Ask A Fund Manager

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, Eley Griffiths portfolio manager Nick Guidera explains why two mining companies and one tourism business are the best bets at the moment.

Hottest ASX shares

The Motley Fool: What are the three best stock buys right now?

Nick Guidera: Monadelphous Group Ltd (ASX: MND) — we believe mining services have been in the wilderness for much of the past five years, impacted by slowing global growth, COVID, labour shortages, rampant cost inflation, and the power resting squarely with the miners. As such, we have seen consolidation amongst the players, and a number of companies go broke.

Monadelphous is considered one of the quality tier-one contractors that is regularly used by the major miners BHP Group Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO) to build new mines and infrastructure as well as maintain some of the existing plants. Commodity prices had a strong end to 2022, buoyed by a falling US dollar and the hope of China’s reopening demand. Higher commodity prices are incentivising the miners to embark on new capital projects to increase or replace production. Monadelphous, as one of the superior engineering firms, is well placed to benefit from a significant amount of new work in a more rational operating environment. 

Iron ore prices have rallied from their lows of sub US$80 in late 2022 to a seven-month high a few days ago of US$127/tonne. Commodity traders are expecting that China’s reopening will follow a similar path to previous stimulus and be focused on property and infrastructure, which will ultimately require demand for steel and hence more iron ore. 

While China’s reopening is expected to be choppy, and the outlook beyond [lunar] new year remains unknown, we remain constructive on the outlook for commodities and China’s end demand for iron ore into 2023. 

Higher iron ore prices will mean stronger revenues and cash flow for iron ore miners. One notable small-cap pure play is Champion Iron Ltd (ASX: CIA). A low cost operator that produces a premium product, with an expanding production profile, [it’s] well placed to benefit from higher prices.

The third pick is Tourism Holdings Ltd (ASX: THL).

‘Van life’ is back in vogue, as travel resumes and a generation of people are keen to explore new destinations. New Zealand RV [recreational vehicle] manufacturing, rental, and retail business Tourism Holdings recently completed its merger with Apollo Tourism & Leisure and the new business was listed for the first time on the ASX, while maintaining its existing listing on the NZX.  

The merger saw the two largest RV rental companies come together in Australia and New Zealand. The combined business owns and operates everything from the humble van to a six-berth driving hotel. 

It has [a] global footprint with operations in North America and Europe, and local manufacturing to produce the best product for the local market, and a retail footprint to dispose of those vehicles at the end of life. 

With any merger there are risks. However, with $27 to $31 million of recurring cash synergies by bringing the businesses together, there is also potential upside. With tourism seen for many as a non-discretionary spend nowadays, the more affordable option of a motorhome should be well placed to benefit from any consumers trading down.

The post 3 small-cap ASX shares to rocket from this year’s mega-trends: fund manager appeared first on The Motley Fool Australia.

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More reading

• 6 ASX mining shares just upgraded by brokers
• Here are the top 10 ASX 200 shares today

​​DISCLAIMER: This presentation has been prepared and issued by Eley Griffiths Group Pty Limited (ABN 66 102 271 812, AFSL 224 818) (EGG) as the investment manager of the Eley Griffiths Group Small Companies Fund and Eley Griffiths Group Emerging Companies Fund (Fund). The Trust Company (RE Services) Limited ABN 45 003 278 830, AFSL 235 150 (Perpetual) is the Responsible entity and issuer of units in the Fund. It is general information only and is not intended to provide you with financial advice and has been prepared without taking into account your objectives, financial situation or needs. You should consider the product disclosure statement (PDS), prior to making any investment decisions. The PDS and target market determination (TMD) can be obtained for free by visiting our website https://www.eleygriffithsgroup.com/invest/.  If you require financial advice that takes into account your personal objectives, financial situation or needs, you should consult your licensed or authorised financial adviser. To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this information. 

Neither EGG, nor any company in the Perpetual Group (Perpetual Limited ABN 86 000 431 827 and its subsidiaries) guarantees the performance of any fund or the return of an investor’s capital. Neither EGG nor Perpetual give any representation or warranty as to the reliability or accuracy of the information contained in this presentation. Any opinions, forecasts,  estimates or projections reflect judgments of EGG as at the date of this document and are subject to change without notice. Rates of return cannot be guaranteed and any forecasts, estimates or projections as to future returns should not be relied on, as they are based on assumptions which may or may not ultimately be correct. Actual returns could differ significantly from any forecasts, estimates or projections provided. Past performance is not a reliable indicator of future performance.

