Category: Stock Market

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small decline. At the time of writing, the benchmark index is down 0.15% to 7,711.6 points.

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

Bapcor Ltd (ASX: BAP)

The Bapcor share price is down 2.5% to $4.87. This morning, this auto parts retailer announced that it has successfully refinanced $200 million of debt facilities that were due to mature in July 2025. Bapcor has increased this debt facility by $100 million to a total of $300 million split into tenors maturing in July 2028 and July 2029. Investors may be concerned that this could be a sign that Bapcor isn’t interested in being taken private. Last week, it received an unsolicited, indicative, conditional and non-binding proposal from Bain Capital for $5.40 cash per share.

Chalice Mining Ltd (ASX: CHN)

The Chalice Mining share price is down over 4% to $1.28. This may have been driven by a broker note out of UBS this morning. According to the note, the broker has downgraded the mineral exploration company’s shares to a neutral rating (from buy) with a $1.50 price target. In addition, as we covered here earlier, short sellers continue to successfully target the company. A total of 9.6% of Chalice Mining’s shares are held short at present.

Integral Diagnostics Ltd (ASX: IDX)

The Integral Diagnostics share price is down 4% to $2.44. This follows news that the diagnostic imaging company has made an offer to merge with rival Capitol Health Ltd (ASX: CAJ). Given that it is an all-scrip deal, it seems that some investors don’t believe that Integral Diagnostics shareholders are getting a good deal. Capitol Health shares are up 15% on the news.

Winsome Resources Ltd (ASX: WR1)

The Winsome Resources share price is down 14.5% to 82.5 cents. This has been driven by the completion of the lithium developer’s equity raising. Firm commitments have been received to raise a total of $25 million. This comprises $13.2 million at $1.275 per new share via Canadian flow through financing and a share placement of $11.8 million at a discount of 85 cents per share. The funds will be used to advance key project initiatives. This includes the Adina Lithium and Renard project studies, which are on track for completion in the third quarter of 2024, and exploration and resource growth drilling to expand the current mineral resource estimate of 77.9Mt @ 1.15%.

The post Why Bapcor, Chalice Mining, Integral Diagnostics, and Winsome Resources shares are dropping appeared first on The Motley Fool Australia.

More reading

• Up 15% last week, why is this ASX 200 share sinking on Monday?
• Why Capitol Health, Capricorn Metals, Credit Clear, and Telix shares are storming higher
• Why is this ASX lithium stock crashing 16% today?
• This ASX All Ords stock is rocketing 20% after accepting a takeover offer
• These are the 10 most shorted ASX shares

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

Investing in the stock market can be a bit daunting, especially if you’re just starting out.

Here are three ASX shares that I believe are perfect for beginners. These shares are known for being stable and reliable, making them ideal choices for those new to investing.

Steadfast Group Ltd (ASX: SDF)

The first pick goes to the insurance brokerage group Steadfast, which provides general insurance brokerage and underwriting services.

Steadfast has delivered consistent earnings growth. Over the past five years, the company’s earnings per share (EPS) have grown at a compound annual growth rate (CAGR) of 13%, reaching 10.2 cents per share (cps). For the full year in FY24, management anticipates underlying diluted EPS growth of between 11% and 16%.

During the same period, the dividend per share (DPS) has risen at a CAGR of 15% to 16 cps. At the current share price, the company offers a dividend yield of close to 3%.

Steadfast reported a robust set of numbers in its 1H FY24 results. Its underlying revenue rose 19.4% from a year ago to $790.4 million, and underlying net profit after tax (NPAT) 17.5% to $106 million. Such growth was driven by strategic acquisitions as well as a solid organic profit growth of 13.4%.

The company insiders own approximately 8.5% of the company. This includes a 5% stake in Mr Jim Angelis following the acquisition of Coverforce Holdco, which Angelis founded.

Its shareholders include some major institutional investors. Australian Super owns 7.5%, followed by First Sentier Investors owning 5%, and Fidelity Management & Research company (FMR) at just about 5%.

The Steadfast share price fell 10% over the past year, which is a rare event based on its trading history. Steadfast shares are trading at $5.40 at the time of writing.

