The Santos Ltd (ASX: STO) share price has climbed slightly in the last year, but could it provide better returns in the future?

Santos shares have risen 3.95% in the last year and are currently fetching $7.37.

In today’s trade, Santos shares are up 3.37%. So what is ahead for the Santos share price?

Could Santos go higher?

Santos is a major oil and gas producer. The price of oil and natural gas is likely to weigh on Santos shares in 2023.

UBS analysts are tipping energy prices to continue to leap higher in 2023. In a report released in January, the UBS chief investment office said it expects oil to “come out on top in 2023”.

UBS is predicting oil prices to lift higher than US $100 a barrel in coming months. Analysts forecast brent crude oil to reach US$110 a barrel, while WTI oil is predicted to hit US $107 a barrel. UBS said, “We expect crude oil prices to rise in 2023 for several reasons”. These include China’s reopening and Russian oil production falling.

With China reopening, oil demand looks set to exceed 2019 levels and hit a record high in 2H23. Emerging Asia, including India, should return to driving oil demand growth in 2023.

Meanwhile, Russian oil production should fall in 2023 due to the European Union’s embargo on Russian crude and refined products (to come into force on 5 February).

While production outside the OPEC+ group, which is primarily driven by the US, will likely grow again in 2023, the increase should only be modest following years of underinvestment in building new supply.

Meanwhile, UBS is tipping natural gas to reach US$4.50 per MMBtu by mid-2023 and hit US$5 per MMBtu by late 2023. Natural gas is currently fetching US$3.68, according to Bloomberg. However, in 2022, natural gas rose as high as US$9.7 per MMBtu in August.

What are brokers saying?

Meanwhile, analysts at Morgans are predicting the Santos share price to charge higher in 2023. The broker has placed an add rating on the Santos share price with a $9 price target. This implies an upside of 22%, based on the current share price.

Morgans is optimistic on Santos due to it’s “growth profile and diversified earnings base”. Analysts said Santos is:

Well placed to outperform against a backdrop of a broader sector recovery.

Santos share price snapshot

The Santos share price has returned gains of 43% over the last five years. In the last week, Santos shares have climbed nearly 7%.

Santos has a market capitalisation of about $24 billion based on the current share price.

The post Should I buy Santos shares in 2023? appeared first on The Motley Fool Australia.

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More reading

• Why Life360, Lithium Power, Lovisa, and Santos shares are storming higher today
• Oil best China reopening play: Goldman Sachs
• 5 things to watch on the ASX 200 on Thursday
• Morgans names 2 ASX 200 dividend shares to buy now
• 5 things to watch on the ASX 200 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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With Goldman Sachs once again reiterating its belief that lithium prices will start its sharp decline later this year, many of the developers and explorers on the Australian share market run the risk of missing out on the sky high prices the battery making ingredient is commanding right now.

Goldman is forecasting the following average prices for these lithium types this year and next compared to current spot prices:

• Lithium carbonate
  • Spot: US$66,750 a tonne
  • 2023: US$53,300 a tonne
  • 2024: US$11,000 a tonne
• Lithium hydroxide
  • Spot: US$76,650 a tonne
  • 2023: US$58,650 a tonne
  • 2024: US$12,500 a tonne
• Lithium spodumene 6%
  • Spot: US$5,990 a tonne
  • 2023: US$4,330 a tonne
  • 2024: US$800 a tonne

The good news is that a few ASX lithium shares are scheduled to commence production this year, which means they may still be able to benefit from the current high prices for a period of time.

Which ASX lithium shares are due to commence production?

Three ASX lithium shares targeting their maiden production this year are Argosy Minerals Limited (ASX: AGY), Core Lithium Ltd (ASX: CXO), and Sayona Mining Ltd (ASX: SYA).

In respect to Argosy Minerals, it has completed 98% of the total works required for the massive 2,000tpa Rincon Lithium Project in Argentina. It also recently produced 1 tonne of battery quality lithium carbonate during the commissioning period. The company is aiming to achieve steady-state production operations by end of the second quarter of calendar year 2023.

