Key ASX hydrogen shares are taking off today following the delivery of the 2023 federal budget last night. And for good reason.

The budget saw $2 billion set aside to accelerate Australia’s renewable hydrogen industry.

That’s good news for Fortescue Metals Group Limited (ASX: FMG). The company’s hydrogen venture Fortescue Future Industries is aiming to be a leader in the space.

The Fortescue share price is up 0.5% right now, trading at $20.68.

Meanwhile, shares in fellow hydrogen-focused stocks Pure Hydrogen Corporation Ltd (ASX: PH2) and Hazer Group Ltd (ASX: HZR) are putting the iron ore giant’s gains to shame.

Stock in Pure Hydrogen are surging 11.4% to trade at 19.5 cents at the time of writing while those in Hazer are leaping 6.9% to reach 69.5 cents.

For comparison, the benchmark All Ordinaries Index (ASX: XAO) is slipping 0.1%.

Let’s take a closer look at the government spending that’s seemingly putting wind under the renewable energy-focused ASX shares on Wednesday.

Labor reveals $2b Hydrogen Headstart program

It’s an exciting day for those invested in ASX hydrogen shares. The federal government revealed its $2 billion Hydrogen Headstart program alongside its 2023 budget last night.

In last night’s speech to parliament, treasurer Jim Chalmers said:

Hydrogen power means Wollongong, Gladstone and Whyalla, can make and export everything from renewable energy to green steel. Seizing these kinds of industrial and economic opportunities will be the biggest driver and determinant of our future prosperity.

The Hydrogen Headstart program makes up half of the $4 billion new renewable energy spend announced as part of this year’s budget.

It aims to scale up the development of Australia’s hydrogen industry by providing revenue support for large-scale renewable hydrogen projects through competitive production contracts.

A joint release from Chalmers, minister for climate change and energy Chris Bowen, and assistant minister for climate change and energy Jenny McAllister reads:

These [contracts] will help bridge the commercial gap for early projects and put Australia on course for up to a gigawatt of electrolyser capacity by 2030 through two to three flagship projects.

They said Australia’s path to net zero is dependent on the renewable energy source, which can be combusted for industrial heat, used as a chemical input for green manufacturing and as a fuel for heavy transport, or exported.

Fortescue has welcomed the move, saying it “demonstrates how seriously the government is taking the green hydrogen industry and its critical role in Australia’s future”.

How have ASX hydrogen shares been performing in 2023

Apparent budget-related gains aside, ASX hydrogen shares have been putting out a mixed performance so far this year.

Leading the pack is the Hazer share price, which has gained 25% since the start of 2023.

Meanwhile, that of Pure Hydrogen has lifted 3% and Fortescue stock is up 1% year to date.

Comparatively, the All Ordinaries Index has increased 4% since the new year began.

The post ASX hydrogen shares surge on 2023 federal budget $2b cash splash appeared first on The Motley Fool Australia.

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More reading

• Fortescue share price lifts on 2023 budget’s $2 billion hydrogen program
• What’s the forecast for the Fortescue share price this month?
• 5 things to watch on the ASX 200 on Wednesday
• Fortescue’s Twiggy could wipe this ASX 300 share from the bourse. Here are the details
• Why the iron ore price is ‘not out of the danger zone’

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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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It’s been an interesting day for the Bubs Australia Ltd (ASX: BUB) share price so far this Wednesday. Bubs shares closed at 18.5 cents each yesterday afternoon and opened at that same level this morning. However, the infant nutrition company initially jumped this morning, climbing to 19 cents a share soon after market open (up 2.7% at the time).

This bouncy performance comes after some big news from Bubs.

Just before market open today, Bubs released an ASX announcement regarding its leadership team. The company revealed that its CEO, Kristy Carr, has been terminated, with immediate effect. This was due to Carr’s alleged “failure to comply with reasonable Board directions”.

