Category: Stock Market

Sometimes even the experts can’t work out what’s going on.

Many ASX-listed companies put out excellent financial results and outlook, but for some reason the market continues to hate them.

This is the frustration facing the team at Forager at the moment.

“While half-yearly results were reported [in February] by most ASX-listed companies, they were not the main drivers of share prices,” read a Forager Australian fund memo to clients.

“The month started with a lot of focus on increasingly concerning signs of inflation and the prospect of higher interest rates, and ended with Russia mounting a full-scale military invasion of Ukraine.”

Forager is keeping the faith with 2 ASX shares in particular that have really copped the thumbs down in recent times: 

Why is the market punishing good businesses?

Perenti Global Ltd (ASX: PRN) and Macmahon Holdings Limited (ASX: MAH) are both mining services providers.

According to Forager analysts, they’re “scratching their heads” as to how these stocks have “almost halved” since the start of 2021 to now hit a forward price-to-earnings ratio of just 6.

“Both companies delivered perfectly acceptable half-year results. Both have a newfound commitment to capital-allocation discipline,” their memo read.

“Macmahon, in particular, has been delivering consistent and improving results for the past 4 years.”

Even their sector outlook is favourable, with resources shares shining bright currently while other industries struggle for investment.

“Commodity prices [are] high and a significant pipeline of new potential mines [are] in the offing,” the Forager team said. 

“And yet their share prices seem to only go down.”

Despite the frustrations, the Forager team is betting that their share prices will soon start reflecting the companies’ clear profitability.

“Something has to give,” the memo read.

“[We] have increased the fund’s holdings in both through February. Combined they represent 6% of the portfolio.”

Macmahon and Perenti are not the only ones suffering from a lack of attention despite positive business performance. 

Technology shares Whispir Ltd (ASX: WSP) and Bigtincan Holdings Ltd (ASX: BTH) have both been swept up in the recent correction to growth stocks.

“Both reported better-than-expected results and strong outlooks for the current year. While less obvious, they are also showing their potential to be highly profitable once the growth taps are turned down,” said the Forage team.

“If they keep getting pummelled in the short term, you should expect a substantially increased allocation to these.”

The post I’m doubling down on 2 ASX shares that keep going down: fund manager appeared first on The Motley Fool Australia.

More reading

• Analysts name 2 ASX growth shares to buy with 40%+ upside
• 2 ASX dividend shares analysts say are buys now
• 2 ASX shares to buy now at bargain prices that you’ve forgotten about
• The Webjet (ASX:WEB) share price has fallen 10% in a month
• Top ASX dividend shares to buy in March

Motley Fool contributor Tony Yoo owns Whispir Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended BIGTINCAN FPO and Whispir Ltd. The Motley Fool Australia has recommended BIGTINCAN FPO and Whispir Ltd. 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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Are you looking for dividend shares to buy? If you are, then you might want to look at the ASX shares listed below.

Here’s why analysts think these ASX dividend shares could be worth considering right now:

Baby Bunting Group Ltd (ASX: BBN)

The first ASX dividend share to consider is Baby Bunting. It is the leading baby products retailer with a strong and growing presence through its national superstores and online business.

Citi is a fan of the retailer and has a buy rating and $6.22 price target on its shares. This is due to its clear leadership position in a less discretionary category which stands to benefit from ~300,000 births a year in Australia.

It is thanks to this strong market position that the broker believes Baby Bunting can “outperform the broader small cap retail sector this year.” But it doesn’t expect its growth to stop there. Citi “forecast[s] a FY21 to FY24 EPS CAGR of 17%.”

As for dividends, Citi has pencilled in fully franked dividends per share of 16 cents in FY 2022 and 19 cents in FY 2023. Based on the current Baby Bunting share price of $4.71, this will mean yields of 3.4% and 4%, respectively.

Westpac Banking Corp (ASX: WBC)

Another ASX dividend share to consider is banking giant, Westpac. Due to concerns over the big four bank’s margin outlook and doubts over its cost cutting plans, its shares have fallen heavily in recent months.

