The Galan Lithium Ltd (ASX: GLN) share price is frozen after the company requested a trading halt today.

The ASX lithium share is sitting at $1.27 while the explorer prepares a “significant resource update”.

Here’s what we know.

Why is this ASX lithium share in a trading halt?

Galan requested an immediate trading halt pre-open this morning. It asked the ASX to keep it in place until it makes its announcement, or until the commencement of trading next Monday 24 October.

The statement refers to the pending announcement as a “significant resource update”. There are no other details.

What’s been happening with Galan Lithium lately?

Among Galan’s major projects is the 100%-owned Hombre Muerto West Project (HMW) in Argentina.

This is a lithium project. Last month, Galan advised the ASX that it has applied for a permit to build a permanent 200-person operational camp at the site in the Catamarca Province.

It said the facility would “house all required personnel to execute construction activities expected to commence during CY2023 and into targeted commercial production in CY2025”.

The company said it was “a key further step towards accelerating the development of the HMW Project”.

It currently has an exploration camp set up for exploration and piloting activities.

In August, Galan provided an update on its well-pumping tests and exploration programs at HMW.

It said the long-term pumping test at the Pata Pila site within HMW had been successfully completed. The test extracted lithium grades of between 821 mg/L and 927 mg/L.

Galan said in a statement: “These strong outcomes support potential higher production capacity parameters for Definitive Feasibility Study (DFS) inputs.”

It reported first-pump well results at another site within HMW, Rana de Sal, that produced average lithium grades above 945 mg/L.

Price snapshot for this ASX lithium share

The Galan Lithium share price is down 35% in 2022 so far.

However, the shares are up 7.6% over the past 12 months.

Over the past five years, Galan shares have lifted by almost 1,500%. Yep, no kidding.

The post Guess which ASX lithium share is on ice with a ‘significant resource update’ incoming appeared first on The Motley Fool Australia.

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More reading

• Why did the Galan Lithium share price drop 7% on Monday?

Motley Fool contributor Bronwyn Allen 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 Syrah Resources Ltd (ASX: SYR) share price is having a strong day.

In early afternoon trade, the graphite producer’s shares are up 13% to $2.13.

Why is the Syrah Resources share price racing higher?

There have been a few reasons for the strong gain by the Syrah Resources share price on Thursday.

The first is news that the company has been selected for a US government grant of up to US$220 million (A$350 million).

According to the release, Syrah has been selected by the US Department of Energy (DOE) as a recipient of the Bipartisan Infrastructure Law Battery Materials Processing and Battery Manufacturing grant.

This will support the financing of the potential expansion of the Vidalia active anode material (AAM) facility in Louisiana, USA to a 45ktpa AAM production capacity.

Management notes that if successfully concluded, the DOE grant would fund a significant proportion of the estimated capital costs for Vidalia’s expansion.

Fellow ASX battery materials shares Novonix Ltd (ASX: NVX) and Piedmont Lithium Inc (ASX: PLL) were also selected for funding.

What else?

Also giving the Syrah Resources share price a lift is news that the company has entered into a non-binding memorandum of understanding with LG Energy Solution, a leading global manufacturer of lithium-ion batteries.

Syrah and LG Energy Solution will evaluate natural graphite AAM supply from the Vidalia AAM facility in USA.

In addition, an offtake agreement for 2ktpa AAM from Vidalia will commence from 2025 and increase to at least 10ktpa AAM upon Vidalia’s expansion to a 45ktpa AAM production capacity.

Anything else?

The announcements don’t stop there. Syrah also revealed that its workers and contractors have returned to the Balama Graphite Operation in Mozambique.

However, further illegal industrial action disrupted a full operational restart and limited logistics movements. Industrial action continues to be driven by a small contingent of local employees and contractors.

Syrah is working towards recommencing full Balama operations and production, and logistics movements, as soon as possible.

Fourth and final

A final announcement reveals that the company produced 38kt of natural graphite at an 80% recovery rate during the third quarter of FY 2022.

Syrah also shipped a record 55kt at a weighted average sales price of US$688 per tonne. This was a quarter on quarter increase of 25% and 3.9%, respectively.

As a result, pleasingly, Balama still recorded a net operating profit after C1 and C2 costs over the quarter despite the disruptions mentioned above.

The post Syrah Resources share price leaps 13% on big news day appeared first on The Motley Fool Australia.

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More reading

• Syrah Resources share price sinks 21% amid ‘illegal action’
• Why BHP, Costa, Link, and Syrah shares are dropping
• Why is the Syrah share price halted?