Brickworks Limited (ASX: BKW)

Next up is Brickworks, a building materials provider that also engages in property development.

It’s largely an asset story. Brickworks owns a substantial portfolio of investment assets, including listed shares and property development ventures.

One of its key holdings is a 26.1% stake in Washington H Soul Pattinson Ltd (ASX: SOL), which is another excellent investment. In property development, Brickworks collaborates with Goodman Group (ASX: GMG) to unlock the hidden value of its extensive land holdings.

If you’re familiar with Sydney’s property market, you know how bustling Western Sydney has become with the construction of the second airport and the residential property shortage. Brickworks owns a large parcel of land in this area.

In its May 2024 trading update, the company estimated its net asset value (NAV) at around $5.6 billion or $36.68 per share. This is far above its share price of around $26.50 today.

Over the past ten years, the company has increased its dividends annually. Impressively, it has maintained a record of 48 years without reducing its full-year ordinary dividend since 1976, as my colleague Tristan highlighted.

At the current share price, Brickworks offers a fully-franked dividend yield of 2.5%.

The Brickworks share price fell approximately 13% from its 52-week high of $31.4 in March 2024. Brickwork shares are trading at $26.67 at the time of writing.

BHP Group Ltd (ASX: BHP)

Last but not least, BHP Group is a leading global resources company involved in the exploration, production and processing of minerals and oil.

Cyclicality is inevitable for any mining company. However, BHP is well-positioned to weather market fluctuations thanks to its improved operating efficiency and balanced product mix.

The company aims to grow its core iron ore production while expanding its copper exposure through the acquisition of Oz Minerals.

BHP boasts a high return-on-equity (ROE) of 19% using the latest 12-month financials. Its ROE tends to range from single digits to above 40% throughout the commodities cycle. However, it’s one of the lowest cost producers in its respective mining sectors compared to its peers.

Using FY25 EPS estimates by S&P Capital IQ, BHP shares are trading at just about 11 times. At the current price, the company offers a dividend yield of 5.5%.

The BHP share price is down 7.4% over the past year to $42.68 today.

Foolish takeaway

I believe the three ASX shares are attractively valued based on their fundamentals and carry relatively low risks, making them suitable options for beginners.

The post 3 lower-risk ASX shares I think are perfect for beginners appeared first on The Motley Fool Australia.

More reading

• Are BHP or Wesfarmers shares a better buy?
• Top brokers name 3 ASX shares to buy next week
• Tax-busters: 5 fully-franked ASX dividend shares I’d buy for FY25
• 2 outstanding ASX 200 shares to buy and hold for a decade
• 2 ASX shares with shareholder-friendly policies

Motley Fool contributor Kate Lee has positions in Brickworks. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks, Goodman Group, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks, Steadfast Group, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

S&P/ASX 200 Index (ASX: XJO) share Bapcor Ltd (ASX: BAP) is giving back some of last week’s blistering gains today.

Shares in the auto parts company closed on Friday trading for $5.00. In late morning trade on Monday, shares are changing hands for $4.87 apiece, down 2.6%.

For some context, the ASX 200 is down 0.2% at this same time.

Here’s what’s happening.

ASX 200 share falls amid debt refinancing

Last Tuesday, the Bapcor share price surged to close up 14% after the company confirmed it had received a non-binding takeover proposal from United States-based private investment firm Bain Capital for $5.40 a share. That saw the stock end the week up 14.6%.

There’s been no update on those acquisition discussions.

However, this morning the ASX 200 share did provide a financing update.

Bapcor said it has refinanced $200 million worth of debt facilities that were due to mature in July 2025. The debt facilities were increased by $100 million and now total $300 million. Those now mature in July 2028 and July 2029.

The auto parts company now has access to a total $720 million debt facility with a number of major lenders including Australia and New Zealand Banking Group Ltd (ASX: ANZ), National Australia Bank Ltd (ASX: NAB) and Westpac Banking Corp (ASX: WBC).

Management noted that the refinancing improves the ASX 200 share’s financial position and provides additional funds for general corporate purposes.

