In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a decent gain. At the time of writing, the benchmark index is up 0.8% to 7,641.2 points.

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

Cettire Ltd (ASX: CTT)

The Cettire share price is up 23% to $3.90. Investors have been buying this online luxury products retailer’s shares following the release of its half year results. Cettire reported a 90% jump in gross revenue to $460.5 million and a 56% increase in adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) to $26.1 million.

Dexus Industria REIT (ASX: DXI)

The Dexus Industria share price is up almost 5% to $2.91. This morning, the industrial property company released its half year results and reported like-for-like income growth of 7.3%. Management believes this leaves it “on track to deliver FY24 guidance.” This will mean FFO of 17.1 cents per share and distributions of 16.4 cents per share.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price is up 7% to $3.62. This follows news that the lithium miner has signed an extension to its agreement with China-based lithium converter Chengxin Lithium Group. The agreement will see the company supply an additional 60,000 tonnes for a total of 85,000 of spodumene concentrate in 2024. And for both 2025 and 2026, it will supply 150,000 tonnes of spodumene concentrate.

Zip Co Ltd (ASX: ZIP)

The Zip share price is up 14% to 89.5 cents. Investors have been scrambling to buy the buy now pay later provider’s shares amid speculation that it is a takeover target. According to The Australian, there is “talk in the market” that Zip may be the subject of takeover interest after making waves with its profitability goals. Zip advised that it hasn’t received any offers.

The post Why Cettire, Dexus Industria, Pilbara Minerals, and Zip shares are jumping today appeared first on The Motley Fool Australia.

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More reading

• Zip share price rises as investors buy now on takeover talk
• 7 ASX lithium shares going gangbusters today
• Pilbara Minerals share price jumps 5% on material offtake extension
• 4 high-profile ASX REITS charging higher on half-year results
• Cettire share price rockets 40% on ‘exceptional result’

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

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Yesterday, I wrote about some big macro stuff – a combination of investing, economics and politics.

But today I’m going to aim straight down the investing fairway.

The inspiration? Shares in Warren Buffett’s company, Berkshire Hathaway, are very, very close to hitting US$600,000 each (that’s around $925,000 at the prevailing exchange rate).

Which is… a lot.

(At this point, let me disclose that I own some shares in Berkshire Hathaway, but not the US$600,000 ones, unfortunately! There is a second class of Berkshire shares that are currently just under US$400 each. They’re the ones I own!)

Now, there are a few jumping off points from that extraordinary share price, and I’ll take each in turn.

The first one is, I hope, relatively obvious. You only get a US$600,000 share price by getting good results for a very, very long time.

Here’s the share price chart, via Google:

The thing is, that data only goes back to 1984.

Warren Buffett has been running Berkshire since 1965.

So the amazing 44,700% gain (447 times your money) actually dramatically underestimates the return.

Going back to the most recent Berkshire report – and it’s almost a year old, during which time Berkshire shares are up another ~25% – the gain over the last 58 years is an incredible…

3,787,464%

Yes, compounding really works. And to get that return, what did you have to do?

Nothing.

Not ‘not much’. You had to do precisely nothing. Just leave your money alone.

But that takes me to my second point.

Yes, time matters.

But if you’ve been a patient AMP Ltd (ASX: AMP) shareholder since early 1999, your 25-odd year share price return has been…

-92.93%.

To be fair, there have been some (sporadic) dividends over that time. Adding those in dividends reduces the loss to…

-82.35%.

Whichever way you cut it, the results aren’t pretty.

So, time isn’t enough.

Quality matters. A lot.

One Buffett is worth a helluva lot of other managers. So was one Steve Jobs.

But it’s not necessarily about the people. One Coca-Cola, one Woolworths Group Ltd (ASX: WOW) or one CSL Limited (ASX: CSL) would have done wonders for your long term returns, too.

However you find it, investing in quality gives your returns a very strong advantage.

My third observation is about a company’s share price.

Is $600,000 expensive for a Berkshire Hathaway share?

This is where I need to break down the word ‘expensive’.

In normal life, ‘expensive’ is measured relative to our ability to pay. A Lamborghini is expensive. An Hermes bag is expensive.

Or it’s measured relative to another product. A bottle of Penfolds Grange (I own shares in the winemaker) is ‘expensive’ in dollars, but also relative to the $9.95 bottle of shiraz you can grab on special from Dan Murphy’s.

But shares are different.

Let me use the investor’s favourite analogy: pizza.

