Category: Stock Market

It was a horror start to the trading week for the S&P/ASX 200 Index (ASX: XJO) and many ASX shares.

After ending what was a pretty sad week on a sour note last Friday, investors seemed to come back from the weekend with even colder feet. After opening with a significant drop, the ASX 200 ended the trading day with a nasty 1.45% fall. That leaves the index at just 8,505.3 points.

This horrid start to the Australian trading week follows a similarly pessimistic end to the American week on Friday night (our time).

The Dow Jones Industrial Average Index (DJX: .DJI) was in a bit of a panic, finishing down 1.07%.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) fared even worse, dropping 1.54%.

But let’s get back to this week and the local markets now, with a deeper dive into what was happening amongst the various ASX sectors today.

Winners and losers

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

More reading

• Why the ASX 200 is sinking to a 7-week low today
• Why Brazilian Rare Earths, Pro Medicus, Service Stream, and Woodside shares are charging higher
• Why are Santos shares jumping higher today?
• Why is everyone talking about Elders, Brambles and New Hope shares on Monday?
• This ASX 200 coal stock is charging higher after a big profit jump

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Lynas Rare Earths Ltd and Pro Medicus. The Motley Fool Australia has recommended Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Knowing which ASX shares to avoid can be just as important as knowing which ones to buy when you are aiming to maximise portfolio returns.

So, with that in mind, let’s see which shares analysts are tipping as sells this week, courtesy of The Bull.

Here’s what they are bearish on:

A2 Milk Company Ltd (ASX: A2M)

The team at Dolphin Partners Financial Services has named this infant formula company’s shares as a sell this week.

The financial services firm highlights that A2 Milk has a tough outlook following weakness in China and a product recall in the United States. As a result, it sees better opportunities elsewhere in the market. It said:

This infant milk formula company recently initiated a voluntary recall of three small batches of product sold in the United States. The company announced the recall was isolated to the US label product. The shares have remained under pressure since April when the company downgraded guidance in full year 2026.

It expects lower infant milk formula sales, mostly related to Chinese labels. The EBITDA percentage margin is forecast to decline from previous guidance of between 15.5 per cent to 16 per cent to between 14 per cent to 14.5 per cent. Other stocks offer more appealing outlooks. The shares have fallen from $9.24 on April 10 to trade at $6.45 on May 13.

Endeavour Group Ltd (ASX: EDV)

Dolphin Partners Financial Services has also named this drinks giant’s shares as a sell this week.

It highlights that the Dan Murphy’s owner is operating in a challenging economic environment and facing increased competition.

In light of this, the financial services firm thinks investors should focus on other ASX shares. It explains:

Endeavour operates liquor outlets, hotels and gaming facilities. While Endeavour is a leader in the liquor retailing space, the business is operating in a challenging economic environment involving fierce competition, continuing margin pressure and macroeconomic shocks. Many analysts have cut forecasts to reflect softer trends.

Increasing fuel costs in response to the Middle East conflict is imposing pricing pressure throughout its supply chain. Increasing cost of living pressures is another challenge. The shares have fallen from $4.04 on March 2 to trade at $3.23 on May 13. Other stocks appeal more in this economic climate of higher interest rates and cash strapped consumers.

Temple & Webster Group Ltd (ASX: TPW)

Over at DP Wealth Advisory, it has named this online furniture retailer’s shares as a sell this week.

It thinks that the higher oil prices and interest rates are likely to weigh on discretionary spending. It said:

TPW is an online furniture and homewares retailer. The share price remains under significant pressure in response to weaker discretionary spending from the oil price shock and rising interest rates in Australia. The stock has also been subjected to short selling by investors betting the shares will fall. Our recommendation is based on a weaker macroeconomic outlook.

At this point, we can’t see any clear and meaningful differentiation between TPW and bricks and mortar retailers or online competitors operating in the same or similar sectors.

The post Why experts are selling these 3 ASX shares this week appeared first on The Motley Fool Australia.

