Category: Stock Market

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

Most cryptocurrencies and crypto stocks continued to plunge today as the industry deals with the fallout from the events in recent days that ultimately led the large crypto exchange FTX to agree to sell its non-U.S. operations to Binance.

Over the past 24 hours, shares of the world’s second-largest cryptocurrency, Ethereum (CRYPTO: ETH), traded more than 24% lower as of noon today. Shares of the meme tokens Shiba Inu (CRYPTO: SHIB) and Dogecoin (CRYPTO: DOGE) traded more than 16% and 23% down, respectively.

So what

In recent days, there have been rumors questioning the solvency of FTX after a scathing report from the news website CoinDesk said that the crypto exchange’s sister trading firm, Alameda Research, had a large number of its total assets in the cryptocurrency FTX Token (CRYPTO: FTT).

FTT is the in-house cryptocurrency created by FTX. The concern was what would happen to both Alameda and therefore FTX, because of how tied the two companies were, if the price of FTT fell. Furthermore, there were concerns about whether FTT was being used as collateral in any way. Not that it matters as much now, but the price of FTT is down more than 78% over the last 24 hours.

On the news of Alameda, Binance’s CEO Changpeng Zhao announced that he would liquidate $2 billion of his FTT holdings, which started the concerns about FTT’s price holding up and the impact on FTX and Alameda.

While FTX CEO Sam Bankman-Fried tried to calm these fears, taking to Twitter to say that FTX’s balance sheet was sound, customers began to withdraw their funds from FTX; the crypto exchange said it saw $6 billion of withdrawals in 72 hours. This eventually led Bankman-Fried to turn to Zhao and sell FTX’s non-U.S. operations to shore up the liquidity crunch the company was facing.

But the deal is pending due diligence, and there are already media reports, including one from CoinDesk citing anonymous sources, suggesting Binance might not end up going through with the deal. This whole series of events has shaken the faith in the entire crypto industry, similar to other big crypto meltdowns like that of algorithmic stablecoins.

“It shows that no one is too big to fail,” Pascal Gauthier, CEO of crypto wallet firm Ledger, said on CNBC. “FTX seemed untouchable.”

This also could hurt the resolve of the general public and reduce investing activity if people are skeptical about the large crypto exchanges and believe that they lack stability.

Now what

I don’t know if the events over the last few days have affected my view of specific cryptocurrencies, but more so reflect the erratic nature of the industry as a whole and how it is still very much the Wild West.

FTX played an important role in the industry, so to see it go down so quickly — and to realize some of the issues it likely had — are going to raise a lot of questions.

Ultimately, my view hasn’t changed on these three cryptocurrencies. I still like Ethereum at these levels and think the token has great long-term potential because of all of its real-world uses. The recent upgrades to the network should also greatly help Ethereum scale as well.

I am still not a fan of Dogecoin or Shiba Inu due to their lack of real-world utility and the lack of technical capabilities on each of their perspective networks.

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

The post Why Ethereum crashed today appeared first on The Motley Fool Australia.

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More reading

• Why Bitcoin and Ethereum were down big on Tuesday morning
• Why cryptocurrencies went into free fall overnight
• Forget Dogecoin, this crypto could be the even bigger winner from Elon Musk’s Twitter takeover
• Ethereum and Bitcoin price crash spells the end for these Aussie crypto ETFs
• The Dogecoin price is up 125% in a week. What’s going on?

Bram Berkowitz has positions in Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Ethereum. The Motley Fool Australia has positions in and has recommended Ethereum. 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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The Origin Energy Ltd (ASX: ORG) share price is rocketing higher on Thursday morning.

In early trade, the energy company’s shares were up 40% to $8.15.

The Origin share price has since pulled back a touch but remains up 33% to $7.73 at the time of writing.

Why is the Origin share price?

Investors have been scrambling to buy Origin’s shares this morning after the company announced the receipt of a takeover approach.

Origin has received an indicative, conditional, and non-binding proposal from Brookfield Asset Management and MidOcean Energy to acquire the company at $9.00 cash per share.

Based on the Origin share price at the close of play on Wednesday, this represents a massive 54.9% premium. It also values the company at $18.4 billion on an enterprise value basis.

