Category: Stock Market

The Lynas Rare Earths Ltd (ASX: LYC) share price is climbing 5.19% in early trade this morning. This comes after the company announced its quarterly activities report for Q1 FY23 before market open.

Shares of the company are currently trading for $8.31 each. That marks a strong recovery after they slumped to $7.72 soon after open.

Let’s go over the report’s highlights.

What did Lynas Rare Earths report?

• Quarterly sales revenue down 44.38% from Q4 FY22 to $163.8 million
• Sales receipts down 33.21% to $234.4 million
• Total rare earth oxide (REO) production down 4.10% to 3,500 REOt
• Neodymium-praseodymium oxide (NdPr) production down 33.81% to 1,045 REOt

Sales of Lynas’s production were affected in September by a “catastrophic” water shortage that reduced its overall production volumes.

Furthermore, the average selling price of its REO production fell drastically in the reported period, down to $49.3/kg from $79.2/kg in the previous quarter, or a 37.75% discount.

The average selling price of its REO was impacted by Lynas fulfilling several large orders of Cerium due to its lower selling price than NdPr, and due to high volumes.

Lynas notes that overall it expects strong demand for its neodymium and praseodymium from its customers in the foreseeable future.

What else happened in Q1 FY23?

Lynas announced a $500 million capacity expansion for its Mt Weld flotation plant located in Western Australia.

This was partially funded by a US$9 million contribution from its senior lender, JARE (Japan Australia Rare Earths BV), via a subscription of ordinary shares in the company.

Meanwhile, the company continued to make progress with the construction of its Kalgoorlie Rare Earths Processing facility. An upgrade to the plant’s facilities was announced as it will incorporate an industry-first carbonate refining process, which was pre-funded by the federal government’s modern manufacturing initiative.

With this new initiative in mind, the project will cost the company roughly 15% more than the original $500 million budget estimate.

What did management say?

Lynas Rare Earths CEO Amanda Lacaze made the following comments:

We continued to face significant operational challenges including a complete outage of water supply in Malaysia. A catastrophic equipment failure experienced by the local water supplier to our Malaysian facility resulted in approximately 16 days of lost production during the quarter.

Ore mining commenced at Mt Weld during the quarter as part of Mining Campaign 4-1 and blended ores from this campaign were introduced into the process plant. Mt Weld and Kalgoorlie integration activities also commenced in the quarter and we continued to use a combination of both commercial and charter shipping to transport concentrate product to Malaysia.

Lynas continues to work with the U.S. Government on the follow-on phase for the commercial Heavy Rare Earths separation facility and the site for the combined Heavy Rare Earths and Light Rare Earths facility is in the final stages of selection.

What’s next?

The report noted that future REO pricing largely hinges on the economic recovery in China. It also notes that demand for materials has suffered from “weak demand” in the recent past.

The company will continue to roll out upgrades and expansion efforts at its Kalgoorlie and Mt Weld sites.

Lynas share price snapshot

The Lynas share price is down around 20% year to date. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is down 8% over the same period.

The company’s market capitalisation is around $7.15 billion.

The post Lynas share price jumps despite 44% revenue fall appeared first on The Motley Fool Australia.

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More reading

• Does the AMP share price undervalue the ASX 200 company?
• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Why is the Whitehaven share price getting beaten up today?
• Is the Lynas share price a buy ahead of tomorrow’s update?

Motley Fool contributor Matthew Farley 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 BHP Group Ltd (ASX: BHP) share price, as you’d expect, is significantly impacted by the price of iron ore.

The industrial metal is responsible for roughly half of BHP’s revenue, bringing in approximately as much as its copper and coal segments combined.

So, it should come as no surprise that the BHP share price rocketed to new record highs in July 2021, shortly after the iron ore price was trading north of US$215 per tonne.

BHP shares then retraced right alongside the iron ore price for the rest of the year as the metal fell to US$92 per tonne.

To round this off, iron ore charged back above US$161 by early April 2022, which saw the BHP share price leap to another near record of $53.17.

Today, iron ore is fetching US$94 per tonne. And BHP shares are trading for $38.54. (Though we should note that the S&P/ASX 200 Index (ASX: XJO) mining giant paid out almost $13 billion in final dividends in September.)

