Category: Stock Market

The Woolworths Group Ltd (ASX: WOW) share price is edging lower during early afternoon trade on Monday. This follows the supermarket operator’s latest supply challenges as the COVID-19 outbreak continues to wreak havoc in Australia.

At the time of writing, Woolworths shares are swapping hands for $37.20 apiece, down 0.43%. In contrast, the broader the S&P/ASX 200 Index (ASX: XJO) is trading at 7,448.3 points, slightly down 0.07%.

Woolworths shelves stripped bare

Investors are sending the Woolworths share price into negative territory as more news surrounding the supermarket giant’s dilemmas come out.

The rapid spread of COVID-19 has forced thousands of people to isolate at home whilst waiting for their test results. This has created a huge disruption to Woolworths’ supply chain as a majority of staff are obeying stay-at-home orders. A reported 35% of its distribution centres workers are in self-quarantine.

Notably, Woolworths shelves have been laid bare in stores across the country as a result of the staff shortages. This has resulted in about 50% of delayed deliveries for major product lines.

Management, however, noted that the current supply issues would likely last for the next two to three weeks.

Australian Prime Minister, Scott Morrison stated new measures allowing critical workers to leave quarantine if tested negative is under review. The national cabinet is closely monitoring both New South Wales and Queensland which enacted these changes.

The latest COVID-19 figures have continued to surge to more than 303,800 active cases in New South Wales and 161,050 cases in Victoria. This is a sharp increase from this time last year when the country had been effectively managing the pandemic.

A statement from Woolworths advised that supply issues are greatest in New South Wales stores. Queensland stores are experiencing some disruptions, though they are significantly smaller than those in New South Wales.

In particular, poultry and other meat products are running low due to COVID-challenges faced by suppliers.

Woolworths share price snapshot

It’s been a rollercoaster ride for Woolworths shares over the last 12 months, posting a small gain of almost 5%.

Based on valuation grounds, Woolworths commands a market capitalisation of roughly $45.13 billion and has approximately 1.21 billion shares outstanding.

The post Woolworths (ASX:WOW) supply woes continue with retailer receiving half of normal deliveries appeared first on The Motley Fool Australia.

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• If supermarkets are ‘COVID winners’, why is the Woolworths (ASX:WOW) share price sliding into 2022?
• API (ASX:API) share price crashes 12% after Woolworths withdraws takeover offer
• Wesfarmers (ASX:WES) share price higher after receiving API takeover boost
• Leading brokers name 3 ASX shares to sell 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 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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At the start of each year, disciples of Michael O’Higgins’ “Dogs of the Dow” strategy will buy many of the worst performing shares on a particular index.

The Dogs of the Dow strategy involves buying 10 of the worst-performing (dividend-paying) shares from the previous year from the Dow Jones Industrial Average at the start of the year. The dividend payment is seen as a sign that the company in question is still financially sound and not about to become insolvent. Some local investors also do the same on the local bourse with the ASX 100 index.

The team at Atlas Funds Management have been looking at the strategy and given their verdict on a few of Australia’s “dogs”.

Firstly, Chief Investment Officer, Hugh Dive, explained why the strategy can work for investors.

He said: “One of the reasons this strategy persists is that institutional fund managers often report their portfolios’ contents to asset consultants as part of their annual reviews. This process incentivises fund managers to sell the “dogs” in their portfolio towards the end of the year as part of “window dressing” their portfolio before being evaluated.”

“Here retail investors can have an advantage over institutional investors. Their lack of scrutiny from asset consultants allows them the flexibility to pick up companies whose share prices have been under pressure late in the year that could see a rebound when the selling pressure stops in January and February,“ Dive added.

Another year to forget for this dog?

One of the dogs of the ASX 100 last year was the A2 Milk Company Ltd (ASX: A2M) share price. It lost over half of its value during the 12 months. And while it doesn’t actually pay a dividend, it appears to have been included due to its ability to pay a dividend if required. The infant formula company is sitting on a mountain of cash but chooses to reinvest it rather than pay a dividend.

