Category: Stock Market

Earlier today the Telstra Corporation Ltd (ASX: TLS) share price dropped to a 2022-low of $3.80.

When the telco giant’s shares hit that level, it meant they were down a sizeable 10% since the start of the year.

Is the weakness in the Telstra share price a buying opportunity?

One broker that is likely to see the weakness in the Telstra share price as a buying opportunity is Morgans.

A recent note reveals that the broker has an add rating and price target of $4.56 on the telco giant’s shares.

Based on the current Telstra share price of $3.82, this implies potential upside of 19% for investors over the next 12 months.

But that doesn’t include the dividends that the broker is expecting Telstra to distribute. It continues to expect Telstra to pay a fully franked 16 cents per share dividend in FY 2022.

And while you may be too late for its interim dividend for FY 2022, which is in the process of being paid, don’t worry because this time next year Morgans expects Telstra to be preparing another interim dividend of the same value.

So, if we include this dividend into the equation to give us a 12-month yield of 4.2%, the total return on offer stretches to over 23%.

What did the broker say?

Morgans has previously stated that its positive view on the Telstra share price is underpinned by improving industry dynamics and its belief that the telco is undervalued on a sum of the parts (SOTP) basis.

It commented: “Industry dynamics have turned positive (NBN and mobile prices are increasing after 5 years of decline; TLS’s targets imply they continue to rise). The SOTP for TLS is worth more than the current share price (and steps to release this value are underway; albeit timing is unclear).”

The post Broker sees 19% upside for Telstra (ASX:TLS) share price and 4% dividend yield appeared first on The Motley Fool Australia.

More reading

• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends
• Analysts name 2 ASX 200 dividend giants to buy in March
• These 3 ASX 200 shares are topping the volume charts on Friday
• The Telstra (ASX:TLS) share price has tumbled 9% in 6 weeks. What’s happening?
• Telstra (ASX:TLS) share price in the red amid new satellite deal

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 owns and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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When an ASX investor buys an exchange-traded fund (ETF), one of the reasons you will probably hear is ‘diversification‘. Yes, index funds, in particular, can be enormously useful in diversifying a concentrated portfolio with one easy investment. Take the most popular index in the world, the US’s S&P 500 Index. One unit of an S&P 500 ETF, such as the iShares S&P 500 ETF (ASX: IVV), represents an investment of roughly 500 of the largest companies on the US markets. You might think the same could be said of the Vanguard Australian Shares Index ETF (ASX: VAS).

VAS is the most popular ETF on our share market. It is an index fund that tracks the S&P/ASX 300 Index (ASX: XKO). This index, as you might imagine, tracks 300 of the largest ASX shares on our share market. Diversified, right?

Well, not as much as you’d think.

What’s in an index?

See, an index fund is usually weighted by market capitalisation. That means that the largest companies on the index also have the largest weighting in the ETF. Woolworths Group Ltd (ASX: WOW) has a far larger presence in VAS than say IGA-owner Metcash Ltd (ASX: MTS), for example. This isn’t a big deal, most index funds follow a similar arrangement.

Over time, it allows the winners in an index to contribute more to the index’s overall performance. But in VAS’s case, we have recently seen the fund become far more concentrated than it used to be. That’s thanks in large part to BHP Group Ltd (ASX: BHP). Earlier this year, BHP ended its dual-listing structure, which saw its London Stock Exchange listing dissolved, and those shares return to the ASX boards. Thus, BHP is now a far larger company on the ASX than it used to be.

That means it’s also a larger holding in VAS. As a matter of fact, as of 31 January, BHP alone made up 10.88% of VAS’s entire portfolio.

Next up, we have Commonwealth Bank of Australia (ASX: CBA), with a 7.41% weighting.

CSL Limited (ASX: CSL) is next, worth 5.77%.

