFR), broker Wilsons has just issued a note to clients reporting that CSL’s Hemgenix drug has been approved in the United States.

This is a world first, with the drug being the first and only one-time gene therapy for adults with haemophilia B to go to market.

Wilsons says it will “expand and fortify CSL’s leadership position in Haemophilia B, already established with Idelvion”.

Wilsons anticipates a commercial launch in FY24.

World-first drug approval for haemophilia B

According to The Australian, CSL CEO Paul Perreault says the United States Food and Drug Administration’s decision is a “historic approval”.

Perreault says:

CSL is committed to delivering innovative and groundbreaking solutions to address unmet medical needs, and we are proud to introduce the next wave of breakthrough medicines for people living with haemophilia B.

What’s next for the CSL share price?

CSL became a $300-plus stock for the first time in January 2020. It rose as high as about $340 before the COVID-19 crash brought it down into the $270 range.

Since then, it has risen above $300 on a number of occasions but hasn’t been able to hold above that threshold for any significant length of time.

But both Wilsons and Citi think it can over the next 12 months.

Top brokers say CSL share price will go well beyond $300 in 2023

As my colleague James reported on Monday, top broker Citi has reaffirmed its expectations that the CSL share price will reach $340 by about this time last year.

In a new note, the broker has retained its buy rating on CSL shares.

Citi likes CSL’s commitment to research and development. On 3 November, CSL held an investor briefing regarding its R&D activities.

Citi highlights that CSL plans to continue spending more than US$1 billion on R&D for the foreseeable future.

CSL spent US$1.156 billion in FY22, which was about 11% of the company’s revenue.

Citi commented:

CSL will continue to spend ~10-11% of revenue on R&D annually. The pipeline now includes assets from recently acquired Vifor with two assets in Phase 3.

Our $340 TP includes $22.40 for the R&D portfolio (down from $23 on delays) – the main asset remains CSL112 (cardiovascular) at $20/share on which we will get Phase 3 data in Q1 CY24. Maintain Buy, $340 TP.

Wilsons is valuing CSL’s drug development pipeline at $62 per share. It values its core business at $265 per share.

So, all up, Wilsons is tipping a 12-month share price target of $327 for CSL and has an overweight rating.

Wilsons said in its client note:

The potential to replace ≥10 years of regular prophylactic management for these patients with a single shot of Hemgenix is a powerful driver of sector dominance, which brings with it margin expansion and sales leverage opportunities within the CSL Behring recombinant haemophilia (rHaem) portfolio.

Wilsons forecasts a 12.3% bump to earnings per share (EPS) in FY23 and a net profit of $US2.5 billion.

The European Medicines Agency is also reviewing the Hemgenix drug for approval.

The post Why did the CSL share price just crack $300 for only the third time in 2022? appeared first on The Motley Fool Australia.

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More reading

• 3 dividend-paying ASX growth shares I would buy to retire rich
• 4 ASX 200 shares to buy in an unmissable sector: expert
• Will ASX 200 shares bottom before the year is out? Here’s Macquarie’s ‘best guess’
• To $300 and beyond! Why this top broker says CSL shares are a buy right now
• Are these the very best ASX 200 shares to buy for 2023?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Bronwyn Allen has positions in CSL Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd. 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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If you’re an income investor, then you may want to consider the Coles Group Ltd (ASX: COL) dividend.

That’s the view of analysts at Morgans, which currently have a buy recommendation on the supermarket giant’s shares.

Is Coles a share to buy?

According to a recent note, the broker has put an add rating and $19.50 price target on its shares.

Based on the current Coles share price of $17.16, this implies potential upside of almost 14% for investors over the next 12 months.

Morgans likes the company in the current environment due partly to its defensive qualities.

The broker also sees plenty of value in its shares at current levels and expects Coles to benefit from a reversal in consumer shopping trends post-COVID. The latter refers to shoppers returning back to supermarkets after shopping locally.

The broker commented:

[W]e continue to see COL as offering good value with the company’s solid balance sheet and defensive characteristics putting it in a good position to navigate through a weaker economic environment. The unwinding of local shopping should also help further market share gains.

What about the Coles dividend?

Morgans is expecting an attractive dividend yield from Coles’ shares in 2023.

The broker has pencilled in a 64 cents per share fully franked dividend for this financial year, which will be up modestly from 63 cents per share in FY 2021.

Based on the current Coles share price, this will mean a 3.7% yield for income investors.

Looking ahead, the broker expects the Coles dividend to grow again in FY 2024 and is forecasting a fully franked payout of 66 cents per share. This represents a yield of 3.85% based on today’s share price.

All in all, this could make Coles a good option if you’re seeking defensive options with attractive yields.

The post How big will the Coles dividend be in 2023? appeared first on The Motley Fool Australia.

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• Are Coles shares worth buying for dividends right now?
• Experts name 2 ASX shares with fully franked dividend yields to buy next week
• If you’d bought $10,000 worth of Wesfarmers shares in January, this is how much you’d have earned in dividends
• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?
• How to have your ASX 200 dividend cake and eat it too

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 positions in and has recommended COLESGROUP DEF SET. 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 fancy yourself a long-term investor, it’s a good idea to pay attention when the market overreacts to an update from a quality company. 

A share price dip from slightly negative or even innocuous news could provide an attractive entry point for those who are willing to ride out the short-term bumps. 

One such case in point is S&P/ASX 200 Index (ASX: XJO) pokies maker Aristocrat Leisure Limited (ASX: ALL).

Last week, the ASX 200 gaming share released its 2022 financial year results and the stock instantly plunged 7%. 

Morgans senior analyst Alexander Mees reckoned all this did was provide a compelling chance to buy (more) shares in Aristocrat.