Atlas Funds Management isn’t keen on A2 Milk, though. This is because it believes “finding the fallen angel” is best when the “underperformance is due to stock-specific problems rather than macroeconomic issues beyond a company’s control.”

Whereas A2 Milk’s underperformance has largely been driven by regulatory issues in China and falling ecommerce sales. This is not something which the company is able to control, as we have seen over the last 18 months.

All in all, although the A2 Milk share price has sunk lower over the last 12 months, this fund manager doesn’t think investors should bet on it outperforming the market in 2022.

The post Why you shouldn’t expect the A2 Milk (ASX:A2M) share price to bounce back in 2022 appeared first on The Motley Fool Australia.

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• These were the 5 worst performing ASX 200 shares in 2021
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. 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 Accent Group Ltd (ASX: AX1) share price is having a tough start to the week.

In afternoon trade, the footwear focused retailer’s shares are down 6% to $2.19.

This leaves the Accent share price trading within sight of its 52-week low of $2.03.

Why is the Accent share price falling?

The weakness in the Accent share price today appears to have been driven by a broker note out of Morgans this morning.

According to the note, the broker has retained its hold rating but trimmed its price target on the company’s shares by 6.5% to $2.40.

Morgans made the move after changing its analyst and adjusting its estimates.

What did the broker say?

The note reveals that Morgans has reduced its earnings before interest and tax (EBIT) estimate for FY 2022.

It now expects EBIT of $97.4 million for the full year, down from $102.1 million previously. This is notably lower than the current consensus estimate of $103.4 million and will be a sizeable decline from FY 2021’s EBIT of $124.9 million.

Most of the damage to its profits is expected in the first half of FY 2022 following lockdowns.

Morgans explained: “We forecast a 53.3% drop in first half EBIT to $38.2m, with the decline mainly a function of the impact of lockdowns and the non-recurrence of the $9m JobKeeper benefit received in the PCP. Our estimate is 19% lower than Visible Alpha consensus ($47.4m with a broad range of $36.5-58.5m).”

Combined with its current valuation, the broker doesn’t appear to believe enough value for money is on offer with the Accent share price at this point.

The broker concludes: “AX1 has a multi-faceted growth strategy, but this is countered by a 23x FY22F P/E ratio, higher gearing than many of its peers, and the reliance on distribution agreements with large third-party suppliers. We rate the stock a HOLD.”

The post Why the Accent (ASX:AX1) share price is sinking 6% today appeared first on The Motley Fool Australia.

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• Top brokers name 3 ASX shares to buy

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 Accent Group. 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 Genetic Signatures Ltd (ASX: GSS) share price is on the move today after an update on the company’s COVID-19 test kit.

Shares in the diagnostics company are swapping hands at $1.77 in afternoon trade, up 6.31%.

Let’s take a look at what might be driving this share price increase today.

COVID-19 test update

Genetic Signatures informed the market of an update on the company’s flagship 3base EasyScreen SARS-CoV-2 (COVID-19) Detection Kit.

The company advised that the Therapeutic Goods Administration has registered a saliva-based protocol to collect and test patients for COVID-19 using this product.

Genetic Signature cited a recent study out of South Africa finding saliva swabs may be better than mid-turbinate nasal swabs for detecting the Omicron variant in PCR tests. Saliva has a higher viral RNA load than nasal samples, the company said. However, the company conceded the nasal swab is more effective in detecting the Delta variant.

Speaking on the announcement, Genetic Signatures CEO Dr John Melki said:

Our team is driven to provide our customers with the highest quality tests and are constantly looking at ways to improve our products so they remain effective in detecting pathogens.

We are pleased that this study and subsequent registration has been completed so quickly.

With Omicron becoming the dominant strain of the SARS-CoV-2 virus it is likely that this new methodology will be needed to identify all cases of this new variant.

Genetic Signatures said some of its customers have already adopted the new protocol for testing COVID-19 patients. The company’s COVID-19 detection kit is able to detect all known variants of the virus.