So, having established the link between the iron ore price and the performance of the BHP share price, what exactly is the government forecasting?

Why government forecasts could see the BHP share price under pressure

If you’ve had a gander over this week’s Federal government budget, you may have noticed the iron ore price forecasts.

Government analysts predict the iron ore price will slide to US$55 per tonne (Free on Board (FOB) Australia) by the end of Q1 2023. That’s a big drop from today’s prices and could put some serious pressure on the BHP share price.

But not everyone agrees with the bearish assessment for iron ore spelled out in the budget.

In its Economic Insights report, Commonwealth Bank of Australia (ASX: CBA) said, “We think that the Government’s forecasts for Australia’s key mining and energy commodities in the coming years are broadly too conservative.”

The report goes on to state:

The Budget’s iron ore price forecast is lower than our outlook through the outlook period. The differences though lessen in later years. The difference reflects our view that prices will only gradually fall to $US60/t-$US65/t (FOB Australia) by late 2026/27 following a volatile year ahead.

Spot prices have come under pressure as China’s property downturn weighs on demand. Policy in China remains the key driver of prices, particularly China’s COVID-zero policy.

We broadly expect iron ore prices to bottom in Q1 2023 as China’s COVID-zero policy continues to weigh on demand. A shift away from China’s COVID-zero by the end of March 2023 should see iron ore prices lift in the following quarters.

If CBA has this one right, the BHP share price should follow iron ore higher in the latter quarters of 2023.

BHP share price snapshot

Atop the miner’s healthy dividends, the BHP share price has marched 48% higher over the past five years. That handily outpaces the 16% gains posted by the ASX 200 over this same period.

The post If the government has this right, the BHP share price could come under some serious pressure appeared first on The Motley Fool Australia.

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More reading

• Here’s how ASX 200 banks stand to benefit from the budget
• Why this expert is loading up on CBA shares in case of a recession
• CommSec penalised $20 million for rorting customers
• Why did the South32 share price take a beating on Tuesday?
• BHP share price dips following rough night on Wall Street

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

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The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price is dropping on Thursday.

At the time of writing, the banking giant’s shares are down 4.5% to $24.67.

This follows the release of ANZ’s full year results this morning.

How did ANZ perform?

For the 12 months ended 30 September, ANZ reported a 5% lift in cash profit from continuing operations to $6,515 million. This was driven by solid performances across all its operations and the benefits of rising interest rates.

In respect to the latter, ANZ’s second half NIM improved to 1.68%, with an exit margin of 1.8%.

Though, don’t expect the bank’s NIM to keep improving wildly from its exit level. Management warned that the current environment is “supportive for margins in the first half” but any “change from the exit margin is likely to be more modest.”

This ultimately allowed the ANZ board to declare a fully franked final dividend of 74 cents per share, bringing its full year dividend to 146 cents per share. This is up 2.8% from 142 cents per share in FY 2021.

Why is the ANZ share price falling?

The reaction to this result has been relatively lukewarm, which may explain the ANZ share price performance today.

Commenting on the result, Goldman Sachs said:

ANZ reported FY22 cash earnings (company basis) from continued operations were up 5% on pcp to A$6,515 mn, 1.4% ahead of GSe, with the beat driven by primarily by outperformance on the BDD charge and supported by slightly better expenses.

FY22 PPOP came in 1% lower than GSe, as an in-line NIM performance was more than offset by slightly weaker volumes and weaker than expected performance in Markets income. The proposed final DPS of A74¢ was higher than GSe (A72¢) and implies a payout ratio of 65% and will come with a non discounted DRP.

Net interest margin could drive estimate upgrades

One thing Goldman Sachs was particularly pleased with was ANZ’s exit margin. It notes that if the bank can improve or maintain this margin for the whole of FY 2023, it would likely result in higher than forecast earnings. It said:

if we assume i) the 1H23 NIM is c. 3 bp ahead of the 2H22 exit NIM of 1.80%, and then this holds through 2H23, and ii) 5% expense growth, then this would represent 8%/9% upside to FY23 GSe/Visible Alpha Consensus PPOP, all else being equal. If the FY23E NIM only holds the 2H22 exit of 1.80%, then the FY23E PPOP upside would still be 6%/7% respectively.

Goldman currently has a neutral rating and $26.09 price target on the ANZ share price.