However, the team at Morgans believes these concerns are unwarranted and has suggested that Westpac can overcome its margin issues and deliver on its cost-cutting targets. 

In light of this, it believes the bank’s shares have been oversold and are great value now. The broker has an add rating and a $29.50 price target on the Westpac shares.

Morgans also expects attractive dividend yields in the near term. The broker has pencilled in fully franked dividends per share of $1.19 in FY 2022 and then $1.60 in FY 2023. Based on the current Westpac share price of $23.23, this will mean yields of 5.1% and 6.9% respectively.

The post 2 ASX dividend shares analysts say are buys now appeared first on The Motley Fool Australia.

More reading

• Why ASX 200 bank shares are storming higher today
• Is the NAB (ASX:NAB) share price a buy? Top broker expects sector-leading earnings growth
• Brokers name 3 ASX shares to buy today
• Why this broker has big doubts over Westpac’s (ASX:WBC) cost cutting plans
• 5 things to watch on the ASX 200 on Friday

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 has recommended Baby Bunting 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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Wise long-term investors will have been using this year’s depressed market to snap up some bargains.

However, when the whole market is so down in the dumps, you can’t possibly keep track of all the cheapies out there.

That’s why it’s worth listening to some experts who have spotted some excellent candidates:

18% share price upside while interest rates head up

With interest rates looking very likely to rise this year, finance and insurance ASX shares have already been tipped by many analysts as value plays.

But one name that hasn’t popped up too much is Challenger Ltd (ASX: CGF).

The annuities and income funds provider is a buy in Morgans investment advisor Jabin Hallihan’s book at the moment.

“A key feature of these products is they distribute cash flow and protect against market movements and inflation risks,” he told The Bull.

“Such products appeal for their stability, particularly during times of market volatility.”

The stock could potentially be at an attractive entry point right now, having fallen more than 4% this year so far.

Hallihan’s team has a 12-month price target of $7.74, which is an 18% upside.

Challenger shares also return a handy dividend yield of around 3.35%.

Australians need healthcare, regardless of what else is happening

Healthcare is one of those sectors that is somewhat resistant to economic and interest rate cycles. People will always need to take care of their health.

As such, Wilsons investment advisor Peter Moran would currently buy shares in Integral Diagnostics Ltd (ASX: IDX).

“This diagnostic imaging services company recently undertook a $90 million capital raising to fund the acquisition of Peloton Radiology.”

The Integral share price has fallen close to 23% so far this year.

Moran admitted February financials were not favourable, but expected the underperformance to be temporary.

“First half 2022 operating net profit after tax was down 21.7% on the prior corresponding period,” he said.

“The result was impacted by COVID-19 restrictions. However, with restrictions easing, we expect profitability to recover as margins improve and recent investments in their business start to produce a return.”

Moran’s team holds an overweight recommendation on Integral shares.

The stock is somewhat polarising, with CMC Markets showing 6 of 13 analysts rating it as a strong buy while 5 label it as a hold.

The post 2 ASX shares to buy now at bargain prices that you’ve forgotten about appeared first on The Motley Fool Australia.

More reading

• Is opportunity knocking? 2 ASX All Ordinaries shares hitting 52-week lows
• Integral Diagnostics (ASX:IDX) share price on ice after trio of big announcements
• Top brokers name 3 ASX shares to buy next week
• Why is the Challenger (ASX:CGF) share price outperforming this week?
• Here are the top 10 ASX 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 recommended Challenger Limited and Integral Diagnostics Ltd. 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 Webjet Limited (ASX: WEB) share price has fallen by around 10% in the past month

Compare that to the S&P/ASX 200 Index (ASX: XJO), which is only down by around 2%.

What’s going on with the Webjet share price?

It’s hard to avoid the fact that oil prices are now much higher than they were at the start of the year.

Aussies are seeing higher prices at the service stations. But cars and trucks aren’t the only transportation experiencing higher fuel costs as well.

