Category: Stock Market

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

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

What happened

“Buy the rumor, sell the news.” That appears to be investors’ motto today, as shares of Nvidia (NASDAQ: NVDA) suffer through their second day of declines since CEO Jensen Huang’s keynote presentation at the virtual GPU Technology Conference yesterday.

As of 11:30 a.m. EST, shares of the artificial intelligence and graphics semiconductors specialist had slumped 2.2% — but that’s not to say that the news was bad.

So what

As investor attention turns to Meta Platforms‘ (NASDAQ: FB) promise to create the first metaverse, Huang gave a presentation that had one analyst exclaiming, “Nvidia is so, so far ahead of any chip company in virtual world dynamic it’s not even close,” reported Investors.com yesterday.  

Walking investors through the future of AI and virtual reality, Huang seemed to promise investors an omniverse to trump Mark Zuckerberg’s metaverse. Therein, omniverse avatars will employ artificial intelligence, artificial vision, and speech recognition to serve as virtual assistants. A new Nvidia Omniverse Replicator will create data to train neural networks that can operate autonomous vehicles and humanoid robots.

In the culmination of his vision, Huang even promised to build “a digital twin of Earth itself,” reports VentureBeat.com, a virtual world online bearing the modest moniker “Earth 2.”  

Now what

After all of that, I suspect there are really only two questions investors can respond with. First: “Where do I sign up?” And second: “But hold on a second — how much does this stock cost?”

And here’s the thing: At the risk of being a buzzkill, though — or worse, “selling the news” — I just have to point out here that as astounding as Nvidia’s plans for the Omniverse sound, there’s a price at which that future begins to cost too much.

Suffice it to say that with today’s decline in stock price, investors may be waking up to the possibility that 105 times earnings, and 112 times free cash flow, is too high a price to pay for Nvidia stock. 

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

The post Why Nvidia stock slumped on Wednesday appeared first on The Motley Fool Australia.

More reading

• Why Nvidia stock rocketed higher on Thursday
• Why Nvidia stock climbed on Monday

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

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The Santos Ltd (ASX: STO) share price is continuing to slide for the third day in a row despite no news having been released by the company.

At the time of writing, the Santos share price is $6.77. That’s 2.17% lower than it was at yesterday’s close. The three-day fall comes after the shares climbed 3% on Monday.

That brings the stock’s total fall since Friday’s close to around 1%.

For context, the S&P/ASX 200 Index (ASX: XJO) is also down today, having dipped 1.05%.

Further, the S&P/ASX 200 Energy Index (ASX: XEJ) is moving in line with the Santos share price. Right now, it has fallen 2.4%, crowning the energy sector as the worst-performing ASX sector today.

Let’s take a look at what might be weighing on the oil and gas producer’s shares – and those of its peers – on Thursday.

Why is the Santos share price falling on Thursday?

The Santos share price isn’t alone in its flop today. It was joined overnight by the price of oil.

While oil prices dipped while Australia slept, they are seemingly recovering this morning.

According to reporting by Reuters, Brent crude futures fell 2.5% to US$82.64 a barrel last night. Meanwhile, West Texas Intermediate crude futures dipped 3.3% to trade at US$81.34 per barrel.

Right now, Brent crude futures is sitting at US$82.72 and West Texas Intermediate crude futures is US$81.61.

The commodities’ prices were reportedly affected by increased inflation in the United States – alongside stocks trading on US markets.

The nation’s inflation has increased 6.3% over the 12 months ended October. Such a surge in inflation reportedly might spur officials to increase rates.

In other news, Santos’ merger with Oil Search Ltd (ASX: OSH) could be about to pass a milestone today as the latter fronts a court in Papua New Guinea to find out if has received approval for the transaction.

The court date was previously delayed until yesterday. However, when yesterday arrived it was pushed back to today at the request of the Papua New Guinea National Court.

Today’s dip included, the Santos share price is currently 9.7% lower than it was this time last month. However, it has gained around 8% since the start of 2021.

The post Here’s why the Santos (ASX:STO) share price is falling again on Thursday appeared first on The Motley Fool Australia.