Motley Fool contributor Tony Yoo 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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While much debate rages among experts about how investments might do in 2023, there is more agreement about the outlook for the global economy.

Higher interest rates are now starting to bite both consumers and businesses. Thus most commentators now agree that economies around the world will have a slowdown, with some countries plunging into recession.

So can you make money with ASX shares this year?

Pengana investment specialist Tim Richardson said that the “short answer is yes”.

“The impact of the global economic slowdown on profitability will be highly stock-specific,” Richardson wrote on the Pengana blog.

“Earnings will depend on company sensitivity to interest rates, consumer spending, and secular growth trends. This will bring share market investors a wider dispersion of returns.”

Of course, he added that the difficulty is picking which ASX shares will thrive through the tough times.

“Such companies often have two things in common: lower sensitivity to interest rates, which are expected to remain elevated, and lower sensitivity to consumer spending, which is expected to remain subdued.”

Secular growth trends in the secret sauce 

According to Richardson, a business that’s exposed to long-term structural growth themes has the best chance of growing earnings regardless of the economic cycle.

Already the market is starting to see “lower corporate earnings”, triggered by reduced disposable incomes, higher home loan repayments, a slower housing market, and more expensive business financing.

“In this environment, many cyclical stocks whose revenues are sensitive to consumer spending are expected to underperform as they struggle to grow earnings,” said Richardson.

“However, companies whose business models are well aligned to secular growth trends which will endure throughout the interest rate and consumer spending cycles are better placed.”

Helpfully he identified 10 such long-term global shifts that investors will want to seek when buying ASX shares right now:

1. Transition to net-zero carbon emissions
2. Labour shortages driving automation
3. Ageing population
4. Retail behaviour shifting to online and home delivery
5. Global travel reopening
6. Delayed family formation
7. Rise of middle class in China and other emerging economies
8. The decoupling of China-US economies
9. Reshoring to high-cost countries
10. Trust in strong brands

Some of these trends cover a broader range of ASX shares than one might first think.

“The switch to net zero will benefit not just manufacturers of electric vehicles and solar panels but a wider range of critical components such as lithium batteries and high voltage cables,” said Richardson.

“Labour shortages will drive vehicle automation, supporting innovation not just in cars, but also in semi-trucks, agricultural vehicles, ride-sharing services, and semiconductors.”

The ageing population has implications for healthcare, insurance, aged care and the pharmaceutical industries.

Considering this, Richardson urged investors to think with a long-term horizon when picking stocks to buy now.

“Investors should now consider selectively establishing some exposure to quality global growth stocks, following the market turbulence of 2022 that leaves many at highly attractive valuations.”

The post 10 types of ASX companies that can grow even if the economy tanks appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Will Liontown Resources post a profit in 2023?
• ‘Exploration breakthrough’: What’s going on with this ASX 200 copper share today?
• ASX 200 lithium share Sayona has surged 38% in 2023. Too late to buy?

Motley Fool contributor Tony Yoo 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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On Tuesday, the S&P/ASX 200 Index (ASX: XJO) was on form again and charged higher. The benchmark rose 0.45% to 7,490.4 points.

Will the market be able to build on this on Wednesday? Here are five things to watch:

ASX 200 expected to drop

The Australian share market looks set to fall on Wednesday following a subdued night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 14 points or 0.2% lower this morning. In late trade on Wall Street, the Dow Jones is up 0.1%, the S&P 500 is down 0.1%, and the Nasdaq is 0.2% lower.

Oil prices sink

Energy producers Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) will be on watch after a poor night for oil prices. According to Bloomberg, the WTI crude oil price is down 2.25% to US$79.79 a barrel and the Brent crude oil price has fallen 2.6% to US$85.94 a barrel. Global economic growth concerns weighed on prices.