Oil is a key expense of getting planes in the air. Higher fuel costs and other inflation may lead to higher ticket prices from the likes of Qantas Airways Limited (ASX: QAN).

It’s possible that higher charges by Qantas and other airlines could hurt the Webjet profit margin and/or lead to lower-than-expected demand for travel, meaning less volume for Webjet.

The ASX travel share has already been living through difficulty because of the COVID-19 global pandemic which has heavily impacted global travel over the last two years.

Webjet’s latest result showed that the business is recovering, but it’s not back to full volumes yet.

Last report

In November 2021, Webjet announced its FY22 half-year result for the six months to September 2021.

Its underlying operations showed total transaction volume (TTV) of $663 million, up 148% year on year. The revenue generated for the six months was $55.4 million, up 145%.

Webjet’s half-year earnings before interest, tax, depreciation and amortisation (EBITDA) was a loss of $15.9 million. However, this was an improvement of 60% compared to the EBITDA loss of $40.1 million in the prior corresponding period.

The ASX travel share also made a net loss after tax of $43.8 million. That was an improvement of around 25% year on year. Growth in the bottom line can be helpful for the Webjet share price.

Promising signs?

Webjet said with that result that the business was turning around as global markets started to reopen. Positive working capital was delivering a $3.5 million per month cash surplus.

WebBeds was profitable since July, with half-year costs down 31% compared to pre-COVID and on track to be 20% more cost efficient at scale. November 2021 TTV was 63% of pre-COVID volumes with many key markets (at the time) yet to reopen.

The Webjet online travel agency (OTA) returned to profitability in October 2021.

Webjet also said that the third quarter was tracking ahead of the FY22 second quarter.

The ASX travel share said that it believes ongoing vaccinations, boosters and anti-viral treatments will stabilise the impact of COVID-19 within the next six to 12 months.

Based on its trajectory, at the time, of outperforming the market with its WebBeds and Webjet OTA businesses, the company believed that it would be back at pre-COVID booking volumes by the second half of FY23. This would be between October 2022 to March 2023.

Is the Webjet share price a buy?

There is a mix of views on Webjet at the moment.

Morgans rates it as a buy with a price target of $6.60. That’s an upside of more than 20%, if the broker ends up being right.

However, Morgan Stanley is only ‘equal-weight’ on the business, with a price target of just $4.30. That’s 20% lower than where it is right now.

The post The Webjet (ASX:WEB) share price has fallen 10% in a month appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• Why Block, Breville, Megaport, and Webjet shares are falling today
• Here’s why ASX 200 travel shares are having another stellar day
• ASX travel shares rebound despite rising oil prices
• Can the Webjet (ASX:WEB) share price recover to reach its 2022 highs?

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 Webjet Ltd. 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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As we head into the cooler autumn months, we asked our Foolish contributors to compile a list of ASX dividend shares experts reckon are worth considering in March. Here is what the team came up with.

Tristan Harrison: Brickworks Limited (ASX: BKW) 

Brickworks is a building products business with a trailing grossed-up dividend yield of 4.1%.  

The company funds its dividend – which hasn’t been cut for more than 40 years — from the growing cash flow of its investments division and a 50% stake of the industrial property trust.  

The trust builds industrial properties on excess Brickworks land. It just completed a huge warehouse in Sydney for Amazon. It’s also building several other large distribution warehouses for other businesses, including major supermarkets.  

Pre-committed developments completed over the next two years will add $50 million of gross rent and increase leased assets by $1.2 billion.  

Motley Fool contributor Tristan Harrison does not own shares of Brickworks. 

Mitchell Lawler: Infomedia Limited (ASX: IFM)

Infomedia could be considered a little-known software-as-a-service (SaaS) company operating in the automotive industry. Its primary order of business is providing a leading online Electronic Parts Catalogue – connecting automotive dealers with up-to-date part manufacturing data. 

While many tech companies have been sold off in recent months – including Infomedia (down ~23%) – due to the market going risk-off, this business remains profitable and debt-free. 