More reading

• Santos (ASX:STO) share price slips as Oil Search merger delayed again
• 5 things to watch on the ASX 200 on Monday
• Santos (ASX:STO) slips amid CSIRO carbon capture partnership
• 5 things to watch on the ASX 200 on Friday
• Move over Twiggy, here’s why Santos’ (ASX:STO) boss is focused on blue hydrogen

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 Creso Pharma Ltd (ASX: CPH) share price is on the move on Thursday. This comes as the cannabis and psychedelics company released a positive trading update for Q4 FY21.

During early afternoon trade, Creso shares are swapping hands for 14.8 cents apiece, up 1.72%.

What did Creso announce?

According to the release, Creso advised that it has recorded strong revenues from its Swiss operations in the current fourth-quarter.

To date, the division’s revenue has soared past $0.8 million, which is a 126% increase compared to the last quarter. Underpinning the performance, Creso experienced an uptick in human health CBD and medical cannabis product sales from Swiss-based company, Cannahealth.

Creso Pharma entered into a strategic collaboration agreement with Cannahealth, for the supply of hemp and cannabis plant material. The latter will also provide marketing and sales of Creso’s products in Switzerland.

Both parties are discussing the potential of extending Creso’s reach into other countries in Europe.

The initial term of the agreement is valid for 1-year and automatically renews unless terminated by either company.

In addition, Creso has expanded its sales pipeline over recent months and anticipates additional purchase orders through its Swiss operations. Furthermore, wholly-owned Canadian subsidiary, Mernova Medical Inc. is also expected to provide a boost in sales in the near term.

Creso’s cannaDOL launch campaign is now being delivered to more than 2,500 retailers across Switzerland. The products are being distributed to several key pharmacies which could lead to rapid growth for the company. Other distribution sites include drugstores, fitness centres, and e-commerce channels.

Creso non-executive chair, Adam Blumenthal commented:

We anticipate that revenue will continue to increase over the remainder of Q4 2021, when additional purchase orders across Switzerland and Canada materialise. The company has a number of business development initiatives underway and remains committed to significantly growing its sales pipeline through international expansion efforts and partnership agreements.

About the Creso share price

Over the past 12 months, the Creso share price has rocketed 361%, reflecting positive investor sentiment. The company’s shares reached a 52-week high of 47 cents in early December 2020. Lawmakers in the United States passed a bill to decriminalise cannabis on a national level, which shot up Creso shares.

Based on today’s price, Creso presides a market capitalisation of roughly $177.96 million, with approximately 1.2 billion shares outstanding.

The post Creso Pharma (ASX:CPH) share price climbs on increasing revenue update appeared first on The Motley Fool Australia.

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• These were the best performing ASX cannabis shares in October
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• Why the Creso Pharma (ASX:CPH) share price is lifting today
• Creso Pharma (ASX:CPH) share price spikes on bonus options issue
• Here’s why the Creso Pharma (ASX:CPH) share price is leaping 9% 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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The Rio Tinto Limited (ASX: RIO) share price is struggling to keep up with its peers. But there are early signs that it’s finding its feet.

Shares in the ASX iron ore miner plunged around 30% in the past three months when the S&P/ASX 200 Materials (INDEXASX: XMJ) index fell by less than half that.

The collapse in the iron ore price is weighing heavily on Rio Tinto. The miner also hasn’t helped itself when it downgraded its production guidance – yet again!

Iron ore drags the Rio Tinto share price into a bear market

It’s not alone in the sin bin of course. The BHP Group Ltd (ASX: BHP) share price isn’t faring much better and the Fortescue Metals Group Limited (ASX: FMG) share price has slumped even more.

Iron ore accounts for just about all of Fortescue’s revenue. At least BHP and Rio Tinto have exposure to other commodities that are faring better.

This explains why the broader sector is holding up better than the iron ore producers. Some commodities are in hot demand, such as lithium.

ASX mining shares that have been outperforming

This is why the likes of the Orocobre Limited (ASX: ORE) share price and Pilbara Minerals Ltd (ASX: PLS) share price have helped offset some of the ASX materials index’s losses.

The index is also supported by gold shares as the safe haven commodity finds renewed support. Worries that inflation will get the better of central banks is driving interest in gold. That’s great news for the likes of the Newcrest Mining Ltd (ASX: NCM) share price.