More reading

• Why A2 Milk, Brambles, Elders, and Tuas shares are sinking today
• 3 ASX shares down over 60% that could be bargain buys
• Synlait Milk CEO resigns – the latest in a line of executive departures
• 9 ASX 200 shares with renewed buy calls from the experts this week
• These ASX retail stocks are near 52-week lows, are they bargain buys?

Motley Fool contributor James Mickleboro has positions in Endeavour Group and Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are on the lookout for some new portfolio additions, then it could be worth hearing what analysts at Morgans are saying about the ASX shares named below, courtesy of The Bull.

Are they bullish, bearish, or something in between? Let’s find out.

ResMed Inc. (ASX: RMD)

Morgans has given its verdict on this sleep treatment company this week.

The broker has concerns that the ASX share could be negatively impacted by cost pressure arising from the conflict in the Middle East.

As a result, it has put a hold rating on ResMed shares. It said:

This global company develops, makes, distributes and markets medical devices for diagnosing, treating and managing respiratory conditions, including sleep disordered breathing. RMD management recently flagged emerging cost pressures from Middle East tensions. It was a response to higher fuel prices and early signs of component inflation.

However, RMD’s fundamentals remain sound, with consistent execution, strong cash generation and structural growth tailwinds from expanding diagnosis and supplies. In our view, investors should continue holding the stock.

Sigma Healthcare Ltd (ASX: SIG)

The team at Morgans thinks that Sigma Healthcare shares could be a buy.

It was pleased with its plan to expand into the UK market and believes it could support quicker than expected growth in its store network. It explains:

Sigma Healthcare is a wholesale distributer of pharmaceutical goods and medicines. Following the merger with Chemist Warehouse to create a leading healthcare franchisor, Sigma recently announced it had signed a memorandum of understanding with Greenlight Healthcare that will launch the Chemist Warehouse brand in the UK market. Sigma will acquire a 75 per cent interest in a number of stores.

Chemist Warehouse has averaged opening 33 new stores per annum over the past five years, but this international expansion could expedite growth. SIG is a first class operator that’s likely to continue its impressive growth track record into the future.

TechnologyOne Ltd (ASX: TNE)

Morgans thinks that TechnologyOne shares are expensive at current levels.

As a result, the broker has put a sell rating on the enterprise software provider’s shares this week.

Commenting on TechnologyOne, the broker said:

TNE is one of Australia’s largest enterprise software-as-a-service companies. TNE provides enterprise resource planning software to thousands of corporations, government departments and statutory authorities. While TNE enjoys strong market positions in Australia and New Zealand, the stock was recently trading on a lofty price-earnings ratio above 65 times, indicating it may be overvalued if growth falters.

The company is exposed to higher interest rates and its subsequent implications regarding valuations of technology companies. Some uncertainty exists about the long term impact of artificial intelligence on companies in the broader technology sector.

The post Buy, hold, sell: ResMed, Sigma, and TechnologyOne shares appeared first on The Motley Fool Australia.

More reading

• Leading brokers name 3 ASX shares to buy today
• Sell alert! Why this expert is calling time on Technology One shares
• 5 things to watch on the ASX 200 on Monday
• What is Bell Potter’s updated view on TechnologyOne shares?
• 3 high-quality ASX 200 shares for beginners to buy and hold

Motley Fool contributor James Mickleboro has positions in ResMed and Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ResMed and Technology One. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The S&P/ASX 200 Index (ASX: XJO) is under pressure again on Monday, with investors taking risk off the table after another jump in oil prices.

At the time of writing, the ASX 200 is down 1.42% to 8,508 points.

The move has pushed the benchmark index to its lowest level in around 7 weeks.

The ASX 200 is now down 2.7% over the past week and 4.9% over the past month.

So, what has investors selling today?

Oil keeps the pressure on

Brent crude futures have pushed above US$111 a barrel as investors watch the risk of further escalation in the Middle East.