Commenting on the transaction, Bapcor interim chief financial officer (CFO) George Saoud said:

We are pleased with the outcome of our refinancing. We appreciate the continued support of our banking partners, and with their support Bapcor has strengthened its financial foundation. The new debt facility has competitive terms and pricing and provides the opportunity for us to prepare for future growth.

What else is happening with Bapcor shares?

In a non-price-sensitive announcement, the ASX 200 share also reported that, as of 1 July, George Saud will transition from interim to permanent CFO.

Saud took over as interim CFO on 14 March.

Commenting on the appointment, Bapcor interim CEO Mark Bernhard said, “Bapcor is delighted to confirm George’s permanent appointment as CFO following an extensive search.”

Bernhard added:

George is highly experienced and has held senior financial and commercial positions across a range of complex corporations including Coles Group, Metcash Supermarkets and Fantastic Holdings. George is a great addition to Bapcor’s Group leadership team and will be pivotal in driving the company’s performance in the future.

With today’s intraday dip factored in, the ASX 200 share is down 9% in 2024.

The post Up 15% last week, why is this ASX 200 share sinking on Monday? appeared first on The Motley Fool Australia.

More reading

• Why Bapcor, Chalice Mining, Integral Diagnostics, and Winsome Resources shares are dropping
• 3 ASX 200 shares going gangbusters in June
• 7 ASX All Ords shares rocketing higher while the market sinks
• Why Bapcor, Botanix, Judo Capital, and Woodside shares are rising today
• Here are the top 10 ASX 200 shares today

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

The S&P/ASX 200 Index (ASX: XJO) is having an underwhelming start to the week. In afternoon trade, the benchmark index is down 0.2% to 7,708.5 points.

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

Capitol Health Ltd (ASX: CAJ)

The Capitol Health share price is up 15% to 28.2 cents. This morning, this diagnostic imaging company announced that it had accepted an offer from Integral Diagnostics Ltd (ASX: IDX). The latter tabled a merger offer with an implied exchange ratio of 0.12849 Integral Diagnostics shares for every Capitol Health share. This equated to an offer of 32.6 cents per share, which represented a 33% premium to Friday’s closing prices. Management intends to recommend the offer to shareholders, subject to a number of conditions.

Capricorn Metals Ltd (ASX: CMM)

The Capricorn Metals share price is up 4.5% to $4.66. This appears to have been driven by a broker note out of Bell Potter. According to the note, the broker has retained its buy rating on the gold miner’s shares with an improved price target of $6.53. Bell Potter made the move in response to news that Capricorn Metals has reduced its gold hedge book by 52,000 ounces. Bell Potter notes that the buyback of approximately half of its remaining hedge book mirrors the successful strategy of 2023, which resulted in a relative cash benefit of ~$13 million.

Credit Clear Ltd (ASX: CCR)

The Credit Clear share price is up 5% to 25.2 cents. This morning, this technology and debt collection provider announced that it was upgrading its guidance again. FY 2024 revenue is now expected to be at the upper end of the $40 million to $42 million guidance range. Whereas FY 2024 underlying EBITDA guidance is up from in excess of $3 million to in excess of $3.7 million. Management notes that this represents a ~23% increase in minimum expectations. It also notes that the guidance upgrade “reflects an improving underlying EBITDA margin, which is a key focus and expectation in the company’s continued growth.”

Telix Pharmaceuticals Ltd (ASX: TLX)

The Telix Pharmaceuticals share price is up 3.5% to $17.18. This may also have been driven by a broker note out of Bell Potter. At the end of last week, the broker upgraded the radiopharmaceuticals company’s shares to a buy rating with a $19.00 price target. It believes that recent share price weakness has created a buying opportunity. The broker said: “The pullback represents an opportunity to buy the stock ahead of an exciting period of news flow over the second half of the CY24 which will include potential FDA approvals for Zircaix and Pixclara.”

The post Why Capitol Health, Capricorn Metals, Credit Clear, and Telix shares are storming higher appeared first on The Motley Fool Australia.