Bubs shares spike on CEO “termination”

Former executive chair Dennis Lim has also been terminated from the company. That’s effective immediately. It was only last month that Katrina Rathie was elected chair, replacing Lin.

Carr will be replaced by Richard Paine as interim CEO “until a permanent CEO is confirmed”.

Here’s some of what the statement had to say on this shake-up:

Noting the recent deterioration in Bubs’ financial performance over the half year, the non–executive directors considered the time was right for a change in leadership and to change the governance framework of the company to ensure that it aligns with ASX Corporate Governance Principles and best practice.

On 28 April 2023, Bubs announced that a strategic review of the global business with a particular focus on expenditure management and the Chinese market. The review is on track to be completed by 30 June 2023.

Chair Rathie added the following regarding Carr: “We acknowledge Kristy’s long service to Bubs and the role she has played in building the Bubs brand to the position it enjoys today.”

So that’s all we know for now. But this has certainly been a dramatic day for Bubs Australia.

Judging by the gain in the Bubs share price this morning, it seems investors approve of the decision to axe both Carr and Lin. That’s despite the fact we don’t know what kinds of “reasonable directions” Carr had apparently failed to follow from the board.

Bubs share price snapshot

The Bubs share price has been on a steep decline for a while now, which always increases pressure on a company’s CEO and management team. In 2023 alone, Bubs has lost almost 38% of its value. The company is also down almost 50% from where it was a year ago:

Bubs shares have also lost around 87% of their value since their last all-time high, which we saw back in May 2019.

At the current Bubs share price, this ASX company has a market capitalisation of $139 million.

The post Bubs share price ricochets following CEO sacking appeared first on The Motley Fool Australia.

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More reading

• UBS tips 4 ASX 200 retail shares to benefit from the federal budget
• Why is the NAB share price tumbling 4% on Wednesday?
• Top broker tips 7 ASX 200 property-related shares to cash in on the 2023 budget
• Top brokers name 3 ASX shares to buy today
• ASX 200 stock Technology One halted following cyber attack

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Bubs Australia. 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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Four S&P/ASX 200 Index (ASX: XJO) retail shares look to be among the winners from the 2023 federal budget just unveiled by Treasurer Jim Chalmers.

That’s according to UBS strategist Richard Schellbach.

Schellbach (as reported by The Australian) believes these four ASX 200 retail shares – encompassing both consumer discretionary and consumer staples stocks – could benefit from the federal budget’s billions of dollars of support for low-income households.

Among the measures contained in the 2023 federal budget are:

• A $40 fortnightly increase in JobSeeker
• $500 of rebates to five million low-income households as part of a $1.5 billion Energy Relief Fund
• A $40 fortnightly increase in Youth Allowance and Austudy
• A $1.3 billion Household Upgrades Fund targeting 111,000 households

Which ASX 200 retail shares might benefit from the federal budget?

According to UBS, the federal budget’s low-income support measures should offer some tailwinds to Wesfarmers Ltd (ASX: WES). That’s largely from a potential revenue boost for its lower-cost Kmart segment.

The Wesfarmers share price is down 0.39% in midday trading and up 12% so far in 2023.

The second ASX 200 retail share UBS thinks could gain from the federal budget is Domino’s Pizza Enterprises Ltd (ASX: DMP). With the boost in the JobSeeker and Youth Allowance payments, it’s a good bet some of that money will find its way into home-delivered pizzas.

The Dominos share price is down 0.67% today and down 22.5% so far in 2023.

Which brings us to ASX 200 retail share number three, Coles Group Ltd (ASX: COL). The grocery store retailer has been promoting its low-cost items and could see more customers with a little extra cash in their pockets thanks to the federal budget.

In its recent third-quarter results, Coles reported that it had doubled the size of its ‘Dropped & Locked’ value campaign, with the price of more than 300 products dropped and locked in.

The Coles share price is down 0.33% today and up 9.7% in 2023.