How much is a slice of pizza worth? I hope, before you answer, you’d ask “How big is the slice”.

$5 a slice would be cheap if a large pizza was only cut into two. If it was cut into 100 pieces, $5 would be too much to pay.

‘Of course’, you say. ‘That’s obvious’.

But when it comes to shares, the same logic should apply, but it’s harder to grasp for many people.

How much should you pay for a share of Woolies? The right answer is a question: “It depends on the value of the whole business (the pizza) and how many shares there are (how many slices)”.

Woolies current total value (the value of all the shares, added together) is $44 billion.

If there were two shares, they’d be valued at $22b each.

If there were 8 billion shares, each would go for $5.50.

They wouldn’t be any ‘cheaper’ at $5.50 than at $22b, in terms of the value you’d get for your money (though admittedly, not many of us have $22b to throw around!)

But let’s make it simpler:

If Woolies had 2 billion shares on issue, they’d be worth $22 each.

If it had 4 billion, they’d sell for $11 each.

Some people will tell you that $11 per share is ‘cheaper’ than $22 per share, and therefore a better buy.

I hope you now see that they’d be very, very wrong.

My last Berkshire-related observation is about ‘runway’ – how much room a company has left to grow.

When I recommended (and bought) Coca-Cola Amatil shares a few years back, I liked the company’s track record, its brands, its distribution, and its ability to stave off competitors.

(Coca-Cola Amatil was the local Coca-Cola bottler in Australia and much of the Pacific, and had a few other businesses, besides. It was eventually acquired by another bottling company.)

To put it simply, I think I was right.

And yet, it was a poor investment.

Why? Because it didn’t have enough ‘runway’ left. It already had products and fridges in every single servo, corner store, supermarket and stadium in the country. And it had vending machines pretty much everywhere else!

Which is fine, but then you have to pay a price that allows for limited growth. I… didn’t.

Berkshire gained so much, over such a long time, because it was a business that could continue growing for decades. I still think it’ll keep growing, for the record, but the opportunities narrow when you become much, much larger, over time.

You don’t have to be on the cutting edge to find business that can grow for a long time – Woolies had been around for decades before listing back on the ASX in 1993 at $2.45. The shares now trade for almost 15-times that price, and that’s before adding back the dividends that have been paid over that 31 years.

I’m not sure we’ll see another Berkshire in our lifetime. But the lessons that can be drawn from its – and Warren Buffett’s – success can be learned and applied to our investing, today.

(Oh, and if the company’s shares grow at just 8% per year between now and Buffett’s 100th birthday, they’ll top the previously unimaginable US$1 million mark. No promises and no guarantees, but that would be extraordinary.)

Fool on!

The post Lessons from a $600,000 share price appeared first on The Motley Fool Australia.

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• Not confident to invest? I’d follow these 2 Warren Buffett tips
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• Investing in ASX shares from scratch? Here are 3 Warren Buffett tips I’d follow religiously
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Motley Fool contributor Scott Phillips has positions in Berkshire Hathaway and Treasury Wine Estates. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway and CSL. The Motley Fool Australia has recommended Berkshire Hathaway, CSL, and Treasury Wine Estates. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) is back on form and pushing higher on Wednesday. In afternoon trade, the benchmark index is up 0.7% to 7,634.9 points.

Four ASX shares that have failed to follow the market’s lead are listed below. Here’s why they are falling:

CSR Ltd (ASX: CSR)

The CSR share price is down 5% to $6.52. Investors have been selling this building products company’s shares after it was downgraded by analysts at UBS. The broker has downgraded CSR’s shares all the way from a buy to a sell with a $6.60 price target. It believes the risks are to the downside now following a strong gain over the last 12 months.

Janison Education Group Ltd (ASX: JAN)

The Janison share price is down 6.5% to 35 cents. This may have been driven by profit taking from some investors. After all, the education technology company’s shares jumped 47% on Tuesday in response to a major contract win from the NSW Department of Education and Cambridge University Press.

Myer Holdings Ltd (ASX: MYR)

The Myer share price is down 4.5% to 72.5 cents. This also could have been caused by profit taking from some investors. The department store operator’s shares jumped on Tuesday after delivering a better than feared trading update. This morning, Ord Minnett responded by retaining its hold rating and 75 cents price target.