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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As you might have guessed from the headline, next week is an important one for the Coles Group Ltd (ASX: COL) share price. On Wednesday 26 October, the S&P/ASX 200 (ASX: XJO) supermarket giant is scheduled to deliver its quarterly sales results covering the three months to 30 September 2022.

Given sales are one of the most important factors contributing to Coles’ underlying profitability, investors will no doubt be paying close attention. But what of the Coles share price today? Could it be in the value zone ahead of this important update?

Coles shares have had what could be described as a resilient year so far in 2022. The ASX 200 has lost more than 11.2% year to date. But the Coles share price has lost a tamer 7.5%. It’s also faring better than the broader market over the past 12 months.

Saying that, it has still been a bit of a bumpy ride for the company. Since 19 August, Coles has lost a painful 14.5%, sliding from over $19 to the $16.53 we see presently (at the time of writing).

So does this mean Coles is in the buy zone right now?

Is the Coles share price a pre-update buy right now?

Well, one ASX broker thinks so. As my Fool colleague James covered earlier this week, broker Morgans is bullish on Coles shares right now. Morgans currently has an add rating on Coles, with a 12-month share price target of $20. That implies a potential upside of close to 21% from today’s pricing.

Morgans sees Coles continuing to dial up its dividend payments over the next 12 months. It is anticipating 65 cents per share in fully franked dividends for the 2022 financial year, and 66 cents per share for FY2023.

But not all expert opinions are so optimistic. My Fool colleague Bernd recently discussed how Coles shares are tracking compared to the company’s arch-rival Woolworths Group Ltd (ASX: WOW). He noted that another ASX broker in UBS only has a neutral rating on the company right now.

Although UBS reckons Woolworths will be hindered more by volume weakness than Coles for the latest quarter, it still has a share price target of $16.23 on the grocer right now. That’s below the current Coles share price.

So mixed opinions on Coles shares today from some ASX experts.

Let’s see what the company has in store for investors next week.

At the current Coles share price, this ASX 200 supermarket giant has a market capitalisation of $22.14 billion, with a dividend yield of 3.81%.

The post Is the Coles share price a buy ahead of next week’s quarterly results? appeared first on The Motley Fool Australia.

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• Could buying Woolworths shares help ‘recession-proof’ your ASX portfolio?
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• Better buy: Woolworths or Coles shares?
• Which ASX All Ords shares could perform well in a recession?
• Own Coles shares? Here’s what to expect from the supermarket giant’s Q1 update

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 positions in and has recommended COLESGROUP DEF SET. 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 has been an eventful morning for the Megaport Ltd (ASX: MP1) share price on Thursday after coming out of a trading halt.

Presently, shares in the network-as-a-service provider are dumping 9.38% to $5.99. The disappointing move is, unfortunately, an encore to a sickening 22% slump yesterday amid the company’s first-quarter update.

Let’s take a look at what is causing dismay among shareholders today.

Oopsie doesn’t go unpunished

Before the market opening, Megaport requested that its shares be temporarily paused pending a further announcement.

Given the recency of its first-quarter update — and the cold reception it received — this likely put investors on edge. Fast forward roughly an hour, and the data interconnectivity provider had released the price-sensitive mishap.

According to the release, an error had been made when converting several of the company’s figures to Australian dollars, sending the Megaport share price reeling.

Specifically, the details requiring amendment related to numbers featured on slide 11 of Megaport’s Q1 investor presentation, as shown below.

While the market is reacting negatively to the news, the revisions were mostly positive. For reference, the adjustments were:

• Capital expenditure (including IP change) reduced from A$16 million outflow to A$14.4 million
• Cash flow used in investing activity reduced from A$15.8 million outflow to A$14.2 million
• Net cash flow changes reduced from A$13.9 million to A$12.3 million
• Effect of foreign exchange movement changed from a A$0.8 million gain to a A$0.8 million loss

The last line item appears to be the only negatively impacting adjustment of the bunch.

In addition, the company noted there were no changes to its previously reported cash balance, USD cash flow, or Appendix 4C.

Is there a positive to the Megaport share price?

For shareholders, today’s pain only adds to what has been a painful year for Megaport shares. In 2022, the company’s value has deteriorated to the tune of 69%. However, there is still a positive to be considered, according to analysts at Jefferies.