Rounding off the list, the fourth ASX 200 retail share UBS tips to benefit from the federal budget is Super Retail Group Ltd (ASX: SUL).

The company’s brands include Supercheap Auto, Rebel, BCF, and Macpac, outlets that could see more business from low-income households with a bit more cash coming in courtesy of the budget.

The Super Retail Group share price is down 0.55% today and up 16.5% in 2023 so far.

The post UBS tips 4 ASX 200 retail shares to benefit from the federal budget appeared first on The Motley Fool Australia.

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More reading

• How my ASX share portfolio is ready for a stock market crash
• Top defensive ASX shares to buy in May 2023
• 5 things to watch on the ASX 200 on Wednesday
• The Wesfarmers share price was in the red today despite green energy acquisition rumours
• Citi rates these ASX dividend shares as buys

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 Domino’s Pizza Enterprises and Super Retail Group. The Motley Fool Australia has positions in and has recommended Coles Group, Super Retail Group, and Wesfarmers. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. 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 having another weak day on the ASX boards so far this Wednesday, building from yesterday’s losses. At the time of writing, the ASX 200 has slipped by 0.28%, dragging the index down to around 7,240 points. I guess investors weren’t too impressed with the Budget last night. But let’s talk about the National Australian Bank Ltd (ASX: NAB) share price.

NAB shares are seemingly having a real shocker today. This ASX 200 big four bank share closed at $27.36 a share yesterday. But this morning, NAB opened at just $26.17 and is presently going for $26.19 a share, down a notable 4.28%.

Most ASX bank shares are having a poor showing this Wednesday. But not on the same kind of scale as the NAB share price. Commonwealth Bank of Australia (ASX: CBA) shares are currently down by 0.45%. ANZ Group Holdings Ltd (ASX: ANZ) shares have lost 0.67%, while the Westpac Banking Corp (ASX: WBC) share price is down by 0.14%.

So why might NAB shares be suffering so much more than both the broader market and other ASX 200 bank shares today?

Well, the answer is a simple and comforting one for shareholders: today is ex-dividend day for NAB.

NAB share price falls as investors lock in latest dividend

It was only last week that NAB revealed the details of its latest shareholder payout. As part of its half-year earnings report, NAB announced an interim dividend worth 83 cents per share, fully franked.

That represents a substantial increase over last year’s interim dividend of 73 cents per share, as well as the final dividend of 78 cents per share that investors enjoyed back in December.

When any ASX dividend share declares a dividend, it must also identify an ex-dividend date preceding it. This is the date when eligibility for the latest dividend is cut off. For NAB, this is today. This means that any investor who owned NAB shares as of yesterday afternoon will receive the bank’s latest dividend. But for anyone who buys NAB shares from today onwards, you miss out.

But there are no free lunches on the ASX. So because NAB shares don’t come with this dividend attached, as of today, their intrinsic value has fallen. That’s why we are seeing such a steep drop in the NAB share price this Wednesday. It’s the ASX’s typical reaction to a big dividend payer trading ex-dividend.

Eligible NAB investors can now look forward to receiving this latest dividend in around two months’ time on 5 July.

Right now, the NAB share price is offering a forward dividend yield (including the July payment) of 6.14%, or 8.77% grossed-up with this ASX 200 bank’s full franking credits.

The post Why is the NAB share price tumbling 4% on Wednesday? appeared first on The Motley Fool Australia.

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• Hoping to bag the boosted NAB dividend? You’d better hurry
• Banking crisis continues: What’s up (and down) with ASX 200 bank shares today?
• Here’s how I’d aim for $200 a month in passive income using ASX 200 bank shares
• Is the NAB share price in the buy zone after crashing?
• 5 things to watch on the ASX 200 on Friday

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 recommended Westpac Banking Corporation. 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 2023 federal budget – the second from the Albanese government – has been delivered.