Share price snapshot

The Genetic Signatures share price has fallen in the past year, down 7.8% compared to the same time last year.

In contrast, the S&P/ASX 200 Index (ASX: XJO) is returning roughly 10% in the past year.

The company’s shares have lifted 37% in the past month.

Genetic Signatures has a market capitalisation of around $238.26 million based on the current share price.

The post Genetic Signatures (ASX:GSS) share price leaps 6% on COVID test news appeared first on The Motley Fool Australia.

More reading

• 20% in a week: Here’s why the Genetic Signatures (ASX:GSS) share price soared 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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Shares in airline operator Qantas Airways Limited (ASX: QAN) are inching higher in afternoon trade today, trading less than 1% in the green at $5.08.

With the concept of international travel gradually returning to be within our grasps, investors haven’t rewarded Qantas in the same way – particularly amid the panic that’s ensued as the latest COVID-19 variants are revealed.

With that in mind, let’s check in and see what’s the outlook for Qantas shares in 2022. The markets are talking, and we are listening. So, is it a buy in 2022? Let’s see what the experts think.

Is Qantas a buy in 2022?

The team at JP Morgan certainly think so. The firm recently advocated Qantas to outperform whilst valuing the company at $6.30 apiece.

Analysts at the firm were upbeat from Qantas’ most recent trading update, and reckon this serves as a good springboard for the company coming into 2022.

Not only that, but JP Morgan “still remain[s] comfortable on the prognosis for a domestic aviation recovery”, even if it trimmed its Qantas valuation by 20 cents in the most recent model update.

In the domestic market, JP Morgan sees capacity guidance of approximately 109% over 2H FY22 as “achievable”, underscored by a recovery in leisure and improving corporate travel over 2H FY22.

In contrast, the broker concedes international travel will take time. It reckons international capacity is set to run at 40-55% of FY19 activity during 2H FY22 and likes the emergence of new “non-stop” long-haul routes to Rome.

In its investment thesis, the broker notes that it sees “QAN as being well positioned, given: 1) it has taken material costs out of its business, ~$1billion p.a. of which are likely to be ongoing savings from FY23; 2) its high proportion of earnings from domestic and loyalty at ~70-75% of earnings; 3) its strong relative balance sheet positioning; and 4) more favourable competitive position – both domestically and internationally”.

Meanwhile, the team at UBS reckons that any potential threats to Qantas from new lockdowns and/or border restrictions are well priced into the share price at its current valuation.

The Swiss broker rates Qantas as a buy as well and reckons the airline is well capitalised and better prepared to deal with any further onslaught from COVID-19.

Not only that, UBS reckons Qantas is cheap at its current levels, trading at an approximate 15% discount to historical averages when comparing to peers.

UBS values Qantas at $6.20 per share and rated it as a buy to clients in an update last month.

In the list of analysts covering Qantas that is provided by Bloomberg Intelligence, 84.6% have the airline as a buy, whereas just 1 firm have it as a hold and sell respectively.

Qantas share price snapshot

Due to several disruptions from the pandemic, the Qantas share price has only managed to climb just over 3% in the last 12 months. However, in the past week shares are again in the green, and are flat on the previous month.

The post Is it a buy in 2022? Leading brokers size up the Qantas (ASX:QAN) share price appeared first on The Motley Fool Australia.

More reading

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• How did the Qantas (ASX:QAN) share price perform in 2021?
• Brokers name 3 ASX shares to buy
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• How are ASX 200 travel shares faring over the holiday season?

The author has no positions 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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Are you looking for options for a retirement portfolio? If you are, then you may want to look at the shares listed below.

Here’s why these ASX shares could be top options for retirees:

Elders Ltd (ASX: ELD)

The first ASX share for retirees to consider is this agribusiness giant. It provides livestock, real estate, feed and processing, wool agency services, financial planning, and grain marketing services to rural and regional customers across Australia and New Zealand.

Goldman Sachs is very positive on the company’s outlook and has a conviction buy rating and $15.65 price target on its shares.

