Category: Stock Market

Charging up: Here are the 3 top performing ASX lithium shares of Q1
ASX lithium shares were in the spotlight in the September quarter amid predictions demand for the battery-making material could skyrocket in the near future.

In fact, a recent report from the Australian Government tipped the nation’s exports of the commodity to increase more than tenfold from 2020-21 to 2022-23, coming in at $13.8 billion this financial year.

That’s expected to be driven by surging lithium prices. Those invested in ASX lithium shares likely jumped for joy when they learnt the government expects lithium hydroxide to trade at US$51,510 a tonne next year.

But some stocks involved with the material performed better than others last quarter. Indeed, one ASX lithium stock saw its value triple over the three months ended 30 September.

For context, the benchmark All Ordinaries Index (ASX: XAO) slumped 1% in that time.

Keep reading to find out which ASX lithium shares topped all others last quarter.

A quick note; only shares with market capitalisations of at least $100 million were considered for inclusion.

3 ASX lithium shares outperforming all others in Q1

The biggest gains of any ASX lithium share last quarter were posted by the Anson Resources Ltd (ASX: ASN) share price. It surged a whopping 210.5% to finish September at 29.5 cents.

However, that’s a long way down from the all-time high of 47.5 cents it posted last month.

Like many of its gains last quarter, that surge came on the back of news of the company’s flagship Paradox Lithium Project in Utah. A definitive feasibility study completed at the project in early September confirmed its “outstanding economics” and future potential.

Anson Resources was joined in the green by S&P/ASX 200 Index (ASX: XJO) lithium share Pilbara Minerals Ltd (ASX: PLS). The Pilbara Minerals share price launched 99% last quarter to close September at $4.56.

The major news from the lithium giant during that time was of its maiden profit. The company posted a $561.8 million after-tax profit for financial year 2022 in August.

And finally, the third best-performing ASX lithium share of the September quarter was Global Lithium Resources Ltd (ASX: GL1). The company’s share price rocketed 90% to $2.20 over the period.

That saw the stock a whopping 1,000% higher than the company’s initial public offering (IPO) asking price of 20 cents. It floated on the ASX in May 2021.

Much of the news from the company last quarter regarded its 80%-owned Manna Lithium Project in Western Australia. The project’s mineral resource estimate is expected to be updated this quarter.

The Global Lithium Resources share price also gained 19% when Mineral Resources Limited (ASX: MIN) upped its stake in the company to 8% last month.

The post Charging up: Here are the 3 top performing ASX lithium shares of Q1 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 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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7 October 2022
Is CBA the best ASX 200 bank share to buy for dividend income?
Commonwealth Bank of Australia (ASX: CBA) shares have long been held in high regard by investors looking for dividend income. It’s one of many S&P/ASX 200 Index (ASX: XJO) bank shares.

The composition of Australia’s economy means that banks (and miners) play a big part in the ASX 200.

CBA is the biggest but there are many others, including National Australia Bank Ltd (ASX: NAB), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group Ltd (ASX: ANZ), Bank of Queensland Limited (ASX: BOQ), Suncorp Group Ltd (ASX: SUN), Macquarie Group Ltd (ASX: MQG) and Bendigo and Adelaide Bank Ltd (ASX: BEN).

There are plenty of banks to choose from.

Positives about CBA shares

CBA is often viewed as the highest-quality bank in Australia. It was strong during the COVID-19 locked-down years of 2020 and 2021.

It kept paying a dividend to shareholders.

The big ASX 200 bank paid an annual dividend of $2.98 per share in FY20, $3.50 per share in FY21 and $3.85 per share in FY22. But, it’s still below the annual dividend per share that was paid in FY19 of $4.31.

It has demonstrated good growth in the most recent result. FY22 saw its pre-provision profit (excluding one-off items) rise by 3.1% to $13.2 billion. The cash net profit after tax (NPAT) rose 11% to $9.6 billion.

Part of the FY22 growth came from the fact that its business lending grew by 13.6% (1.3x faster than the overall banking system), and business deposits increased by 15.1% (1.4x the overall banking system).

CBA has a goal to build Australia’s leading business bank. Its strategy is centred around the “quality of its customer relationships and being their main financial institution”.