Reuters reported that oil and bond yields rose as global markets reacted to fresh inflation concerns and ongoing geopolitical tension.

Investors were already nervous after Wall Street ended lower on Friday as concerns over rising prices and higher bond yields weighed on sentiment.

The Dow Jones Industrial Average Index (DJX: .DJI) fell 1.1%, the S&P 500 Index (SP: .INX) lost 1.2%, and the Nasdaq Composite Index (NASDAQ: .IXIC) dropped 1.5% as Treasury yields moved higher.

That has left local investors with little reason to take on more risk today.

Most ASX 200 shares are falling

The weakness is spreading across most of the market.

The S&P/ASX 200 Industrials Index (ASX: XNJ) and the S&P/ASX 200 Materials Index (ASX: XMJ) are among the main drags, down 4.22% and 2.89%, respectively.

On the other hand, the S&P/ASX 200 Energy Index (ASX: XEJ) is one of the few areas finding support from the oil rally, up 1.94%.

A big part of the industrials weakness is coming from Brambles Ltd (ASX: BXB).

The Brambles share price is down 19.23% to $17.85 at the time of writing after the pallet pooling giant cut its FY26 profit guidance.

The downgrade has made Brambles one of the day’s biggest ASX 200 fallers, which is not helping an index already under pressure.

Foolish Takeaway

Today’s ASX 200 fall is being driven by a mix of global concerns and local weakness.

Higher oil prices are keeping inflation worries alive, while Brambles has given investors another reason to sell after cutting its profit guidance.

The weakness also looks broad, with most sectors in the red and materials stocks weighing heavily on the index.

Investors appear to be showing caution rather than buying the dip, especially with no clear sign yet of where the selling might settle.

With the ASX 200 continuing to drift lower and US futures pointing lower, the market could be set for another difficult start tomorrow.

The post Why the ASX 200 is sinking to a 7-week low today appeared first on The Motley Fool Australia.

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• Abacus Storage King internalises management and rebrands as Storage King Group
• New Hope Corporation posts stronger coal output and profit in third quarter
• Pro Medicus inks $90m contract
• Brambles revises FY26 outlook, announces new US$400m buy-back
• Elders posts higher HY26 profit and holds interim dividend

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

With so many shares to choose from on the Australian share market, it can be difficult to decide which ones to buy. The good news is that brokers across the country are doing a lot of the hard work for you.

Three top ASX shares that leading brokers have named as buys this week are outlined below. Here’s why they are bullish on them:

Electro Optic Systems Holdings Ltd (ASX: EOS)

According to a note out of Ord Minnett, its analysts have retained their speculative buy rating on this defence and space company’s shares with an improved price target of $14.00. The broker was pleased with a recent update from the company relating to its proposed acquisition of MARSS Group. Ord Minnett is positive on the deal, highlighting that the MARSS NiDAR system has a track record of defeating multiple Shahed drone attacks recently in the Middle East. Outside this, it was pleased to see that MARSS’ order book is substantial, which boosts the total combined unconditional order book to over $726 million. In light of this, Ord Minnett has boosted its earnings estimates for the near term and its valuation accordingly. The EOS share price is trading at $8.82.

Regis Resources Ltd (ASX: RRL)

A note out of Macquarie reveals that its analysts have retained their outperform rating and $9.50 price target on this gold miner’s shares. The broker has been looking at the company’s plan to merge with Vault Minerals Ltd (ASX: VAU). Macquarie sees positives in the deal, noting that it has the potential to become the second-largest Australian gold miner with significant production capacity. And while it concedes that there will be no operational synergies, it points out that there will be tax benefits and a potentially lower cost of capital. The Regis Resources share price is fetching $6.38 at the time of writing.