Why did the market react negatively?

There were potentially some short-term points that worried the market, admitted Mees. But overall he was not concerned with the ASX 200 stock’s price dip.

“Whether it was the disappointment of there being no acquisition announcements… the negative effect of higher finance costs on future estimates, or simply a reaction to FY22 earnings coming in slightly below consensus, the 5% decline in Aristocrat’s share price today creates a buying opportunity,” Mees said on the Morgans blog.

Aristocrat actually boosted its revenue, earnings and dividend in 2022.

“A post-COVID-19 recovery of casino capex budgets, combined with increased product penetration, drove a strong performance by Aristocrat Leisure’s land-based gaming business in FY22, especially in its key US market.”

The big downside was Aristocrat’s digital gaming arm, but it wasn’t a surprise to Mees.

“Growth in the digital gaming business, Pixel United, came to an abrupt — though expected — halt as the mobile games market normalised following the lockdown-fuelled sugar hit of the prior year.”

Why is Mees keeping the faith in ASX 200 share Aristocrat?

As far as Mees is concerned, all three reasons for buying Aristocrat shares for the long term still hold:

1. Long-term organic growth potential
2. Strong cash conversion and return on capital employed (ROCE)
3. Strong platform for investment

“Aristocrat is better capitalised than many of its competitors and has what we regard as a strong platform to continue investment in design and development,” said Mees.

“[It] is a capital-light business, despite its ongoing investment in gaming operations capex and working capital. It has a high level of cash conversion and ROCE.”

Mees’ peers generally agree with him, with 12 out of 14 analysts currently surveyed on CMC Markets rating Aristocrat shares as a buy.

With much of its revenue coming from offshore, currency fluctuations are always a risk for the company. As is an escalation in operational or user acquisition expenses.

An example of this was when the ASX 200 share experienced disruption due to the war in Europe. According to the Australian Financial Review, Aristocrat had the largest presence in Ukraine of any Australian business.

The post Buy this ASX 200 share now while the market’s distracted: expert appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy next week
• Brokers name 3 ASX shares to buy today
• 3 ASX 200 shares that announced supersized dividends this week
• Why Aristocrat, CBA, Core Lithium, and GrainCorp shares are dropping today
• Why is the Aristocrat share price diving despite a 27% profit boost?

Motley Fool contributor Tony Yoo 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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All Ordinaries Index (ASX: XAO) share BWX Ltd (ASX: BWX) hasn’t gone anywhere for nearly three months, but that could be about to change.

The beauty company suspended trading of its stock in late August amid confusion over certain revenue recognition issues for financial year 2021 and financial year 2022.

The BWX share price last trading at 63 cents – 85% lower than it was at the start of 2022.

For comparison, the All Ords fell 9% over the eight months ended 31 August.

Let’s take a closer look at when the market might expect the All Ords share to return to trade.

Shares in All Ords company BWX to return to trade

The BWX share price could be set to kick off for the first time in three months next week.

The company now expects to drop its audited financial year 2022 results on Monday before returning to trade on Tuesday. The latest update on the saga was released earlier this week.

The confusion over its earnings meant it wasn’t sure whether it met its previous guidance.

It also meant the company might have needed to restate its earnings for financial year 2021 and the first half of financial year 2022. Though, that wasn’t mentioned in its most recent update.

Its earnings were initially expected to be released in late September. That was later pushed back to late October before being delayed once more last month.

The company also deferred its annual general meeting (AGM) due to the delay. It hasn’t yet announced when the meeting will go ahead.

BWX develops, manufactures, and distributes natural beauty and wellness products under brands including Sukin, Andalou Naturals, and Mineral Fusion.

No doubt many will be watching BWX shares next week to see how the market reacts to the All Ords stock’s extended halt and financial year 2022 results.

The post ASX All Ords share BWX tipped to start trading next week after 3-month trading halt appeared first on The Motley Fool Australia.

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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 BWX Limited. 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 Chalice Mining Ltd (ASX: CHN) share price has been a strong performer on Wednesday.

In early trade, the mineral exploration company’s shares rose as much as 10% to $5.11.

The Chalice share price has pulled back a touch since then but remains up 6% at $4.92.

Why is the Chalice Mining share price surging?

Investors have been scrambling to buy the company’s shares this morning following the release of drilling results from the Julimar Ni-Cu-PGE Project in Western Australia.

According to the release, exploration activities are continuing across the >30km long Julimar Complex, with two diamond drill rigs currently drilling across the 10km long Hartog-Baudin strike length and four rigs continuing resource drilling at the Gonneville deposit.

The good news is that recent drilling demonstrates the potential for material resource growth at Julimar, with several outstanding new intersections up to 650 metres beyond the current resource.

One of the holes, named HD042, intersected a significant interval in Gonneville-type ultramafic geology. Management believes this is a “highly encouraging result” and confirms the prospectivity of the Hartog Intrusion and demonstrates that it is a continuation of the Julimar Complex.

The company advised that access to additional drill sites to adequately test this offset part of the Julimar Complex is anticipated in the coming weeks. Systematic drilling into Hartog will then commence at a step-out of ~1.6km north of the current resource.

What else is on the horizon?

It looks set to be a busy period for Chalice with a number of activities on the go at Julimar.

This includes access discussions for the Bindoon Training Area which covers the high-priority Flinders Target, ~25km north east of Gonneville.

In addition, mine development studies to support a scoping study for a mine at Gonneville on farmland is targeted for completion in late 2022.

If these activities deliver positive outcomes, it could give the Chalice Mining share price a much-needed boost. Despite today’s gain, it remains down almost 45% in 2022.

The post Why is the Chalice Mining share price surging 10% on Wednesday? appeared first on The Motley Fool Australia.

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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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