How does CBA compare to other ASX 200 bank shares?

According to CommSec, CBA is predicted to pay an annual dividend per share of $4.19 in FY23. That would be an increase of 8.8% compared to FY22.

However, the grossed-up dividend yield is only expected to be 6.2%. Why? Because it has a relatively high price-to-earnings (P/E) ratio. That explains what multiple of earnings the share price is trading at. The higher it is, the more ‘expensive’ it can seem.

CBA is predicted (by CommSec) to generate $5.58 of earnings per share (EPS) in FY23, which means the CBA share price is valued at 17x FY23’s estimated earnings.

Let’s have a look at the other banks’ grossed-up dividend yields and P/E ratios for FY23, according to CommSec, so these are forward projections.

NAB’s FY23 predicted yield is 7.7% with a forward P/E ratio of under 13.

Westpac’s FY23 predicted yield is 8.7% with a forward P/E ratio of 11.1.

ANZ’s FY23 predicted yield is 8.75% with a forward P/E ratio of 11.4.

BOQ’s FY23 predicted yield is 10% with a forward P/E ratio of under 10.

Bendigo Bank’s FY23 predicted yield is 9.25% with a forward P/E ratio of 10.

Suncorp’s FY23 predicted yield is 9.4% with a forward P/E ratio of 11.

Macquarie’s FY23 predicted yield is 4.5% with a forward P/E ratio of 15.

My verdict

CBA shares have been a solid idea for dividend income for many years. I think that will continue for the foreseeable future. If I were a long-term shareholder, I’d be happy to keep holding for the dividend income.

However, if I were looking at all of the ASX 200 bank shares and choosing to buy something, its high valuation and lower yield would put me off.

Only part of Macquarie is a bank, the rest of the business is a global investment bank – I like its growth and diversification.

But, in terms of domestic banks, I would pick NAB out of the big four because of the experienced management and turnaround strategy.

BOQ is doing a number of things to try to improve and grow the business (such as digitalisation), but it also has the biggest expected yield and the lowest P/E ratio, so it would be my non-big-four bank pick.

The post Is CBA the best ASX 200 bank share to buy for dividend income? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Macquarie Group Limited and Westpac Banking Corporation. 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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7 October 2022
Allkem share price higher on Sal de Vida lithium project update
The Allkem Ltd (ASX: AKE) share price is on the move on Friday morning.

At the time of writing, the lithium miner’s shares are up 3% to $14.76.

Why is the Allkem share price rising?

The catalyst for the rise in the Allkem share price on Friday has been the release of an announcement relating to the company’s Sal de Vida project.

According to the release, Allkem and the International Finance Corporation (IFC) have agreed a non-binding term sheet for a project financing facility for the Sal de Vida Project in the Catamarca Province of Argentina.

IFC has proposed a US$200 million project finance facility to support Allkem’s development of Sal de Vida stage one. The release notes that IFC’s environmental and social performance requirements are globally recognised and will complement the ESG standards already adopted at Sal de Vida by Allkem.

Subject to finalisation of commercial terms and other key outstanding items, including final board approval, the facility is expected to be in place by late 2022.

Sal de Vida stage one

The Sal de Vida stage one project is designed to produce 15ktpa of predominately battery grade lithium carbonate. A feasibility study earlier this year estimated that the capital expenditure would be US$271 million and cash operating costs would be US$3,612 per tonne.

Stage one project economics include pre-tax net present value of US$1.23 billion at a 10% discount rate, pre-tax internal rate of return of 50%, and a payback period of 1.75 years from the start of commercial production. Construction commenced in January.

Allkem’s managing director and CEO, Martin Perez de Solay, said:

We are already in a strong financial position to self-fund the Sal de Vida project however we saw an opportunity to further improve the financing structure for Sal de Vida and partner with IFC, an institution with decades of experience providing finance and sustainable business solutions in the mining space. Sal de Vida is expected to generate significant economy-wide benefits that will improve the fiscal outlook, economic performance and social outcomes at national, regional and local community levels.