Additionally, Infomedia announced the appointment of its new CEO last week following the resignation of its former CEO in October last year.

For the income investor, this company touts a dividend yield of approximately 3.5% with 70% franking.

Motley Fool contributor Mitchell Lawler does not own shares in Infomedia Ltd.

James Mickleboro: Charter Hall Social Infrastructure REIT (ASX: CQE)

Charter Hall Social Infrastructure REIT is the largest Australian ASX-listed real estate investment trust that invests in social infrastructure properties. These are properties such as emergency command centres, pathology facilities, childcare centres, and council buildings.

At the last count, the company owned 364 properties and boasted a 100% occupancy and a massive 14.6-year weighted average lease expiry.

Goldman Sachs is very positive on its future and has a conviction buy rating and $4.20 price target on its shares. Its analysts stated: “We continue to believe the REIT is positioned for a solid growth outlook given the sector’s positive fundamentals and CQE’s strong balance sheet, with headroom and liquidity to pursue accretive investment opportunities.”

As for dividends, the broker is forecasting dividends per share of 17.2 cents in FY 2022 and 18.3 cents in FY 2023. Based on the current Charter Hall Social Infrastructure share price of $3.99 at Monday’s close, this implies yields of 4.3% and 4.6%, respectively.

Motley Fool contributor James Mickleboro does not own shares of Charter Hall Social Infrastructure REIT.

Sebastian Bowen: iShares Global Consumer Staples ETF (ASX: IXI)

This ETF invests in a global basket of consumer staples shares. It has holdings from a range of regions, but mostly from the United States.

Consumer staples companies typically manufacture goods that are deemed as food, drinks, or household essentials. Although this ETF has a seemingly bland trailing yield of roughly 2.1%, it holds many companies that are dividend aristocrats, such as Coca-Cola Company, PepsiCo and Walmart.

A dividend aristocrat is a company that has raised its dividend payments every year for at least 25 years. Additionally, consumer staples, due to their defensive ‘needs-based’ nature, can help to add stability to a portfolio.

Motley Fool contributor Sebastian Bowen does not own shares of the iShares Global Consumer Staples ETF, but owns Coca-Cola, PepsiCo and Walmart.

Aaron Teboneras: Dicker Data Ltd (ASX: DDR) 

Dicker Data is an Australian distributor of computer hardware, software, and related products. Its vendor partners include many of the world’s leading IT names. 

In its FY21 financial scorecard, the company reported double-digit growth for both total revenue and profit after tax. It also expanded its active service base with more than 8,200 reseller partners. 

As a result, the board opted to increase its quarterly dividend to 15 cents per share. This represented a 66.6% increase from the 9 cents declared in the previous period. 

The company noted that it intends to maintain its dividend policy and to continue paying interim dividends in quarterly instalments. 

Over the past 12 months, Dicker Data has delivered dividends totalling 42 cents, up 27.3% on FY20. 

Furthermore, the Dicker Data share price has accelerated 25% since this time last year. 

Motley Fool contributor Aaron Teboneras owns shares of Dicker Data Ltd. 

The post Top ASX dividend shares to buy in March appeared first on The Motley Fool Australia.

More reading

• Why CSL, Dicker Data, Elders, and Virtus Health shares are charging higher
• Leading brokers name 3 ASX shares to buy today
• 2 ASX dividend shares with big yields that analysts rate as buys
• Broker names the 3 best ASX tech shares to buy today
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Brickworks, Dicker Data Limited, and Infomedia. The Motley Fool Australia owns and has recommended Brickworks, Dicker Data Limited, and iShares Global Consumer Staples ETF. The Motley Fool Australia has recommended Infomedia. 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 fund manager Wilson Asset Management (WAM) has told investors about two compelling ASX shares that it has in its portfolio.

WAM operates several listed investment companies (LICs). Some, like WAM Leaders Ltd (ASX: WLE), focus on larger companies.

There’s also one called WAM Capital Limited (ASX: WAM) which targets “the most compelling undervalued growth opportunities in the Australian market”.