The post Why is the ANZ share price sinking today? appeared first on The Motley Fool Australia.

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More reading

• ANZ share price on watch after reporting $6.5b cash earnings for FY22
• 5 things to watch on the ASX 200 on Thursday
• Here’s how ASX 200 banks stand to benefit from the budget
• Own ANZ shares? Here’s why the bank just copped a $25 million fine
• 22 high-yield ASX dividend shares Wilsons is targeting

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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Investment giant Argo Investments Limited (ASX: ARG) predicts demand for the commodities underpinning electric vehicles (EVs) will rise well into the future. This could include lithium.

Argo has expanded its exposure to ASX 200 lithium share IGO Ltd (ASX: IGO) in 2022.

In an AGM investor presentation this week, Argo managing director Jason Beddow placed the spotlight on the lithium price. He said:

The price of spodumene, which is the base or for lithium production, has increased over +500% in 12 months, as, as global automakers and battery manufacturers fight to lock in limited supply at almost any price.

EV demand driving commodities

Argo noted demand for EVs was expected to rise right up until 2030. Lithium is an essential component in EV batteries.

Reflecting on the demand for commodities used in EVs, Beddow said:

Sustainable energy and electric vehicles are two trends that fall into the decarbonisation category. The commodities that underpin these themes will likely remain in demand well into the future.

IGO has 49% ownership in a joint venture with the Tianqi Lithium Corporation, which is currently focused on lithium assets in Western Australia.

As my Foolish colleague Bronwyn reported yesterday, Argo has lifted its position in ASX 200 lithium share IGO by 20% in 2022, with 600,000 new shares. Commenting on IGO, Beddow said:

Lithium remains one of the key components in batteries for electric vehicles. IGO is one of the biggest lithium producers in Australia and provides high quality exposure to the rapidly growing battery materials market, with low-cost lithium and nickel operations.

Argo also opened a position in ASX lithium share Liontown Resources Limited (ASX: LTR) for the first time in 2022, buying up 7,575,758 Liontown shares. Liontown is exploring the Kathleen Valley lithium mine in WA.

Share price snapshot

The Liontown Resources share price has increased 16% in the year to date, while IGO shares have soared 44%.

For perspective, the S&P/ASX 200 (ASX: XJO) has fallen 8.2% since January.

The post Could ASX 200 lithium shares bask in sky-high lithium prices into the future? Here’s what Argo says appeared first on The Motley Fool Australia.

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More reading

• This multi-billion-dollar investment fund has been buying up Liontown shares. Should you?
• Why $6.5b Argo Investments is backing these ASX 200 lithium shares
• Here are the top 10 ASX 200 shares today
• 3 ASX mining shares that turned a $10,000 investment into $500,000
• Brokers name 5 ASX lithium shares to buy now

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 AMP Ltd (ASX: AMP) share price has had a disastrous few years on the market. It’s tumbled a whopping 76% over the last five years amid shocking findings from the Financial Services Royal Commission.

The AMP share price last closed at $1.19, leaving the company with a market capitalisation of around $3.7 billion.

Though, many a transformation has occurred at AMP recently. Could it be that its current valuation doesn’t consider some of its major assets? Let’s take a look.

Does the AMP share price undervalue the company?

The AMP share price has caught the eye of one expert this month.

Speaking to my Fool colleague Bernd, Bennelong Kardinia Absolute Return Fund portfolio manager Kristiaan Rehder heralded the stock as a potential winner, saying:

It’s been out of favour for some time … [but] our analysis shows that there’s considerable excess capital. And we think it can surprise the market in regards to the extent of its capital returns in the near term.

Excess capital indeed. The company had $1.45 billion of surplus capital on its books at the end of the first half. It has already begun returning some of that to shareholders through an on-market share buyback.

It’s also awaiting the finalisation of the sale of its Collimate Capital business ­– set to bring in around $700 million of upfront cash payments.

Thus, the company will likely soon boast more than $2 billion of surplus capital.

Its fund management platforms’ cash outflows have also notably improved recently. AMP’s North and New Zealand Wealth Management divisions each saw net cash inflows in the September quarter, while its Australian Wealth Management segment’s outflows markedly improved.