The post Allkem share price higher on Sal de Vida lithium project update appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Allkem Limited. 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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7 October 2022
Why Tesla stock fell today
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

On an only modestly red day for the stock market, with major indices all down just a fraction of a percent each, shares of automotive stocks are getting hurt more than most. Tic-tac-toe, three in a row, shares of Ford Motor Company (NYSE: F), Tesla (NASDAQ: TSLA), and Nio (NYSE: NIO) are down 2%, 1.9%, and 5.9%, respectively.

Each of the three ran into a fender bender of modestly bad news today.

So what

In the case of electric vehicle (EV) specialists Tesla and Nio, it’s basically Wall Street to blame for today’s declines. Granted, yesterday’s announcement that Elon Musk has apparently decided he will buy Twitter after all is probably still having an effect on Tesla stock — but there’s new news, too.

Specifically, this morning, Japan’s Mizuho bank lowered its price target on Tesla stock, citing “logistics challenges” that prevented the company from hitting its targeted delivery number for the last quarter. Although Tesla did still grow its deliveries 42% year over year, and grew its production numbers 54%, the miss necessitates a price target cut to $370 per share, says Mizuho today in a note covered by StreetInsider.

Similarly, Mizuho cut its price target on China’s Nio by about 5%, to $40 a share, citing — surprise! — “softer SepQ deliveries” and consequently lower expected earnings in the quarter. Indeed, across the EV industry, Mizuho says getting the needed parts to build EVs, and getting transportation to deliver them where they’re going, remains “a challenge.” Long term, Mizuho is still a supporter of both Tesla and Nio stocks and maintains buy ratings on both companies.

Mizuho just isn’t sure the stocks will go up as much as it previously hoped they might.

Now what

Now, what about Ford — which, for all its electric ambitions, still remains today primarily a maker of SUVs and trucks powered by the venerable internal combustion engine? Well, earlier this week, as you probably heard, Ford reported a 9% decline in sales for September — and an 18% decline in trucks. The company blames parts shortages for sidelining as many as 45,000 vehicles that remain only half-built because they don’t have the parts needed to complete them.

For that matter, even Ford’s small but growing electric operation is apparently not immune from the problems plaguing its competitors. Last night, Ford announced that it’s raising the price of its base model F-150 Lightning electric pickup truck by $5,000 — not because it wants to, but because it has to, in order to absorb the costs of “supply chain constraints, rising material costs and other market factors.”

After this hike and the first round of price increases, announced less than two months ago, the price of the F-150 Lightning is now up an astounding 30% over its originally announced base price of just under $40,000 last year.

Now, from one perspective, Ford charging more money for a truck might be considered a good thing — more money for Ford, right? But if all the extra money coming in one door immediately goes out another to pay Ford’s suppliers, then there’s really no net gain for the company or the stock. To the contrary, as Ford F-150 Lightning prices rapidly run up from “It’s a bargain!” territory to “Hmm, maybe I should just buy a Rivian truck” levels, the good publicity and sales advantages Ford initially enjoyed from introducing the Lightning are already starting to evaporate.

Granted, at a lowly 4.3 times trailing earnings, I still think Ford stock looks cheap enough to buy. But based on today’s bad news, I can’t blame other investors for deciding Ford might actually need to get a little bit cheaper.

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

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Rich Smith 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 Nio Inc., Tesla, and Twitter. 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.

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

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7 October 2022
2 of the best ASX growth shares to buy now according to Morgans
If you’re a fan of investing in growth shares, then you may want to look at the ASX shares named below that have been tipped as buys by analysts at Morgans.

Here’s why the broker thinks these are some of the best growth shares on the Australian share market right now:

Corporate Travel Management Ltd (ASX: CTD)

One growth share that Morgans is bullish on right now is corporate travel specialist Corporate Travel Management. The broker feels it is a great option in the travel sector. This is due to its belief that the company is well-placed for growth over the medium term thanks to acquisitions, its lower cost base, and technology development. Morgans commented:

CTD is our key pick of the travel sector. For investors that can take a medium-term view, we see substantial upside in its share price as the company recovers from the COVID-affected travel downturn. In fact, CTD should be a materially larger business post COVID given it has made two highly accretive acquisitions during the downturn. The company has also won a lot of new business, implemented structural cost-out opportunities and continued to develop its market-leading technology offering which means it will require less staff in the future. CTD is well managed and has a strong balance sheet (no debt).