But National Australia Bank Ltd (ASX: NAB), Australia and New Zealand Banking Group Ltd (ASX: ANZ), and Westpac Banking Corp (ASX: WBC) were VAS’s 4th, 5th and 6th most-weighted shares respectively. That’s with a corresponding 4.12%, 3.47% and 3.45% weighting. And Macquarie Group Ltd (ASX: MQG) was the 7th, at 3.01%.

That’s a total of 21.46% of VAS’s total holdings for the big four and Macquarie alone. More than a fifth.

VAS-t diversification?

Throw in BHP’s 10.88% and Rio Tinto Limited‘s (ASX: RIO) 1.92% and we have a total of 34.26% of VAS’s total holdings in banks and miners. More than third.

So almost one dollar in every three invested in VAS goes to these two miners and five bank shares. That’s not exactly what one might call a high level of diversification. And this diversification would deteriorate even further if an investor holding the Vanguard Australian Shares Index ETF in their portfolio also happened to hold any of those companies too.

Now, other index funds like the iShares S&P 500 ETF are also top heavy. But, by contrast, IVV’s top holding is only worth 6.91% of the entire portfolio. That’s a big difference from 10.88%.

That said, there’s nothing inherently wrong with VAS’s structure. That’s how index funds are supposed to work. But just be wary of the kinds of diversification you are getting with an ASX index ETF. It might not be as diverse as you might think.

The post Diversification? Why VAS is really a bet on banks and miners appeared first on The Motley Fool Australia.

More reading

• Think VAS is the best ASX index fund? These ETFs have beaten it over the past decade…
• What’s going so wrong for ASX ETFs in 2022 so far?
• Hot ETF? Here’s how the VAS (ASX:VAS) share price has performed in 2022 so far…

Motley Fool contributor Sebastian Bowen owns National Australia Bank Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended CSL Ltd. The Motley Fool Australia has recommended Macquarie Group Limited, Westpac Banking Corporation, and iShares Trust – iShares Core S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Polynovo Ltd (ASX: PNV) share price has continued to decline, sending investors for the exits.

Since the beginning of 2022, the company’s shares have lost 38% to hit a multi-year low of 83.5 cents today.

Although a slight rebound has occurred during afternoon trade, its shares are still down 2.85% to 93.8 cents.

Below, we take a look at what is impacting the company’s share price of late.

Polynovo shares continues to attract short interest

Following the company’s first half results, negative sentiment around the Polynovo share price continues to induce investors holding short positions.

This comes despite the company reporting solid growth over the last 6 months, particularly across the United States segment.

Notably, management refrained from providing a meaningful outlook for H2 FY22, which may have caused investors to sell Polynovo shares.

Previously, the company stated that challenging market conditions caused by COVID-19 created headwinds for the company.

On 2 March, the Australian Securities & Investments Commission (ASIC) released its short position report, indicating an increased short interest in Polynovo shares.

As such, Polynovo took up sixth place with the highest number of investors shorting its shares at 8.92%. This is a 3.2% increase from the same time last month when Polynovo had a short interest of 8.64%.

Given the scope of short positions being taken up, it appears investors believe the company’s performance will be inconsistent.

What do the brokers think?

Following Polynovo’s financial scorecard for H1 FY22, Wilsons further cut its 12-month price target for the company’s shares by 22% to $1.11.

It appears the broker is acknowledging that Polynovo is underperforming its expectations for FY22 thus far.

In addition, Macquarie had a similar tone, slashing its rating by 44% to $1.60 per Polynovo share. Based on the current share price, this implies an upside of roughly 70.5% for investors.

Polynovo share price summary

Over the past 12 months, the Polynovo share price has continued its downward trend to post a 60% loss.

In comparison, the S&P/ASX 200 Healthcare (ASX: XHJ) sector has gained around 2.6% in the same timeframe.

Based on today’s price, Polynovo presides a market capitalisation of about $618.68 million and has approximately 661.69 million shares outstanding.