More reading

• Why Bapcor, Chalice Mining, Integral Diagnostics, and Winsome Resources shares are dropping
• Leading brokers name 3 ASX shares to buy today
• This ASX All Ords stock is rocketing 20% after accepting a takeover offer
• 5 things to watch on the ASX 200 on Monday
• Top brokers name 3 ASX shares to buy next week

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

The Mexican food business Guzman y Gomez (GYG) is planning to list on the ASX this week with an initial public offering (IPO). As there is so much attention on the company, I am going to outline what attracts me to it and why I plan to buy shares.

It’s scheduled to trade on the ASX on Thursday, 20 June 2024, on a conditional and deferred settlement basis. Normal trading is expected on the ASX on a normal settlement basis on 25 June 2024.

The business is planning to raise $200 million in primary proceeds and $135.1 million through existing investors selling down some of their stake.

Strong sales growth and international potential

The Mexican food company has grown significantly in the last several years.

In FY15, the business generated $101 million of global network sales, which increased to $759 million in the 2023 financial year. That’s a compound annual growth rate (CAGR) of 29% over the period. Management is expecting further growth in the coming years.

Guzman y Gomez has forecast that global network sales can increase to $954.4 million in FY24 and $1.14 billion in FY25. That would be an increase of around 50% between FY23 and FY25.

I believe GYG can continue to grow its global network sales at a double-digit rate for years to come because of its growing Australian and international presence.

The company’s pro-forma (underlying) earnings before interest, tax, depreciation and amortisation (EBITDA) is expected to increase from $29.3 million in FY23 to $59.9 million in FY25. 

Store rollout plan

Some successful businesses have generated excellent returns by expanding their store networks. Just think about global winners like McDonald’s, Yum! Brands, and Chipotle.

I’m not suggesting GYG will do as well as those businesses. On the ASX, Collins Foods Ltd (ASX: CKF) has done very well for shareholders over the past decade. But GYG isn’t a franchisee business like Collins Foods, so GYG can benefit from franchisee sales growth locally or globally.

Guzman y Gomez has a hybrid restaurant ownership model with a mix of corporate and franchise restaurants. It has 185 restaurants in Australia, including 62 corporate restaurants and 123 franchise restaurants. The business has four corporate restaurants in the US.

GYG also has 16 restaurants in Singapore and five restaurants in Japan which are owned and operated by separate master franchisees. GYG earns royalty revenue from franchisee sales.

In Australia, GYG expects to open 30 new restaurants in FY25 and thinks it can increase its annual openings to 40 per year within five years. It thinks it can reach over 1,000 Australian locations over the “next 20+ years”. The Guzman y Gomez listing value may not be cheap, but I’m thinking about where the business may be in three years, five years and ten years, not just its position in June 2024.

The company plans to expand in the US, though it will “continually assess and adjust the pace of restaurant expansion to ensure it is underpinned by robust restaurant economics.” It’s expecting to have seven US stores in FY25, up from four now.

Becoming bigger can help drive the underlying profit margins and value of the business.

Rising margins

Investors often like to value a business based on how much profit it’s making now and what it can make in the future. Rising profit margins can help the bottom line grow even faster than revenue.

Guzman y Gomez showed in its prospectus that its EBITDA to global network sales margin was 3.8% in FY22 and 3.9% in FY23. GYG projects this to increase to 4.5% in FY24 and 5.3% in FY25. Rising margins are a promising sign of economies of scale.

In five years, the Mexican food business could be much bigger and earn even stronger margins (on much higher revenue), which bodes well for future profit.

Foolish takeaway

There could be a lot of volatility with GYG shares in the short term because some investors think they’re overvalued, and others think they have compelling long-term value. I’m planning to start with a minimal investment and then buy more on any weakness or buy more over time as the business executes its store rollout plan and delivers high margins.

The post Why I’m planning to buy Guzman y Gomez shares and own for the long-term appeared first on The Motley Fool Australia.