Morgans currently has an add rating and $25.65 price target on the company’s shares.

TechnologyOne Ltd (ASX: TNE)

This enterprise software company could also be a growth share to buy according to Morgans. It is one of the broker’s favourite options in the tech sector right now. This is thanks to its pricing power, defensive earnings, strong cash balance, and long track record of solid earnings growth. The broker explained:

The technology sector is under pressure due to inflation and interest rate concerns which remain a key risk. However, for those looking for a technology play, TNE is our preferred exposure. It has pricing power (CPI passthrough on contracts), has ~$170m of net cash, is highly cash generative, has very defensive earnings, pays a dividend, and a has a decade plus track record of 10-15% pa EPS growth.

Morgans has an add rating and $11.53 price target on TechnologyOne’s shares.

The post 2 of the best ASX growth shares to buy now according to Morgans 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 recommended Corporate Travel Management Limited and TechnologyOne 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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7 October 2022
Is the October outlook brightening for the Fortescue share price?
The Fortescue Metals Group Limited (ASX: FMG) share price has risen in the first week of October. Since the start of the month, it has climbed by almost 5%.

It’s not the only one that has seen a positive start to the month. The S&P/ASX 200 Index (ASX: XJO) as a whole has risen by more than 5% after the surprise interest rate increase by the Reserve Bank of Australia (RBA) on Tuesday. It was only a 25 basis point rise this month, less than many experts predicted.

What’s the outlook for iron?

For at least the next few years, the performance of iron ore could be key for Fortescue.

The current profit and cash flow generation from Fortescue is dependent on its iron ore mining. Higher revenue for the iron ore it produces largely turns into more net profit after tax (NPAT) and cash flow for the company.

But, the opposite is true when the resource price goes down. Iron ore has been drifting lower since June. The iron ore price is currently sitting at around US$95 per tonne, according to CommSec.

Some experts think the iron ore price is headed lower over the next couple of years. This could put pressure on the Fortescue share price.

The resources and energy quarterly report from the chief economist from the Department of Industry, Science and Resources notes that the iron ore price fell around 20% in the three months to September 2022.

The decline was attributed to growing global recessionary fears, new COVID-19 outbreaks and weakness in China’s housing sector. These have dampened world steel and iron ore demand in recent months.

The chief economist’s report projects the benchmark iron ore price to average US$90 per tonne in 2023 and around US$70 per tonne in 2024. This is expected to lead to a redintion of earnings from iron ore miners.

Latest on Fortescue’s green efforts

Fortescue has a plan to become a decarbonised materials and green energy powerhouse. Producing green hydrogen and green ammonia is a key focus for the company.

It recently announced its plan for US$6.2 billion of capital investment by 2030 to eliminate fossil fuel risk and reduce operating costs by US$818 million per year.

The cumulative operating cost savings are US$3 billion by 2030, with a payback of capital by 2034 at current market prices.

Fortescue Future Industries will also establish a “significant new green growth opportunity by producing carbon-free iron ore product and through the commercialisation of decarbonisation technologies”.

Success with these efforts could be an important driver of the Fortescue share price in the future.

Management commentary

Fortescue founder and executive chair Andrew Forrest said:

Fortescue, FFI [Fortescue Future Industries] and FMG, is moving at speed to transition into a global green metals, minerals, energy and technology company, capable of delivering not just green iron ore but also the minerals, knowledge and technology critical to the energy transition.

FFI is partnering with Tree Energy Solutions (TES) to develop a green hydrogen import facility in Germany. A US$127 million investment will be funded by FFI’s unutilised capital commitment and provides FFI with a pathway for access to “critical infrastructure to execute its strategy”.

TES is developing a portfolio of terminals globally that will enable the transportation of green energy.

The first phase of the partnership is to develop and invest in the supply of 300,000 tonnes of green hydrogen. The first delivery into the TES terminal in Germany is expected to take place in 2026. This could help get green hydrogen into energy networks and therefore help the Fortescue share price.

Forrest said:

The United Kingdom and Europe urgently need green solutions to replace fossil fuels and this investment will enable Europe to do exactly that. Not in 2050, but in four years from now.