TechnologyOne Ltd (ASX: TNE)

Analysts at Bell Potter have retained their buy rating on this enterprise technology provider’s shares with an improved price target of $32.25. According to the note, the broker is feeling positive ahead of this week’s half-year results release. It expects TechnologyOne’s profit before tax growth to be consistent with its guidance. Bell Potter is forecasting 9% growth to $89.4 million, while the consensus estimate is for growth of 8% to $88.4 million. It also expects 17% growth in annual recurring revenue (ARR) to around $600 million. However, it suspects that there could be a positive surprise with its ARR, which could be a potential catalyst for its share price. The TechnologyOne share price is trading at $28.46 on Monday afternoon.

The post Leading brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

More reading

• EOS shares halted after huge run as $175 million raising lands
• Sell alert! Why this expert is calling time on Technology One shares
• 5 things to watch on the ASX 200 on Monday
• What is Bell Potter’s updated view on TechnologyOne shares?
• Why EOS, Megaport, Racura, and Xero shares are racing higher today

Motley Fool contributor James Mickleboro has positions in Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems, Macquarie Group, and Technology One. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The team at Shaw and Partners has been keeping a close watch on the small cap and emerging side of the market recently, and has come up with plenty of ideas around companies they see as good value.

Today I’ve selected two in the technology field, albeit very different companies, to see what the analyst team at Shaw and Partners are saying.

Let’s have a look.

Smart Parking Ltd (ASX: SPZ)

This company does as the name suggests – it supplies parking monitoring and management systems and now has offices in the UK, Denmark, Germany, Australia, New Zealand, and the US.

The company only entered the US in March of last year, after it acquired Peak Parking for $56.9 million.

The company said in its most recent half-year report that it had added 53 new automatic number plate recognition sites globally during the half year, while revenue jumped from $32 million to $62.8 million.

Net profit increased from $3.9 million to $4.3 million.

Shaw and Partners said in their recent note to clients that “a strong buying opportunity seems to have emerged in SPZ as the March quarter trading update paints a picture of solid performance notwithstanding a share price drop of over 40% since February”.

The analyst team said the US represented a large potential market for the company, which it was just breaking into.

They added:

The roll-out of SPZ’s low-cost, user-friendly, accurate parking technology into the relatively untapped parking segment of unmanaged, small surface lots (attached to retailers, hotels, fast food chains, and high-density transportation hubs etc) could add significant value. SPZ is confident in its ability to launch the service and has now hired a sales team.

Shaw and Partners has a price target of $1.55 on Smart Parking shares compared with 83.5 cents currently.

Atturra Ltd (ASX: ATA)

This company presented at the Shaw and Partners TechRise conference recently and Chief Executive Officer Stephen Kowal gave a “confident update” according to the Shaw analyst team.

Shaw and Partners said:

Management implicitly reaffirmed FY26 guidance and agreed the business is returning to growth in 2H, with accelerating demand across data, security and AI-readiness work offsetting weakness elsewhere and supporting confidence into FY27/FY28. Margins are expected to benefit from restructuring and automation-led managed services efficiencies, while improving cross-sell traction and stronger momentum across IP products (ACP and Scholarian) are incrementally strengthening the medium-term outlook.

Shaw and Partners has a price target on Atturra shares of $1.15 compared with 45 cents currently. Atturra is valued at $171 million.

The post Shaw and Partners says these two ASX small-cap companies could have some serious upside appeared first on The Motley Fool Australia.

More reading

• Why the ASX 200 is sinking to a 7-week low today
• Leading brokers name 3 ASX shares to buy today
• Why Brazilian Rare Earths, Pro Medicus, Service Stream, and Woodside shares are charging higher
• Why A2 Milk, Brambles, Elders, and Tuas shares are sinking today
• Which ASX rare earths company is spinning out a new aluminium company?

Motley Fool contributor Cameron England 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 Atturra. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a disappointing decline. At the time of writing, the benchmark index is down 1.35% to 8,515.9 points.