Is the Rio Tinto share price at a turning point?

However, there are tentative signs that the Rio Tinto share price may be close to bottoming. Its shares have jumped 1.7% to $89.03 this morning even as the commodity dipped below US$90 a tonne.

Despite the ongoing weakness in the price of the steel-making mineral, some experts think the worst could be over. The commodity may even stage a rebound in December.

Markets are nothing if not forward looking. Bargain hunters are also getting excited after the Rio Tinto share price shed more than a third of its value in three months.

Value emerging

Even if the iron ore price were to settle around US$80 a tonne over the longer term, analysts reckon the miner can still pay a very generous dividend.

This is because it only costs Rio Tinto around US$15 a tonne for iron ore. The margins the miner makes will make any monopoly business green with envy.

Outlook starting to shine

But there is another tailwind that could draw investors back to the Rio Tinto share price. This is aluminium. The outlook for the metal is bright and Rio Tinto provides great exposure to that thematic.

This isn’t to say that ASX iron ore miners are out of the woods. If China can’t contain the fallout from its property sector, its economy could take a big blow.

That won’t be good for our economy, let alone the Rio Tinto share price.

The post Why the Rio Tinto (ASX:RIO) share price underperformed the materials sector over the last 3 months appeared first on The Motley Fool Australia.

More reading

• Evergrande reportedly defaults, DMSA is preparing bankruptcy proceedings
• ASX 200 (ASX:XJO) midday update: Xero’s results and Nearmap’s guidance disappoint
• 5 things to watch on the ASX 200 on Thursday
• Why are ASX 200 mining shares having such a lousy day?
• How much Fortescue (ASX:FMG) cash is Twiggy sinking into green hydrogen?

Motley Fool contributor Brendon Lau owns shares of BHP Billiton Limited, Fortescue Metals Group Limited, Newcrest Mining Limited, Orocobre Limited, and Rio Tinto Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It is being reported that Evergrande has officially defaulted on interest payments to international investors.

One of those investors, DMSA, says that it hasn’t received any interest payments as the grace period ends. DMSA is preparing bankruptcy proceedings against Evergrande and is calling on all bond investors to join it.

What’s going on with Evergrande?

Evergrande is one of China’s largest property developers. Indeed, it’s one of the biggest in the world. But it has a huge amount of debt hanging overhead – hundreds of billions of dollars.

DMSA, which stands for Deutsche Markt Screening Agentur, is an independent data service that collects and evaluates market information on companies, products and services. It sees itself as an advocate for consumers, private customers and investors.

In order to be able to file for bankruptcy against Evergrande as a credit, DMSA invested in Evergrande bonds. The grace period ended on 10 November 2021. In total, DMSA said that Evergrande would have had to pay US$148.13 million in interest in three bonds no later than 10 November 2021.

But DMSA says it has not received any interest on its bonds. DMSA said Hong Kong banks were closed, which meant that it was certain the bonds had defaulted.

The DMSA senior analyst Dr Marco Metzler said:

But while the international financial market has so far met the financial turmoil surrounding the teetering giant Evergrande with a remarkable basic confidence…the US central bank Fed confirmed our view yesterday. In its latest stability report, it explicitly pointed out the dangers that a collapse of Evergrande could have for the global financial system.

When will Evergrande bankruptcy proceedings start?

DMSA noted that all of Evergrande’s 23 reported outstanding bonds have a cross-default clause, meaning if one bonds defaults, then all of them supposedly automatically have default status.

But that doesn’t automatically result in Evergrande bankruptcy, an insolvency petition must be filed with the court.

Dr Metzler said:

DMSA is preparing bankruptcy proceedings against Evergrande. We are already holding talks with other investors in this regard. We would be pleased if other investors were to join our action group.

As soon as a court opens insolvency proceedings, Evergrande will also be officially bankrupt and that is only a matter of days.

Time will tell whether this officially comes to something.

It was reported yesterday that Evergrande had sold a 5.7% stake in media business HengTen Networks Group which produces films and television shows, and operates a streaming platform for US$145 million.

There are conflicting reports that Evergrande has actually paid the due interest on those bonds.