Following Megaport’s Q1 figures, Jefferies revealed it expects the company to be free cash flow positive by the second half of FY25. Although, the team still reduced its Megaport share price target from $9.60 to $7.54 in light of the slower growth.

The post Why is the Megaport share price receiving a 9% spanking today? appeared first on The Motley Fool Australia.

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More reading

• Winner and Sinner: Woodside stock looks dirt cheap, whilst Megaport shares could have even further to fall
• Why did the Megaport share price crash 22% today?
• Why GQG, Megaport, Melbana Energy, and St Barbara shares are dropping today
• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today

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 positions in and has recommended MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. 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 Redbubble Ltd (ASX: RBL) share price is having another day to forget.

In morning trade, the ecommerce company’s shares are down 26% to a two-year low of 53 cents.

This makes it the worst performer on the All Ordinaries Index (ASX: XAO) today.

It also means the Redbubble share price is now down 84% since the start of the year.

Why is the Redbubble share price crashing?

Investors have been heading to the exits in their droves this morning following the release of the company’s first quarter update.

For the three months ended 30 September, Redbubble reported a 5% decline in gross transaction value (GTV) to $134.9 million and a 5% reduction in underlying marketplace revenue (MPR) to $102 million. Both metrics were down 8% in constant currency despite the Australian dollar’s significant weakness this year.

While that wasn’t great, things got worse the further down the income statement you travelled.

For example, Redbubble’s gross profit fell 7% to $39.4 million or 10% in constant currency terms.

Finally, the company’s earnings before interest and tax (EBIT) turned negative during the quarter and went from a profit of $0.9 million to a whopping $17 million loss. That’s despite its gross profit only falling $3 million year on year.

Bizarrely, at a time when most companies are cutting costs, Redbubble has increased its costs materially. It made a $3.8 million brand investment, which didn’t even deliver sales growth, recorded a $4 million increase in other expenses, and increased its salaries and wages by $4.7 million.

The latter means that its salaries and wages totalled $19.3 million for the first quarter. Annualised, this equates to $77.2 million, which is the equivalent of half the company’s market capitalisation!

But it won’t stop there, it intends to increase its salaries and wages by $14 million to $18 million in FY 2023. This means at least another $9.3 million increase over the remainder of the year.

Management commentary

Redbubble’s CEO, Michael Ilczynski, commented:

The MPR this quarter was down $5.1 million versus the pcp. This largely reflects the impact of cycling $4 million of mask sales within the Accessories category, and the encouraging and continued growth in the T-Shirts category of 12% or $7 million. The growth in T-Shirts was not sufficient to offset the decline in the Artwork and Homeware categories. The MPR result was impacted by slightly lower sales in Australia, Europe and the UK than expected, particularly in September. Importantly, the Group’s largest market, North America, remained resilient in the first quarter of FY23.

Salaries and wages totaled $19.3 million for the first quarter. The increase in salaries and wages reflects our strategy to invest to drive revenue and margin growth, with 76% of new FTEs since July 2021 added to our growth focused areas of Product & Technology, Marketing, Commercial and Supply Chain & Logistics.

FY 2023 guidance

Redbubble’s guidance for FY 2023 remains unchanged.

It continues to expect revenue growth and “compelling” unit economics, as represented by the GPAPA margin, supported by the ~6% average base price rise from early May 2022.

The post Why did this ASX All Ordinaries share just crash 26%? appeared first on The Motley Fool Australia.

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More reading

• 3 ASX tech shares that have managed to turn a $1,000 investment into $50,000
• Winner and Sinner: Woodside stock looks dirt cheap, whilst Megaport shares could have even further to fall
• Novonix share price rockets 26% on $240m US Government grant news
• This crypto stock just got a huge nod of approval
• Zip share price charges 13% higher on Q1 update

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 REDBUBBLE FPO. 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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This year has been rough on ASX tech shares, with inflation and rising rates taking their toll on many of the market’s favourites.

While the S&P/ASX 200 Index (ASX: XJO) has dumped 11% year to date, the S&P/ASX 200 Information Technology Index (ASX: XIJ) has tumbled 36%.

The broader S&P/ASX 200 All Technology Index (ASX: XTX), meanwhile, has fallen 35% in 2022.

If there was ever a time to remind market watchers of the winners that can be found in the sector, this would be it.

Here’s how an ASX investor could have turned $1,000 into nearly $50,000 in just 10 years by investing in ASX tech shares.

3 ASX tech shares that turned $1,000 into $50,000

If an investor split $1,000 between these three ASX tech shares 10 years ago, investing $333 in each, here’s how their buy would have turned out.