Woodside Q4 update

The Woodside Energy Group Ltd (ASX: WDS) share price will also be one to watch on Wednesday. That’s because the energy giant is scheduled to release its fourth quarter and full year update this morning. According to a note out of Morgans, its analysts are expecting full year production of 146MMboe. From this it expects revenue of US$15,864 million and EBITDAX of US$11,914 million.

Gold price rises

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a decent session after the gold price rose overnight. According to CNBC, the spot gold price is up 0.4% to US$1,936.2 an ounce. Demand for safe haven assets boosted the precious metal.

Q4 inflation reading

It is a big day for the ASX 200 index on Wednesday. Later today, the Australian Bureau of Statistics will be releasing the eagerly anticipated inflation data for the fourth quarter of 2022. According to a note out of Westpac Banking Corp (ASX: WBC), its economics team expect inflation to come in at 7.4% after a 1.5% quarterly lift in consumer prices. A stronger than expected reading could spook the market and increase rate hike expectations.

The post 5 things to watch on the ASX 200 on Wednesday appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Will Liontown Resources post a profit in 2023?
• ‘Exploration breakthrough’: What’s going on with this ASX 200 copper share today?
• ASX 200 gold share Evolution Mining gains on increased production and falling costs

Motley Fool contributor James Mickleboro has positions in Westpac Banking. 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. 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 Materials Index (ASX: XMJ) lifted 1.26% in Tuesday trading, but four ASX 200 lithium shares soared considerably higher.

Lithium explorers IGO Ltd (ASX: IGO), Allkem Ltd (ASX: AKE), Mineral Resources Ltd (ASX: MIN), and Pilbara Minerals Ltd (ASX: PLS) all leapt on the market today.

Let’s take a look at what may have impacted these lithium companies today.

What’s going on

IGO shares rose 4.49% today, while Mineral Resources shares jumped 5.28%. Meanwhile, Pilbara shares gained 5.18% and Allkem shares climbed 3.45%.

Today’s lift in ASX lithium shares comes amid broker upgrades from analysts at UBS. The broker upgraded Mineral Resources and IGO to a buy and Pilbara Minerals to neutral, while it retained its buy rating on Allkem, the Australian Financial Review reported.

UBS has lifted its lithium price outlook by up to 50%, according to the publication. Commenting on lithium, UBS analyst Lachlan Shaw said:

We believe lithium markets will remain in deficit for the near and medium term before moving to structural deficit long term.

This needs a demand rationing price, for which we have seen no evidence in the past 12 months despite record-high prices that are orders of magnitude above costs

Meanwhile, Pilbara Minerals has also just received positive broker coverage from Morgans, as my Foolish colleague James reported this morning.

Morgans has maintained an add rating on Pilbara shares and lifted the price target to $5.40.

Commenting on Pilbara, analysts said:

We maintain our ADD rating given the upside that we see to our target price. The company’s growing cash balance gives it options for capital management including buybacks or a special dividend.

Share price snapshot

The IGO share price has risen 25% in the last year.

Mineral Resources shares have exploded 56% over the past 12 months.

Pilbara shares have risen 46% in the last 52 weeks.

Allkem shares have soared 39% in the past year.

The post Guess which four ASX 200 lithium shares charged higher today appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• I’d buy 100 shares of this ASX lithium stock for $700 a year in passive income
• Move over bank deposits! These ASX 200 mining shares are forecasting yields of over 5%
• 5 ASX 200 shares rocketing to new 52-week highs on Tuesday

Motley Fool contributor Monica O’Shea 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 S&P/ASX 200 Index (ASX: XJO) continued its upwards trajectory today, posting a 0.44% gain to close at 7,490.4 points. That sees it just 1.8% lower than its all-time high – reached in 2021.

Meanwhile, the market geared up to learn of the latest Australian inflation figures, set to drop tomorrow. Some experts are hopeful the cash-eating measure that wreaked havoc on markets in 2022 peaked in the December quarter, my Fool colleague James reports.

Perhaps in anticipation, the S&P/ASX 200 Real Estate Index (ASX: XRE) posted today’s biggest gain, lifting 1.8%.

Meanwhile, the S&P/ASX 200 Information Technology Index (ASX: XIJ) rose 1.3% following a strong session for the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC). It surged 2% overnight.