Santos Ltd (ASX: STO)

The Santos share price is down 6% to $7.37. Investors have been hitting the sell button today after takeover talks with Woodside Energy Group Ltd (ASX: WDS) concluded without a deal. Woodside’s CEO, Meg O’Neill, advised that for every opportunity it assesses, it conducts thorough due diligence, and will only pursue a transaction that is value accretive for its shareholders. Santos doesn’t appear to have ticked this box.

The post Why CSR, Janison, Myer, and Santos shares are tumbling today appeared first on The Motley Fool Australia.

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• Why Inghams, Janison, Myer, and Nick Scali shares are rising today
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• Here’s why Santos shares are making ASX news on Thursday

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

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It’s been a decent start to this Wednesday’s trading for ASX shares and the S&P/ASX 200 Index (ASX: XJO). At the time of writing, the ASX 200 has bounced by a healthy 0.69%, a pleasing turnaround from the falls we saw earlier this week. But let’s talk about the ANZ Group Holdings Ltd (ASX: ANZ) share price. 

It’s been a strange day for ANZ shares indeed. At present, this ASX 200 bank stock is up 0.26% and is sitting at $27.50 a share.

Soon after market open, ANZ stock was rising to fresh heights. The bank closed at $2.43 a share yesterday but opened at $27.50 this morning before leaping as high as $27.63. That’s a new 52-week high for the ANZ share price.

Watchers of the banking sector on the ASX might have been expecting something like this to happen sooner or later. After all, recent weeks have seen a series of fresh new 52-week highs for ANZ’s big four compatriots.

Late last month, we saw National Australia Bank Ltd (ASX: NAB) hit a new 52-week high of its own. And just yesterday, Westpac Banking Corp (ASX: WBC) minted its own fresh 52-week high of $24.25.

Of course, Commonwealth Bank of Australia (ASX: CBA) has also been flying at high altitudes. CBA shares have clocked not just new 52-week highs, but new all-time highs after new all-time highs over the past month. Its most recent high watermark stands at $118.24.

With all of this going on in the ASX banking sector, it was arguably only a matter of time before ANZ was brought in from the cold.

Why is the ANZ share price clocking a new 52-week high today?

As has been the case with the fresh highs of the other ASX banks recently, there’s been no obvious, concrete news that can explain today’s new ANZ share price elevation. It seems that, in line with broader market sentiment, investors have been pushing the share prices of the big four banks higher out of sheer optimism.

As we covered last week, the ASX 200’s recent all-time highs of its own have arguably been spurred by renewed hopes of a soft economic landing following the interest rate hikes of the past two years. Not to mention optimism that interest rates will start falling in 2024.

Banks are some of the ASX’s most economically sensitive companies. As such, they tend to become more profitable when the economy is in a healthy state. Especially so if interest rates are falling, rather than rising.

ANZ investors, as of today, have enjoyed a return of 7.17% over the past 12 months. Since mid-November, the ANZ share price is up around 14%. However, investors are still about 6% underwater since ANZ’s 2021 highs of over $29 a share.

At the current ANZ share price, this ASX 200 bank has a market capitalisation of $80.96 billion, with a trailing dividend yield of 6.36%.

The post ASX news: ANZ share price hits new 52-week high appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in National Australia Bank. 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.

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Commonwealth Bank of Australia (ASX: CBA) stock is marching higher today.

Shares in the S&P/ASX 200 Index (ASX: XJO) bank stock closed yesterday trading for $114.37. As we head into the lunch hour on Wednesday, shares are changing hands for $115.04 apiece, up 0.6%.

For some context, the ASX 200 is up 0.7% at this same time.

That’s today’s CBA stock price action for you.

Now, here’s what’s happening with Australia’s biggest bank and Microsoft Corp (NASDAQ: MSFT), the world’s biggest company.

Tapping into AI to boost efficiency

Microsoft, with an eye-watering market cap of US$3 trillion (AU$4.6 trillion) is a global leader in the artificial intelligence (AI) revolution.

In 2019 the company invested US$1 billion into OpenAI. And it’s kept adding to its holdings since then, which sees it with a 49% stake in the start-up. That partnership has proven to be a valuable one for Microsoft, giving it prime access to some of the world’s leading AI models.

And CBA stock could enjoy some longer-term tailwinds as the bank works to boost the efficiency of its staff with its own early adoption of Microsoft’s AI technologies.

CBA’s group chief information officer, Gavin Munroe, said the bank has rolled out Microsoft’s GitHub co-pilot to its software engineering teams. He said their productivity was soaring as a result, adding that the introduction of AI-driven efficiency improvements had not directly led to any of last year’s staff layoffs.