In response to its strong full year result in November, Goldman said: “We expect ELD can continue this solid performance into FY22, with key drivers further delivering on the Eight Point Plan: (1) market share growth, with a pipeline of 27 further bolt-on acquisitions; (2) gross margin expansion driven by ongoing execution of backward integration in animal health and crop protection.”

As for dividends, Goldman expects 40 cents per share in FY 2022 and 42 cents per share in FY 2023. Based on the current Elders share price of $12.33, this will mean yields of 3.2% and 3.4%, respectively.

Transurban Group (ASX: TCL)

Another ASX share that could be a top option for a retirement portfolio is this leading toll road operator. Transurban owns a portfolio of 17 roads in Australia, four in North America, and a significant project pipeline across its networks that could support its growth in the coming years.

The team at Morgans appear to believe the company’s shares would be great long term options for investors.

The broker recently commented: “We view TCL as a high quality pure-play toll road infrastructure portfolio benefitting from employment and population growth, urbanisation, and the value of time, with particular exposure to the east coast capital cities in Australia.”

Morgans currently has an add rating and $14.57 price target on Transurban’s shares. In addition, the broker is forecasting dividends per share of 35 cents in FY 2022 and then 55.3 cents in FY 2023. Based on the current Transurban share price of $13.48, this will mean yields of 2.6% and 4.1%, respectively.

The post 2 top ASX shares for a retirement portfolio appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Elders 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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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.

Shiba Inu (CRYPTO: SHIB) and Dogecoin (CRYPTO: DOGE) both have been riding the popularity wave of cryptocurrencies with a dog as a mascot. These popular meme tokens skyrocketed last year — and took spots among the biggest cryptocurrencies.

Shiba Inu beat its older rival when it comes to annual gains. It soared a jaw-dropping 45,000,000%. Dogecoin “only” climbed 2,900%. But Shiba Inu lags when it comes to market value. It’s the world’s 13^th biggest cryptocurrency while Dogecoin is the 12^th largest.

Dogecoin also beats Shiba Inu by value of individual tokens. It’s worth about 15 cents while Shiba Inu trades for a fraction of a cent. Considering Shiba Inu’s popularity and strong community support, could it rise above the price of Dogecoin this year? Could it surpass Dogecoin’s market value? And what about from a pure percentage increase perspective? Let’s look for some clues.

An experiment in community building

First, a little background on Shiba Inu. A founder known only as “Ryoshi” launched Shiba Inu in August 2020. Shiba Inu’s whitepaper calls the cryptocurrency “an experiment in decentralized spontaneous community building.” And community — known as the Shib Army — is indeed the driving factor behind Shiba Inu’s success.

So, what exactly is Shiba Inu? It’s a token built on the Ethereum blockchain. Shiba Inu isn’t a blockchain itself and can’t host smart contracts. So, users can’t go to Shiba Inu for decentralized applications that allow them to buy insurance or manage their investments, for example. Instead, investors can buy Shiba Inu and stake their holdings for passive income — or use their tokens as a payment method at certain merchants.

Unlike Shiba Inu, Dogecoin is a currency and a blockchain. But like Shiba Inu, Dogecoin’s real world uses are limited to staking and payment. So, it seems fair to compare the two — and consider whether Shiba Inu has what it takes to jump ahead of its rival.

The key to our answer has to do with token supply. Dogecoin has an unlimited supply overall. That limits gains. But right now, about 132 billion tokens are in circulation. That’s a lot fewer than the 549 trillion Shiba Inu coins in circulation.

Market value and price per coin

Now, let’s do some math. Today, Shiba Inu is priced at about 0.00002949. If it doubles to 0.00005898, we’re still at a price that’s much lower than today’s Dogecoin price. But it brings Shiba Inu to a market value of more than $32 billion. As of right now, that would put Shiba Inu ahead of Dogecoin in terms of market value. And it would make it the ninth-biggest cryptocurrency by market value after Ripple. From a math standpoint, it’s possible Shiba Inu could beat Dogecoin when it comes to market value.