The offer will be reduced accordingly if any dividends are declared and paid in the future. There’s also potential for a 3 cents per share increase if the deal closes by the middle of May.

Will the offer be accepted?

The three parties have been in discussions for a while and finally appear to have settled on a price.

Origin revealed that it has previously rejected offers of $7.95 cash per share in August and $8.70 to $8.90 per share in September.

However, on this occasion, the Origin board revealed that it would be prepared to accept the offer and recommend it to shareholders if the proposal becomes binding. As a result, it has given Brookfield Asset Management and MidOcean Energy due diligence access.

Can a deal be done?

It is worth remembering that the proposed takeover is subject to a number of conditions.

Firstly, it would only be recommended to shareholders in the absence of a superior proposal. The parties would also need to enter into a binding scheme implementation agreement on terms acceptable to Origin and an independent expert would need to conclude that it is fair and reasonable and in the best interests of shareholders.

And let’s not forget approvals from the likes of the Foreign Investment Board Review (FIRB).

Analysts at Credit Suisse appear to believe this could be the difficult part of the takeover. And with the Origin share price trading at a sizeable discount to the offer price, it appears as though the market agrees and has priced in this uncertainty.

The broker commented: “Foreign Investment Review Board hurdles loom large for proposed acquisitions of this nature, and the Government could use its approvals leverage to extract concessions on domestic gas prices.”

Time will tell what happens. But it certainly will be an interesting few months for the Origin share price.

The post Why is the Origin share price rocketing 40%? appeared first on The Motley Fool Australia.

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More reading

• Origin share price on watch amid $18.4b takeover offer
• Why are Origin shares burning 4% brighter today?
• Here’s why the Origin share price is storming higher today
• 5 big ASX announcements making news this week
• Origin share price higher on earnings guidance update

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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No doubt, the approach to retirement can be both exhilarating and daunting, with the prospect of abundant free time perhaps contrasted against potential financial pressure. Fortunately, S&P/ASX 200 Index (ASX: XJO) dividend shares can help provide passive income during retirement.

A passive income is just that – passive. Those who create one can sit back and enjoy periodic payments, rarely lifting a finger to actively manage it.

ASX 200 dividend-paying companies generally pay out a portion of their profits to those invested in their shares every half year. That could be a huge benefit to retirees.

Additionally, dividend shares can act as an inflation hedge, as they can provide returns faster than inflation can eat away at cash in a savings account.

That’s not to say that all ASX 200 dividend shares will suit any one investor. Particularly, if said investor is considering retirement.

Let’s take a look at what one might want to consider when building a passive income for retirement using ASX 200 dividend shares.

How I would buy ASX 200 dividend shares for retirement

There are a few measures one looking to retire might want to consider before hunting out ASX 200 dividend shares.

The first is the intended length of their prospective investment.

Assumably, a retiree would be aiming to hold their investment for years or decades, with the goal of receiving dividends over the life of their holding.

Thus, if I were about to retire, I would consider focusing my attention on ASX 200 blue-chip shares. They generally offer more stability due to their proven track record and strong financial position.

I would also make a point to diversify my portfolio, adding shares from various industries and companies. That way, my portfolio would be better protected against single-sector or -company downturns.

Fortunately, there are plenty of stocks that fit that bill. Some ASX 200 dividend shares are even currently brokers’ recommendations.

3 ASX 200 dividend shares rated buys right now

Coles Group Ltd (ASX: COL)

Readers will likely know exactly what business Coles is in. The company operates one of Australia’s largest supermarket chains.

Investors have enjoyed consistent dividends since it was spun out of Wesfarmers Ltd (ASX: WES) in late 2018. And Morgans thinks it could grow both its share price and its payouts in coming years, as my colleague James reports.

The broker tips the Coles share price to rise 18% to $19.50. While its dividends are forecast to lift to 64 cents this financial year and to 66 cents the year after.

Westpac Banking Corp (ASX: WBC)

Once again, Aussies would be hard-pressed not to recognise blue-chip bank share Westpac.

Following the banking giant’s latest results, Citi expects the ASX 200 share to lift 26% to $30. While Goldman Sachs believes its dividends will increase to $1.48 in financial year 2023.