According to Munroe (quoted by The Australian Financial Review), “We tried to quantify the benefits of upgrading highly skilled engineering talent to more complex stuff, and there is a 30% uplift in just those boilerplate activities, that every engineer had to do,” 

Boilerplate refers to the basic code that supports more sophisticated applications.

Munroe added:

In the last 12 weeks 80,000 lines of code have been generated by GitHub Co-Pilot, which is one-third of the lines of code created across the bank … When we asked engineers to describe the impact, they said they are being 50% more creative.

How has CBA stock been performing?

CBA stock is up 4% over 12 months.

The ASX 200 bank’s shares really took off in late October. That strong run sees the CBA share price up 19% since 31 October.

And, in case you’re wondering, Microsoft shares have rocketed 52% since this time last year.

The post CBA stock: What’s happening with the ASX 200 bank and Microsoft today? appeared first on The Motley Fool Australia.

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• Want to buy ASX 200 bank shares? You need to read this
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• What history says on avoiding CBA shares because they’re ‘expensive’
• 3 ASX blue-chip stocks I think every Aussie should own
• Own CBA shares? Here’s what to expect from its half year results

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 Microsoft. 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.

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The China market is one of the most lucrative in the world. If a company can gain a foothold in the world’s second largest economy, it has the potential to supercharge its sales and profits.

One ASX 200 stock which recently embarked on an extension into the country is fashion jewellery retailer Lovisa Holdings Ltd (ASX: LOV).

It opened its first store in China late last year and this could be followed by significantly more in the future.

That’s the view of analysts at Bell Potter, which have been digging deep into its expansion plans.

What is the broker saying about this ASX 200 stock?

Bell Potter is very positive on the company’s opportunity in the country. It highlights that China’s fashion jewellery market is estimated to be worth US$13 billion a year, which is 25 times the size of Australia’s market. It commented:

While China’s fashion jewellery market alone estimated at ~US$13b is ~25x as that of Australia, we estimate a China based store network opportunity of 15-20x as Australia’s total 550-600 stores retailing fashion jewellery. We’ve seen international fast fashion brands such as H&M and Zara growing their footprint to ~375 and ~200 respectively within 15-20 years since opening the maiden store in Mainland China.

The good news is that the early signs are positive for the ASX 200 stock in the massive market. Bell Potter notes that consumer feedback has been encouraging. It said:

We have assessed the latest customer reviews for Lovisa from Mainland China on the dominant social media app, Xiaohongshu (Little Red Book), since opening of the first Chinese store in December. Majority of the reviews are favourable, focusing on the attractiveness of styles/designs, price point and perceiving Lovisa products as value for money while the less conductive feedback driven by product durability and a close comparison to unbranded online substitutes.

Based on the above, Bell Potter believes that Lovisa could reach 100 stores in the country within 4 to 6 years. It adds:

We believe a 4-6 year timeline to reach 100 stores in Mainland China is justified given the US market blueprint and management experience in the region.

And if it does, the broker says it could add an estimated $40 million to $50 million to group revenues. Furthermore, due to lower operating costs, this could have a greater impact on its profitability.

Should you invest?

In light of the above, Bell Potter has reiterated its buy rating with an improved price target of $26.50. This implies potential upside of 13% for investors.

It also expects a 2.6% dividend yield in FY 2024, boosting the total potential return beyond 15%. It concludes:

We view LOV’s premium to the peer group as justified (~25x FY25e P/E, BPe), considering the gross margin outlook, store opportunity upside and ability to execute as a strong player in the fashion jewellery market, maintain BUY.

The post Buy this ASX 200 stock for its ‘massive’ China opportunity appeared first on The Motley Fool Australia.

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

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The Zip Co Ltd (ASX: ZIP) share price is currently up 4% on rumours of possible takeover interest for the buy now, pay later business.

What do we know?

According to reporting by The Australian, there is “talk in the market” that Zip may be getting takeover interest following its turnaround from being loss-making to now making operating profits.

The newspaper pointed out a number of smaller competitors have collapsed and some of its larger competitors have exited the buy now, pay later market including Apple, Goldman Sachs and PayPal.

On top of that, Zip’s main rivals have increased their fees and are being rational with their business choices.

The Australian reported a Zip spokesman said the ASX share has not received any takeover approaches, but “multiple sources” have suggested at least one possible suitor is eyeing up Zip, and it is “gaining interest”.