Core Lithium isn’t far behind. In fact, the lithium developer made its first shipment of 15,000 dmt of 1.4% Li2O spodumene direct shipping ore last week. It is now aiming to commence spodumene concentrate production in the first half of 2023.

Finally, Sayona Mining is on the cusp of restarting the North American Lithium project with partner Piedmont Lithium Inc (ASX: PLL). At the end of last month, the company revealed that it was on track to restart production at the Quebec based operation in the first quarter of 2023. Sayona owns 75% of the project, with Piedmont Lithium owning 25%.

The post 3 ASX lithium shares forecasting maiden production in 2023 appeared first on The Motley Fool Australia.

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More reading

• Why Brainchip, Core Lithium, Deterra Royalties, and Mesoblast shares are falling
• Will Sayona Mining turn a profit in 2023?
• Here’s what Goldman Sachs is saying about the Core Lithium share price now
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Which ASX lithium shares are producing and which are not in 2023?

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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AGL Energy Limited (ASX: AGL) shares may not have the best reputation as a prime income-producing investment. Since 2018, the dividend per share (DPS) from this energy giant has crumbled — falling from $1.26 per share to 26 cents per share.

Once upon a time, a 4% dividend yield was considered to be quite good. But now savvy savers can score themselves a 4.5% return through a personal savings account. A higher yield — say around 7% — is more desirable now given the risk premium of shares.

Could AGL shares be one blue-chip that can deliver a sublime 7% yield in the future?

What are analysts expecting for AGL shares?

Let’s start with our baseline. At the moment, the $5.25 billion energy retailer is trading on a 3.3% trailing dividend yield, paying 26 cents per share during the past year. As shown below, this is around historical lows for the company.

According to Commsec consensus estimates, analysts forecast the company’s yield to expand to 7.2% in FY24. This is based on the current AGL share price and the estimated DPS of 56 cents per share for the year ending June 2024.

If the analysts are right, then AGL could be a passive income machine in FY24. But could their estimates be off the mark? The short answer is yes, they could be — no one knows the future with 100% certainty. But it’s more valuable if I provide my thoughts with justification.

Dripping dividends or hunkering down?

If AGL pays 56 cents per share in dividends in FY24, it would increase 115% from its current level. There are three ways that the energy giant could achieve this phenomenal feat:

• Doubling its profits and maintaining its current payout ratio; or
• Maintaining its current profits and doubling its payout ratio; or
• Some combination of the two options above.

In its September 2022 update, AGL guided for between $200 million to $320 million underlying net profit after tax (NPAT) for FY23. At the midpoint, that would be $260 million in underlying NPAT — suggesting a 15.5% increase. If statutory earnings were to grow at the same pace, we’d be looking at approximately $994 million.

Below is the range of scenarios I could see playing out in FY24 — ranging from a 20% fall in earnings (due to investment in its energy transition) to a 20% increase caused by higher wholesale electricity prices.

	Bear case	Base case	Bull case
Earnings growth	-20%	0%	+20%
Statutory NPAT	$795.2 million	$994 million	$1,192.8 million
Payout ratio	20%	40%	60%
Total dividends	$159.04 million	$397.6 million	$715.68 million
DPS	23.6 cents	59.1 cents	$1.06
Dividend yield	3.0%	7.6%	13.6%

Assuming the AGL share price stays at current levels, I’d personally think a dividend yield of around 7% in FY24 is possible. The base case assumes no earnings growth, which is probable in my view as the company plans to invest $20 billion in new generation capacity over the next 13 years.

The post Can AGL shares really deliver a 7% dividend yield in FY24? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 dividend stocks I’m running a mile from
• Fortescue’s Twiggy Forrest is in the wars this week. Here’s why
• The AGL share price rocketed 30% in 2022. Can it keep the fire burning this year?
• Bought $1,000 of AGL shares 10 years ago? Here’s how much dividend income you’ve received
• 5 ASX 200 directors who have been buying up their company shares this month

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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A collection of ASX mining shares have been upgraded by various brokers today.