On the other hand, the S&P/ASX 200 Financials Index (ASX: XFJ) lost ground on Tuesday, falling 0.25%, dragged down by many of the big four banks.

So, having covered all that, let’s take a gander at today’s 10 top-performing ASX 200 shares.

Top 10 ASX 200 shares countdown

The index’s biggest gains came from the Breville Group Ltd (ASX: BRG) share price today. It soared 7.5% to close at $22.39.

That’s despite no news having been released by the manufacturer of small appliances.

These shares made today’s biggest gains:

ASX-listed company	Share price	Price change
Breville Group Ltd (ASX: BRG)	$22.39	7.54%
Block Inc (ASX: SQ2)	$114.69	5.7%
Mineral Resources Ltd (ASX: MIN)	$96.28	5.28%
Pilbara Minerals Ltd (ASX: PLS)	$5.08	5.18%
Evolution Mining Ltd (ASX: EVN)	$3.41	4.92%
Liontown Resources Ltd (ASX: LTR)	$1.54	4.76%
IGO Ltd (ASX: IGO)	$15.84	4.49%
South32 Ltd (ASX: S32)	$4.83	4.32%
Sayona Mining Ltd (ASX: SYA)	$0.27	3.85%
Premier Investments Limited (ASX: PMV)	$27.60	3.64%

Our top 10 shares countdown is a recurring end-of-day summary to let you know which companies were making big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

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

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• I’d buy 100 shares of this ASX lithium stock for $700 a year in passive income
• Move over bank deposits! These ASX 200 mining shares are forecasting yields of over 5%
• 5 ASX 200 shares rocketing to new 52-week highs on Tuesday
• Why Block, Codan, Latin Resources, and Myer shares are storming higher

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 positions in and has recommended Block. The Motley Fool Australia has positions in and has recommended Block. The Motley Fool Australia has recommended Premier Investments. 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 Qantas Airways Limited (ASX: QAN) share price has jumped higher since the start of 2023. It has risen by around 8% this year and it’s up 40% over the last six months.

To put that into perspective, the S&P/ASX 200 Index (ASX: XJO) has only gone up by 10% in the last six months. That’s still a good effort.

I think it’s understandable why Qantas shares are performing so well.

The company’s updates have been full of promising updates and financial guidance.

It told investors in November what it was expecting in the first half of FY23. Let’s remind ourselves what was in that update.

Profit upgrade

The ASX airline share told investors that underlying profit before tax is expected to be between $1.35 billion to $1.45 billion. This will help reduce net debt to a range of $2.3 billion to $2.5 billion.

Qantas put this improved performance down to customers continuing to put a high priority on travel ahead of other spending categories. The airline said there are signs that limits on international capacity are driving more domestic leisure demand, benefiting Australian tourism.

However, Qantas did say that fuel costs would remain significantly elevated compared to FY19 and are expected to reach $5 billion in FY23. That’s despite international capacity being at around 30% less than pre-COVID levels.

Debt is falling. It’ll be around $900 million better than expected in the most recent update. That’s due to an acceleration of revenue inflows as customers book flights on Qantas, Jetstar, and partner airlines in the second half and beyond, as well as the deferral of approximately $200 million of capital expenditure to the second half.

Qantas said it’s adding back capacity as quickly as possible in the second half of the year while maintaining operational reliability. However, it did say that it was the most on-time domestic airline in October.

Is it too late to buy Qantas shares?

Investors are able to buy shares whenever they want to, the key question is whether they are good value today.

Commsec numbers suggest the airline could generate 92 cents of earnings per share (EPS) in the 2023 financial year and 97 cents of EPS in FY25. That puts the company at 7x FY23’s estimated earnings and around 6.5x FY25’s estimated earnings.

If earnings recover that strongly to FY25, the projections suggest the business could pay an annual dividend per share of 21 cents. That could be a dividend yield of 3.25%, excluding the effect of franking credits.

Qantas shares could still be quite cheap if its earnings stabilise at the projected level, though it’s not as cheap as it was a few months ago. I believe the business still has further to run over the next year, particularly if the fuel costs keep dropping.

Looking at the recommendations covered by Commsec, there are 12 buy ratings, two hold ratings, and no sell ratings. Goldman Sachs currently has a buy rating, with a target price of $8.20. That implies a rise of around 30% on Tuesday’s closing price of $6.41 over the next year.