The WAM Capital portfolio has delivered an investment return of 15.8% per annum since its inception in August 1999, before fees, expenses and taxes. This gross return outperformed the All Ordinaries Total Accumulation Index (ASX: XAO) return of 8.4% per annum over the same timeframe.

These are the two ASX shares that WAM Capital outlined in its most recent monthly update:

Ardent Leisure Group Ltd (ASX: ALG)

Ardent Leisure owns and operates leisure and entertainment businesses in Australia and the US, including theme parks such as Dreamworld, WhiteWater World and SkyPoint.

WAM pointed out that during February 2022, the ASX share announced its FY22 half-year result beat expectations in its important US business, Main Event Entertainment. This business operates 45 bowling centres in 16 states in the US.

The fund manager noted that Main Event Entertainment continued to outperform constant centre revenue expectations, by achieving levels of over 20% growth in the financial year to date compared to pre-COVID levels in FY20.

Main Event Entertainment’s growth pipeline remains “robust” with plans for three new centres to open in the second half of FY22. As domestic and international border restrictions continue to ease, the fund manager believes momentum will return to the entertainment sector and it sees a strong outlook for both Main Event Entertainment and Dreamworld.

Uniti Group Ltd (ASX: UWL)

This ASX share is described as a business focused on the construction of core telecommunications infrastructure and is the owner and operator of fibre cable networks across Australia.

In February 2022, Uniti Group announced its FY22 half-year result, which showed a 98.4% increase in revenue to $109.5 million and a 130.3% increase in operating cash flow to $65.4 million. The ASX share’s earnings before interest, tax, depreciation and amortisation (EBITDA) for the half-year was $70.5 million, up 140.3%.

WAM noted that despite achieving a result that was in-line with what the market was expecting, Uniti Group’s half-year result disappointed the market, resulting in a fall of the Uniti Group share price after the announcement.

In February, Uniti Group commenced its on-market share buyback. WAM sees the potential for the company to make earnings accretive acquisitions thanks to its “strong” balance sheet.

The post These 2 compelling ASX shares are a buy: fund manager appeared first on The Motley Fool Australia.

More reading

• 2 punished ASX shares that don’t deserve to be (and experts are buying)
• I’m still kicking myself for missing the ASX company with the perfect business model: expert
• Broker names the 3 best ASX tech shares to buy today
• WAM boss urges cashed-up ASX 200 companies to buy, invest or pay dividends
• Dream result: Ardent Leisure (ASX:ALG) share price soars 18% on earnings

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 Uniti Group 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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On Monday, the S&P/ASX 200 Index (ASX: XJO) was back on form and started the week with a strong gain. The benchmark index rose 1.2% to 7,149.4 points.

Will the market be able to build on this on Tuesday? Here are five things to watch:

ASX 200 expected to sink

The Australian share market looks set to give back the majority of yesterday’s gains on Tuesday. This follows a volatile start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 75 points or 1.05% lower. In late trade, the Dow Jones is flat, the S&P 500 has fallen 0.65%, and the Nasdaq is down 1.8%. The Dow was up as much as 450 points at one stage before paring its gains.

Oil prices fall heavily

Energy producers such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could have a tough day after oil prices sank. According to Bloomberg, the WTI crude oil price is down 7.3% to US$101.42 a barrel and the Brent crude oil price has fallen 6.7% to US$105.14 a barrel. This follows talks between Russia and Ukraine, as well as new COVID lockdowns in China.

Rio Tinto acquisition

The Rio Tinto Limited (ASX: RIO) share price will be on watch today after it announced a non-binding proposal to acquire the remaining ~49% of the issued and outstanding shares of Turquoise Hill that it doesn’t already own. The mining giant has made an all-cash offer of ~US$2.7bn. If the deal completes, Rio Tinto’s share of the Oyu Tolgoi operation will increase to 66%.

Gold price tumbles

Gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a difficult day after the gold price tumbled lower overnight. According to CNBC, the spot gold price is down 1.55% to US$1,954.40 an ounce. This follows a rise in Treasury yields amid rate hike optimism.

