Category: Stock Market

At lunch on Wednesday, the S&P/ASX 200 Index (ASX: XJO) has been fighting hard to stay in positive territory but is falling short. The benchmark index is currently down 0.25% to 6,612.4 points.

Here’s what is happening on the ASX 200 index on Wednesday:

Miners weigh on the ASX 200

Concerns that there could be a global recession put pressure on commodity prices overnight. This has led to mining giants such as BHP Group Ltd (ASX: BHP), Fortescue Metals Group Limited (ASX: FMG), and South32 Ltd (ASX: S32) tumbling notably lower today. So much so, the S&P/ASX 200 Resources index is down 4.4% at the time of writing.

EML Payments jumps

The EML Payments Ltd (ASX: EML) share price is racing higher today. This follows news that the payments company has signed an agreement with the Spain’s national post office network, Correos. EML will support the issuing of a government contract known as the Bono Cultural Joven 2022 (Youth Cultural Bonus) tender. This is supporting the cultural sector which was adversely impacted during the pandemic.

Energy shares tumble

Energy shares such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) have sunk deep into the red today. This follows a sharp pullback in oil prices amid concerns that a recession could lessen demand for energy products. According to Bloomberg, the WTI crude oil price fell more than 10% before eventually closing the session 8.2% lower at US$99.50 per barrel. Brent crude oil ended the session 9.45% lower at US$102.77 a barrel.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Wednesday has inexplicably been the Zip Co Ltd (ASX: ZIP) share price with a 17% gain on no news. However, it is worth noting that the tech sector is performing very positively today. The worst performer has been the Regis Resources Limited (ASX: RRL) share price with a 7% decline. This follows broad weakness in the gold sector and the release of a bearish broker note out of Citi.

The post ASX 200 midday update: BHP and Fortescue sink, EML and ZIP jump appeared first on The Motley Fool Australia.

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More reading

• South32 share price heads 8% south on high volumes, but why?
• Why is the Fortescue share price slipping 5% today?
• Zip share price reignites with a 19% rally amid tech bounce
• Why did the Beach Energy share price outperform the ASX 200 last month?
• Santos and Woodside on watch after oil prices crash 10%

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 EML Payments and ZIPCOLTD FPO. The Motley Fool Australia has positions in and has recommended EML Payments. 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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June wasn’t the best of months for the Bitcoin (CRYPTO: BTC) price.

At all.

Depending on your time zone, the world’s biggest token by market cap kicked off June trading for US$31,693. By the time the calendar rolled over into July, the token was worth $18,880, down 41% for the month.

US$31,693 also happens to be the high for the Bitcoin price in June, with it trading as low as US$17,700, according to data from CoinMarketCap.

While Bitcoin has recovered slightly in July, currently fetching US$20,273, it remains down more than 70% from its 10 November all-time highs.

So, what went wrong in June?

Inflation and rising interest rates

The biggest headwind facing the entire cryptocurrency market has been hot running inflation in the developed world and the accompanying interest rate hikes being rolled out to tame that.

An outsized 0.75% interest rate hike by the US Federal Reserve and hawkish guidance on more rate rises ahead saw most risk assets sell-off in June. The tech-heavy NASDAQ, as a handy benchmark, closed the month down 9%.

Of course, that’s far less than the Bitcoin price tumbled.

Why did the Bitcoin price crash 41% in June?

Just as the token has the potential to deliver outsized gains when markets are running strong, it also has proven itself able to deliver painfully outsized losses when the selling fever hits.

Bitcoin looks to have come under extra selling pressure after falling below some key levels.

Nothing technical, mind you.

But as the Bitcoin price slipped below US$30,000, a growing number of holders found themselves in the red. In fact, by mid-June, anyone who’d bought the crypto since early December 2020 was sitting on a loss, with analysts estimating half of all investors were underwater.

This looks to be pressuring a number of institutional investors to lighten their crypto holdings.

According to Wilfred Daye, chief executive officer of Securitize Capital:

There may be capitulation because larger institutional players, guys who got in during the current cycle, they’re at risk of selling their assets and liquidating their assets. This particular cycle that started late 2020, you had a lot of institutional folks getting in at a higher price, so I think it’s more institutional capitulation.

Then there’s the crypto miners.

Securitize Capital estimates it costs some crypto miners more than US$20,000 for every Bitcoin they mine. And as the Bitcoin price kept sliding, more miners were selling their tokens to pay their bills, adding to the supply.

According to JP Morgan:

Offloading of Bitcoins by miners, in order to meet ongoing costs or to de-lever, could continue into Q3 if their profitability fails to improve… [Selling] has likely already weighed on [Bitcoin] prices in May and June, though there is a risk that this pressure could continue.