The post Why is the Polynovo (ASX:PNV) share price sinking to a new multi-year low? appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• ASX 200 (ASX:XJO) midday update: Rio Tinto, South32 storm higher, PointsBet sinks
• These are the 10 most shorted ASX shares
• Polynovo (ASX:PNV) share price stung 4% as H1FY22 net loss wreaks havoc
• These are the 10 most shorted ASX shares

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. owns and has recommended POLYNOVO 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 Bruce Jackson.

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The team at Morgans has been running the rule over a number of ASX 200 shares following the completion of earnings season.

Among its best ideas for March are the shares listed below. Here’s why they broker rates these ASX 200 shares highly:

Treasury Wine Estates Ltd (ASX: TWE)

This wine company is a key pick for the broker. It believes Treasury Wine’s shares are trading at a very attractive level, particularly given its strong growth outlook.

It said: “TWE owns much loved iconic wine brands, the jewel in the crown being Penfolds. We rate its management team highly. The company recently reported an impressive 1H22 result despite facing a number of material headwinds. The foundations are now in place for TWE to deliver strong double digit growth from the 2H22 over the next few years. Trading at a material discount to our valuation and other luxury brand owners, TWE is a key pick for us.”

Morgans currently has an add rating and $13.93 price target on the Treasury Wine’s shares.

Wesfarmers Ltd (ASX: WES)

Another ASX 200 share that the broker rates highly is Wesfarmers. It is a big fan thanks to the strength of its portfolio of retail brands and strong balance sheet. And while it acknowledges that trading conditions are not easy, it remains confident on the future and sees recent share price weakness as a buying opportunity.

Morgans explained: “WES possesses one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart, Target and Officeworks. The company is run by a highly regarded management team and the balance sheet is healthy. While Covid-related staff shortages are proving to be a challenge, the core Bunnings division (>60% of group EBIT) remains a solid performer as consumers continue to invest in their homes. We see the recent pullback in the share price as a good entry point for longer term investors.”

The broker currently has an add rating and $58.50 price target on Wesfarmers’ shares.

Westpac Banking Corp (ASX: WBC)

Finally, this banking giant is another of Morgans’ best ideas for March. It believes the bank’s shares are very attractively priced, with significant upside potential ahead.

The broker commented: “WBC is our preferred major bank. We believe WBC offers the most compelling valuation of the major banks. In terms of quality of overall risk profile, we believe WBC is a close second to CBA. On credit risk, we believe WBC is positioned relatively defensively due to its loan book being more skewed to Australian home lending.”

Morgans has an add rating and $29.50 price target on Westpac’s shares.

The post Broker names 3 of the best ASX 200 shares to buy in March appeared first on The Motley Fool Australia.

More reading

• Is the Westpac (ASX:WBC) share price the best bank idea for dividends?
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends
• Could Wesfarmers (ASX:WES) be gearing up for an electrifying investment?
• Australia’s newest tech unicorn, Zeller, is taking on the ASX banks. Here’s how
• 2 cheap ASX dividend shares analysts rate as buys

Motley Fool contributor James Mickleboro owns Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Wesfarmers Limited. The Motley Fool Australia has recommended Treasury Wine Estates Limited and Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The share price of ASX energy stock Melbana Energy Ltd (ASX: MAY) is surging today, hitting its highest point since 2012.

Its gains come despite no news having been released by the oil and gas producer. Additionally, the S&P/ASX 200 Energy Index (ASX: XEJ) is plunging 2.91%.

At the time of writing, the Melbana Energy share price is 13 cents, 8.7% higher than its previous close.

Let’s take a look at what might be boosting the ASX energy producer’s shares today.

Why is the Melbana Energy share price soaring today?

The Melbana Energy share price is launching upwards today despite the energy sector retreating after its 5.25% gain yesterday.

The sector’s struggles come as the energy prices wobble.

Right now, West Texas Intermediate futures have recovered from a dip to trade at US$119.85 a barrel ­– up 0.3%, according to CNBC. Brent crude futures are 0.8% higher, trading at US$124.20 a barrel.