While the upgrades demonstrate increased confidence in these ASX mining shares, many are already trading above the brokers’ raised valuations.

Over the past three months, the S&P/ASX 300 Metals & Mining Index (ASX: XMM) has increased by almost 25%.

Investors are likely more enthusiastic about ASX mining shares now that China has dumped its COVID-19 Zero policy. This significantly disrupted the Chinese economy and affected demand for our exports.

Which ASX mining share got the biggest price forecast bump?

According to The Australian, Goldman feels a lot more confident about the prospects for ASX copper share Sandfire Resources Ltd (ASX: SFR).

The broker has raised its 12-month share price target by a whopping 38% to $4.50. But Sandfire shares are already trading well above this at $6.20, down 1.12% at lunchtime on Friday.

Goldman has also upgraded its share price target on ASX iron ore share Champion Iron Ltd (ASX: CIA) by 22% to $8.40.

Champion Iron shares are swapping hands for $7.76 today, up 0.91%. So, there’s a bit of potential upside available for investors here.

The broker has also raised its price target for South32 Ltd (ASX: S32) shares by 17% to $4.20. South 32 shares are already above this point, trading at $4.64 today, up 1.98%.

Conversely, Credit Suisse is not so confident and has cut its recommendation on South 32 shares to neutral.

Goldman upped its price target for BHP Group Ltd (ASX: BHP) shares by 12% to $48.10. But investors are more bullish, pushing BHP shares to $49.89 today, up 1.03%.

Goldman also backs ASX coal share New Hope Corporation Limited (ASX: NHC).

The team has raised its price target on New Hope shares by 26% to $4.90. But the New Hope share price has soared well beyond this to $6.27, up 5.91% on no news from the company at all today.

At the time of writing, it’s the top-performing share on the S&P/ASX 200 Index (ASX: XJO) today, according to ASX data.

They’ve also raised their forecast for the thermal coal price by 18% to US$275 per tonne for 2023.

Goldman also sees Rio Tinto Limited (ASX: RIO) heading 9% higher to $130 per share. Rio Tinto is currently trading at $122.85 per share, up 1.39% today.

Barclays has raised its recommendation on Rio Tinto shares to equal weight.

What’s got the brokers positive on ASX resources stocks?

In a new note, Goldman Sachs says it is forecasting a commodity price recovery in the second half of FY23:

While we continue to think 1Q23 will be a tough quarter for base metals and steel due to ongoing weak European and global demand, our expectation of a China reopening in 2Q, extreme lows in global base metal inventories and ongoing supply side disruptions make us positive on a 2H commodity price recovery.

Goldman said it was “most positive” on 62% fe and high-grade iron ore, as well as coking coal, due to an expected increase in Chinese steel production.

The broker is also optimistic about copper, aluminium, and zinc due to low global inventories and supply-side disruptions.

It cites copper production issues in Chile and a “slow restart of European aluminium and zinc smelters” as reasons for the shortages right now.

The post 6 ASX mining shares just upgraded by brokers appeared first on The Motley Fool Australia.

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More reading

• Why right now is always a great time to invest in ASX ETFs: Scott Phillips
• 4 ASX 200 shares celebrating Friday with new, 52-week highs
• 2 ASX 200 dividend stocks I’m running a mile from
• 3 ASX 200 shares I own for big dividends in 2023
• Are nervous investors returning to the ASX stock market right now?

Motley Fool contributor Bronwyn Allen has positions in BHP Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Barclays Plc. 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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Here at the Motley Fool, we’re all about picking individual ASX shares to try and beat the market over time. In theory, this is what most investors should be doing if they are not investing in index or exchange-traded funds (ETFs).

We can easily get the market’s returns by just putting our money in an index ETF. So if an investor isn’t going on that road, they should be aiming to beat those ETFs’ returns.

But we also recognise that researching individual companies is not everyone’s forte or cup of tea. For those investors unwilling or unable to put the hard yards into building their own ASX share portfolio, ETFs are a fantastic alternative.