Iron ore continues to fall

Evergrande is indirectly a big single user of iron ore. There are several other Chinese property developers that are facing financial problems. Combined, there is a big question mark over a significant group of consumers of Australian iron ore.

The iron ore price continues to fall. It has fallen below US$90 per tonne. The share prices of BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) remain in focus.

The post Evergrande reportedly defaults, DMSA is preparing bankruptcy proceedings appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Xero’s results and Nearmap’s guidance disappoint
• 5 things to watch on the ASX 200 on Thursday
• Why are ASX 200 mining shares having such a lousy day?
• How much Fortescue (ASX:FMG) cash is Twiggy sinking into green hydrogen?
• Evergrande raises US$145 million, is it saved from default?

Motley Fool contributor Tristan Harrison owns shares of Fortescue Metals Group Limited. 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 Graincorp Ltd (ASX: GNC) share price is finding momentum today following the release of its full-year results for FY21.

Currently, shares in the grain handler are fetching $6.47, down 3.29%. Although, the Graincorp share price had been as high as $7.03 shortly after trading commenced.

Here’s a look at the results that have contributed to today’s moves.

A slam-dunk year of profits not enough for Graincorp share price

The Graincorp share price is not quite sure what direction to take today following the company’s FY21 results, bobbing and weaving between green and red. One thing is for sure though, the company’s bottom-line for the financial year was far from red.

According to the release, Graincorp experienced an exceptional year backed by a favourable season for grain crops. In turn, the company has been able to deliver towards the top end of its previous guidance range supplied back in August of this year.

In specific terms, $331 million in underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) was recorded during the full-year period. For comparison, FY20 did $108 million in EBITDA, indicating a more than threefold increase year on year.

Likewise, underlying net profit after tax swung from a $16 million loss to a mighty $139 million profit. As management pointed out, this improved result was partly due to a substantial increase in grain receivals across Graincorp’s sites, allowing it to demonstrate improved operational efficiencies of its various assets. Yet, this has failed to boost the Graincorp share price today.

Notably, the company plans on implementing further enhancements to its asset utilisation. That is in addition to investments in key growth areas such as animal nutrition, alternative protein, and AgTech.

The strong result also accommodated a final fully franked dividend of 10 cents per share, taking total dividends for FY21 to 18 cents. Further rewarding shareholders, Graincorp announced an on-market share buyback of up to $50 million. This is set to commence sometime early in the next calendar year.

What does Graincorp’s outlook look like?

While it was a bumper season in FY21, Graincorp’s management highlighted that current harvests are also well above average.

Commenting on this, Graincorp CEO Robert Spurway stated:

We expect the 2021-22 ECA winter crop currently being harvested to be well above average. This will support grain and oilseed receivals into GrainCorp’s country storage facilities and a continuation of the strong export program in FY22.

The anticipated strength of the 2021/22 crop and positive seasonal conditions will also have a positive flow-on effect for FY23, with high levels of carry-over grain expected to continue.

Despite the optimistic outlook ahead, the Graincorp share price is succumbing to selling pressure today.

The post Graincorp (ASX:GNC) share price slides as earnings swing to $139 million profit appeared first on The Motley Fool Australia.

More reading

• Why the Graincorp (ASX:GNC) share price could outperform next week

Motley Fool contributor Mitchell Lawler 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 lunch on Thursday, the S&P/ASX 200 Index (ASX: XJO) is on course to record another decline. The benchmark index is currently down 0.7% to 7,370.9 points.

Here’s what is happening on the ASX 200 today:

Xero’s half year results disappoint

The Xero Limited (ASX: XRO) share price is trading lower today after the release of its half year results. For the six months ended 30 September, Xero reported a 23% increase in operating revenue to NZ$505.7 million but a 19% decline in EBITDA to NZ$98.1 million. And while its top line growth was strong, it is tracking below the market’s full year growth rate expectations. Goldman Sachs, for example, is expecting the cloud accounting platform provider to deliver revenue growth of 33% in FY 2022.