Who might be interested in buying Zip shares?

The Australian suggested large offshore competitors could be interested in buying Zip, such as Klarna.

Some ASX bank shares may also be interested. The newspaper said Westpac Banking Corp (ASX: WBC) leader Peter King wants to make acquisitions. As some investors may know, Westpac used to own a substantial stake in Zip.

ANZ Group Holdings Ltd (ASX: ANZ) may also decide to embark on some acquisition activity if it isn’t allowed to buy the banking division of Suncorp Group Ltd (ASX: SUN).

Why would these ASX bank shares want Zip? The rationale would be that it could supposedly allow them to gain more exposure to younger Aussies.

Latest update

In the latest update, Zip said it’s expecting to report group cash earnings before tax, depreciation and amortisation (EBTDA) of between $29 million to $33 million. It said its revenue margin improved to 8.2%, up from 7.1% in the second quarter of FY23.

Zip also revealed it achieved a cash transaction margin of 3.5%, up from 2.8% in the second quarter of FY23.

Those numbers show that Zip has become a lot more profitable than it was before.

Zip share price snapshot

Over the past six months, the Zip share price has soared 90%.

The post Zip share price rises as investors buy now on takeover talk appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple, Goldman Sachs Group, PayPal, and Zip Co. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: short March 2024 $67.50 calls on PayPal. The Motley Fool Australia has recommended Apple and PayPal. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It hasn’t been an easy time to be an investor in the lithium space, but things are certainly looking up for the industry today.

A number of ASX lithium shares are going gangbusters on Wednesday, much to the delight of their long-suffering shareholders.

ASX lithium shares going gangbusters

Here’s a summary of some of the movers and shakers in the industry today:

• The Argosy Minerals Limited (ASX: AGY) share price is up 8% to 10.25 cents
• The Core Lithium Ltd (ASX: CXO) share price is up 7% to 19.25 cents
• The Latin Resources Ltd (ASX: LRS) share price is up 8.5% to 15.2 cents
• The Liontown Resources Ltd (ASX: LTR) share price is up 5.5% to 95 cents
• The Mineral Resources Ltd (ASX: MIN) share price is up 3% to $56.91
• The Piedmont Lithium Inc (ASX: PLL) share price is up 11% to 20.5 cents
• The Pilbara Minerals Ltd (ASX: PLS) share price is up 4% to $3.52

What’s going on?

It appears that investors have been flooding back into ASX lithium shares on Wednesday in response to strong gains made by their global peers.

For example, Ganfeng Lithium jumped 8%, Tianqi Lithium leaped 7%, Albemarle rose 4%, and Lithium Americas Corp climbed 7% during overnight trade.

It’s possible that some investors believe that the industry has been oversold and are now returning to pick up some bargains.

In addition, there has been some individual news giving at least a couple of these ASX shares a boost today.

As we covered here, Pilbara Minerals has executed an amendment to its existing offtake agreement with Chengxin Lithium Group. It notes that this materially extends and expands the supply of spodumene concentrate to a leading lithium chemical converter.

In 2024, Pilbara Minerals will supply an additional 60kt of spodumene concentrate, taking the total supply to 85kt. In 2025 and 2026, the company will supply 150kt of spodumene concentrate to Chengxin Lithium Group.

Elsewhere, Piedmont Lithium has released a corporate update this morning. It confirmed that it has completed a 27% reduction in its workforce in an effort to cut costs. It hopes to save US$10 million on an annual run rate.

The post 7 ASX lithium shares going gangbusters today appeared first on The Motley Fool Australia.

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More reading

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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 Scott Phillips.

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The ResMed Inc (ASX: RMD) share price is edging higher today.

Shares in the S&P/ASX 200 Index (ASX: XJO) healthcare stock closed yesterday trading for $29.30. In morning trade on Wednesday, shares are swapping hands for $29.34, up 0.1%.

For some context, the ASX 200 is up 0.6% at this same time.

Here’s what’s happening.

What’s going on with the ASX 200 healthcare company?

The ResMed share price may be trailing the ASX 200 because the sleep treatment company’s stock is trading ex-dividend today.

That means investors who buy the stock today will no longer be eligible for the 4.8 US cents per share unfranked dividend.

That passive income payout will go to investors who held ResMed shares at market close yesterday. Eligible investors can expect to see this hit their bank accounts on 14 March.

The company will report on the Aussie dollar equivalent for ASX investors on Friday, 9 February. (At time of writing AU$1 is worth 65.3 US cents.)