But for many investors, that age-old question of ‘when to invest’ is still a barrier to full participation in the wealth-generating effects of the share market. The idea of buying an ETF, only to see it fall in value in the coming weeks or months, is something many people (understandably) find terrifying.

The best time to buy an ETF? Right now…

Our own chief investment officer, Scott Phillips, has some sage advice for such a conundrum. Scott recently spoke with Gemma Dale on NABtrade’s Your Wealth podcast. When asked, “if you’ve got a bit of money left over after Christmas, where would you be going?”, here’s why Scott pointed to index ETFs as a good place to start:

For a lot of people listening, if they’re not comfortable picking individual stocks should at least make sure they invest that money in a broad index-based ETF, which is the most boring answer in the world. But put that money to work is my point.

And not because I know what’s coming next, not because I know the market’s going to jump 15% in the first six months of the year or not, just because, mathematically, the amount goes up over time – it goes up a lot over time.

So that’s why investing in ETFs right now could be a prudent choice for many investors out there.

Many investors keep some cash in the bank to deploy during a market downturn or crash. But the problem with that method is that we never know when the markets are going to tank next.

Your monetary firepower could end up sitting dormant in a bank account for years, as you wait for that ‘inevitable downturn, costing you valuable returns.

That’s why Scott told listeners that he likes to remain fully invested at all times. Here’s some of what he said about that idea:

And for my money, I’m always fully invested by the way, despite market gyrations, because I believe mathematically that makes sense.

If you look at history, being invested earlier has been better consistently than being invested late. Not every year, not every month, not every day, but over time, mathematically, you are better to be investing earlier rather than later. So at least invest the money is my point.

So if you’re waiting for an opportune time to invest in an ASX index ETF, it might just be today.

The post Why right now is always a great time to invest in ASX ETFs: Scott Phillips appeared first on The Motley Fool Australia.

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More reading

• 6 ASX mining shares just upgraded by brokers
• 4 ASX 200 shares celebrating Friday with new, 52-week highs
• 2 ASX 200 dividend stocks I’m running a mile from
• 3 ASX 200 shares I own for big dividends in 2023
• Are nervous investors returning to the ASX stock market right now?

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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The S&P/ASX 200 Index (ASX: XJO) has followed the lead of Wall Street and is racing higher. In afternoon trade, the benchmark index is up 0.8% to 7,338.3 points.

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

Life360 Inc (ASX: 360)

The Life360 share price is up almost 11% to $5.41. Investors have been buying the location technology company’s shares following the release of a business update. As well as achieving guidance on key metrics in FY 2022, the company announced a restructure that is expected to accelerate its path to profitability.

Lithium Power International Ltd (ASX: LPI)

The Lithium Power share price is up over 6% to 50 cents. This morning the lithium explorer revealed that it has commenced its inaugural drilling program at its East Kirup lithium prospect located in the Greenbushes region of Western Australia. In addition, the company advised that its Western Lithium business is to be demerged during the first half of 2023, subject to market conditions and shareholder approval.

Lovisa Holdings Ltd (ASX: LOV)

The Lovisa share price is up 4% to $26.42. This appears to have been driven by a broker note out of Canaccord Genuity. According to the note, its analysts have lifted their price target on this fashion jewellery retailer’s shares by a massive 22% to $27.75.

Santos Ltd (ASX: STO)

The Santos share price is up over 3% to $7.36. Investors have been buying Santos and other energy shares on Friday following another rise in oil prices overnight. This was driven by optimism that global demand for oil could strengthen. At the time of writing, the S&P/ASX 200 Energy index is up approximately 2%.

The post Why Life360, Lithium Power, Lovisa, and Santos shares are storming higher today appeared first on The Motley Fool Australia.

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• Why this ASX All Ords tech share is rocketing 14% today
• Oil best China reopening play: Goldman Sachs
• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Morgans names 2 ASX 200 dividend shares to buy now

Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360 and 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 S&P/ASX 200 Index (ASX: XJO) is on a roll today, and so are four shares that call it home.

They’ve each shot up to reach new 52-week highs on Friday.