The post Is the October outlook brightening for the Fortescue share price? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group Limited. 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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7 October 2022
Can the Pilbara Minerals share price keep charging higher in October
The Pilbara Minerals Ltd (ASX: PLS) share price has been a top performer in the last few months. Can the ASX lithium share keep going?

Since the start of October, it’s up by 18%. Over the past month it’s up more than 35%. From the middle of June, it has gone up by over 160%.

It has outperformed the S&P/ASX 200 Index (ASX: XJO) significantly over each of those time periods. For example, the ASX 200 is close to flat over the past month.

What could drive the Pilbara Minerals share price higher?

One of the most important elements that can affect investor sentiment about the business is the resource price.

A commodity business is heavily reliant on the price of its resource for how well its profit margins perform. It’s a price taker.

It essentially costs Pilbara Minerals the same to produce one tonne of production. So, higher revenue for that tonne can translate largely into more profit and higher cash flow, after paying more to the government in taxes.

I like how the company has been using the digital Battery Material Exchange (BMX) platform to sell off small, but regular, parts of its production.

The latest auction was its ninth BMX auction. It presented a cargo of 5,000 dry metric tonnes (dmt) for sale with a target grade of around 5.5% lithia.

Pilbara acknowledged that there was strong interest in both participation and bidding by a broad range of quality buyers with a total of 22 bids received online during the 30-minute auction window.

The ASX lithium share said that it intends to accept the highest bid of US$6,988 per dmt, on a pro rata basis for lithia content (and adjusted to be inclusive of freight costs), it equates to a price of around US$7,708 per dmt.

In the first BMX auction it carried out, in July 2021, the highest bid was US$1,250 per dmt.

Lithium demand grows with electric vehicle growth

The quarterly resources and energy report from the chief economist of the Department of Industry, Science and Resources referred to the growing global demand for lithium as electric sales “take off”. I think it’s worth including most of the section about world demand because it explains some of the positive support for ASX lithium shares and the Pilbara Minerals share price:

Global lithium demand continued to grow strongly in the June quarter 2022, driven by rising demand for electric vehicle batteries. Despite faltering global economic growth in the June quarter, sales and production of electric vehicles (EVs) continued their rapid growth trend.

Global sales of all types of EVs increased 36% in the year to June 2022 compared with the same period in 2021 — with Chinese sales up 110%, European sales up 6%, and North American sales up 27%.

In China, total EV sales have averaged almost half a million vehicles a month so far in 2022, reaching a peak of 650 thousand vehicles in June. Overall, auto production and supply chains in China have now largely recovered from the COVID lockdowns, when EV sales fell to just over 300 thousand vehicles in April 2022.

In May, the Chinese Government cut purchase taxes on some low-emission passenger vehicles by 50%, while some municipal governments have also provided subsidies and incentives to encourage EV purchases. Global passenger EV sales are expected to continue to grow strongly, albeit at a slower rate than in 2021 — when passenger EV sales more than doubled to an estimated 6.8 million vehicles. Passenger EV sales are expected to hit 11.2 million in 2022 and 14.5 million in 2023.

Key global automakers continue to accelerate plans to transition to EVs by developing new product lines and converting existing manufacturing capacity. The global market share for passenger EVs has quadrupled since 2019, with EV sales representing about 9% of the car market in 2021.

Broker ratings on the Pilbara Minerals share price

The broker UBS rates it as a sell, with a price target of $2.65. That implies a possible drop of 50% over the next year because of its valuation.

Even Macquarie’s bullish price target of $5.60 has almost been met. The broker thinks that the ASX lithium share will sell more through the platform when Ngungaju increases production.

The post Can the Pilbara Minerals share price keep charging higher in October appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie 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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7 October 2022
The Lake Resources share price was never far from the headlines in Q1, but has it paid off?
The Lake Resources N.L. (ASX: LKE) share price was the talk of the town over the first quarter of financial year 2022. And for good reason.

Stock in the lithium developer rocketed a whopping 100% over the first seven weeks of the period. Sadly, it handed much of that gain back before the quarter was out.

The Lake Resources share price was trading at 79 cents at the end of the last financial year. At its August peak, stock in the company was swapping hands for $1.595.

Come the final close of September, however, Lake Resources shares were worth 90 cents – marking a 13.9% quarterly gain.