Stockland Corporation Ltd (ASX: SGP)

Finally, shares in ASX 200 housing developer and commercial property group Stockland could be in for a good run, according to Goldman Sachs.

The broker expects the stock will gain 23% to trade at $4.40, saying potential residential headwinds are already priced in.

It also thinks Stockland’s dividends will increase to 28 cents per share this fiscal year and next.

The post Worried about your income in retirement? Take a look at these 3 ASX 200 dividend shares appeared first on The Motley Fool Australia.

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More reading

• ASX 200 bank shares: Buy, hold, or fold?
• 5 things to watch on the ASX 200 on Thursday
• Why has the Sayona Mining share price dumped 33% in 2 months?
• Here are the top 10 ASX 200 shares today
• Here are the 3 most traded ASX 200 shares on Wednesday

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs. The Motley Fool Australia has positions in and has recommended COLESGROUP DEF SET and Wesfarmers Limited. The Motley Fool Australia has recommended 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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The Perpetual Limited (ASX: PPT) share price is pushing higher on Thursday.

In morning trade, the fund manager’s shares are up 2.5% to $29.84.

Why is the Perpetual share price rising?

Investors have been buying Perpetual shares today after the company revealed that it has received an improved takeover approach.

According to the release, Perpetual received a further unsolicited conditional, non-binding indicative proposal to acquire all its shares on issue from the consortium comprising BPEA Private Equity Fund VIII and Regal Partners.

Under the revised indicative proposal, the consortium is offering $33.00 cash per share, a 10% increase from the original indicative proposal of $30.00 cash per share.

However, Perpetual’s board has considered a number of factors, including value, high conditionality, transaction and execution risks. After taking all this into account, it has determined once again that the consortium’s revised indicative proposal is not in the best interests of its shareholders and has therefore rejected the offer.

In fact, it believes the offer “continues to materially undervalue the company.” So, it appears that a significantly improved offer will need to be tabled to get a deal over the line.

For now, Perpetual’s board advises shareholders to take no action. It will keep shareholders informed in accordance with its continuous disclosure obligations.

Pendal deal still on

In other news, Pendal Group Ltd (ASX: PDL) has responded to speculation that the above approaches could impact Perpetual’s proposed takeover.

Pendal isn’t planning to let that happen and is pushing ahead with a scheme meeting this week despite Perpetual requesting a delay. It commented:

Pendal wishes to update its shareholders and the market that despite requests by Perpetual for a delay, it intends to proceed to the first court hearing for the Scheme this week and to seek orders convening the scheme meeting and for despatch of the Scheme Booklet to shareholders, with a scheme meeting to occur in mid-December 2022.

Pendal notes that while the Scheme Implementation Deed permits Perpetual to engage with another proposal, it does not permit Perpetual to terminate or otherwise abandon the Scheme in order to pursue a proposal. For clarity, the Deed does not preclude Perpetual responding to a proposal, but any resulting transaction can only be implemented in circumstances where the Scheme is accommodated. Any speculation to the contrary is inaccurate and contrary to a certain and well-functioning market for corporate control.

The post Perpetual share price leaps on boosted takeover bid appeared first on The Motley Fool Australia.

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More reading

• Here are the 10 most shorted ASX shares
• How did Pendal shares fare today amid takeover talk and an earnings update?
• Why A2 Milk, Bravura, Magellan, and Pendal shares are dropping
• Here are the top 10 ASX 200 shares today
• Why A2 Milk, New Hope, Perpetual, and Talga shares are charging higher

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

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The Xero Limited (ASX: XRO) share price is falling on Thursday following the release of the company’s half year results.

At the time of writing, the cloud accounting platform provider’s shares are down 7% to $67.60.

Xero share price lower on earnings miss and CEO exit

• Operating revenue up 30% (27% in constant currency) to NZ$658.5 million
• Annualised monthly recurring revenue (AMRR) jumped 31% (23% in CC) to NZ$1.49 billion
• EBITDA up 11% to NZ$108.6 million
• Total subscribers increased 16% to 3.5 million
• CEO Steve Vamos leaving after almost 5 years in the job

What happened during the half?

For the six months ended 30 September, Xero reported a 30% increase in operating revenue to NZ$658.5 million and a 31% jump in AMRR to NZ$1.49 billion. This was driven by a 16% increase in subscribers to 3,496,000 and a 13% lift in average revenue per user (ARPU) to NZ$35.30.