The post Why did the Bitcoin price crash 41% in June? appeared first on The Motley Fool Australia.

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More reading

• Why Bitcoin stocks crashed (again) last month
• How did the price of crypto assets perform in June?
• Here’s what will impact the Bitcoin price in July: expert
• What did the SEC just say about Bitcoin?
• How crypto miners are squeezing the Bitcoin price

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

Shares of Google parent Alphabet (NASDAQ: GOOGL)(NASDAQ: GOOG) took a 24.8% header during the first half of 2022, according to data from S&P Global Market Intelligence.

When looking back at the chart to all-time highs of autumn 2021, Alphabet is off 28% from its peak. By comparison, the S&P 500 and Nasdaq Composite indexes are off 21% and 31%, respectively, from their all-time highs.  

So what

A confluence of events conspired to drag down the mighty Alphabet’s stock — and few of those events had much to do with business results. What started as a healthy market pullback early in 2022 widened into all-out carnage as inflation soared past 8% year over year, driven by higher energy, food, auto, and home prices.

In response, the Federal Reserve has started aggressively raising interest rates in an attempt to cool off the economy which, in turn, would cool off prices. As a reminder, higher interest rates lower the present value of risk assets like stocks.  

Thus far, the Fed’s plan has done little to tame inflation, but it has pushed the economy to what some economists think is the brink of recession. Add in Russia’s war on Ukraine, and it all creates a very gloomy outlook for the global economy.

About Alphabet: As just mentioned, its business seems to be doing just fine. In fact, in the first quarter of 2022, revenue and operating income increased 23% and 22%, respectively.

But since the bulk of Alphabet’s revenue comes from advertising, the possibility of a recession has also weighed on shareholder sentiment. Ad spending tends to take a hit when the economy hits the skids, so there’s worry that Google’s growth is in for a severe cool-off.  

Now what

At this juncture, investors need to weigh Alphabet’s longer-term prospects against the current valuation. Digital ads are still a steadily growing industry gobbling up traditional marketing, and the tech giant has lots of other irons in the fire, like its Google Cloud segment, that give it exposure to other secular growth trends. 

The stock now trades for 22 times trailing 12-month free cash flow and 20 times expected current-year earnings. It also has some of the deepest pockets around with cash and short-term investments of $121 billion net of debt.

If Alphabet can sustain its growth momentum over the long term, now might be a fantastic buying opportunity — if you don’t mind some ongoing elevated volatility this year and can sit on your hands for at least a few years.

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

The post Why Alphabet stock crashed 25% in the first half of 2022 appeared first on The Motley Fool Australia.

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More reading

• 4 potential winners from Netflix’s advertising plans
• Better stock-split buy: Alphabet or Tesla?
• 3 top stock splits to watch in 2022
• Alphabet’s stock split: The real reason it matters
• 4 reasons to buy Alphabet before its stock split

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Nicholas Rossolillo and his clients have positions in Alphabet (C shares). The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares) and Alphabet (C shares). The Motley Fool Australia has recommended Alphabet (A shares) and Alphabet (C shares). 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 Zip Co Ltd (ASX: ZIP) share price is back on the horse on Wednesday. Its recovery comes as the S&P/ASX 200 Information Technology Index (ASX: XIJ) leads the market, gaining 3.57%.

At the time of writing, the Zip share price is 60.5 cents, 18.63% higher than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.25%.

Let’s take a look at what might be going on with the ASX 200 buy now, pay later (BNPL) share and its tech peers today.

What’s driving the Zip share price higher today?

ASX 200 tech stocks are launching higher on Wednesday and the Zip share price is leading the way.

That’s despite the Reserve Bank of Australia hiking interest rates 50 basis points to 1.35% yesterday. The move is likely bad news for consumer sentiment and could have been expected to weigh on the BNPL giant’s stock today.

While Zip isn’t technically a tech share – it’s at home on the S&P/ASX 200 Financials Index (ASX: XFJ) – the company’s stock tends to trade in line with its technology-focused peers.

The tech sector’s rally might be a reaction to a strong session on the tech-heavy NASDAQ index on US markets overnight.

The Nasdaq Composite lifted 1.75% in Tuesday’s session overseas following a public holiday on Monday.

Its surge also comes as bond yields fall. US 10-year yields fell by around 2.8% overnight.

LPL Financial’s Quincy Krosby has reportedly linked falling bond yields with potential gains among tech stocks. Krosby was quoted by News.com.au as saying:

The concern of a recession is deepening … You look for growth, where you can find it. Many of those large tech names that have been beaten up by the market become attractive again, particularly when the bond yields are lower.