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

Brazilian Rare Earths Ltd (ASX: BRE)

The Brazilian Rare Earths share price is up 6% to $5.68. Investors have been buying the rare earths developer’s shares after it announced the spin-off of its aluminium business. Brazilian Rare Earths plans to demerge its Amargosa bauxite and gallium project into a new company through an initial public offering worth up to $50 million. It said: “The proposed demerger affords Amargosa the focus and flexibility it needs to be progressed rapidly, and reflects a disciplined portfolio strategy that separates two large-scale, strategically important mineral platforms with different development pathways.”

Pro Medicus Ltd (ASX: PME)

The Pro Medicus share price is up 2.5% to $125.35. This morning, the health imaging technology company announced a seven-year, A$90 million contract with Boston-based Beth Israel Lahey Health. The contract will see the company’s cloud-based Visage 7 Enterprise Imaging Platform implemented throughout Beth Israel Lahey Health providing a unified diagnostic imaging platform. Pro Medicus’ CEO, Dr Sam Hupert, said: “Our pipeline remains strong and spans all market segments. This deal is for our ‘full stack’ comprising all three core Visage products, namely viewer, workflow and archive, a trend we see continuing.”

Service Stream Ltd (ASX: SSM)

The Service Stream share price is up 1.5% to $2.17. This has been driven by the release of an announcement from the essential network services provider. Service Stream has secured new agreements worth $455 million across two major customers. This includes a new nine-year contract with Yarra Valley Water under its Maintenance Services Delivery Partners program. The company’s managing director, Leigh Mackender, said: “Service Stream is delighted to be selected as a delivery partner for this long-term program. We look forward to working closely with Yarra Valley Water and supporting the maintenance of its critical infrastructure across Melbourne.”

Woodside Energy Group Ltd (ASX: WDS)

The Woodside share price is up 3% to $32.16. Investors have been buying the energy giant’s shares following a strong rise in oil prices on Friday night. Traders were bidding oil prices higher after Donald Trump suggested that he was losing patience with Iran in relation to peace talks. This has sparked fears of an escalation in the conflict.

The post Why Brazilian Rare Earths, Pro Medicus, Service Stream, and Woodside shares are charging higher appeared first on The Motley Fool Australia.

More reading

• Which ASX rare earths company is spinning out a new aluminium company?
• Investors are buying this ASX stock after a $455 million update
• Pro Medicus shares jump as massive US contract win turns heads
• How much could the Pro Medicus share price rise in the next year?
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Motley Fool contributor James Mickleboro has positions in Pro Medicus and Woodside Energy Group Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The S&P/ASX 200 Index (ASX: XJO) is having a tough start to the week. In afternoon trade, the benchmark index is down 1.4% to 8,507.7 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

A2 Milk Company Ltd (ASX: A2M)

The A2 Milk share price is down 4.5% to $5.85. This appears to have been driven by a broker note out of Citi. According to the note, the broker has downgraded the infant formula company’s shares to a sell rating with a reduced price target of $5.85. Citi made the move in response to ongoing supply challenges. In addition, it points out that lower birth rates are weighing on the industry and its shares are looking expensive at current levels.

Brambles Ltd (ASX: BXB)

The Brambles share price is down 18% to $18.08. This has been driven by a guidance downgrade from the supply chain solutions company this morning. Brambles now expects sales revenue growth of 2% to 3% (previously 3% to 4%) and underlying profit growth of 3% to 5% (from 8% to 11%). Brambles CEO, Graham Chipchase, said: “Our immediate priority is to meet our customers’ needs and to restore stability and service in the affected parts of our US network. Our response and ongoing investments in quality reinforce that meeting our customers’ needs is non-negotiable. We will not compromise on the investment required to meet the quality, network resilience and service outcomes our customers expect.”