Here’s a summary of its performance across different markets:

• Australian revenue up 31% (25% in CC) to NZ$294 million after increasing subscribers by 126,000 to 1.47 million.
• New Zealand revenue up 16% to NZ$84 million following a 24,000 increase in subscribers to 536,000.
• UK revenue up 32% (34% in CC) to NZ$175 million. Xero added 44,000 net subscribers, bringing its total to 894,000. New additions were impacted by a slower than expected uptake of MTD for VAT and partner sales approach changes.
• North America revenue up 44% (30% in CC) to NZ$44 million. Xero added 15,000 net subscribers in the market, bringing its total to 354,000. Subscriber growth was impacted by seasonality factors.
• Rest of the World revenue up 35% (25% in CC) to NZ$62 million. Subscribers grew 16,000 to 242,000 in the market.

Softer earnings

One disappointment was that Xero’s top line growth didn’t flow all the way down to the bottom line.

The company reported an 11% increase in earnings before interest, tax, depreciation, and amortisation (EBITDA) to NZ$108.6 million. This was due largely to the impact of a NZ$25.9 million non-cash impairment driven by changed operational and market conditions for the Waddle business, which was partially offset by non-cash revaluation gains of NZ$10.8 million.

Excluding these adjustments, EBITDA would have been NZ$123.7 million, up 28% against the comparative period. This reflects a slight increase in operating expenses as a percentage of operating revenue from 83.4% to 83.9%.

How does this compare to expectations?

This result was somewhat mixed in comparison to what analysts were expecting.

For example, Goldman Sachs was expecting “Revenue/GP/EBITDA +28/+30/+42% vs. PcP to NZ$648/571/143mn.”

While Xero’s revenue was higher than Goldman’s estimate, its EBITDA has fallen well short both before and after adjustments. It was also the same for consensus estimates, which stood at NZ$656 million revenue and NZ$143 million EBITDA.

That may explain some of the weakness in the Xero share price today.

CEO exit

Also potentially weighing on the Xero share price is news that its CEO, Steve Vamos, is leaving after almost five years in the top job.

Vamos is retiring from the role and plans to return to his previous portfolio in business coaching and leadership development as an advisor, director, and investor.

The good news is that the company has acted fast and appointed a replacement, Sukhinder Singh Cassidy.

The release explains that Singh Cassidy is an experienced Silicon Valley executive, with more than 25 years’ global leadership experience. This includes as President, Asia Pacific & Latin America at Google; President at StubHub; founder of theBoardlist; founder of Joyus, where she was CEO; and co-founder of Yodlee.

Singh Cassidy will join the company at the end of month and formally takeover the role on 1 February 2023.

Outlook

Looking ahead, it is business as usual for Xero. Its outlook statement is little changed from the end of FY 2022. It stated:

Xero will continue to focus on growing its global small business platform and maintain a preference for reinvesting cash generated, subject to investment criteria and market conditions, to drive long-term shareholder value. Total operating expenses (including acquisition integration costs) as a percentage of operating revenue for FY23 are expected to be towards the lower end of a range of 80-85%.

The post Xero share price sinks 7% on half-year earnings miss and CEO exit appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• How I’d find ASX growth shares to buy today to double my money
• Analysts name the ASX growth shares to buy
• US$10 billion was just wiped from the value of Atlassian. How are ASX 200 tech shares responding?
• What’s the outlook for the Xero share price in November

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 Xero. The Motley Fool Australia has positions in and has recommended Xero. 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

Elon Musk, as expected, has sold a sliver of his Tesla (NASDAQ: TSLA) stake to help fund his acquisition of Twitter. Investors are now left to wonder whether Musk is done selling, which is creating volatility in the stock. Shares of Tesla opened Wednesday up as much as 2.4% before beginning a steady decline, trading down more than 6% for the day as of 2 p.m. ET as investors try to figure out what comes next.

So what

Shares of Tesla are down more than 30% in the last three months, and at least part of that decline is likely due to concerns about how Musk will fund and manage his Twitter adventure. Investors got at least part of the answer on Tuesday night, when Musk disclosed in a regulatory filing the sale of 19.5 million Tesla shares via 38 separate transactions over the past few days.