Today’s gain leaves the Zip share price 86% lower than it was at the start of 2022. The ASX 200 tech sector has also slumped 34% year-to-date.

The post Zip share price reignites with a 19% rally amid tech bounce appeared first on The Motley Fool Australia.

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More reading

• Up and back down: Why is the Zip share price volatile today?
• The Zip share price lost 94% of its value in FY22
• What on earth happened to ASX 200 tech shares in June?
• Why Austal, Mesoblast, Regis Resources, and Zip shares are charging higher
• Why is the Zip share price jumping 11% today?

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 ZIPCOLTD FPO. 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 South32 Ltd (ASX: S32) share price has been among the worst performers on the ASX 200 on Wednesday.

In morning trade, the mining giant’s shares were down as much as 8% to $3.55.

The South32 share price has since recovered a touch but remains down 5.5% at the time of writing.

Why is the South32 share price sinking?

Investors have been selling down the South32 share price on Wednesday following a pullback in commodity prices.

Commodity prices tumbled lower overnight after recession fears intensified, sparking concerns that demand for many metals and energy products could weaken.

Among the worst performing metals were aluminium and copper which fell 3.2% to US$1.08 per pound and 4.2% to US$3.44 per pound, respectively, during overnight trade. Copper’s decline took it to a 19-month low.

This doesn’t bode well for South32, which generates significant earnings from these metals.

For example, Goldman Sachs is forecasting earnings before interest, depreciation, and amortisation (EBITDA) contributions of US$2,025 million from South32’s aluminium operations and US$678 million from its copper operations in FY 2023.

This is the equivalent of 38.5% and 12.9% or the group EBITDA of US$5,260 million Goldman is expecting for the year.

And given that Goldman is expecting an average aluminium price of US$1.70 per pound and an average copper price of US$5.53 per pound, these estimates could prove to be wide of the market based on current prices.

In light of this, it isn’t overly surprising to see the South32 share price fall today.

The post South32 share price heads 8% south on high volumes, but why? appeared first on The Motley Fool Australia.

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More reading

• How did the South32 share price perform in FY22?
• Experts name these ASX 200 dividend shares with big yields as buys
• 3 more of Morgans’ best ASX share ideas for July
• Here are the 3 most heavily traded ASX 200 shares on Monday
• South32 crashes into bear market in June as recession fears bite

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 Fortescue Metals Group Limited (ASX: FMG) share price is coming under selling pressure during morning trade.

This is despite the iron ore mining outfit not releasing any price-sensitive announcements to the ASX.

At the time of writing, Fortescue shares are fetching at $16.62 apiece, down 4.04%. Earlier in the session, the company’s share price hit a low of $16.39, a 5.36% drop on yesterday’s close.

For context, the S&P/ASX 200 Index (ASX: XJO) is treading also treading lower, down 0.14% so far today.

Let’s take a look at what’s dragging down the miner’s shares today.

Iron ore prices continue to sink

After stabilising for the last four weeks around the US$130 per metric tonne mark, iron ore prices have resumed their descent.

According to Trading Economics, the steel-making ingredient is trading at US$113 per tonne as of last night. This represents a fall of 21% compared to this time last month.

Mining.com reported that there’s currently weak demand for iron ore as Chinese steel mills put their blast furnaces on hold. This is due to COVID-19 restrictions in the country as well as bad weather amid a gloomy economic outlook.

With rampant inflation and aggressive rate hikes from major central banks, investors are bracing for slower economic growth worldwide.

These negative factors have put downward pressure on iron ore prices which, in turn, impacts Fortescue’s earnings.

Other shares in miners such as BHP Group Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO) are down 3.8% and 4.33%, respectively.

It’s worth noting that Fortescue sometimes suffers larger share price drops than its peers due to the lower-grade iron ore the company produces.

At 62% Fe (iron), Fortescue’s product is sold at a discounted rate below the benchmark price as opposed to its peers.

Fortescue share price snapshot

Adding to today’s decline, the Fortescue share price has tumbled almost 30% in the past 12 months.

When looking year to date, its shares are down around 13%.

Fortescue presides a market capitalisation of approximately $51 billion.

The post Why is the Fortescue share price slipping 5% today? appeared first on The Motley Fool Australia.

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More reading

• Why did the Fortescue share price sink in FY22?
• 5 things to watch on the ASX 200 on Tuesday
• 5 things to watch on the ASX 200 on Monday
• Should investors dig the Fortescue share price in July?
• How did the Fortescue share price perform in June?