Shares going ex-div

A number of ASX 200 shares are going ex-dividend this morning and could trade lower on Tuesday. This includes media giant News Corp (ASX: NWS), copper miner Sandfire Resources Ltd (ASX: SFR), and telco TPG Telecom Ltd (ASX: TPG).

The post 5 things to watch on the ASX 200 on Tuesday appeared first on The Motley Fool Australia.

More reading

• Why is the Rio (ASX:RIO) share price down 12% in a week?
• Hero to Xero? The Xero (ASX:XRO) share price is now down 36% in 2022
• Why now is a great time to invest in ASX shares (even if you’re fearful of an uncertain world)
• These ASX 200 shares trade ex-dividend tomorrow. Here’s what you need to know
• ASX 200 (ASX:XJO) midday update: Elders jumps, Magellan and Zip tumble

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended TPG Telecom 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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The Rio Tinto Ltd (ASX: RIO) share price has slumped in the past week after trading ex-dividend.

Rio shares have lost 12% between Monday 7 March and today’s close. The company’s share price finished the day 0.52% down, at $111.12.

Let’s take a look at what’s impacted the Rio share price during the past week.

Why did the Rio share price fall?

A major reason for the share price fall was the company trading ex-dividend last week. The company will be offering a fully-franked final dividend of US$10.40 per share on 21 April.

Trading ex-dividend tends to make a company’s share price fall in proportion to the dividend paid out, as my Foolish colleague Aaron noted last week. Any shareholders who bought Rio Tinto shares on or after ex-dividend day are not eligible for the latest dividend.

Iron ore prices may have also impacted the Rio share price in the past week. The global iron ore price slipped 4% from $US159 per tonne on 7 March to the latest reported price of $152.50, Trading Economics data reveals.

In other news, Rio also revealed it was cutting all ties with Russia on Thursday. This sparked questions about the company’s Queensland Alumina Limited refinery. Russian company Rusal holds 20% of this business. There is speculation Rio may need to buy out Rusal’s share of the venture.

Also last week, Rio was hailed as one of the top three dividend payers in the world for 2021. The only ASX share to top Rio in the list of global dividend payers was BHP Group Ltd (ASX: BHP). Fortescue Metals Group Limited (ASX: FMG) came in at number 10.

Rio share price snapshot

The Rio share price has shed nearly 5% in the past year. It’s fallen 9% in the past month alone although it is up 11% year to date.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) has returned nearly 5.7% over the past 12 months.

Rio has a market capitalisation of about $41 billion based on its current share price.

The post Why is the Rio (ASX:RIO) share price down 12% in a week? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• These were the worst performing ASX 200 shares last week
• Guess which 3 ASX 200 shares are among the top 10 dividend payers in the world
• Rio Tinto (ASX:RIO) is cutting all ties with Russia. What does this mean for the mining giant?
• Why Newcrest, Nickel Mines, Rio Tinto, and Woodside shares are dropping today

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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We all know that 2022 hasn’t been the kindest year to ASX shares thus far. Even after today’s robust gains on the market, the S&P/ASX 200 Index (ASX: XJO) remains down 5.8% year to date. However, that’s nothing compared to the Xero Limited (ASX: XRO) share price.

Xero shares have certainly not been a market beater in 2022. In fact, while the ASX 200 has lost 5.8% this year, the Xero share price has plunged by a rather astounding 35.99% over 2022 so far. It’s also down 17.24% over the past 12 months.

Xero share price cops a beating

Now, investors may have gotten used to Xero giving back astronomical returns. After all, this is a company that, despite its recent woes, remains up more than 425% over the past 5 years. So what’s changed for Xero?

Well, unfortunately, it’s not exactly clear. We haven’t gotten much news out of the company in 2022. Xero hasn’t even reported any earnings this year.

But what we do know is that Xero is a pre-profit growth share that, prior to this year, had enjoyed some astounding gains. And this company is not the only one of those that has copped a belting this year. 2022 has seen tech shares of all stripes suffer immense losses.