It has likely left many investors wondering what sectors could benefit from government spending, and which might be dealt a blow.

Fortunately, it looks like it could be a good one for seven S&P/ASX 200 Index (ASX: XJO) property-related shares. That’s according to UBS, anyway.

7 ASX 200 shares that could benefit from the 2023 budget: expert

The 2023 budget contains a few notable housing initiatives that could benefit ASX 200 property-related shares. Notably, a tax break for managed investment trusts behind build-to-rent projects, as well as expanded access to the home guarantee scheme.

Tax break for built-to-rent developers

The first change might offer some benefit to the likes of Mirvac Group (ASX: MGR) and Lendlease Group (ASX: LLC), UBS equity strategist Richard Schellbach envisages, as per The Australian.

The managed investment trust withholding tax rate attributed to new build-to-rent developments will be cut from 30% to 15% from 1 July 2024.

The capital works tax deduction rate, otherwise called depreciation, will also be lifted from 2.5% to 4% a year. That will increase the returns offered by new build-to-rent developments.

Building to rent is a relatively new concept in Australia. Indeed, Mirvac opened the first large-scale development in Sydney in 2020.

Expanded access to first home buyer scheme

Mirvac and fellow developer Stockland Corporation Ltd (ASX: SGP) are also capable of benefiting from changes to the first home guarantee scheme.

Schellbach also reportedly said ASX 200 building material providers CSR Limited (ASX: CSR) and Boral Limited (ASX: BLD) could be rewarded.

Finally, property advertising and media companies Domain Holdings Australia Ltd (ASX: DHG) and REA Group Ltd (ASX: REA) might also experience a boost on the back of the change, according to the analyst.

The first home guarantee sees the government backing a portion of a buyer’s first mortgage. It, therefore, allows Australians to get their first foothold on the property ladder with as little as a 5% deposit.

Thanks to the 2023 budget, first-home buyers will be able to apply alongside friends or family. Previously, only spouses or de facto couples could jointly apply.

Australians who haven’t owned property in the last decade will also be made eligible for the scheme.

The post Top broker tips 7 ASX 200 property-related shares to cash in on the 2023 budget appeared first on The Motley Fool Australia.

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• ASX 200 stock Technology One halted following cyber attack
• Keen for $1,000 of monthly passive income? Buy 38,462 shares of this ASX 200 stock
• 3 ASX 200 building shares that could rise now that house prices have bottomed
• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended REA 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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Many of Australia’s top brokers have been busy adjusting their financial models again, leading to the release of a number of broker notes this week.

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

CSL Limited (ASX: CSL)

According to a note out of Morgan Stanley, its analysts have retained their overweight rating and $339.00 price target on this biotherapeutics company’s shares. This follows the release of a quarterly update from one of CSL’s rivals, which revealed a sharp reduction in plasma collection costs. Morgan Stanley hasn’t factored this into its model, but highlights that if CSL were to experience the same type of reduction, its earnings would be well ahead of estimates in FY 2024. The CSL share price is trading at $300.84 this morning.

Rural Funds Group (ASX: RFF)

A note out of Bell Potter reveals that its analysts have retained their buy rating and $2.65 price target on this agricultural property company’s shares. Bell Potter highlights that the company’s shares have been crushed over the last 18 months. This has left them trading at a 31% to their net asset value. It points out that this implies a downward correction in property values comparable to that seen in US agricultural land values in 1932-33 and 1985-87. The broker sees this as highly unlikely. The Rural Funds share price is fetching $1.94 today.

Westpac Banking Corp (ASX: WBC)

Analysts at Goldman Sachs have retained their buy rating on this banking giant’s shares with a trimmed price target of $24.67. The broker was pleased with Westpac’s net interest margin management during the first half of FY 2023, noting that its exit margin was stable compared to the deteriorating margins of peers. And while Westpac has walked away from its cost target, Goldman still expects a broadly flat cost trajectory over the next two years. It expects this to see Westpac outperform peers in this relatively difficult inflationary environment. The Westpac share price is trading at $21.66 on Wednesday.