It’s common for stocks to face some headwinds on the day they trade ex-dividend. All else being equal, the ResMed share price is now factored in at 4.8 US cents less than it would have been yesterday.

Unlike most ASX 200 stocks, ResMed pays dividends on a quarterly basis.

In the quarter just past, the company paid US$70.7 million in dividends. It also repurchased 335,000 shares for US$50 million as part of ResMed’s ongoing capital management.

Overall, it was a strong quarter for the company, with revenue up 12% year on year (11% on a constant currency basis) to US$1.2 billion. And profits were well up, with non-GAAP operating profit leaping 20%.

Commenting on the outlook for the sleep treatment company on the day it reported, CEO Mick Farrell said, “ResMed is well-positioned to lean into leading the expansion and growth of sleep health and breathing health. We are the clear leader in a very large and growing market.”

ResMed share price snapshot

The steep falls in August and September see the ResMed share price down 7% over 12 months.

Shares have soared 37% since the lows on 25 September.

The post What’s happening with the ResMed share price on Wednesday? appeared first on The Motley Fool Australia.

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More reading

• Own Resmed shares? Here are 3 impactful points from the results of its feared disruptor
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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 positions in and has recommended ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Pilbara Minerals Ltd (ASX: PLS) share price is climbing this morning following some juicy news.

At the time of writing, shares in the lithium producer are up 5.2% to $3.56. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is basking in a 0.74% increase.

Let’s rummage through the release giving investors a jolt.

Please, Pilbara, may I have some more

Fresh off its quarterly update late last month, Pilbara Minerals is giving its shareholders another optimistic item today. This time, the news relates to an extension to an agreement struck last year with China-based lithium converter Chengxin Lithium Group.

For some background, Chengxin Lithium is a significant producer of lithium chemicals, supplying a vast assortment of customers. Its clientele includes prominently established names in the automotive and battery industries such as BYD, LG Chemical, CATL, and Hyundai.

In the 12 months ending 30 September 2023, Chengxin Lithium raked in A$2.27 billion of revenue and A$490 million in net profits after tax (NPAT). Currently, the Shenzhen-listed company is valued at A$3.79 billion.

According to today’s release, Pilbara Minerals has executed an amendment to its existing offtake agreement with Chengxin Lithium. The heavily shorted Aussie lithium company will see a material extension and expansion of its original agreement.

The initial 2023 agreement stipulated 70,000 tonnes of spodumene concentrate to be supplied in FY24 from the Pilgangoora operation. However, the newly updated offtake arrangement will see Pilbara Minerals provide spodumene until the end of the 2026 calendar year.

Quantities under the agreement are as follows:

• CY24: Supply an additional 60,000 tonnes for a total of 85,000 of spodumene concentrate
• CY25: Supply 150,000 tonnes of spodumene concentrate
• CY26: Supply 150,000 tonnes of spodumene concentrate

All sales to Chengxin Lithium under the extended offtake agreement will be priced at prevailing market rates.

Will it shake out the Pilbara Minerals share price shorters?

Pilbara Minerals shares have seemingly been in a death spiral since August 2023 — a trend aligning with a slump in lithium prices. As a result, the company’s shares have sat atop the most shorted ASX share throne for many weeks.

On Monday, fellow Fool James Mickleboro again disclosed Pilbara Minerals as the most shorted stock on the Australian share market. Roughly one-fifth of shares in the lithium producer were sold short, indicating many are expecting lower prices from here.

However, today’s announcement indicates increasing demand for the electrifying commodity from Chengxin Lithium, at least.

Ultimately, the Pilbara Minerals share price will heavily rely on the underlying commodity’s supply and demand. Interestingly, the team at Ark Invest hold a positive view of the future of electric vehicle demand, which could correspond with increasing lithium needs.

As shown above, Ark Invest forecasts approximately a four-fold uptick in EV sales by 2030, surpassing 70 million.

The Pilbara Minerals share price is down 26% over the past year.

The post Pilbara Minerals share price jumps 5% on material offtake extension appeared first on The Motley Fool Australia.

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More reading

• These are the 10 most shorted ASX shares
• If you’d invested $20,000 in Pilbara Minerals shares in 2020, this is how much you’d have today
• These ASX 200 shares could rise 30% to 50%
• Top brokers name 3 ASX shares to buy next week
• BHP stock and more: 3 ASX commodity titans to watch in 2024

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 Scott Phillips.

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