ASX tech company	Gains over the last decade	Recent value of $333 invested	Dividends paid per share
HUB24 Ltd (ASX: HUB)	3,242%	$11,129	45.1 cents
Altium Limited (ASX: ALU)	4,534%	$15,431	$2.48
Nearmap Ltd (ASX: NEA)	6,533%	$22,089	–

All in all, an initial $1,000 investment in these ASX tech shares would have returned a total of $49,868 as of yesterday’s close. That’s certainly nothing to scoff at.

The biggest gain in that time was posted by the only stock not to pay a dividend.

Nearmap shares were trading at just 3 cents this time 10 years ago. They closed Wednesday’s session at a whopping $1.99.

Meanwhile, shares in Altium were swapping hands for 79 cents this time last decade. They’re now worth $36.61 apiece.

The company has also offered a shareholder who bought $333 worth of its stock in October 2012 a total of $1,044 worth of dividends over the life of their investment. Though, it didn’t pay out its first fully franked offering until this year.

Finally, the HUB24 share price lifted from 76 cents this time last decade to trade at $25.40 as of Wednesday’s close.

Someone who bought $333 worth of the ASX tech favourite’s shares back then would have received around $197.50 in dividends since then, the majority of which were fully franked.

And, of course, if they had chosen to reinvest those dividends, they would have been even better off due to the compounding effect.

The key takeaway

While times are tough in 2022, particularly for tech shares, there will likely always be winners hidden on the ASX. The trick is to know where to look.

The post 3 ASX tech shares that have managed to turn a $1,000 investment into $50,000 appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX 200 shares today
• 4 ASX tech shares with ‘long runways for growth at valuations rarely seen’: expert
• Why Hub24, Sezzle, Telix, and Westpac shares are rising
• Guess which ASX 200 tech share is surging 14% following a $3 billion quarter
• If I’d invested $5,000 in these 5 ASX shares five years ago, here’s what I’d have now

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 Altium, Hub24 Ltd, and Nearmap Ltd. The Motley Fool Australia has positions in and has recommended Hub24 Ltd. The Motley Fool Australia has recommended Nearmap Ltd. 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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Winner

The Woodside Energy Group Ltd (ASX: WDS) share price has gained $1.65 or 5.1% to $34.20 in Thursday morning trade after the oil and gas producer reported record third-quarter production, sales volume and revenue, up 52%, 59% and 70% respectively for the previous quarter.

Strong operational performance across the combined portfolio allowed Woodside to upgrade its full-year production guidance by around 5%.

Woodside shares trade on a trailing fully-franked dividend yield of around 9%, making them one of the highest-yielding ASX 200 stocks. On top of that, the company trades on a forward forecast price-to-earnings (P/E) ratio of under 9 times earnings.

Woodside is a beneficiary of the high oil and gas prices, and the lower Aussie dollar. It’s hard to imagine a better macroeconomic environment, yet at the same time, it’s equally hard to imagine what could derail the Woodside juggernaut.

In August, the company said the upheavals in global and Australian energy markets have shone a spotlight on the importance of gas in the world’s energy mix, underscoring the company’s confidence in the longer-term demand outlook for gas, which makes up 70% of Woodside’s portfolio.

Sinner

The Megaport Ltd (ASX: MP1) share price plunged 22% to $6.61 yesterday after the network-as-a-service provider released a lacklustre first-quarter trading update. 

Once a tech stock darling, Megaport shares have fallen almost 70% from their 52-week high, with the company now valued at just over $1 billion.

The company is a high-profile holding in the Firetrail Australian Small Companies Fund, and in June this year, amid an earnings miss, the fund said it “has added capital to the Megaport position on the back of the share price weakness and our conviction in the medium-term outlook for the company”.

In its September update, Firetrail said an analyst report highlighted that Megaport’s first mover advantage continues to widen, the fund also saying “pricing across the sector has started to increase which, combined with a falling AUD, should benefit the company in the short term”.

I don’t get it with Megaport. For the month of September, its reported monthly recurring revenue increased by $913,000 quarter on quarter. That’s chicken feed for a company with a market capitalisation of over $1 billion, and one which saw its cash balance fall in the quarter to $69 million.

With highly valued tech stocks, even if they are loss-making, I like to see them growing revenues like gangbusters, allowing them to grow into their valuation. No such joy at Megaport, where revenue for the quarter grew 10% quarter on quarter to just $34 million. At this rate of progress, it’s going to take a very long time for Megaport to grow into its still lofty valuation.