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

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• The Westpac share price could offer a 20% return: Goldman Sachs
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• Why Lynas, Piedmont Lithium, Westpac, and Woodside shares are rising

Motley Fool contributor James Mickleboro has positions in CSL and Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has positions in and has recommended Rural Funds Group. The Motley Fool Australia has recommended Westpac Banking Corporation. 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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TechnologyOne Ltd (ASX: TNE) shares have been halted after the S&P/ASX 200 Index (ASX: XJO) tech stock revealed that it is responding to a cyber attack.

There have been a number of cyber attacks on Australian businesses in recent times, including Medibank Private Limited (ASX: MPL), Optus, Latitude Group Holdings Ltd (ASX: LFS), and IPH Ltd (ASX: IPH).

For readers who don’t know, TechnologyOne is an enterprise resource planning (ERP) software business for organisations. Among its customers are the University of Melbourne, the Australian Bureau of Statistics (ABS), Noosa Council, and Brookfield.

Cyber attack on TechnologyOne

The ASX 200 tech stock said it has detected “an unauthorised third-party acted illegally to access its internal Microsoft 365 back-office system”.

It emphasised that its customer-facing software as a service (SaaS) platform is not connected to the Microsoft 365 system and therefore has not been impacted.

But, the company has “acted with urgency” to investigate the issue, including initiating its cyber response strategy, appointing third-party experts, and isolating affected systems.

TechnologyOne has reported the incident to the relevant authorities and continues to “not only comply but go beyond its regulatory obligations”, it says.

The business said in its statement to the ASX that once the investigation is “further progressed”, it will be in a position to contact those who “may be affected with them on the ongoing safety of their data”.

The ASX 200 stock apologised to impacted individuals for any concern this incident may cause. It will provide further updates through the ASX and on its website as they become available.

How long will TechnologyOne shares remain halted?

The business has requested that the trading halt continue until the earlier of a further announcement by the company or the start of normal trading on Friday 12 May 2023.

What could this mean for the ASX 200 stock?

Looking at the hack effect on the Medibank share price, it caused a sizeable drop when trading resumed. However, the private health insurer has now recovered amid return policyholder growth.

But the reaction for the TechnologyOne share price could depend on the details and what the impacts of the cyber incident are.

Time will tell how much of a long-term impact this has on the business. Prior to this, the ASX 200 stock had risen by close to 50% over the last 12 months, with strong growth of revenue and profit in its recent financial results.

The post ASX 200 stock Technology One halted following cyber attack appeared first on The Motley Fool Australia.

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• Keen for $1,000 of monthly passive income? Buy 38,462 shares of this ASX 200 stock
• 3 ASX 200 building shares that could rise now that house prices have bottomed
• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday

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 Technology One. The Motley Fool Australia has recommended IPH and Technology One. 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 Appen Ltd (ASX: APX) share price has come under significant selling pressure on Wednesday.

In morning trade, the artificial intelligence data services company’s shares are down 22% to $2.50.

This means the Appen share price is now down over 60% since this time last year, as you can see on the chart below.

Why is the Appen share price crashing?

Investors have been hitting the sell button today after the company revealed that its performance has continued to deteriorate.

In February, management advised that it expected a soft start to FY 2023 and for that to lead to underlying EBITDA being materially lower than the prior corresponding period.

Clearly, expectations were already low. But even these low expectations appear to have been wide of the mark, which explains the weakness in the Appen share price today.

According to the release, challenging external operating and macroeconomic conditions have led to a sharp drop in revenue and earnings for the first four months of FY 2023. Appen has reported:

• Revenue down 21.4% to US$95.7 million
• Gross profit down 24.7% to US$35.8 million
• Constant currency underlying EBITDA down to negative US$12.4 million from positive $7.9 million

What’s next?