The executive raised about $3.95 billion from the sales, a significant part of the total cash outlay Musk needs for his $44 billion cash-and-debt purchase of Twitter. Musk has previously sold about $15 billion worth of Tesla shares in order to fund the acquisition.

A large shareholder selling into the open market tends to put pressure on the share price because supply and demand can become temporarily unaligned. If Musk’s sale is all the funding he needs to complete the Twitter deal and that overhang can be removed, it could be a positive for the Tesla share price from here. But Musk has said previously he hoped to avoid further sales, and investors are likely to be cautious, at least for now.

Tesla shares could also be under pressure due to the electric vehicle manufacturer issuing a recall of about 40,000 vehicles over concerns they could lose power steering. The problem can be fixed via an over-the-air software update, according to reports.

Now what

For Tesla investors, there is little to suggest the volatility will subside anytime soon. Despite whatever reassurances Musk provides, it is hard to say for sure that there will be no further stock sales. And Twitter adds another distraction to Musk, who already runs SpaceX and The Boring Co. in addition to serving as CEO of Tesla, at a time when the automaker is dealing with macroeconomic pressures.

For long-term-focused investors, the bull and bear case for Tesla is largely unchanged from where it was a year ago. This remains a highly valued stock, but one with much potential for growth from here. But no matter where you think Tesla will be in five years, there is a good chance that this current spate of volatility will continue in the weeks and months to come.  

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

The post Why Tesla stock is tumbling today appeared first on The Motley Fool Australia.

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More reading

• Why did Elon Musk just sell $6 billion worth of Tesla shares?
• Why Tesla hit a new 52-week low today
• Why Tesla shares dropped below $200 on Monday
• Forget Dogecoin, this crypto could be the even bigger winner from Elon Musk’s Twitter takeover
• Tesla sees a China slowdown, but this Nasdaq stock is faring much worse

Lou Whiteman 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 Tesla. 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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The A2 Milk Company Ltd (ASX: A2M) share price has seen plenty of volatility over the last couple of years.

Since the start of July 2020, A2 Milk shares have fallen by around 70%.

But, interestingly, the company has gone on a strong run over the past six months, rising by 44%.

So, with the recent rise from the low, can investors say that the worst is over?

A2 Milk is expecting growth

After a couple of years of revenue declines, with regular earnings downgrades, A2 Milk is finally expecting to deliver growth again.

When the dairy company announced its FY22 result, it also gave some comments about expectations for FY23. It said that it’s expecting continued revenue and earnings growth.

The company said that it’s expecting high single-digit growth in FY23. FY23 first-half growth is expected to be “significantly higher” than the FY23 second half.

The FY23 gross profit margin is expected to be “broadly in line” with FY22, with cost of goods sold headwinds related to increasing milk, ingredient and packaging costs offset by price increases, product mix benefits and cost mitigation initiatives.

Overall, the business is expecting earnings before interest, tax, depreciation and amortisation (EBITDA) growth in FY23 and a modest improvement in the EBITDA margin. It’s expecting the FY23 second-half EBITDA margin to be better than the first half.

Is the worst over?

The latest win for the business came as the United States Food and Drug Administration approved A2 Milk to supply infant milk formula to the US to help with the shortage there.

The FDA had deferred further consideration of A2 Milk’s US application. But, after ongoing engagement with the FDA, the agency has given A2 Milk approval to supply infant formula. The business is expecting to sell up to 1 million cans, all within the second half of FY23.

According to reporting by the Australian Financial Review, Spheria Asset Management portfolio manager Matt Booker said:

It’s done reasonably well despite the challenges and headwinds, particularly in China. They are growing again, and rolling out into more stores there.

My feeling is they won that a2 category years ago. They sold the brand hard into China, and it’s hard to displace – consumers tend not to like copycats and rather have the original brand. I think the brand still resonates with Chinese consumers.

They are coming off that low base in terms of margins. I think they can get back to the 20 per cent EBITDA margins from where they are now. This is a far more sustainable business today.

The AFR also referred to Barrenjoey head of consumer research Tom Kierath liking the ASX share, saying the US news is incrementally positive, but not a “game changer”, and China remains its opportunity.