Meanwhile, natural gas futures have dropped 1.9% to US$4.74 per metric million British thermal unit.

That’s weighing on oil giants Santos Ltd (ASX: STO), Woodside Petroleum Limited (ASX: WPL), and Beach Energy Ltd (ASX: BPT). Their share prices are slumping 3.37%, 3.28%, and 2.54% respectively today.

However, Melbana hasn’t been tracking its sector lately.

The ASX energy share has gained a whopping 456% year to date. That was largely driven by a 78% surge experienced by the stock when the company announced the finding of a “significant oil interval” last month.

It gained another 25% yesterday as oil prices soared to their highest point in 13 years.

Meanwhile, the energy sector is up a respectable 20% year to date, including today’s dip.

Perhaps that’s why the small-cap ASX energy share is defying the broader market today.

The post This ASX energy share is combatting its sector’s sell-off to hit 9-year highs appeared first on The Motley Fool Australia.

More reading

• Melbana (ASX:MAY) share price jumps 6% on exploration approval

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 Bruce Jackson.

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Qantas Airways Limited (ASX: QAN) shares are coming under renewed pressure.

Just as the 2-year long pandemic related travel restrictions are lifting across its major markets, the cost of fuel – a major cost for airlines – is heading skywards following Russia’s invasion of Ukraine.

While Brent crude oil dipped 0.7% overnight, it remains at a more than 10-year high of US$122 per barrel. That’s up from US$78 per barrel on 1 January and $91 per barrel just 1 month ago.

Over that month, Qantas shares have fallen 17%.

So, how is the S&P/ASX 200 Index (ASX: XJO) airline responding to fast rising fuel costs?

Recovering the costs of fuel

Qantas chief financial officer Vanessa Hudson said that higher ticket prices are among the airline’s plans to tackle rising fuel costs.

Hudson said (quoted by Bloomberg), “The group is very well placed to be able to recover the cost of fuel if it stays at the levels that it is at the moment.”

Hudson also pointed out that Qantas’ oil exposure is 90% hedged through June. That will help insulate the company from the immediate impact of rocketing crude prices and offer some support for Qantas shares.

As for lifting airfare prices, Hudson said:

What you need for that is strong underlying demand and relatively stable and rational capacity, and right now we are seeing that. We’re seeing very strong leisure demand coming across both our domestic and our international markets.

She added that all of Qantas’ major markets for international travel, such as the United Kingdom and the United States are open. And that with Western Australia rejoining the nation, all of its domestic markets are open now without restriction as well.

And people are eager to resume travelling. “The intent to travel over the coming year is as high as it’s ever been,” Hudson said.

How have Qantas shares been tracking?

Qantas shares are down 11.5% in the new year. That compares to a year-to-date loss of 7.6% posted by the ASX 200.

The Qantas share price remains down more than 35% from its pre-pandemic levels.

The post Qantas (ASX:QAN) shares have slumped 17% in a month. So how is the airliner responding to rising oil prices? appeared first on The Motley Fool Australia.

More reading

• Why Block, GQG, Qantas, and Unibail-Rodamco-Westfield are sinking today
• Why is the Qantas (ASX:QAN) share price diving 7% today?
• The oil price just hit a 13-year high, and these ASX 200 shares are surging
• Why Magellan, Nick Scali, Qantas, and Zip shares are tumbling today
• Qantas (ASX:QAN) share price dives 4% amid escalating Ukraine fears

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 Bruce Jackson.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is losing steam and starting to slide lower. At the time of writing, the benchmark index is down 0.4% to 7,012.1 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are pushing higher:

CSL Limited (ASX: CSL)

The CSL share price is up 3% to $256.98. Investors have been buying this biotherapeutics giant’s shares following reports that the TGA has approved a super flu jab by its Seqirus business for children as young as two years old. The Flucelvax Quad vaccine was the first cell-based seasonal influenza vaccine offered in Australia when it was first approved in 2021. Prior to TGA approval, CSL had distributed 100 million doses globally.