One positive is that management revealed that its focus on establishing a greater level of operational rigour is in progress with the previously identified ~US$10 million of cost savings to be implemented over the course of FY 2023.

In addition, a series of significant measures to achieve further annualised cost savings of approximately US$36 million have been identified and will be delivered over the course of FY 2023. The first full year impact of these measures is expected in FY 2024.

If all goes to plan, Appen expects to exit the current financial year with an annualised run-rate cash operating cost base of approximately $113 million. This is expected to lead to Appen “exiting FY23 with a return to underlying EBITDA and underlying cash EBITDA profitability on an annualised, run-rate basis.”

Outlook

Although there clearly has not been any immediate positive impact to its performance from the emergence of ChatGPT and other generative AI tools, management continues to believe it has a major opportunity in this side of the industry and is very positive on the launch of its new Large Language Model (LLM) data products.

Nevertheless, it has warned that it expects “revenue to decline materially in FY23 compared to FY22.” Though, with an “improvement in 2H FY23 revenue relative to revenue achieved in 1H FY23.”

Appen’s CEO, Armughan Ahmad, commented:

Appen has tremendous potential. These important initiatives announced today represent a refresh of the business. We are highly focused on the areas that are within our control and have taken the necessary steps to align our cost structure with current revenue expectations and now expect to exit 2023 as an underlying EBITDA and cash EBITDA positive business. With this stronger foundation, we look to the future to fully capitalise on the exciting growth opportunities enabled by generative AI.

The post Appen share price crashes 22% amid ‘materially’ declining revenue appeared first on The Motley Fool Australia.

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More reading

• Why Appen, Megaport, Mirvac, and Pilbara Minerals shares are pushing higher today
• Down 60% in a year, are Appen shares a bargain buy?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Appen. 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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There could be big returns lurking at the small end of town according to analysts at Morgans.

Here’s what it is expecting from these small cap ASX healthcare shares:

Aroa Biosurgery Ltd (ASX: ARX)

The first small cap ASX healthcare share that Morgans is bullish on is Aroa Biosurgery.

The broker highlights that Aroa Biosurgery is a regenerative medicine company engaged in developing, manufacturing, and distributing medical devices for wound and tissue repair. It does this with extracellular matrix (ECM) technology in the United States and internationally.

The company has a range of products. These include Endoform Natural and Endoform Antimicrobia Restorative Bioscaffold for treating acute and chronic wounds; Myriad Matrix, an engineered ECM for soft tissue repair, reinforcement, and complex wounds; Myriad Morcells, a morcellized (powdered) format of Myriad Matrix for soft tissue repair and complex wounds; and Reinforced Bioscaffolds, a surgical product for use in ventral hernia repair and abdominal wall reconstruction.

The broker is positive on Aroa Biosurgergy for a number of reasons. These include its low product price point, manufacturing capacity, and product pipeline. It explains:

Aroa has developed a cost effective technology which is estimated to be 30% cheaper than existing products. Sufficient manufacturing capacity through 2 facilities with enough capacity for $100m sales. ARX have a pipeline of new products through both Oroa and TelaBio supported by strong clinical data, we anticipate further news on Symphony and Enivo products.

Morgans currently has an add rating and $1.57 price target on its shares. This implies potential upside of 54% for this small cap ASX healthcare share over the next 12 months.

Volpara Health Technologies Ltd (ASX: VHT)

Another small cap ASX healthcare share that Morgans is tipping as a buy is Volpara.

It is a digital health company offering an increasingly popular solution that improves clinical decision making for early detection of breast cancer. Morgans notes that its products are approved for sale in key regions and provide objective evidence that can be used by relevant specialists including the woman herself to make informed decisions about further screening.