Finally, AMP Bank recorded growth of 1.4 times above system last quarter. And the company’s CEO Alexis George is hopeful of its future, saying:

We’ve seen a reduction in cash outflows to other superannuation funds and we’re winning new customers on our North platform.

[W]e have already launched our digital mortgage and unique-to-market retirement offer. These are important strategic deliverables that will support AMP’s longer-term growth.

But could the AMP share price really undervalue the company?

Well, the ASX 200 stock boasted $4.6 billion of equity and reserves attributable to shareholders at the end of June.

That’s around $900 million more than AMP’s valuation at its share price’s previous close and leaves the stock with a price-to-book (P/B) ratio of around 0.8. That’s relatively undervalued, if you ask me.

The post Does the AMP share price undervalue the ASX 200 company? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Why is the Whitehaven share price getting beaten up today?
• Is the Lynas share price a buy ahead of tomorrow’s update?
• Here are the 3 most heavily traded ASX 200 shares on Wednesday

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG), the world leader in online advertising, released its third-quarter financial report after the market closed Tuesday, and the results were disappointing. Furthermore, these results were seen as a harbinger of what’s to come for the rest of the digital advertising industry.

As a result, many adtech and digital advertising stocks fell in sympathy on Wednesday, as investors considered what was to come. Shares of The Trade Desk (NASDAQ: TTD) and Meta Platforms (NASDAQ: META) slumped as much as 8.1% and 5.5%, respectively, while Amazon (NASDAQ: AMZN) and Roku (NASDAQ: ROKU) had fallen as much as 4.8% and 3.9% respectively. As of 1:59 p.m. ET, the quartet was down 3.9%, 5.1%, 3.9%, and 2.9%, respectively.

This sell-off was broad based, taking down a wide variety of companies that rely on digital advertising for their livelihood. Earlier this year, Google’s ad revenue seemed largely immune to the recessionary fears that gripped much of Wall Street. It’s well documented that advertising is among the first items in corporate budgets to be slashed in times of economic uncertainty, and it seems that reality has finally caught up with the digital advertising kingpin.

So what

In the third quarter, Alphabet reported revenue of $69.1 billion, which grew just 6% year over year. Foreign currency headwinds played a part, as revenue would have been up 11% in constant currency. For context, revenue in the prior-year quarter grew by 41%.

The pressure on the top line also dented profits, as earnings per share (EPS) of $1.06 declined 24%. Analysts’ consensus estimates had called for revenue of $71 billion and EPS of $1.26, so Alphabet failed to clear either bar.      

However, commentary by the company sent investors running for the exits, as management detailed several factors that will weigh on results for the coming quarter. Alphabet cited tough comps, worsening foreign exchange headwinds, and lower ad spending as companies shore up their financial positions in the face of growing economic uncertainty.

As a result of the disappointing results, analysts issued a flurry of price target reductions, with no fewer than 14 of Wall Street’s finest cutting their expectations. JMP Securities analyst Andrew Boone seemed to capture the prevailing mood, saying the results were a warning sign that digital advertising this quarter will likely be weaker than originally imagined. 

Bernstein analyst Mark Shmulik echoed those sentiments, writing, “Google is an ad business first, and digital ads [are] no longer a safe place to hide.”  

Now what

Alphabet’s results seemed to suggest the writing is on the wall for the rest of the digital advertising and adtech space. That said, investors shouldn’t be too quick to jump ship but rather assess the potential for each of these companies on their own merit.

Meta Platforms leads the social media space and is widely regarded as the other company in the Google/Facebook duopoly that dominates much of the digital advertising space. Given the similarities in their business models and Meta’s reliance on digital advertising for more than 97% of its revenue and all of its profits, the comparison is an appropriate one. After that, however, the contrasts become more pronounced.

Amazon derives the lion’s share of its revenue from e-commerce and cloud computing, though in recent years, digital advertising has been one of the company’s fastest-growing businesses. Amazon’s advertising services revenue grew 20% so far this year but still represents just 7% of the company’s total revenue, so the sell-off in this case is likely related to the state of the broader economy and the potential to slow growth in its e-commerce and cloud segments.

Roku is an interesting one. Investors inexorably link the company with its namesake streaming devices, but many are unaware that Roku derives the majority of its revenue from the digital advertising that appears on its streaming video platform. Alphabet said that digital ads on YouTube, the company’s streaming platform, declined 2% year over year, the first such decline since Alphabet began reporting the platform’s results in 2019. This could spell trouble for Roku in the coming quarters.  