Snapshot

Over the last month, the A2 Milk share price is up around 4%.

The post Has the worst been and gone for A2 Milk shares? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today  
• Why A2 Milk, Cettire, Lottery Corp, and Weebit Nano shares are rising
• Why is the A2 Milk share price surging 5% on Tuesday?
• Broker tips A2 Milk share price to jump 24%
• Why did the A2 Milk share price go backwards in October?

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 A2 Milk. 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 volatile times like 2022, it’s worth paying attention to ASX shares that are on a winning streak.

That’s because they must be doing something right to consistently attract support from investors while other stocks yo-yo up and down.

The analysts at Celeste Funds Management, in a memo to clients this week, pointed out two small-cap stocks that each had a spectacular October. 

They are still holding on to them, confident of further rises:

Bright future even after ‘ongoing consistent performance’

Litigation fund Omni Bridgeway Ltd (ASX: OBL) saw its share price rocket 19.6% upwards last month, reported the Celeste team, on the back of “ongoing consistent performance”.

“Income conversion for the quarter was lower than expected as a Fund 5 investment was realised earlier than the previously forecast FY27, resulting in an internal rate of return (IRR) of 152%,” read the memo.

“Estimated portfolio value (EPV) in FY23 experienced normal slippage to outer years, although pleasingly total EPV increased by 4.4% [from] the June quarter.”

Against the odds in a turbulent stock market, Omni Bridgeway shares have climbed in excess of 25% year to date.

The outlook for the coming years is bright, according to Celeste analysts.

“Commitments of $69 million and indicative investment opportunities of $214 million imply the business is on track to meet FY23 commitments guidance.”

As of the end of October, Omni Bridgeway was the Celeste Australian Small Companies Fund’s largest holding.

Coverage is sparse from other professionals on the litigator, but three out of the four analysts currently surveyed on CMC Markets are rating it as a strong buy.

Rare business where increased debt facility is to be celebrated

Lifestyle Communities Ltd (ASX: LIC) develops, owns and operates land lease properties for older Australians.

The stock price enjoyed a 15.7% rise in October, despite unfavourable conditions for real estate assets.

The Celeste team attributed the ascent on the news of new debt capacity.

“Lifestyle Communities increased its [debt] facility size from $375 million to $525 million, secured as a $150 million, five-year tranche.”

The facility in totality now has expiries spread over mid-2025 to late 2027, according to Celeste analysts.

“The debt is earmarked for ongoing land acquisitions and development costs as the business scales up to enable the sale of two communities per annum to move towards three over the next few years.”

Celeste’s peers are less convinced about Lifestyle Communities than Omni Bridgeway.

According to CMC Markets, three analysts each think the stock is a strong buy and a hold respectively, while one recommends it as a moderate buy.

The post 2 small-cap ASX shares to buy that had a MASSIVE October: fund appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today

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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ASX earnings fans are likely having a great month as reporting season for S&P/ASX 200 Index (ASX: XJO) banks nears its end.

Australia and New Zealand Banking Group Ltd (ASX: ANZ) kicked off the action among the big four, posting its full-year earnings late last month. Westpac Banking Corp (ASX: WBC) followed suit earlier this week and National Australia Bank Ltd (ASX: NAB) posted its earnings this morning.

Next up will be Commonwealth Bank of Australia (ASX: CBA). The financials giant will drop its first quarter update next week after reporting in August.

So, with most of the market’s biggest banks having now dropped their full-year earnings, are the ASX 200 financials giants worth buying? Here’s what experts are saying.

Are ASX 200 bank shares a buy right now?

ASX 200 banks could be a buy, according to some experts, while others warn investors not to over-expose themselves to the sector.

Head of investments and capital markets at VanEck, Russel Chesler warns non-performing home loans could rise as the property market slows down, The Australian reports. The expert was quoted as saying:

Higher costs including wage inflation are limiting the expansion of bank profits. Looking forward the significantly higher interest rates will see loan growth continuing to slow and bad debts will increase.

We do not believe these risks are fully factored into the major bank’s share prices.

That’s in comparison to many previous predictions that rate hikes would allow ASX 200 banks to reprice their loan offerings, thereby increasing their net interest margins (NIMs) and profits.