Incitec Pivot Ltd (ASX: IPL)

The Incitec Pivot share price is up almost 2% to $3.53. This morning the agricultural chemicals company’s shares were upgraded by analysts at Credit Suisse. According to the note, the broker has put an outperform rating and $3.85 price target on its shares. It believes Incitec Pivot will benefit from higher fertiliser prices.

Lake Resources N.L. (ASX: LKE)

The Lake Resources share price is up 2% to $1.01. This appears to have been driven by news that the lithium explorer has raised $39 million through an at-the market raise. As per its agreement with Acuity Capital, it has raised the funds through the issue of 40 million shares at 97.5 cents per new share.

St Barbara Ltd (ASX: SBM)

The St Barbara Ltd (ASX: SBM) share price is up 8% to $1.53. Investors have been bidding this gold miner’s shares higher today amid speculation it could be a takeover target. Nearby peers Northern Star Resources Ltd (ASX: NST) and Ramelius Resources Limited (ASX: RMS) could reportedly be interested in the beaten down gold miner’s Gwalia underground mine and processing plant.

The post Why CSL, Incitec Pivot, Lake Resources, and St Barbara are pushing higher appeared first on The Motley Fool Australia.

More reading

• CSL (ASX:CSL) share price lifts following new regulatory approval
• ASX 200 (ASX:XJO) midday update: CSL and St Barbara charge higher
• Here’s why the St Barbara (ASX:SBM) share price is leaping 8% on Tuesday
• 5 things to watch on the ASX 200 on Tuesday
• These 3 ASX 200 shares are topping the volume charts this Monday

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. owns and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Bapcor Ltd (ASX: BAP) share price in heading south during early afternoon trade on Tuesday. This follows the news that the companies has confirmed an impending reshuffle in the leadership team.

At the time of writing, the auto parts retailer’s shares are exchanging hands for $6.11, down 2.24%.

Bapcor COO hands in notice to take on new position

The Bapcor share price is in negative territory today as investors react to the latest news.

According to an article published by the Australian, Bapcor has confirmed that its chief operating officer, Mr Nicol has resigned.

While the departure date has not been set, Mr Nicol will leave the company within the next few months. This will see him take on a new role as CEO in the flooring industry.

Mr Nicol joined Bapcor in July 2019, overseeing an array of functions that included logistics, IT, group procurement, and branding strategy.

Most notably, Mr Nicol was heavily involved in the company’s new Victorian distribution centre, which opened in 2021.

The 50,000 square metre warehouse services Bapcor’s 32 business units and 1100 locations in Australia and New Zealand. 

The company didn’t note a successor to the COO role; however, it’s almost certain that a transition process will occur.

Bapcor share price snapshot

Over the past 12 months, the Bapcor share price has lost about 14%, with most of these losses coming in 2022.

It’s worth noting that the company’s shares reached a 52-week low of $6.03 today following weak investor sentiment.

Based on valuation grounds, Bapcor commands a market capitalisation of roughly $2.07 billion, with 339.41 million shares outstanding.

The post Why is the Bapcor (ASX:BAP) share price underperforming today? appeared first on The Motley Fool Australia.

More reading

• 2 cheap ASX shares for value investors to buy in March 2022: experts
• Leading brokers name 3 ASX shares to buy today
• 2 cheap ASX shares value investors shouldn’t miss
• Here are the top 10 ASX shares today
• Why Bapcor, Mineral Resources, Nanosonics, and Syrah shares are falling today

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 recommended Bapcor. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Picking ASX shares that prove to be dividend winners is always a tricky game. As is any other kind of investing for that matter. But it’s the unique metrics that dividend investors have to navigate which makes this area of investing a little more unique. All investors know upfront what kind of dividends an ASX share has paid out over the past 12 months. And, by extension, the kind of dividend yield each ASX share may possess.