For comparison, the S&P/ASX 200 Index (ASX: XJO) dumped 1.4% over the three months ended 30 September.

So, what went so right, and then so wrong, for the Lake Resources share price in the first quarter? Let’s take a look.

What drove the Lake Resources share price in Q1?

Cast your mind back to early July.

Then, Lake Resources was down a managing director after Steve Promnitz suddenly stormed off the job. He then appeared to sell his entire 10.2 million share holding in the company the following day, as my Fool colleague James reported at the time.

Additionally, it had only been a month since Goldman Sachs’ bearish outlook for lithium seemingly inspired a major sell-off among ASX lithium shares.

And if the company was hoping for less drama in the new financial year, it was likely disappointed.

A short drop and a sudden stop

The Lake Resources share price was halted in mid-July following the release of a scathing report by activist short seller J Capital.

Among other things, the short seller slammed the company’s plan to produce lithium using direct lithium extraction (DLE) technology – owned by partner Lilac Solutions.

Incredibly, when the company responded to the claims, it said J Capital had criticised the wrong process, calling the report “incorrect” and “inaccurate”.

Remarkably, the attack didn’t outwardly harm the Lake Resources share price. However, it likely helped bolster the company’s short position.

It increased from 7.9% in late June to 10.2% at the end of September, making Lake Resources one of ASX’s most shorted shares.

Perhaps the staunch performance of the stock was due to increasing warnings the world could soon experience a lithium shortage. Or perhaps the revelation of its new CEO and managing director David Dickson played a part.

Whatever the reason, it wasn’t long before the lithium favourite faced yet another challenge.

A bone to pick with Lilac

The Lake Resources share price tumbled 16.5% in mid-September after the company acknowledged a dispute between it and Lilac Solutions.

The pair previously agreed Lilac could earn a 25% stake in the Kachi Project by achieving certain milestones by an agreed upon date. However, it seems the agreed upon date was far from agreed upon.

Lake Resources believes the deadline was 30 September, while Lilac thought it had until 30 November. The market still hasn’t heard news of an outcome of the dispute.

Though, the pair are continuing to work on the Kachi Project. Onsite processing of Kachi brines was expected to begin this week.

Lake Resources share price snapshot

Sadly, the Lake Resources share price’s September tumble sees it trading in the longer-term red.

The stock has fallen 6% since the start of 2022. Though, it has gained a whopping 80% since this time last year.

Meanwhile, the ASX 200 has dumped 10% year to date and 6% over the last 12 months.

The post The Lake Resources share price was never far from the headlines in Q1, but has it paid off? 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 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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7 October 2022
Brokers say these are the ASX 200 mining shares to buy
If you’re wanting to diversify your portfolio by investing in the mining sector, then you may want to check out the ASX 200 mining shares listed below.

Both have recently been tipped as buys in the sector by leading brokers. Here’s what you need to know about these mining shares:

Iluka Resources Limited (ASX: ILU)

The first ASX 200 mining share for investors to look at is Iluka.

It is the mineral sands and rare earths miner behind a number of quality projects across South Australia and Western Australia. This includes the Eneabba project, where Iluka is developing a fully integrated rare earths refinery, which will be only the third of its kind outside the China market.

This is a big positive given how demand for rare earths is expected to remain strong long into the future.

Analysts at Goldman Sachs are bullish on Iluka. They commented:

We are positive on ILU’s project pipeline and forecast >40% production growth in mineral sands volumes, c.18ktpa of Rare Earths (~3.5-4ktpa of high value NdPr). We think ILU’s Eneabba RE refinery is a strategic asset considering it will be only the third western world RE refinery.

The Zircon and TiO2 feedstock markets entered a supply side driven deficit in 2021, and we think prices will remain supported in 2H22 & 2023.

Goldman Sachs currently has a conviction buy rating and $13.30 price target on Iluka’s shares.

South32 Ltd (ASX: S32)

Another ASX 200 mining share that has been tipped as a buy is South32.

It is a diversified mining mining and metals company producing alumina, aluminium, bauxite, coal, copper, lead, manganese, nickel, silver, and zinc at operations in Australia, Southern Africa and South America.