More reading

• Why Bapcor, Chalice Mining, Integral Diagnostics, and Winsome Resources shares are dropping
• 3 lower-risk ASX shares I think are perfect for beginners
• Up 15% last week, why is this ASX 200 share sinking on Monday?
• Why Capitol Health, Capricorn Metals, Credit Clear, and Telix shares are storming higher
• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor Tristan Harrison has positions in Collins Foods. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Chipotle Mexican Grill. The Motley Fool Australia has recommended Chipotle Mexican Grill and Collins Foods. 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 listed below. Here’s why they are bullish on them:

BlueScope Steel Limited (ASX: BSL)

According to a note out of Goldman Sachs, its analysts have reiterated their buy rating on this steel products company’s shares with an improved price target of $30.10. The broker is feeling positive about BlueScope’s outlook thanks to its exposure to painted steel products. Its analysis indicates the US painted steel growth opportunity could deliver ~$400 million (~20%) EBITDA upside for the company. In addition, the broker believes that BlueScope’s shares are undervalued compared to their US steel peers. As a result, it thinks that this is a great opportunity for investors to pick up shares on the cheap. The BlueScope share price is trading at $20.18 today.

Capricorn Metals Ltd (ASX: CMM)

A note out of Bell Potter reveals that its analysts have retained their buy rating on this gold miner’s shares with an improved price target of $6.53. This follows news that Capricorn Metals has reduced its gold hedge book by 52,000 ounces. Bell Potter notes that the buyback of approximately half of its remaining hedge book mirrors the successful strategy of 2023, which resulted in a relative cash benefit of ~$13 million. And while this has resulted in the broker reducing its earnings forecasts for FY 2024 due to higher financing costs, it has lifted its future earnings estimates meaningfully and has boosted its valuation accordingly. The Capricorn Metals share price is fetching $4.63 at the time of writing.

Light & Wonder Inc (ASX: LNW)

Analysts at Morgans have initiated coverage on this gambling products and services provider’s shares with an add rating and $172.00 price target. According to the note, the broker has been impressed with the way the company’s restructuring and rebranding has resulted in the significant capture of land-based market share in Australia. But the real reason Morgans is bullish is that it believes Light & Wonder can replicate this in the massive United States market. In addition, the broker highlights that its digital segments are performing well with its social casino division, SciPlay, significantly outpacing the rest of the market. The Light & Wonder share price is trading at $140.15 on Monday.

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

More reading

• This ASX 200 stock’s ‘compelling valuation’ makes it a strong buy
• 5 things to watch on the ASX 200 on Monday
• Top brokers name 3 ASX shares to buy next week
• This fund returned 30% per annum for 3 years. Here are the ASX shares it’s buying now.
• These ASX shares could rise 25% to ~50%

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 positions in and has recommended Goldman Sachs Group and Light & Wonder. The Motley Fool Australia has recommended Light & Wonder. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX growth stock Close The Loop Ltd (ASX: CLG) is showing its growth potential today.

Shares in the company, which provides reuse, recycling, and sustainability solutions, closed on Friday trading for 34 cents. Shares leapt to 36 cents apiece shortly after market open today, up 5.9%.

After some likely profit-taking, shares are currently swapping hands for 35 cents, up 2.9%.

For some context, the All Ordinaries Index (ASX: XAO) is down 0.1% at this same time.

Here’s what’s spurring investor interest in the ASX growth stock today.

ASX growth stock expanding its reach

Investors are bidding up Close The Loop shares on Monday after the company reported on a range of potential growth opportunities.

The ASX growth stock said it is looking into opportunities to expand its footprint in the United States, Europe and the Middle East. Over the next 12 months, the company expects to establish new facilities in these locations to support its expanding operations.

The planned expansions are focused on providing enhanced IT refurbishment services and solutions. That includes a new IT refurbishment plant in Mexicali, Mexico. Close The Loop expects that plant will be operational by October.

The company also highlighted its growing HP Inc relationship, noting that IT refurbishment opportunities have been identified with HP Renew Solutions.

And in Europe, the ASX growth stock is expanding its European print consumables program, Circular Planet, into Spain and Portugal.

Commenting on the growth plans, Close The Loop CEO Joe Foster said: “We are excited about the potential opportunities that lie ahead and are dedicated to ensuring a smooth and successful implementation of this expansion plan.”

According to Foster:

We acknowledge the importance of effectively managing our resources to support our growth objectives without impacting on the FY 2024 guidance or expected financial results as previously advised to the market. As we move forward, we will diligently leverage our existing working capital and debt facilities to achieve our strategic milestones.