But as investors should know, just because an ASX share has a high dividend yield, it doesn’t mean investors can take that to the bank. A common investing mistake is to choose an ASX dividend share due to a seemingly fat yield, only to have that yield pared back. Not to mention a simultaneous share price fall to boot. This scenario is often described as a ‘dividend trap’.

So let’s look at some ASX shares today that seem to be offering outsized yields right now. Could any of them be a dreaded dividend trap?

When is a high dividend yield just trap bait?

Magellan Financial Group Ltd (ASX: MFG) is one such share. Magellan has had a horrible year, losing around 66% of its value. But this has pushed up Magellan’s trailing dividend yield to an eye-watering 15.57% on current pricing. The interesting thing about Magellan is that when the company reported its half-year earnings last month, it declared an interim dividend of 110.1 cents per share, which coincidentally was paid out today.

That was Magellan’s highest-ever interim dividend. So why aren’t investors flocking to this company’s massive 15%-plus yield? Well, Magellan makes its money from its funds management business. And the company has been experiencing record fund outflows over the past few months for a number of reasons.

So it seems that investors are betting that this outflow will start to bite the company’s ability to keep funding dividends at these kinds of levels. We’ll have to see if this turns out to be the case, but at least one broker isn’t too sure it will.

Another ASX dividend share with a 15% yield right now

Fortescue Metals Group Limited (ASX: FMG) is another ASX dividend share seemingly offering a monster dividend yield right now. On current pricing, the iron ore giant has a trailing dividend yield of close to 15.5%. That’s even after the company cut its interim dividend by 41% as announced in its earnings last month. The cut was the result of Fortescue directing more capital towards its emerging Fortescue Future Industries hydrogen business.

Fortescue’s profits (and dividends) are intrinsically tied to the price of iron ore itself. Last month, Fortescue announced that its average revenue per dry metric tonne over the half was US$96. But iron ore has continued to boom in recent months, and is now going for a six-month high above US$160 a tonne.

If the iron ore price continues to hold at these levels, and Fortescue can continue to extract it at relatively low costs (made harder recently by surging oil prices), we could well possibly see dividends continue to roll in at these high rates. But again, we shall have to wait and see.

The post 15% yield! But are these ASX high-yield shares dividend traps? appeared first on The Motley Fool Australia.

More reading

• Down 31% this year: Top broker tips more pain for Magellan (ASX:MFG) share price
• ASX 200 (ASX:XJO) midday update: CSL and St Barbara charge higher
• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX shares today
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends

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

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The Woodside Petroleum Limited (ASX: WPL) share price is dipping into the red today.

At time of writing, shares in the S&P/ASX 200 Index (ASX: XJO) energy giant are down 2.6% to $33.52.

But don’t go breaking out your tiny violin for Woodside shareholders just yet.

Today is the first time in 7 trading days that the Woodside share price has gone backwards.

Yesterday, shares closed at $34.41. That’s the highest price in more than 2 years, going all the way back to February 2020 before the pandemic knocked the stuffing out of oil and gas prices.

What’s happening with the Woodside share price?

It’s not just Woodside coming under some selling pressure today.

The S&P/ASX 200 Energy Index (ASX: XEJ) is down 2.7%, compared to a 0.2% retreat on the ASX 200.

Why are ASX energy shares underperforming?

It all boils down to oil and gas prices.

After soaring higher all month following oil-rich Russia’s aggressive posturing and then invasion of Ukraine, crude oil prices dipped overnight. Brent crude fell 0.7% to US$122 per barrel, according to data from Bloomberg.

While that’s no major fall, and still up from US$91 per barrel just a month ago, investors may be looking to take some profits off the table after riding ASX energy shares to multi-year highs.

As for the Woodside share price, despite today’s retrace it remains up 48% for the year.

The post Woodside (ASX:WPL) share price slips for first time in 7 days appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX shares today
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends
• Woodside (ASX:WPL) share price surges another 9% today as oil resumes rally
• Why Argosy Minerals, De Grey, Whitehaven, and Woodside shares are racing higher

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 Bruce Jackson.

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