Motley Fool contributor Aaron Teboneras 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 OZ Minerals Limited (ASX: OZL) share price is taking a belting this morning even after a leading broker upgraded its shares.

Shares in the copper miner fell around 5% in early trade – making it one of the worst performers on the S&P/ASX 200 Index (ASX: XJO).

The silver lining is that its shares recovered some ground to be down 1.26% at $17.23 at the time of writing.

OZ Minerals share price looking too cheap to ignore

The upgrade by Morgans may be helping. The broker lifted its recommendation on the OZ Minerals share price from hold to add, as it believes it is “far too oversold”.

OZ Minerals has shed a whopping 40% in value since the start of this calendar year.

Technical issues at its Carrapateena project, rising costs, and a weakening outlook for copper have weighed on the miner.

Recession fears tarnishing the copper outlook

The copper price has dived on fears of a looming global recession. It wasn’t that long ago that experts were forecasting supply constraints, but a recession would limit demand for the metal.

While Morgans acknowledges that uncertainties remain, it believes the outlook for the red metal isn’t as bad as some might believe.

The broker explains:

The long-term structural drivers appear intact despite marginal investors selling uncertainty. Despite short-term opacity, we note several macro shocks in recent years have proved compelling entry opportunities.

What is the OZ Minerals share price worth?

The opportunity looks even more compelling given where the OZ Minerals share price is currently sitting. The miner traded up to 1.3 times net present value (NPV) through 2021 due to over-excitement about “green metals”, which prompted Morgans to slap a hold on the shares.

But OZ Minerals is currently on 0.76 times NPV. The broker calls this “excessively cheap”. It also noted that the OZ Minerals share price has rebounded from these levels before during similar sell-offs.

Morgan’s 12-month price target is $23.12, which implies a more than 30% upside to the OZ Mineral’s share price.

Catching a falling knife  

However, Morgans warned would-be buyers that it may be “tactically prudent” for traders and short-term investors to wait. This is because the OZ Minerals share price could fall further in this climate of fear.  

OZ Minerals isn’t the only company under this dark cloud. Fellow copper producers Sandfire Resources Ltd (ASX: SFR) and South32 Ltd (ASX: S32) have also fallen out of favour, down 4% and 5% respectively.

The post Broker upgrade fails to stop the OZ Minerals share price from falling today appeared first on The Motley Fool Australia.

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More reading

• Why Argosy Minerals, Cann, OZ Minerals, and PointsBet shares are pushing higher
• ASX 200 midday update: Energy shares drop, PointsBet jumps
• What’s behind the weakness in ASX 200 mining shares during June?
• 5 things to watch on the ASX 200 on Tuesday
• Why Evolution, Newcrest, OZ Minerals, and Zip shares are dropping today

Motley Fool contributor Brendon Lau has positions in OZ Minerals Limited, Sandfire Resources NL, and South32 Ltd. 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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Financial year 2022 (FY22) was a busy period for now S&P/ASX 200 Index (ASX: XJO) tech staple, Block Inc (ASX: SQ2) and its share price.

While the payment service provider didn’t reach the Aussie market until January, it was the talk of the town for most of FY22 after announcing its plan to acquire former market darling and ASX buy now, pay later (BNPL) share Afterpay.

But between listing on the ASX and the end of FY22, the Block share price tumbled 48.7% to trade at $90.50.

For context, the ASX 200 slumped around 10% across the entirety of FY22.

Let’s take a closer look at what happened to Block and its share price over the course of last financial year.

What went wrong for the Block share price in FY22?

The Block share price first emerged on the ASX on 20 January, closing its first session at $176.63. Shares in the company hit the market after being issued to those previously invested in Afterpay.

Block proposed to take over the BNPL giant in August 2021, offering 0.375 Block (then Square) shares for each Afterpay stock to do so. The deal was valued at around $39 billion at the time.

However, that value tumbled alongside Block’s US listing, Block Inc (NYSE: SQ)’s share price. It fell around 55% between the acquisition’s proposal and its implementation.

Of course, the company also underwent a name change last financial year. Block was born from Square on 10 December. On announcing the switch, the company said:

The name has many associated meanings for the company — building blocks, neighbourhood blocks and their local businesses, communities coming together at block parties full of music, a blockchain, a section of code, and obstacles to overcome.

Finally, the most recent results released to the ASX from the payments and BNPL giant dropped in May.

Block’s revenue fell 22% to US$3.96 billion in the first quarter. Though, when excluding revenue from Bitcoin (CRYPTO: BTC), it increased by 44%. The company’s gross profit was also up 34% year-on-year, reaching US$1.29 billion.