However, soaring NIMs haven’t quite come to fruition just yet. The sector was bolstered when Bank of Queensland Ltd (ASX: BOQ) reported a final quarter NIM of 1.81% last month. Though, that’s since proven to be among the best of the bunch.

ANZ reported an exit NIM of 1.8% and that of NAB reached 1.72%.

Meanwhile, Westpac saw a NIM of 1.9% in the second half. However, its full-year NIM dropped 17 basis points to 1.87%.

Still, on an individual level, many top brokers are bullish on most of the ASX 200’s big four banks.

What do brokers expect from the big four?

Morgans added CBA shares to its November ‘best ideas‘. The broker believes the bank is “the highest quality bank and a core portfolio holding for the long term”. Though, it did note the biggest bank is also the most expensive on key valuation metrics.

Meanwhile, Westpac retained its place on the monthly list. The broker said it has “the greatest potential for return on equity improvement… if its business transformation initiatives prove successful”.

Citi and Goldman Sachs also tipped Westpac shares as buys with as much as 16% upside following the bank’s full-year results, my Fool colleague James reports.

The pair also expect big things from ANZ shares. They both believe the smallest of the ASX 200 big four banks could up its dividends in coming years, with Citi slapping it with a buy rating and Goldman Sachs remaining neutral on the stock.

Finally, Goldman Sachs believes NAB shares are a buy right now. It expects the bank to outperform due to its exposure to commercial real estate, helping it to grow its dividends.

The post ASX 200 bank shares: Buy, hold, or fold? appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Thursday
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Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs. The Motley Fool Australia has recommended 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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The Origin Energy Ltd (ASX: ORG) share price will be one to watch on Thursday.

That’s because the energy company has just made a major announcement.

Why is the Origin share price on watch?

The Origin share price is likely to jump on Thursday after the company revealed that it has received a takeover approach.

According to the release, the company has received an indicative, conditional, and non-binding proposal from Brookfield Asset Management and MidOcean Energy to acquire Origin by way of a scheme of arrangement at a price of $9.00 cash per share. This will be reduced by any dividends declared and paid in the future.

This represents a massive 54.9% premium to the Origin share price at the close of play on Wednesday and values the company at $18.4 billion on an enterprise value basis. It could also be increased by 3 cents per share if completed by 15 May 2023.

Brookfield Asset Management is a Canadian investment company and MidOcean Energy is an LNG company formed and managed by EIG. Under the terms of the proposal, Brookfield would acquire Origin’s Energy Markets business and MidOcean would acquire the Integrated Gas business.

Not the first offer

The release reveals that this isn’t the first time that the consortium has tabled an offer. Previous offers of $7.95 cash per share in August and $8.70 to $8.90 per share in September were rejected.

On this occasion, due diligence has been granted and the Origin board has stated that if the consortium were to make a binding offer at $9.00 cash per share, then its current intention is to unanimously recommend that shareholders vote in favour of the proposal. This would be in the absence of a superior proposal.

It would also be subject to the parties entering into a binding scheme implementation agreement on terms acceptable to Origin and an independent expert concluding that it is fair and reasonable and in the best interests of shareholders.

Origin’s chairman, Scott Perkins, commented:

This proposal confirms that Origin, its operations and management team represent a highly strategic platform, well-placed to benefit from the energy transition. Our confidence in Origin’s prospects underscored our engagement with the Consortium and delivered a material increase on their initial offer. While the due diligence process advances, we will remain focussed on the successful execution of our strategy.

Origin CEO, Frank Calabria, added:

Over the past year, Origin has executed a number of important strategic initiatives that have strengthened the balance sheet, sharpened our strategic focus and positioned the company to prosper from the energy transition. At the same time, we have a dedicated, engaged and highly-skilled workforce who are committed to delivering good outcomes for our customers and communities. We believe Origin is in a strong position to lead the energy transition, capture opportunities and create value for shareholders.

The post Origin share price on watch amid $18.4b takeover offer appeared first on The Motley Fool Australia.

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More reading

• Why are Origin shares burning 4% brighter today?
• Here’s why the Origin share price is storming higher today
• 5 big ASX announcements making news this week
• Origin share price higher on earnings guidance update
• Here are the top 10 ASX 200 shares today

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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