Foster added:

FY 2024 has seen Close the Loop focus and refine its growth strategy in the IT refurbishment space. We have an opportunity to expand into new geographies, work deeper into the consumer business electronic product lifecycle and nurture new OEM [original equipment manufacturer] relationships.

These growth opportunities are a validation and realisation of the ISP Tek Services acquisition and the synergies we expected to flow from the combined businesses.

Close the Loop share price snapshot

With today’s intraday moves factored in, the ASX growth stock is down around 7% in 2024.

The post This ASX growth stock just leapt 6% on international expansion plans appeared first on The Motley Fool Australia.

More reading

• 2 great value ASX shares I want to buy
• 1 overlooked ASX growth stock I’m chasing for multibagger potential

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

There are ways to invest in the property market beyond traditional real estate without incurring a significant amount of debt. One approach is to invest in ASX real estate investment trusts (REITs), which can provide exposure to various areas, including retail, office, logistics and distribution, manufacturing, storage units, childcare centres, healthcare and more.

ASX REITs have recently experienced significant challenges due to higher interest rates. However, it appears that interest rates may now be at or near their peak.

Hence, a fund manager has shared their perspective on whether this is the right time to invest in REITs. Funds management business Janus Henderson has discussed where it sees structural growth and if this is a turning point.

Is it time to invest in REITs?

Janus Henderson notes the commercial real estate sector has been through difficulties over the last two years as central banks tried to tame inflation.

The fund manager suggests a stabilisation of interest rates, with potential interest rate cuts, “should be good news” for ASX REITs.

Janus Henderson suggests the REIT market may be entering “the early innings of a potentially significant recovery”. If so, the cost of and access to capital, particularly debt financing, should “increasingly play a part in differentiating” between businesses and investors in this space.

Janus Henderson’s Guy Barnard, co-head of global property equities, said:

We are hitting an inflection point in underlying commercial real estate markets, where you will see people rebuilding their allocations as it becomes clearer that underlying real estate markets have bottomed.

Where to buy

The fund manager points out that the real estate market is evolving rapidly due to the growth in e-commerce, which has created “significant headwinds” in retail, while a shift to working from home is “creating challenges” in the office sector.

Barnard said:

We are trying to tap into those areas of structural demand from tenants, rather than trying to ride an economic cycle. We see the growth of digitisation as a great tailwind for tech real estate, including areas like data centres and cell towers.

While the fund manager didn’t name any particular stocks, I’ll point out a few. REITs with exposure to warehouses, logistics and distribution include Centuria Industrial REIT (ASX: CIP), Goodman Group (ASX: GMG) and Dexus Industria REIT (ASX: DXI).

Goodman is also rapidly growing its investments in data centres. While Nextdc Ltd (ASX: NXT) is not an ASX REIT, it is a way to play that theme on the ASX of building and owning data centres and generating revenue from them.

Janus Henderson also sees opportunities in demographics where baby boomers enter retirement and require underlying senior housing accommodation. Healthco Healthcare and Wellness REIT (ASX: HCW) can provide some of that exposure, though it has a diversified portfolio. Meanwhile, Ingenia Communities Group (ASX: INA) is a business that owns retirement communities.

The post Are ASX REITs a good investment right now? appeared first on The Motley Fool Australia.

More reading

• Analysts name 3 high yield ASX dividend stocks to buy
• 3 steps to take for a rich retirement with ASX shares
• 2 outstanding ASX 200 shares to buy and hold for a decade
• Top ASX AI stocks to buy in June 2024
• Here are the top 10 ASX 200 shares today

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 positions in and has recommended Goodman Group. The Motley Fool Australia has recommended Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It has been a tough start to the week for the Winsome Resources Ltd (ASX: WR1) share price.

The ASX lithium stock has returned from a trading halt this morning and crashed deep into the red.

At the time of writing, the lithium developer’s shares are down 16% to 81.5 cents.

Why is this ASX lithium stock crashing?

The catalyst for this weakness has been the completion of the company’s equity raising this morning.

According to the release, firm commitments have been received for a $25 million equity raise at a weighted average price of approximately $1.00 per share.