The post Up 8% in 2023, is it too late to buy Qantas shares now? appeared first on The Motley Fool Australia.

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More reading

• Qantas share price struggles amid second incident in 2 days
• 3 ASX 200 shares smashing new 52-week highs on Wednesday
• Should ASX 200 investors buy Qantas shares today?
• 5 things to watch on the ASX 200 on Tuesday
• Shareholders rejoice! Qantas share price hits post-market-crash high

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 Goldman Sachs Group. 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 Australian share market is making another move higher today, bringing returns from the S&P/ASX 200 Index (ASX: XJO) to 7.8% so far this year. Today’s enthusiasm is being felt across ASX energy shares, with the sector’s performance peaking in early afternoon trade.

While the energising segment is on the move, there are a handful of energy companies that are receiving heightened attention on Tuesday. Juiced-up trading volume can be found in several names following the release of their quarterly reports.

Here’s a quick summary of the results.

Drilling down into these ASX energy shares

Warrego Energy Ltd (ASX: WGO)

The $478 million oil and gas explorer released its quarterly cash flow and activities report today for the three months ending 31 December 2022. In response, investors have pushed shares in the ASX energy company up 1.3% to 39.5 cents apiece.

According to the cash flow report, Warrego pulled in $1.26 million in cash receipts from customers during the quarter. However, the company experienced a net operating cash outflow of $4.49 million after expenses.

Notably, Warrego’s made further progress on its host of projects during the quarter while fielding an ongoing takeover war from Hancock Energy and Strike Energy.

Cooper Energy Ltd (ASX: COE)

Next up is Cooper Energy, a $513 million ASX energy share that is on the way down on Tuesday. The market appears to be unimpressed by the company’s figures for the second quarter.

According to its release, Cooper Energy achieved record year-to-date production and revenue. Production increased by 16% to 1.82 million barrels of oil equivalent (MMboe). However, production and revenue fell 16% and 17% respectively in Q2 compared to the prior corresponding period.

Shares in the company are currently 1.54% below yesterday’s closing price, swapping hands at 19.2 cents apiece.

Karoon Energy Ltd (ASX: KAR)

Back to ASX energy shares that are in the green. Karoon Energy has settled 0.22% higher at $2.325 a share in late afternoon trading as the market digests its latest update. Earlier today, it hit a high of $2.38 a share, or 2.6% higher.

The two major positives to take from Karoon’s quarterly are its 62% increase in production — reaching 2.08 MMboe — and its 34% lift in oil sales. The elevated sales helped the ASX energy share secure US$159.2 million in oil sales revenue.

Melbana Energy Ltd (ASX: MAY)

Last but not least is the best performing of the bunch, Melbana Energy. Shares in the small-cap energy company shot 15.6% higher at one stage today, hitting 8.9 cents a share. Melbana shares are currently trading at 8.1 cents each, up 5.2%.

This ASX energy share actually released its quarterly report after the market close yesterday. Although, the report largely covered the status of its Zapato-1st exploration well and its plans for well appraisals.

Today, Melbana revealed independent assessments estimate volumes of 1.9 billion barrels of oil in place at Amistad structure in Block 9. The company will now move to evaluate the quality and performance of this formation.

The post 4 ASX energy shares heating up on quarterly reports today appeared first on The Motley Fool Australia.

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More reading

• Looking to energise returns with this pocket of undervalued ASX shares in 2023
• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
• Why HUB24, Lovisa, Redbubble, and Warrego shares are sinking today
• These two ASX shares are celebrating 2023 by hitting new 52-week highs

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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It’s been a rather interesting Tuesday for the S&P/ASX 200 Index (ASX: XJO) so far this session. The ASX 200 had a strong start this morning but soon fell back into red territory just before midday.

However, investors seem to have gotten cold feet about their cold feet, and have now sent the index back up. At the time of writing, the index is comfortably in the green having recorded a gain of 0.41% at present to just under 7,490 points.