Its analysts have been impressed with the company’s performance, which has been underpinned by a strategy shift. It commented:

VHT continues to focus on the most profitable products and markets as well as focusing on larger value customers in line with their revised strategy. The second consecutive quarter of positive net operating cashflow is ahead of management’s guidance for 4Q24. We continue to expect the sales pipeline to grow and remain comfortable in guidance to have sufficient cash on hand to maintain net operating cashflow break-even.

Morgans has an add rating and $1.21 price target on this small cap ASX healthcare share. This implies potential upside of 59% for investors over the next 12 month.

The post Morgans says these small cap ASX healthcare shares are buys with 50% upside appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Volpara Health Technologies. The Motley Fool Australia has positions in and has recommended Volpara Health Technologies. 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 Fortescue Metals Group Ltd (ASX: FMG) share price is marching higher in early trading on Wednesday.

Shares in the S&P/ASX 200 Index (ASX: XJO) miner closed yesterday trading for $20.58 each. Shares are currently changing hands for $20.60 apiece, up 0.1%.

For some context, the ASX 200 is down 0.32% at this same time.

The Fortescue share price looks to be getting support from some big renewable energy spending plans contained in the 2023 federal budget.

$2 billion for green hydrogen in 2023 budget

Well, the 2023 budget is out.

And as you’d expect with any multi-billion-dollar federal government spending package, there are winners and losers.

Many companies involved in renewable energy look to be on the winners’ side of the coin, with Treasurer Jim Chalmers unveiling plans to invest an additional $4 billion in Australia’s renewable energy sector.

In what could provide some ongoing tailwinds for the Fortescue share price, that spending includes $2 billion to support green hydrogen production in a new program called Hydrogen Headstart.

The Australian government is playing catchup with the United States. The Biden administration recently passed the Inflation Reduction Act, which includes more than $500 billion in green energy incentives.

Commenting on the green hydrogen funding contained in the 2023 budget, Energy Minister Chris Bowen said (quoted by The Australian Financial Review):

Our regions need to be supported to harness their immense potential, build new industries and create jobs – because the regions that power Australia today will be the regions that power Australia tomorrow…

Renewable hydrogen is a critical enabler for future manufacturing of green metals and other products the world needs as the transformation to net-zero by 2050 gathers pace.

The government is forecast to commence direct investments into renewable hydrogen in 2026.

Why could this benefit the Fortescue share price?

The Fortescue share price could be a long-term winner from the 2023 budget via the company’s green energy branch, Fortescue Future Industries (FFI).

FFI is a front-runner in Australia in the production of green hydrogen.

Hydrogen can be created by running electricity through water, which divides the water into hydrogen and oxygen. That hydrogen carries the vaunted green label if the electricity is tapped from renewable sources, like solar, wind, hydropower, or geothermal energy.

According to the Fortescue website, “Through FFI, Fortescue will use green hydrogen to decarbonise the company’s mining and shipping fleet including trucks, drill rigs and trains.”

Founder Andrew Forrest is also keen on producing green iron. In March, the ASX 200 miner announced a major breakthrough in its green iron production plans.

FFI director Guy Debelle called the 2023 budget’s green energy funding, which looks to be supporting the Fortescue share price today, “a great first step”.

According to Debelle (quoted by the AFR), “It shows the government recognises the importance of the green hydrogen economy. It’s about future prosperity and decarbonising the economy.”

Fortescue share price snapshot

The Fortescue share price is up 8% over the past 12 months, handily outpacing the 3% gains posted by the ASX 200 over that same period.

The post Fortescue share price lifts on 2023 budget’s $2 billion hydrogen program appeared first on The Motley Fool Australia.

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More reading

• What’s the forecast for the Fortescue share price this month?
• 5 things to watch on the ASX 200 on Wednesday
• Fortescue’s Twiggy could wipe this ASX 300 share from the bourse. Here are the details
• Why the iron ore price is ‘not out of the danger zone’
• Here’s what brokers are saying about the Fortescue share price in May

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.

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