Elders Ltd (ASX: ELD)

The Elders share price is down 22% to $5.61. Investors have been selling the agribusiness company’s shares following the release of its half-year results. Elders posted a 32% increase in underlying sales to $1.77 billion and a 33% jump in underlying EBIT to $76.6 million. This was driven largely by the addition of Delta Agribusiness, which was acquired in November. While this was a strong result on paper, its earnings fell short of consensus estimates. Nevertheless, Elders’ managing director and CEO, Mark Allison, was pleased with the half. He said: “The first half of FY26 has been eventful for Elders, with Delta Agribusiness welcomed into the Elders Group and seasonal improvements driving optimism for the winter crop. Our decision to implement a new divisional structure in FY26 is already reaping benefits through improved alignment and efficiency gains.”

Tuas Ltd (ASX: TUA)

The Tuas share price is down 64% to $2.20. Investors have been selling this Singapore-based telco after it revealed that its SIMBA business has allegedly been using spectrum that it doesn’t own. In light of this, the Infocomm Media Development Authority of Singapore (IMDA) has suspended its review of Tuas’ proposed acquisition of M1 Limited for S$1.43 billion. It said: “The circumstance identified by the IMDA as giving rise to its decision to suspend the review is that it had learned that Simba may have been using radio frequency bands that it was not authorised to use, which would be a breach of the Telecommunications Act and the conditions of Simba’s Facilities-Based Operations Licence.”

The post Why A2 Milk, Brambles, Elders, and Tuas shares are sinking today appeared first on The Motley Fool Australia.

More reading

• Why is everyone talking about Elders, Brambles and New Hope shares on Monday?
• Why are Tuas shares crashing 69% on Monday?
• Why are Brambles shares crashing more than 15% to a new 12-month low today?
• Which ASX 200 share is crashing 22% on half-year results?
• Brambles revises FY26 outlook, announces new US$400m buy-back

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. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Brazilian Rare Earths Ltd (ASX: BRE) plans to demerge its Amargosa bauxite and gallium project into a new company, which will launch after an initial public offer worth up to $50 million.

Shareholders to share the wealth

The new company will be known as Alurion Resources Ltd, and Brazilian Rare Earths shareholders on the register on an as-yet unannounced record date will be given 0.5607 shares in Alurion for each share they own.

Brazilian Rare Earths shareholders will also be given priority for new shares under the initial public offer.

The company’s board said in a statement to the ASX on Monday that separating the Amargosa project into a new company with its own focused management team made sense.

The company said:

The proposed demerger affords Amargosa the focus and flexibility it needs to be progressed rapidly, and reflects a disciplined portfolio strategy that separates two large-scale, strategically important mineral platforms with different development pathways.

The company added that bauxite was in high demand, with new sources needed globally.

Bauxite is the primary raw material used to make alumina, which is then used to produce aluminium. The world’s seaborne bauxite supply chain has become increasingly concentrated, with Guinea now supplying approximately 70% of China’s imported bauxite feedstock. This supply concentration highlights the strategic importance for new, high-quality bauxite supply from reliable mining jurisdictions.

Advanced project status

Brazilian Rare Earths said Amargosa was not an early-stage project, with exploration work by Rio Tinto Ltd (ASX: RIO) and, more recently, by Brazilian Rare Earths itself, having defined a 568 million tonne resource, including 98 million tonnes of direct-ship bauxite at a grade of 41.9%.

The company added:

The scale and quality of the resource provide the foundation for a low-complexity initial development pathway and potential longer-term expansion opportunities. The first-stage Scoping Study development plan is simple by design: mine and ship bauxite directly, without building a beneficiation plant, tailings facility or major fixed infrastructure. This development pathway is designed to minimise upfront capital intensity, reduce time to market and position Amargosa in the first quartile of the global cost curve.

Brazilian Rare Earths said the scoping study envisaged a 1.2 year payback period and a development cost of just US$119 million.