Morgans is very positive on the miner due to its portfolio optimisation and exposure to metals that will be important to the decarbonisation megatrend.

It explained:

S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32’s risk and ESG profile. Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.

Morgans has an add rating and $5.50 price target on South32’s shares.

The post Brokers say these are the ASX 200 mining shares to buy 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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7 October 2022
3 ASX shares I’d buy with $500
I think ASX shares are a great way to build wealth over the long term. For beginner investors, it might be the case that $500 is how much money they have to start.

In my opinion, investing is the type of thing that people can learn best by getting stuck into it and getting experience. People don’t need a ton of money to get started.

Many brokers have a minimum investment size of $500. For example, that’s how much CommSec requires investors to have.

I think it’s a good idea for beginner investors to consider investments that could make sense for the long term and that they might want to buy more of in the future. A $500 investment could just be the start.

With that in mind, here are three I’d start buying:

Betashares Nasdaq 100 ETF (ASX: NDQ)

This is an exchange-traded fund (ETF) that owns a number of businesses that we see and probably use in our everyday lives. An ETF is an investment that owns a bunch of different shares inside it.

I think it can be a useful teaching tool to be invested in shares that we use the products or services of.

Some of the recognisable names in this portfolio are: Apple, Microsoft, Amazon.com, Alphabet, Tesla, Meta Platforms, Nvidia, Costco, Adobe, Intel, Netflix, PayPal, Starbucks, Monster Beverage, Moderna, Airbnb, Kraft Heinz and Lululemon.

It could be a good time to consider this ASX share with $500 because the Betashares Nasdaq 100 ETF has dropped around 25% this year. In other words, these shares are on a big discount at the moment.

Australian Ethical Investment Ltd (ASX: AEF)

Australian Ethical is an interesting funds management business.

It looks to provide investors with investment funds that match their ethics. For example, it avoids fossil fuel businesses and invests in companies that are making a positive difference to the world.

The ASX share has a growing number of customers, as more people look for ethical investments.

A key segment of the business is that it offers superannuation money. It had $6.2 billion of funds under management (FUM) at 30 June 2022 – over FY22, it achieved record super net flows of $0.8 billion. It’s benefiting from the regular superannuation contributions made by employees and other people.

After falling around 60% in 2022, I think the Australian Ethical share price looks compelling for the long term.

Wesfarmers Ltd (ASX: WES)

I think Wesfarmers is one of the most attractive long-term ideas around.

It has been around for many decades, and I think it could continue to be one of the longest-running companies.

Several businesses are in the portfolio, including Bunnings, Priceline, Kmart, and Officeworks.

One of the most attractive things about this ASX share is that management is unafraid to change what names are in the portfolio. For example, it has divested coal, Kmart Tyre & Auto and Coles Group Ltd (ASX: COL) in recent times. It has acquired Catch, Priceline and a stake in a lithium project in recent years. I like that it’s focused on the future.

With a good dividend, a growing portfolio of good businesses, and a long-term focus, I think Wesfarmers is one of the most solid ASX shares around.

The Wesfarmers share price has fallen around 25% in 2022.

The post 3 ASX shares I’d buy with $500 appeared first on The Motley Fool Australia.

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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. Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adobe Inc., Airbnb, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Australian Ethical Investment Ltd., BETANASDAQ ETF UNITS, Costco Wholesale, Intel, Lululemon Athletica, Meta Platforms, Inc., Microsoft, Monster Beverage, Netflix, Nvidia, PayPal Holdings, Starbucks, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Moderna Inc. and has recommended the following options: long January 2023 $57.50 calls on Intel, long January 2024 $420 calls on Adobe Inc., long March 2023 $120 calls on Apple, short January 2023 $57.50 puts on Intel, short January 2024 $430 calls on Adobe Inc., short March 2023 $130 calls on Apple, and short October 2022 $85 calls on Starbucks. The Motley Fool Australia has positions in and has recommended BETANASDAQ ETF UNITS, COLESGROUP DEF SET, and Wesfarmers Limited. The Motley Fool Australia has recommended Adobe Inc., Airbnb, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Australian Ethical Investment Ltd., Meta Platforms, Inc., Netflix, Nvidia, PayPal Holdings, and Starbucks. 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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7 October 2022