As for actual price per coin, it seems nearly impossible that Shiba Inu could beat Dogecoin. Considering Shiba Inu’s coin supply, a price of 15 cents would give the cryptocurrency a market value of $82 trillion. By comparison, the entire crypto market is worth about $3 trillion.

When it comes to general percentage gains, it may be easier for Shiba Inu to beat Dogecoin than vice versa. That’s simply because it’s easier for assets with a lower value to double or triple than those starting out at a higher price.

So, Shiba Inu could beat Dogecoin when it comes to percentage gains or market value. Does that mean you should invest in this popular crypto player? No. There are a few reasons why I would avoid Shiba Inu. And the great news is this: Choices are many. There are plenty of other cryptocurrency opportunities that look much more promising for 2022.

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

The post Could Shiba Inu Surpass Dogecoin in 2022? appeared first on The Motley Fool Australia.

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Adria Cimino owns Dogecoin and Ethereum. The Motley Fool owns and recommends Ethereum. The Motley Fool has a disclosure policy.

 

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: Z1P) share price has been hitting 12-month lows over the last 30 days.

Today, the buy now, pay later (BNPL) company’s stock hit yet another 52-week low of $3.66.

At the time of writing, the Zip share price has rebounded to $3.81, representing a 0.2% drop on its previous close.

So, with the Zip share price bottoming out, what do experts predict for its future? Let’s take a look.

What’s going on with the Zip share price?

The last time the market heard price-sensitive news from Zip was on 7 December.

Then, the company announced that, based on its November transaction volume, its bringing in more than $10 billion of transactions per year.

The Zip share price surged 9% that session and another 10% the following session.

However, on 17 December, the BNPL company’s stock hit a 52-week low of $4.05.

Then, on 6 December, it dropped to another low of $3.80. Of course, today’s intraday low was another new 52-week record low.

Thus, some experts are warning investors to hold off from buying Zip shares for the time being. However, brokers’ price targets on the stock remain high.

While both Citi and UBS have a neutral rating on the BNPL company, they’ve respectively slapped it with price targets of $5.85 and $5.20.

Both targets are lower than the brokers’ previous assumptions but they imply an upside of 36% to 53% on the current Zip share price.

The target comes despite Citi predicting the company will post deeper losses for financial year 2022.

As The Motley Fool Australia recently reported, the broker expects the company will end financial year 2022 with a loss of $218 million. For comparison, Zip recorded a $211 million loss last financial year.

Though, Citi is expecting Zip’s losses to improve from financial year 2023.

The broker is also concerned about the growth of Zip’s international presence.

The company rebranded its 2020 acquisition, Quadpay, to become its leg in the North American nation.

Citi has noted that the company’s growth in the United States is slower than expected.

The post The Zip (ASX:Z1P) share price has hit 3 52-week lows in the last month. What now? appeared first on The Motley Fool Australia.

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• Own Zip (ASX:Z1P) shares? Top broker forecasts earnings for next 3 years
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns 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 Bruce Jackson.

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The Bitcoin (CRYPTO: BTC) price has tumbled so far in 2022 following the latest comments from the US Federal Reserve.

Since the beginning of the calendar year, the flagship cryptocurrency has slumped by more than 10%, highlighting its extreme volatility.

At the time of writing, the price of Bitcoin is fetching US$41,760.73. This represents a drop of almost 38% from its all-time high of US$68,789.63 in November.

What’s happened to Bitcoin lately?

Once again, in spectacular fashion, the Bitcoin price has fallen as unfavourable market conditions weigh on investor sentiment.

The release of minutes from the US Federal Reserve’s meeting indicated that interest rates would soon rise. In addition, an end to stimulus packages to counteract the impact of COVID-19 could also provoke distress.

US Treasury Secretary Janet Yellen’s statements late last year on the cryptocurrency didn’t help matters. Those comments were centred around Bitcoin being an extremely inefficient way of conducting transactions, along with its use in illegal activities.

And if that wasn’t enough to put a dent in investor confidence, Tesla boss Elon Musk also gave his input. He noted the price of Bitcoin seemed higher than where it should be trading.