Right now, the ASX 200 is up 0.89%, trading at 7,345 points.

Let’s take a look at some of its constituents making the most of their day in the green.

Which ASX 200 shares have hit long-forgotten highs today?

The first ASX 200 share posting a new 52-week high today is also the market’s biggest participant, BHP Group Ltd (ASX: BHP).

The ASX 200 mining giant soared to $49.92 earlier today – a new record high and a 1.1% increase on its previous closing price.

Its gains came amid a good session for the S&P/ASX 200 Materials Index (ASX: XMJ). The sector is up 0.65% right now amid Goldman Sachs’ broadly bullish outlook for the sector.

BHP shares are joined in the green by Northern Star Resources Ltd (ASX: NST) stock.

The ASX 200 gold producer’s share price launched 2.6% earlier today to a near-two-year-high of $12.32.

It came after gold futures hit their highest point since May 2022, reaching US$1,898.80 an ounce overnight.

Soaring to join the miners at a new 52-week high is Aussie icon Qantas Airways Limited (ASX: QAN).

The Qantas share price took off this morning, climbing 1.6% to $6.52. That leaves the ASX 200 airline share nearly on par with where it was in February 2020 – arguably a milestone in the company’s pandemic recovery.

It’s also the third consecutive day in which the stock surpassed its previous 12-month high.

Also posting a third consecutive 52-week high is fellow ASX 200 travel share Webjet Limited (ASX: WEB).

Shares in the online travel agent leapt 1.5% to peak at $6.69 this morning.

Though, that’s still 32% lower than it was before the onset of the pandemic.

The post 4 ASX 200 shares celebrating Friday with new, 52-week highs appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 dividend stocks I’m running a mile from
• 3 ASX 200 shares I own for big dividends in 2023
• Are nervous investors returning to the ASX stock market right now?
• How I’d invest my very first $500 in ASX shares in 2023
• 5 things to watch on the ASX 200 on Friday

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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If you’re looking for exchange traded funds (ETFs) to buy in January, then you might want to look at the three listed below.

Here’s what you need to know about these top ETFs:

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

If you’re interested in gaining exposure to the Asian tech sector now that China is finally reopening, then the BetaShares Asia Technology Tigers ETF could be worth considering. This ETF tracks the performance of the largest technology companies in Asia (excluding Japan). Among the exciting companies that you’ll be buying are tigers such as Alibaba, JD.com, Pinduoduo, Samsung, Taiwan Semiconductor, and Tencent Holdings.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

If you are a fan of legendary investor Warren Buffett, then you may want to look at the VanEck Vectors Morningstar Wide Moat ETF. That’s because when Buffett invests, he looks for fairly valued companies with sustainable competitive advantages or moats. VanEck has taken this into account and made an ETF out of it by bringing together around 50 attractively priced companies with moats. At present, this includes high quality companies such as Adobe, Alphabet, Boeing, Kellogg Co, Microsoft, and Walt Disney.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

A final ETF for investors to look at is the Vanguard MSCI Index International Shares ETF. It could be a great option if you’re looking for an easy way to diversify your portfolio. That’s because this popular ETF provides investors with access to around 1,500 of the world’s largest listed companies. This provides significant diversity and also allows investors to take part in the long term growth potential of international economies. Among the companies included in the fund are giants such as Amazon, Apple, Nestle, Nvidia, Procter & Gamble, Tesla, and Visa.

The post 3 of the best ASX ETFs for investors to buy in January appeared first on The Motley Fool Australia.

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• 2022 wasn’t kind to the Vanguard MSCI Index International Shares ETF (VGS). What now?
• How I’d invest $300 a month in ASX dividend shares to target a $30,000 annual second income
• 1 in 7 Australians own an ETF: Are these the ones to buy?
• I’d listen to Warren Buffett and invest in ASX shares with wide economic moats
• 2 super ETFs for ASX investors to buy in 2023 and hold for a decade

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 Vanguard Msci Index International Shares ETF. The Motley Fool Australia has recommended Betashares Capital – Asia Technology Tigers Etf, VanEck Morningstar Wide Moat ETF, and Vanguard Msci Index International Shares ETF. 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week with a solid gain. At the time of writing, the benchmark index is up 0.9% to 7,343.7 points.