Brazilian Rare Earths Managing Director Bernardo de Veiga said regarding the plan:

The proposed demerger and public listing of Alurion Resources is a disciplined value-unlocking transaction for BRE shareholders and the right structure for the leading Amargosa Bauxite-Gallium Project. Amargosa is a large-scale bauxite-gallium province, with the resource base, grade, logistics and low-capex first-stage development pathway to support a compelling standalone investment proposition. Establishing Alurion as a dedicated company gives Amargosa the capital focus, specialist leadership and strategic mandate to advance its development pathway. For BRE, the demerger also sharpens our corporate focus. It allows Alurion to advance Amargosa as a leading bauxite and critical minerals development company, while BRE concentrates its development and execution capabilities on advancing one of the world’s most important rare earth and critical minerals provinces.

Brazilian Rare Earths shares were 4.9% higher on Monday at $5.60.

Canaccord Genuity recently issued a share price target for the company of $8.

The post Which ASX rare earths company is spinning out a new aluminium company? appeared first on The Motley Fool Australia.

More reading

• Why Brazilian Rare Earths, Pro Medicus, Service Stream, and Woodside shares are charging higher

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

With almost $900 million in funds under management, the VanEck Morningstar Wide Moat ETF (ASX: MOAT) is a popular exchange-traded fund (ETF) on the ASX.

Although not quite in the same league as the index fund heavy-hitters like the Vanguard Australian Shares Index ETF (ASX: VAS), many Australian investors have entrusted the MOAT ETF with their hard-earned cash.

Most index funds are incredibly simple, and easy to wrap one’s head around. VAS, for example, holds the largest 300 shares on the ASX, weighted by market capitalisation. Nothing more, nothing less.

MOAT is another kettle of fish, though, and works a little differently from a basic index fund. So today, let’s dive deeper into the VanEck Wide Moat ETF, see how it works, and discuss what an investor will actually own if they buy this ASX ETF.

Unlike a simple index fund, MOAT uses a complex approach to build an underlying portfolio of investments that the ETF indirectly allows investors to purchase. Its portfolio is determined by a series of formulas. These seek to identify US stocks that show clear signs of possessing a wide economic moat.

This term, originally coined by legendary investor Warren Buffett, refers to a durable competitive advantage that a company can possess. It is used to keep customers within the company’s ‘walls’, as well as keeping competitors out.

What’s in the VanEck Wide Moat ETF?

This competitive advantage could be a strong brand, a low-cost advantage, or providing a good or service that customers find difficult to replace or avoid using.

The VanEck Wide Moat ETF identifies a series of companies that show signs of possessing at least one of these moats, and adds said company to its portfolio if the price is attractive. As such, MOAT tends to have a portfolio of around 50 individual stocks, all held at an equal weighting.

Here are the fund’s current ten largest stocks, as of 15 May:

1. Fortinet Inc
2. NXP Semiconductors N.V.
3. NVIDIA Corporation
4. Mondelez International Inc
5. Airbnb Inc
6. Masco Corp
7. Bristol-Myers Squibb Co
8. Kenvue Inc
9. Constellation Brands
10. Microsoft Corporation

As you can see, there are clearly some wide moats there. It could be Microsoft’s sticky Office or Windows software suites, Nvidia’s dominance in AI and chip technology, Airbnb’s network effects, or the power of Mondelez and Constellation’s popular brands (which include Cadbury chocolate and Corona beer, respectively).

Some other names that you may recognise in MOAT’s current portfolio include Amazon, Nike, PepsiCo, and Walt Disney Company.

The VanEck Morningstar Wide Moat ETF charges a management fee of 0.49% per annum.

The post Own the VanEck Wide Moat ETF? Here’s what you’re really buying appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Amazon, Microsoft, Mondelez International, PepsiCo, VanEck Morningstar Wide Moat ETF, Vanguard Australian Shares Index ETF, and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Airbnb, Amazon, Bristol Myers Squibb, Fortinet, Kenvue, Microsoft, NXP Semiconductors, Nike, Nvidia, and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Constellation Brands and Masco. The Motley Fool Australia has recommended Airbnb, Amazon, Microsoft, Nike, Nvidia, VanEck Morningstar Wide Moat ETF, and Walt Disney. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.