Take Zip Co Ltd (ASX: Z1P). It’s down a far-nastier 64.1% year to date. Before Afterpay was swallowed by Block Inc (ASX: SQ2), it had also had a rough trot. And Block shares have been under the weather as well, losing more than 20% since their ASX debut.

In fact, the entire S&P/ASX All Technology Index (ASX: XTX) remains down more than 23% year to date.

So it’s possible that Xero has just been caught up in a general market distaste for growth and tech companies that has been one of the defining themes of ASX investing so far this year.

But now that Xero is down by a notable 36% or so in 2022, and down an even more significant 40% from the all-time highs we saw late last year, many investors might be wondering if it could be time to buy Xero shares.

Could it be time to buy?

Well, there are more than a few brokers who think it could be. Goldman Sachs, Citi and Morgan Stanley have all rated Xero as a buy in the past month. As have analysts at Sage Capital and even here at The Motley Fool (be sure to check out why Fool analyst Ryan Newman likes Xero).

So there are a lot of fans of this cloud-based accounting software provider at the moment.

At the current Xero share price, this ASX 200 tech share has a market capitalisation of $13.95 billion.

The post Hero to Xero? The Xero (ASX:XRO) share price is now down 36% in 2022 appeared first on The Motley Fool Australia.

More reading

• Why now is a great time to invest in ASX shares (even if you’re fearful of an uncertain world)
• ASX 200 (ASX:XJO) midday update: Elders jumps, Magellan and Zip tumble
• 2 punished ASX shares that don’t deserve to be (and experts are buying)
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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. owns and has recommended Block, Inc., Xero, and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Block, Inc. and Xero. 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 Telstra share price finished in the green today amid speculation it plans to buy a major stake in Fetch TV.

The company’s shares gained 1.56% today and were trading at $3.90 at the market close. In comparison, the  S&P/ASX 200 Index (ASX: XJO) closed 1.2% higher.

Let’s take a look at what might have impacted investor sentiment in the telco today.

Potential new deal

Speculation is mounting Telstra plans to buy a 51% stake in Fetch TV, an independent Australian pay-TV provider offering streaming services via the internet.

According to a report in the Sydney Morning Herald, the telco plans to build a combined platform that can “compete against international companies such as Apple and Google”.

Telstra also holds a 35% stake in pay-TV provider, Foxtel. Fetch TV has coverage in at least 670,000 homes.

Sources told the publication that Telstra and Fetch TV were in advanced talks about a possible deal that could be finalised as soon as the end of March.

Flood assistance

In other news, Telstra has offered $250,000 for communities impacted by the floods in Queensland and New South Wales.

Telstra CEO Andy Penn said in a statement on Friday:

As part of our overall support for flood-affected communities, the Local Flood Grants will provide either cash or technology to the value of up to $10,000 to eligible local organisations.

Our local Telstra teams have been on the ground working around the clock to get communities back online as quickly as possible.

Furthermore, analysts have recently recommended Telstra as a potential dividend share to buy.

As my My Foolish colleague James reported, Morgans predicts a fully franked dividend of 16 cents per share in FY 2022 and FY 2023. The broker has a $4.56 price target on Telstra shares.

Telstra share price ASX recap

The Telstra share price is up 27% over the past 12 months, but shares in the telco have dropped 3% in the past month and are down 6.7% year to date.

For perspective, the benchmark ASX 200 has returned nearly 5% over the past year.

Telstra has a market capitalisation of almost $46 billion based on its current share price.

The post Telstra (ASX:TLS) share price climbs amid rumours the telco plans to take on US giants appeared first on The Motley Fool Australia.

More reading

• 2 buy-rated ASX 200 dividend shares with top yields
• These 3 ASX 200 shares are topping the volume charts this Friday
• Why was everyone talking about the Telstra (ASX:TLS) share price today?
• Own Telstra shares? Here’s why the telco faces new legal action
• Broker sees 19% upside for Telstra (ASX:TLS) share price and 4% dividend yield

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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