But time now to dive deeper into these gyrations. So let’s check out the shares currently at the top of the ASX 200’s share trading volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume this Tuesday

Liontown Resources Ltd (ASX: LTR)

Our first horse out the gate today is the ASX 200 lithium stock Liontown. This session has had a notable 15.05 million Liontown shares exchanged on the ASX at this point of the day. We haven’t had any fresh news out of the company so far this week.

So this volume probably comes down to the movements of the Liontown share price itself. The lithium stock has had a very fresh day indeed. It’s currently up a healthy 3.74% at $1.52 a share. This lift puts Liontown up more than 10% so far this week.

Core Lithium Ltd (ASX: CXO)

Core lithium is next up this Tuesday. A fellow ASX 200 lithium share to Liontown, Core Lithium has watched as a decent 16.76 million of its shares have flown around the ASX boards so far today. There’s been no new news out of this company either.

So we can probably lay the blame for the high volumes we see at Core’s volatile trading today. Core Lithium shares are also in the green, albeit not quite as enthusiastically as Liontown’s. The ASX 200 lithium share has gained 0.9% at present to $1.12 a share.

But the company has traded as high as $1.16 and as low as $1.12 today in what has been a bouncy day of trading.

Pilbara Minerals Ltd (ASX: PLS)

Last but certainly not least in terms of trading volumes, we have yet another ASX 200 lithium stock in Pilbara Minerals. This Tuesday has seen a chunky 20.5 million Pilbara shares whiz across the share market as it currently stands.

Once again, investors have been treated to no news whatsoever out of Pilbara this week. So this volume could be a consequence of some love from ASX brokers. As we covered this morning, Morgans has just come out with a bullish rating on Pilbara, predicting even more upside for investors.

Perhaps this is why Pilbara shares have shot up 4.45% today so far to $5.04 each. It’s probably a combination of these factors that is driving the massive volumes we are seeing.

The post Here are the 3 most heavily traded ASX 200 shares on Tuesday appeared first on The Motley Fool Australia.

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More reading

• Will Liontown Resources post a profit in 2023?
• ‘Exploration breakthrough’: What’s going on with this ASX 200 copper share today?
• Analyst says Pilbara Minerals share price can keep rising
• ASX 200 lithium share Sayona has surged 38% in 2023. Too late to buy?
• 3 ASX shares to buy in the hottest sector for 2023: Firetrail

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 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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Stock in S&P/ASX 200 Index (ASX: XJO) coal producer and 2022 dividend winner Coronado Global Resources Inc (ASX: CRN) is tumbling on Tuesday despite the company posting record full-year results and shareholder returns.

The Coronado share price is currently $2.095, 2.1% lower than its previous close.

Coronado share price powers down on earnings update

Here are the key takeaways from the company’s quarterly earnings:

• December quarter revenue reached US$717 million – an 18% quarter-on-quarter fall
• Quarterly run of mine (ROM) coal production lifted 4.4% to 6.7 million tonnes
• Quarterly saleable production came in at 4.3 million tonnes – a 4.4% jump
• Full-year revenue, however, came to a record US$3.57 billion – a 66% increase
• The company also paid a record US$700 million in dividends over 2022
• It ended last year with a US$92 million net cash position and US$434.4 million of liquidity

Coronado says the benchmark index price of Australian coking coal averaged at US$278 per tonne last quarter – up from US$250 a tonne in the September quarter.

Meanwhile, the benchmark index price of US coking coal was US$273 – up from US$259 in the prior quarter.

However, wet weather, inflation, and planned maintenance saw its average mining costs increase 34.5% to US$88.40 per tonne in 2022.

Meanwhile, its capital expenditure more than doubled to US$185.4 million last year as the company worked to improve production rates.

What else happened in the December quarter

The Coronado share price rose 13.7% last quarter while the ASX 200 gained 8.7%.

The company repaid U$72 million of senior secured notes obligations in the December quarter and increased its coal production despite increasingly heavy rainfall at its Australian operation.

It also paid out a 14.1 cent special dividend in December.

What did management say?

Coronado CEO Gerry Spindler commented on the news seemingly weighing on the ASX 200 stock today, saying:

Our record financial results and returns have occurred despite the impacts to production from considerable wet weather conditions in Queensland and global economic circumstances that have driven significantly higher inflation.