Nearmap guidance update

The Nearmap Ltd (ASX: NEA) share price is sinking today after releasing its guidance for FY 2022. The aerial imagery and location data company revealed that it expects annual contract value (ACV) of between $150 million and $160 million on a constant currency basis in FY 2022. This will be up 12% to 19% year on year, which is short of its medium to long term target of ACV growth of 20% and 40%.

Ramsay’s shares fall following update

The Ramsay Health Care Limited (ASX: RHC) share price is under pressure today after the release of a trading update. The private hospital operator revealed a 1.3% increase in unaudited first quarter revenue to $3.2 billion. However, on the bottom line, the company recorded an unaudited quarterly profit after tax of $58.1 million. This is down 39.5% on the prior corresponding period.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday has been the Fortescue Metals Group Limited (ASX: FMG) share price with a 6.5% gain. This is despite iron ore prices falling again overnight. The worst performer on the index has been the Nearmap share price with a 7% decline following its guidance update.

The post ASX 200 (ASX:XJO) midday update: Xero’s results and Nearmap’s guidance disappoint appeared first on The Motley Fool Australia.

More reading

• Nearmap (ASX:NEA) share price slips despite plan to boost contract value by 12%–19% in FY22
• Ramsay Health (ASX:RHC) share price falls 6% as earnings take a dive
• ASX 200 tech shares in focus as Nasdaq plunges 1.7%
• Xero (ASX:XRO) share price on watch after delivering strong first half growth
• 5 things to watch on the ASX 200 on Thursday

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 shares of and has recommended Nearmap Ltd. and Xero. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. and Xero. The Motley Fool Australia has recommended Ramsay Health Care 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 Tlou Energy Ltd (ASX: TOU) share price has been a very strong performer on Thursday.

In early trade, the clean power solutions company’s shares were up as much as 64% to 10.2 cents.

The Tlou share price has since pulled back a touch but remains up 36% to 8.4 cents at the time of writing.

Why is the Tlou share price rocketing higher?

Investors have been bidding the Tlou share price higher today after it provided an update on its Lesedi Power Project.

According to the release, Tlou and its hydrogen technology partner Synergen Met are working on combining large, established natural gas reserves with abundant solar energy to produce green hydrogen. It notes that this will provide a complementary range of cleaner and greener power generation options.

The release explains that the company has secured a 10MW Power Purchase Agreement (PPA) with Botswana Power Corporation. The power dispatched under this PPA will help displace existing carbon‐intensive power.

What’s next?

The prototype hydrogen production unit is being designed, built and tested in Brisbane prior to transportation to Lesedi in first half of 2022, when production trials will commence.

Management notes that the successful production of hydrogen and solid carbon products could allow the company to achieve early‐stage revenue ahead of gas‐to‐power revenue under the 10MW PPA.

The construction of transmission lines to connect Lesedi to the existing power grid is expected to be completed in 2023.

Tlou’s Managing Director, Tony Gilby, said: “Tlou is well advanced in terms of approvals and agreements to commercialise our gas. With continued encouraging gas flows from Lesedi and the development of additional ways to monetise our gas, we are about to enter a very exciting time for our company. With the potential for Synergen Met to grow alongside Tlou, we see the development of a mutually rewarding and highly beneficial relationship.”

The post Tlou Energy (ASX:TOU) share price skyrockets 64% on green hydrogen update appeared first on The Motley Fool Australia.

More reading

• Nearmap (ASX:NEA) share price slips despite plan to boost contract value by 12%–19% in FY22
• Dream run: Why the Chalice Mining (ASX:CHN) share price is up another 5% today
• Government support of Woodside (ASX:WPL) hydrogen project ‘doesn’t stack up’, says Fortescue
• Ramsay Health (ASX:RHC) share price falls 6% as earnings take a dive
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Nearmap Ltd (ASX: NEA) share price is in the red this morning after the company released guidance for the financial year 2022.

The aerial imagery company is targeting an annual contract value (ACV) of between $150 million and $160 million on a constant currency basis in the financial year 2022. For context, the company’s ACV came to $133.8 million for the financial year 2021 (on a constant currency basis).

At the time of writing, the Nearmap share price is $2.09, which is 2.79% lower than its previous close.

Let’s take a closer look at today’s news from the S&P/ASX 200 Index (ASX: XJO) tech company.