However, it was likely a broader tech sell-off that damaged the Block share price most.

The S&P/ASX 200 Information Technology Index (ASX: XIJ) had a rough start to 2022 as uncertainty reigned. Then, tech stocks were once again among the hardest hit as inflation and resulting rate hikes kicked off.

The tech sector slipped around 40% over the course of FY22.

The post Why did the Block share price have such a lousy time in FY22? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX shares today
• Why APM, Block, Breville, and Superloop shares are charging higher
• These are the 10 most shorted ASX shares
• The Block share price plummeted 28% in June. Here’s why
• 5 things to watch on the ASX 200 on Monday

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 Bitcoin and Block, Inc. The Motley Fool Australia has positions in and has recommended Block, Inc. 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 had an incredibly volatile month in June.

Although the lithium developer’s shares recorded a monthly decline of 32%, that’s only part of the story.

What happened to the Sayona Mining share price in June?

Sayona Mining and other lithium shares came under significant pressure last month for a number of reasons. These include a bearish note out of Goldman Sachs and news that BYD is planning to buy a large number of lithium mines.

In respect to the latter, Warren Buffett-backed electric vehicle company BYD is reportedly planning to buy six lithium mines in Africa with the aim of producing approximately 1 million tonnes of lithium carbonate each year.

That would be enough to build at least 27.78 million electric vehicles, which covers the automaker’s expected demand for the next decade.

This means that as well as increasing overall supply, it would take a major lithium buyer out of the chain, which could have a big impact on the demand side of the equation. And if other automakers decide to follow suit, lithium developers like Sayona Mining could end up being bypassed.

What else?

Also weighing on the Sayona Mining share price was a note out of Goldman Sachs. Although the broker has been predicting a sharp decline in lithium prices in the coming years for some time, its latest note reiterating this view caught the attention of investors this time around.

This had investors panicking that lithium prices will be nowhere near current levels when Sayona Mining and other developers finally get around to producing and selling the white metal.

Following these events, the Sayona Mining share price eventually dropped as much as 50% month to date before a late rebound pared some of these declines.

That rebound was driven by the release of an update on drilling activities in Canada. Those results reveal that the Moblan deposit has the potential to become a world-class deposit.

Here’s hoping that July is a better month for shareholders.

The post Why did the Sayona Mining share price crash 32% in June? 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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The GrainCorp Ltd (ASX: GNC) share price is heading south in early trade on Wednesday morning, despite no company announcements.

At the time of writing, shares in the Australian agribusiness are down 6.12% to $8.59

Why are GrainCorp shares in reverse today? 

Following the company’s half-year results released on 11 May, investors are eyeing GrainCorp shares as they go ex-dividend today.

Typically, one business day before the record date, the ex-dividend date, is when investors must have purchased shares. If the investor did not buy GrainCorp shares before this date, the dividend will go to the seller.

What does this mean for GrainCorp shareholders?

For those eligible for GrainCorp’s dividend, shareholders will receive a payment of 24 cents per share on 21 July. The dividend is fully franked and comprises a 12 cent interim dividend and a 12 cent special dividend.

The interim dividend reflects a 50% increase compared to the prior corresponding period (8 cents per share).

And in case you weren’t aware, the 24 cent total dividend is the largest dividend that has been paid by the company since 2013.

Are GrainCorp shares a buy now?

Following the company’s financial scorecard, one broker weighed in on the GrainCorp share price.

According to ANZ Share Investing, the analyst team at Wilsons cut its price target by 9.4% to $8.80 for the grain exporter’s shares. The team believes that GrainCorp shares are fully valued for the time being.

Based on today’s price, this is roughly in line with where the company’s shares are currently trading.

GrainCorp share price snapshot

Looking at the past 12 months, the GrainCorp share price has accelerated 70% on the back of favourable trading conditions.

In contrast, the S&P/ASX 200 Consumer Staples (ASX: XSJ) sector has risen by around 2% over the same timeframe.

GrainCorp shares reached an all-time high of $10.86 in May, before backtracking amid inflationary movement and cost of living pressure.

The company commands a market capitalisation of roughly $2.09 billion, and has a dividend yield of 1.93%.

The post Here’s why the GrainCorp share price is shedding 6% today appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Hoping to bag the next Graincorp dividend? Read this
• These 2 ASX 200 shares are going ex-dividend next week
• Here are the top 10 ASX shares today
• Why GrainCorp, PointsBet, Weebit Nano, and Westpac shares are racing higher

Motley Fool contributor Aaron Teboneras 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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