Finally, there’s The Trade Desk. The company’s adtech platform places digital ads across a wide spectrum of online locations, acting as a go-between for some of the world’s largest ad agencies.

When The Trade Desk released its second-quarter report in early August, the results were surprisingly robust. Revenue grew 35% year over year, while adjusted EPS climbed 11%. At the time, CEO Jeff Green made a startling pronouncement, saying (emphasis mine), “This trend also gives us confidence that we will continue to gain market share in any market environment.”  

The Trade Desk is seen as a striking alternative to advertising in the walled gardens offered by Google, Facebook, and Amazon. It also has one of the highest valuations, a function of its consistently strong results and entrenched position in the industry. While the stock may yet feel the impact of the economic downturn, The Trade Desk is still my top pick among these digital advertising and adtech stocks. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why were Meta and Amazon stocks falling today? appeared first on The Motley Fool Australia.

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More reading

• Why did Alphabet stock crash 9% on Wednesday?
• The bear market rally has seen the ASX 200 jump five percent higher in October. It could all be about to run out of steam
• Here’s how I allocate my ASX share portfolio and why
• One US stock set to soar 1,000%: expert
• Tough year for leading global growth fund laid bare with brutal fall in tech stocks

Danny Vena has positions in Alphabet (A shares), Amazon, Meta Platforms, Inc., Roku, and The Trade Desk. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Meta Platforms, Inc., Roku, and The Trade Desk. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Meta Platforms, Inc., and The Trade Desk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.  

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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This year has been defined by a lot of volatility, mostly declines. I think this is a great time to go investing in top ASX shares.

Interestingly, the rising interest rates have hit some of the highest-quality businesses the hardest. Some companies may be better at handling economic downturns, but higher interest rates have had a widespread effect on valuations, even if the business’ operations haven’t been affected much (yet).

I think we can see how hard quality businesses have been hit by looking at the return of the Betashares Global Quality Leaders ETF (ASX: QLTY). This is a globally-focused exchange-traded fund (ETF) that looks for businesses that rank well on return on equity, debt-to-capital, cash flow generation ability and earnings stability.

Despite that focus on quality, resilient businesses, the ETF is down 21% since the start of 2022, while the Vanguard MSCI Index International Shares ETF (ASX: VGS) is only down around 13%. However, from the current levels, I think it’s the quality (ASX) shares that are going to do better from here, particularly on the revenue and/or profit.

How I’d build a portfolio in top ASX shares

Over the long term, I think that ‘better’ businesses are likely to outperform ones that don’t have attractive features.

There are plenty of different factors that investors can look for, such as good management, a solid balance sheet, a good growth record, a compelling business model, attractive plans and so on.

For me, one of the things that can make a business really stand out as a potential opportunity is international growth.

Australia is a great place to do business in. It’s a huge country with a lot of land for resources and agriculture. However, the population is small, relatively speaking. So, the growth ceiling is pretty low in most industries compared to markets like the US, Asia, Europe or essentially most of the world.

This gives an ASX share a much larger potential growth runway. But, just because it’s targeting overseas growth doesn’t automatically mean it will be successful.

For me, some of the businesses that tick many quality boxes, including international growth, include Xero Limited (ASX: XRO), Breville Group Ltd (ASX: BRG), Premier Investments Limited (ASX: PMV), REA Group Limited (ASX: REA), Reece Ltd (ASX: REH), Idp Education Ltd (ASX: IEL), Lovisa Holdings Ltd (ASX: LOV), and Altium Limited (ASX: ALU).

I’m also very interested in the retail ASX share sector at the moment, due to the market’s pessimism. After recent declines, I think names like Wesfarmers Ltd (ASX: WES), Nick Scali Limited (ASX: NCK), Adairs Ltd (ASX: ADH), and Universal Store Holdings Ltd (ASX: UNI) are interesting.

I also like the VanEck Morningstar Wide Moat ETF (ASX: MOAT), which gives Aussie investors exposure to US shares with strong competitive advantages that are expected to endure for many years.

Foolish takeaway

A big part of investing is choosing a good investment and then being patient. The prices that the ASX share market is presenting look too good to ignore — I believe it’s a good time to go hunting businesses at cheaper prices.