Nearmap share price down on FY22 outlook

The Nearmap share price is falling as the market digests the company’s plans to boost its ACV by 12%–19% in the financial year 2022.

Nearmap states it will keep targeting medium to long term ACV growth of between 20% and 40%. It’s also working to maintain its underlying retention at above 90%.

The North American region is expected to continue to drive Nearmap’s growth. ACV in the region increased by 54% in the financial year 2021.

The company has also continued to deploy capital raising funds in line with its financial year 2022 guidance to increase investment in the business. It expects to consume around $30 million of cash this financial year.

The funds are to go towards initiatives designed to scale the business for growth. Nearmap also states it is fully funded for the foreseeable future.

Finally, Nearmap is on track to roll out its next iteration of aerial camera systems, HyperCamera3, this financial year. It has recently completed a series of tests on custom-designed components in aerial flight.

Over the past month, the Nearmap share price has gained almost 13%. However, it’s still 15% lower than it was at the start of 2021.

What did management say?

In an address at the annual general meeting (AGM), taking place this morning, Nearmap chair Peter James states:

There were significant technological challenges to overcome in designing a camera system of this complexity, but our world class team delivered. Their work means that Nearmap has further extended our already significant technology leadership position.

The post Nearmap (ASX:NEA) share price slips despite plan to boost contract value by 12%–19% in FY22 appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• ASX 200 (ASX:XJO) midday update: NAB hits 52-week high, CSL upgraded
• Brokers rate these ASX growth shares as buys
• These were the best performing ASX tech shares in October
• The Nearmap (ASX:NEA) share price is up 20% in 3 weeks. What’s happening?

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 shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of and has recommended Nearmap 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 Chalice Mining Ltd (ASX: CHN) share price has continued its dream run and is charging higher again on Thursday.

In morning trade, the mineral exploration company’s shares are up a further 5.5% to $9.67.

This means the Chalice Mining share price is now up 43% just this week.

Why is the Chalice Mining share price rising?

Investors have been bidding the Chalice Mining share price higher this week following the release of its maiden mineral resource estimate for the Gonneville deposit at the Julimar Project in Western Australia.

The company has defined a tier-1 scale, pit-constrained maiden resource for Gonneville, which includes a mix of oxide, transitional and sulphide mineralisation.

The maiden indicated and inferred, pit constrained, mineral resource estimate is for 10Moz of palladium, platinum, and gold, 530kt of nickel, 330kt of copper and 53kt of cobalt. This makes it the largest nickel sulphide discovery in over 20 years and the largest platinum-group elements (PGE) discovery in Australian history.

Management believes this establishes the foundation for a world-class green metals project.

What else is supporting its shares?

Also giving the Chalice Mining share price a boost was a broker note out of Bell Potter this week.

In response to the mineral resource estimate, the broker has retained its (speculative) buy rating and lifted its price target by 85% to $11.73.

Bell Potter commented: “This is an excellent outcome for CHN that demonstrates significant scale. The high grade sulphide Resource alone shows potential to support a 6Mtpa mining and processing operation for +12 years. The large scale, lower grade pit-constrained Resource shows potential to maintain and potentially expand production while supporting a multi-generational asset of the type attractive to the world’s largest mining companies.”

“CHN’s 100%-owned Julimar project has emerged as a globally significant PGE-Ni-Cu deposit. Located 70km north of Perth in WA, it represents a unique opportunity to open up new supply in a top mining jurisdiction. The maiden MRE is a major milestone and de-risking event. Incorporating it into our notional mining scenario increases our risk-adjusted NPV-based valuation for CHN by 85%, to $11.73/sh. We retain our Speculative Buy recommendation,” it concluded.

Bell Potter’s price target implies potential upside of 21% for the Chalice Mining share price.

The post Dream run: Why the Chalice Mining (ASX:CHN) share price is up another 5% today appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX shares today
• Why Chalice Mining, Life360, Kogan, and NAB shares are storming higher
• Chalice Mining (ASX:CHN) share price leaps another 8% on the back of historic discovery
• Here are the top 10 ASX shares today
• Why Brainchip, Chalice, Life360, and PointsBet shares are surging higher

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

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