Winsome Resources notes that it is taking advantage of Canadian flow through provisions with this equity raising before rules change next week. This essentially allows an exploration company to raise funds at a higher price thanks to favourable tax credits.

So much so, the ASX lithium stock was able to raise $13.2 million at $1.275 per new share. This represents a sizeable 32% premium to Winsome Resources’ last traded price.

However, there are some shares changing hands for a big discount. A share placement has been undertaken alongside the Canadian flow through financing to raise a further $11.8 million at a discount of 85 cents per share.

Why is it raising funds?

Management notes that the funds will be used to advance key project initiatives.

This includes the Adina Lithium and Renard project studies, which are on track for completion in the third quarter of 2024, and exploration and resource growth drilling to expand the current mineral resource estimate of 77.9Mt @ 1.15%.

It also notes that the equity raising means that the ASX lithium stock is in a strong financial position to continue its transition from lithium explorer to project developer.

Winsome Resources’ managing director, Chris Evans, said:

Winsome Resources is firmly committed to developing the Adina Lithium Project and is pleased to see the high level of interest from high conviction investors who believe in Winsome’s vision of integrating into the North American EV supply chain.

The flow through financing provisions under Canadian tax law mean we are again able to raise funds at a significant premium to the current share price and therefore at a lower cost of capital. The additional funds put Winsome in an enviable position, with one of the largest and growing lithium deposits in North America, an exclusive option to acquire the billion-dollar Renard operation and associated infrastructure and a clearly defined pathway to production.

Following today’s decline, this ASX lithium stock is down more than 50% over the last 12 months.

The post Why is this ASX lithium stock crashing 16% today? appeared first on The Motley Fool Australia.

More reading

• Why Playside Studios, Pro Medicus, Strike Energy, and Winsome shares are charging 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 Scott Phillips.

The All Ordinaries Index (ASX: XAO) is down 0.5% on Monday morning, but this ASX All Ords share isn’t making any moves just yet.

Shares in the New Zealand based company infrastructure investment company entered a trading halt before the opening bell this morning at the company’s request.

This came on the heels of a major AI related capital raise announcement earlier this morning.

Any guesses?

If you said Infratil Ltd (ASX: IFT), go to the head of the virtual class.

Here’s what’s happening.

ASX All Ords share tips hat for $1.1 billion

Infratil said it intends to raise NZ$1.15 billion (approximately AU$1.1 billion) to fund data centre operator CDC’s accelerating growth. The new funds will also be used to provide more flexibility for growth across the ASX All Ords shares’ global portfolio.

The equity raising comprises an underwritten1 NZ$1.0 billion placement of new IFT shares and a NZ$150 million non-underwritten retail offer of new IFT shares.

New shares will be issued for NZ$10.15 apiece. That’s 6.8% below Friday’s closing price.

“CDC continues to see a surge in demand for data centre capacity,” Infratil CEO Jason Boyes said. “Demand continues to accelerate on the back of cloud adoption and significant investments in generative AI.”

He noted that CDC has been one of Infratil’s top investments. The ASX All Ords share’s stake in CDC is valued at NZ$4.42 billion. That’s 10 times what the company first invested in 2016.

According to Boyes:

This rapid increase in demand has seen CDC enter advanced negotiations with customers for over 400MW of capacity at multiple sites across the CDC footprint with this capacity expected to come online over the next four to five years.

CDC expects at least 200MW of capacity to commence construction over the next 12 months. And Infratil said it expects to commit equity funding of around AU$600 million to the data centre developer over the next two years.

“CDC’s growth has accelerated considerably recently, driven by rapid growth in AI-driven data demand,” Boyes said.

CDC CEO Greg Boorer added:

We are seeing an unprecedented increase in the number of customer discussions, many of which are tied to AI-related workloads. CDC has been AI-ready for more than 15 years and is well positioned to capture strong share of AI-driven demand.

Infratil said there was no change to its FY 2025 guidance.

Infratril share price snapshot

If you look back at the chart up top, you’ll notice a remarkably stable long-term uptrend in the Infratil share price.

Over the past 12 months, the ASX All Ords share has gained 14.3%.

The post Guess which ASX All Ords share is raising $1.1 billion to back generative AI appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben 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.