The post How I’d build a portfolio by investing in top ASX shares now appeared first on The Motley Fool Australia.

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More reading

• 2 ASX shares that turned $5,000 into $2.5 million (or more)
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• 3 excellent ASX 200 growth shares experts rate as buys
• 22 high-yield ASX dividend shares Wilsons is targeting

Motley Fool contributor Tristan Harrison has positions in Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ADAIRS FPO, Altium, Idp Education Pty Ltd, Lovisa Holdings Ltd, Vanguard MSCI Index International Shares ETF, and Xero. The Motley Fool Australia has positions in and has recommended ADAIRS FPO, Wesfarmers Limited, and Xero. The Motley Fool Australia has recommended Lovisa Holdings Ltd, Premier Investments Limited, REA Group Limited, VanEck Vectors Morningstar Wide Moat ETF, and Vanguard MSCI Index International Shares ETF. 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 Sayona Mining Ltd (ASX: SYA) share price is trading higher on Thursday morning.

At the time of writing, the lithium developer’s shares are up 1% to 26 cents.

Why is the Sayona Mining share price rising?

Investors have been bidding the Sayona Mining share price higher following the release of an update on the company’s 75% owned North American Lithium (NAL) operation in Quebec, Canada.

According to the release, the company has further advanced the restart of production at NAL, with construction, procurement, recruitment and other activities progressing amid growing demand for lithium.

Management highlights that NAL’s restart is on track for the first quarter of 2023, with permitting applications and procurement both 96% complete as at the end of September.

Construction activities are also continuing, with the installation of the HP300 and HP400 Cone Crushers almost complete and the Wet High Intensity Magnetic Separator (WHIMS) now fully assembled.

The company has also been busy bolstering the management team of NAL with the recent appointment of Yves Desrosiers as interim general manager. In addition, Guy Belleau has been appointed in a president role and Sylvain Collard as chief operating officer for Sayona Quebec.

‘The first North American local producer’

Sayona’s managing director, Brett Lynch, was pleased with the progress the company is making at NAL. Particularly given how demand for lithium is growing in North America. He commented:

It is pleasing to see the continued progress at NAL as we advance towards the restart of production in the first quarter of 2023. Lithium demand from North America and globally continues to increase and Québec is well placed to deliver, with NAL set to become the first North American local producer next year and with further value‐ adding planned as we move into downstream processing.

The post Sayona Mining share price higher on lithium project update appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why is the Sayona Mining share price booming 10% on Tuesday?
• Guess which ASX lithium company is the biggest holder of Sayona Mining 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 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 Newcrest Mining Ltd (ASX: NCM) share price is charging higher on Thursday morning.

At the time of writing, the gold miner’s shares are up 5% to $18.25.

Why is the Newcrest share price charging higher?

The catalyst for the rise in the Newcrest share price has been the release of the gold miner’s quarterly update this morning.

For the three months ended 30 September, Newcrest reported gold production of 527koz and copper production of 32kt. While this was down on the prior corresponding period, this was due partly to planned maintenance.

Importantly, the company remains on track to achieve its annual guidance following the quarter. Particularly given its expectation for gold and copper production to increase in the December quarter.

FY 2023 gold production guidance remains 2,100koz to 2,400koz and copper production guidance is steady at 135kt to 155kt.

One negative, though, was that Newcrest’s production was achieved at an all-in sustaining cost (AISC) of $1,098 per ounce, delivering an AISC margin of $579 per ounce.

This AISC was 23% higher than the prior period, driven by lower gold and copper sales volumes with lower production following planned maintenance, and a lower realised copper price. This was partly offset by the benefit of a weakening Australian and Canadian dollar on operating costs.

Management notes that with a significant proportion of operating costs exposed to the Australian and Canadian dollars, continued weakness of these currencies against the US dollar will favourably impact its AISC.

Management commentary

Newcrest’s managing director and CEO, Sandeep Biswas, commented:

While overshadowed by the upsetting news from Brucejack, Newcrest delivered a solid performance during the September quarter which reflected our normal cadence for planned major maintenance shutdowns across our operations during this period.