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

Brainchip Holdings Ltd (ASX: BRN)

The Brainchip share price is down a further 1.5% to 66 cents. This semiconductor company’s shares have come under pressure this week after it raised capital again. Investors appear concerned that this could mean the company’s latest quarterly sales performance underwhelmed and it needed a cash injection.

Core Lithium Ltd (ASX: CXO)

The Core Lithium share price is down 3% to $1.15. This may have been driven by a bearish broker note out of Goldman Sachs this morning. According to the note, the broker has reiterated its sell rating and 95 cents price target on this lithium developer’s shares. Goldman believes Core Lithium’s shares are overvalued at the current level.

Deterra Royalties Ltd (ASX: DRR)

The Deterra Royalties share price is down 2.5% to $4.68. This may also have been driven by a broker note out of Goldman Sachs. This morning, the broker downgraded the mining royalties company’s shares to a neutral rating with a $4.50 price target. Goldman made the move largely on valuation grounds after a strong gain since October.

Mesoblast Ltd (ASX: MSB)

The Mesoblast share price is down 2.5% to 93.5 cents. This is despite there being no news out of the biotech company. However, with its shares up strongly since the start of the year, some profit taking could be happening. The Mesoblast share price remains up 7% year to date.

The post Why Brainchip, Core Lithium, Deterra Royalties, and Mesoblast shares are falling appeared first on The Motley Fool Australia.

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More reading

• Here’s what Goldman Sachs is saying about the Core Lithium share price now
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Which ASX lithium shares are producing and which are not in 2023?
• Why has the Core Lithium share price already surged 18% this year?
• Will Core Lithium turn a profit in 2023?

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 Whitehaven Coal Ltd (ASX: WHC) share price rocketed ahead in 2022, but could it still go higher in 2023?

Whitehaven shares soared 261% from $2.61 at market close on 31 December 2021 to $9.42 at market close on 30 December 2022. In today’s trade, Whitehaven shares are up 2%.

So could the Whitehaven Coal share price still go higher?

Could Whitehaven go even higher?

Whitehaven is a major coal producer and global exporter to markets including Japan, Korea and Taiwan.

The coal price is likely to weigh heavily on investors’ minds this year, since it impacts the company’s profit margin.

Analysts at UBS have recently predicted coal prices to “stay elevated” for longer. UBS said in January this year:

High calorific value coal (6,000 kilocalories per kilogram) is likely to remain in short supply, keeping prices of Newcastle thermal coal elevated in 2023. That said, some decline from record levels of above USD 400 per metric ton should still be expected.

A stronger price decline will probably only happen after 2025, following the next wave of additional LNG supply and additional power supply from renewables.

Meanwhile, a report from the Office of the Chief Economist is predicting thermal coal prices to rise from US$245 a tonne in FY22 to US$360 a tonne in FY23. However, metallurgical prices are predicted to drop from US$404 a tonne in FY22 to US$262 in FY23.

Production of coal from Whitehaven’s mines may also weigh on the company’s share price this year.

In November, Whitehaven “moderated” its guidance for FY23 coal production from its open-cut mines given possible weather impacts and labour constraints. The company is forecasting it will produce 19 to 20.4 Mt of coal in the 2023 financial year. Previously, Whitehaven had guided for 10 to 22 Mt of coal.

Whitehaven share price snapshot

The Whitehaven share price has exploded 202% in the last year. However, in the past month, it has slid 6%.

Whitehaven Coal has a market capitalisation of about $8 billion based on the current share price.

The post The Whitehaven share price exploded 260% in 2022. Is that all there is? appeared first on The Motley Fool Australia.

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More reading

• What’s the forecast for the coal price in 2023?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Power up: 3 best ASX 200 energy shares of 2022
• Here’s why 2023 will be a huge year for passive income
• 3 ASX 200 dividend shares with HUGE passive-income potential for FY24

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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