A number of critics are putting the spotlight upon the sheer amount of power required to mine new crypto coins. Miners run souped-up machines and supercomputers to solve complex algorithms and puzzles in order to create Bitcoins.

While there are roughly 19 million Bitcoins currently circulating, just 2 million bitcoins remain to be mined in the future. Bitcoin inventor Satoshi Nakamoto originally capped the total supply to 21 million Bitcoin.

Experts predict that the remaining bitcoins will be mined by 2140.

Is it a buy?

If the price of Bitcoin can pass the psychological barrier of US$50,000, the resistance barrier may turn into a support level. Notably, the cryptocurrency has corrected by a considerable percentage which should be expected with this asset class.

Bitcoin, along with other coins such as Ethereum, Solana, and Cardano, is considered to be high risk/high reward investment.

A sound approach for any investor is the dollar-cost averaging strategy (DCA).

It is a simple strategy that entails investing an amount in the same asset at regular intervals over a period of time.

DCA reduces the impact of market volatility on the overall purchase. It is known as a risk-reduction tool, especially in this current climate.

Tiptoeing in small increments during a market dominated by COVID-19 news may also avoid cryptocurrency slumps.

The post The Bitcoin (CRYPTO:BTC) price has tumbled 10% since the start of 2022. Is it a buy? appeared first on The Motley Fool Australia.

More reading

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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 shares of and has recommended Bitcoin. 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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Australia’s leading investment analysts are always on the lookout for ASX share opportunities that could generate attractive performance.

Share prices are changing all the time, so good value can quickly appear.

If a single analyst thinks a business is a buy, then there’s worth thinking about. If there are multiple brokers that suggest an ASX share is a buy then that may imply there’s a good opportunity there. Or, all of those analysts are wrong at the same time.

With that in mind, here are two ASX shares that are highly-recommended:

Nickel Mines Ltd (ASX: NIC)

Nickel Mines holds an 80% economic interest in the Hengjaya nickel and Ranger nickel projects, both of which operate two line rotary kiln electric furnace (RKEF) plants producing nickel pig iron (NPI) within the Indonesia Morowali Industrial Park.

It also recently bought an 80% interest in the Angel Nickel project. In December 2021, it announced the signing of an agreement with Shanghai Decent to acquire a 70% interest in the Oracle nickel project.

The ASX share and Shanghai Decent also committed to reducing carbon emissions and have undertaken to explore transitioning its energy sources to renewable energy and other lower carbon emitting solutions. Solar is one main focus.

Nickel Mines is currently rated as a buy by at least four brokers, including Macquarie Group Ltd (ASX: MQG). The price target is $1.70, which is approximately 20% higher than where it is right now. The broker thinks that Chinese demand will help the nickel price.

Whitehaven Coal Ltd (ASX: WHC)

Whitehaven is one of the largest coal miners in Australia. It operates four mines (three open-cut and one large underground mine) in the Gunnedah Coal Basin of NSW. It also has two near-term development assets, being Vickery, near Gunnedah, and Winchester South, in Queensland’s Bowen Basin.

It is currently rated as a buy by at least six brokers including Citi, which has a price target of $3.20 – that’s a potential upside of around 15% if the broker is right. The buy rating came after a decline of the Whitehaven share price from the highs in October 2021.

The three months to September 2021 saw managed saleable coal production of 4.7mt from the ASX share. During October 2021, it saw record thermal coal prices. Management said this would help with cashflow. Prices are reportedly rising again.

It’s paying down debt and expects to fully repay the debt facility early in the 2022 calendar year and to be in a net cash position by March 2022.

Whitehaven says that demand for thermal coal is “extremely strong” with supply constraints in key producing countries, causing the Asian coal market to tighten further. Logistics issues have impacted Russia and South Africa.

The miner said both thermal and metallurgical coal prices are forecast to remain “well supported” due to strong demand and continuing supply tightness.

The post 2 highly-recommended ASX shares to buy appeared first on The Motley Fool Australia.

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

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