Expectations are that weather patterns will improve in 2023 and global inflationary impacts will ease, which should translate to improved production and costs for our business.

However, should these events, which are outside of our control continue, I remain extremely confident in our ability to address all challenges presented to the company and in our ability to continue to provide enhanced value and returns to all shareholders.

What’s next?

The market can expect to hear from the ASX 200 stock on 22 February when it releases its annual report and financial year 2023 guidance.

The company will also boast a new CEO shortly, with current chief operations officer Douglas Thompson taking the reins in May. Meanwhile, Spindler will take on the role of executive chair.

Coronado expects metallurgical coal prices to remain above historical averages in 2023. It will likely be supported by elevated thermal coal prices, the removal of Russian coal from key markets, rising demand for steel, and China’s reopening.

Coronado stock outperforms ASX 200

While the Coronado share price is tumbling today, the stock has outperformed the ASX 200 in recent months.

It has gained 10% so far this year compared to the index’s 7.8% gain.

Coronado shares have also soared 48% over the last 12 months. Meanwhile, the ASX 200 has dropped almost 5%.

The post Record revenue and dividends: Why is this ASX 200 coal stock burning down? appeared first on The Motley Fool Australia.

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More reading

• Why Coronado Global, Mincor, OFX, and Zip shares are dropping today
• Here are the top 10 ASX 200 shares today
• I’d put $97 a week into this ASX 200 share for $1,000 a year in passive income
• Here are the top 10 ASX 200 shares today
• Can ASX 200 coal shares really deliver dividend yields of over 10% in FY24?

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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Like most ASX 200 mining shares, Rio Tinto Limited (ASX: RIO) has delighted investors with record dividend payments over the past two years.

After doling out $5.66 in dividends per share in the COVID-ravaged 2020 (which was the second-highest level of dividend payments in Rio Tinto’s history at the time after 2019), the company broke its own record in 2021. That year, Rio Tinto rained a whopping total of $12.77 in dividends per share on investors.

2022 wasn’t quite as lucrative. But investors still enjoyed a total of $10.47 per share last year. That was made up of the March final dividend of $5.77, the March special dividend of 86 cents per share and the August interim dividend of $3.84.

These three dividend payments give Rio Tinto shares a trailing dividend yield of 8.25% on the current Rio Tinto share price of $126.95. Rio Tinto’s dividend payments usually come fully franked too. That means that this dividend yield grosses up to an impressive 11.79% with the value of those full franking credits.

So does this mean investors can expect an 8.25% yield if they buy Rio Tinto shares today?

Are Rio Tinto shares really offering an 8.25% dividend yield right now?

Well, a company’s dividend yield always represents the past, not the future. It assumes that if investors bought Rio Tinto shares today, and the company pays out the same dividends in 2023 as it did in 2022, only then will investors actually get an 8.25% yield.

But a company is never under any obligation to maintain its dividends at a previous level. If iron ore prices collapse in 2023, Rio Tinto could decide to halve its dividends. Then, investors would be looking at a yield with a 4 at the front, rather than an 8.

So you should never buy a divided share based purely on what it paid out last year.

Earlier today, my Fool colleague James looked at what ASX broker Goldman Sachs is expecting from Rio Tinto shares in FY2023. Goldman has pencilled in dividends worth just $6.25 per share this financial year.

If Rio Tinto does hit that mark, it would give its shares a forward dividend yield of 4.92% on the current share price. That is still decent for an ASX dividend share. But it’s not an 8.25% yield.

So if Goldman is right, Rio Tinto doesn’t really have a dividend yield of 8.25% on the table right now. As always, we’ll have to wait and see what Rio Tinto pulls out of its hat. But buying Rio Tinto shares today with an expectation of getting 8 cents back in yield for every dollar you spend could be misplaced.

The post Does Rio Tinto really have an 8% dividend yield right now? appeared first on The Motley Fool Australia.

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More reading

• Move over bank deposits! These ASX 200 mining shares are forecasting yields of over 5%
• Looking to energise returns with this pocket of undervalued ASX shares in 2023
• Should I buy ASX mining shares now or not?
• Top brokers name 3 ASX shares to buy next week
• 3 all-star ASX 200 shares ECP is going all-in on

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 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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