Our group gold and copper production has increased substantially from a year ago, reflecting maintenance and productivity improvements at Cadia and Lihir, and additional ounces from Brucejack. Following this strong start to the year we expect gold and copper production to be higher in the December quarter on lower planned maintenance and remain on track to meet FY23 guidance.

The post Newcrest share price up 5% on strong Q1 update appeared first on The Motley Fool Australia.

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More reading

• Why did ASX 200 gold shares have such a top run today?
• 5 things to watch on the ASX 200 on Monday
• Demolished ASX 200 materials shares: Why this fundie is buying the 30% dip
• Can ASX 200 gold shares bank on a higher gold price in 2023?
• 5 things to watch on the ASX 200 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 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 Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price will be on watch this morning.

This follows the release of the banking giant’s eagerly anticipated full year results.

ANZ share price on watch amid strong earnings

• Statutory profit after tax up 16% to $7,119 million
• Cash earnings from continuing operations up 5% to $6,515 million
• Dividends per share up 3% to $1.46
• CET1 ratio 12.3%
• Second half net interest margin (NIM) of 1.68%
• Exit NIM of 1.8%

What happened during FY 2022?

For the 12 months ended 30 September, ANZ reported a 16% increase in statutory profit after tax to $7,119 million and a 5% lift in cash profit from continuing operations to $6,515 million.

The latter follows a strong second half which saw ANZ’s cash profit rise 9% to $3,402 million thanks to improvements in its NIM. ANZ’s second half NIM improved to 1.68% for the quarter, with an exit margin of 1.8%.

However, while management believes that the current environment is “supportive for margins in the first half” of FY 2023, it believes any “change from the exit margin is likely to be more modest.”

This strong finish to the year allowed the ANZ board to declare a fully franked final dividend of 74 cents per share, bringing its full year dividend to 146 cents per share. This is up from 142 cents per share in FY 2021.

How does this compare to expectations?

The good news for the ANZ share price today is that the company’s profits and dividend appear to have been a touch ahead of expectations.

For example, Goldman Sachs was forecasting a second half cash profit of $3,309 million and a full year dividend of 143.4 cents per share.

How did ANZ’s businesses perform?

During the second half, the Australia Retail business reported a 6% increase in profit over the first half. Management notes that the company closed the year with positive home loan momentum and approval times back in line with major peers. There was also strong customer up-take of ANZ Plus, with deposits reaching $1.2 billion, growing at a faster pace than any new digital bank in Australia.

The Australia Commercial business reported a 10% increase in revenue for the year and an 11% increase in profit thanks to good volume growth and disciplined margin management. The business grew net loans and advances by 6% over the year with solid lending growth in specialist segments including agribusiness and health.

Elsewhere, the Institutional business ended the year strongly with a 10% half on half increase in revenue thanks to strong demand and the New Zealand business reported a 5% half on half profit. The latter reflects its continued market share lead in key products including retail and funds management.

Management commentary

ANZ’s CEO, Shayne Elliott, was pleased with the bank’s performance. He said:

This was a strong financial result with all divisions making a material contribution and demonstrating the benefits of a diversified portfolio.

We restored momentum in Australian home loans with application approval times back in line with industry peers. We continued the re-platforming of Australia Retail onto ANZ Plus, which is our new digital bank, with deposits already exceeding $1.2 billion and growing at a rate faster than any new digital bank in Australia.

We continued the systematic de-risking of the bank, highlighted by the sale of our margin lending business to Bendigo & Adelaide bank and just last month we completed the formal separation of our Wealth business to Insignia and Zurich. Combined with the exit of Financial Planning & Advice, as well as the associated remediation being at the very final stage, we are the only major bank in Australia to have removed the risks associated with wealth management for shareholders.

Outlook

No real guidance was given for FY 2023, but Elliott appears cautiously optimistic on the next 12 months.

He commented:

There is uncertainty ahead, however we have the business in good shape to withstand volatility. We also have a highly engaged workforce with a high-performance culture and I’m confident in our ability to continue to deliver for customers and shareholders.

The post ANZ share price on watch after reporting $6.5b cash earnings for FY22 appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Here’s how ASX 200 banks stand to benefit from the budget
• Own ANZ shares? Here’s why the bank just copped a $25 million fine
• 22 high-yield ASX dividend shares Wilsons is targeting
• ASX 200 bank shares have had a stellar month. Here’s why this expert is now worried

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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