The post Winner and Sinner: Woodside stock looks dirt cheap, whilst Megaport shares could have even further to fall appeared first on The Motley Fool Australia.

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More reading

• Woodside share price jumps 5% on record Q3 performance
• 5 things to watch on the ASX 200 on Thursday
• Why did the Megaport share price crash 22% today?
• Why GQG, Megaport, Melbana Energy, and St Barbara shares are dropping today
• Why is the Woodside share price having such a stinker this week?

Motley Fool contributor Bruce Jackson 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 MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. 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 Novonix Ltd (ASX: NVX) share price is having a sensational day after returning from a trading halt.

In morning trade, the battery materials and technology company’s shares are up 26% to $2.68

Why is the Novonix share price rocketing higher?

Investors have been scrambling to buy Novonix and a couple of other US-based battery material shares on Thursday after they awarded a major US government grant.

This morning Novonix, Piedmont Lithium Inc (ASX: PLL) and Syrah Resources Ltd (ASX: SYR) were all individually selected to enter negotiations to receive grant funding from the U.S. Department of Energy (DOE) to strengthen the North American battery supply chain amid surging demand and growing calls to onshore these critical industries.

According to the release, in respect to Novonix, its Anode Materials division was selected to enter negotiations to receive US$150 million (A$240 million) in grant funding from the US DOE. Under the terms of the grant, the government funds must be at least matched by the recipient.

Management notes that these funds would be dedicated to the construction of a 30,000 tonnes per annum (tpa) U.S. manufacturing facility, including site selection, plant layout, and engineering design with capability for additional expansion.

Proud and ready

Novonix co-founder and CEO, Dr Chris Burns, was delighted with the news. He said:

We are proud to have been selected to negotiate this funding in recognition of our readiness to accelerate the domestic battery supply chain and meet growing global demand from the electric vehicle and stationary grid storage markets.

Since inception, our mission has been to enhance batteries through innovation and pave the way for the clean energy transformation. We are excited to partner with the DOE to further our mission of establishing a domestic supply chain for synthetic graphite used in lithium-based batteries and creating long-term sustainable value for our stakeholders.

The post Novonix share price rockets 26% on $240m US Government grant news appeared first on The Motley Fool Australia.

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• Why is the Novonix share price stuck on standby today?
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• The Novonix share price has just capped off a shocker first quarter. What’s next?
• Why did the Novonix share price crash 27% in September?

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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

It’s no surprise that 2022 has been a volatile year for both the capital and crypto markets. The days of meme stocks and mooning assets seem so long ago. Since its public debut in April 2021, Coinbase (NASDAQ: COIN) has been one of the most scrutinized stocks on the Nasdaq. It’s become challenging to keep up with the company’s developments amid increasing regulatory concerns over the crypto markets and waning investor enthusiasm.

Yet despite all of this turbulence, Coinbase has managed to make some significant progress. In this article, we are going to discuss how Coinbase has started laying the foundation to become a full-spectrum crypto conglomerate and mature beyond simply a trading exchange.

Big tech follows Wall Street 

Over the summer, Coinbase announced that it had partnered with asset-management firm BlackRock. More specifically, the partnership revolves around BlackRock’s proprietary risk-management software called Aladdin. At a high level, Aladdin’s software is leveraged by hedge funds and other financial institutions to process analytics across stocks, bonds, and foreign exchange currencies as well as derivatives and alternative assets. While that is an impressive roster of asset classes, do you see anything missing? Coinbase did.

According to a press release on Coinbase’s blog, BlackRock selected the exchange to serve as its integrator to provide “crypto trading, custody, prime brokerage, and reporting capabilities to Aladdin’s Institutional client base who are also clients of Coinbase.” 

While this partnership is nascent, it is probably not a surprise that other large companies, albeit in different industries, took notice. Just last week, Internet behemoth Alphabet announced a strategic partnership with Coinbase. Let’s explore why this is a big step forward for Coinbase and the crypto economy. 

Is this partnership a big deal?

There are a lot of moving pieces in Alphabet’s deal with Coinbase, and both companies are well-positioned to benefit. 

Essentially, Alphabet has decided that it will allow its cloud customers to pay for its services in Bitcoin, Ether, or Dogecoin should they choose. Coinbase will be the technology powering these payments via its Coinbase Commerce offering. This is an interesting position for Coinbase because as Alphabet’s cloud platform continues to grow, there is an argument to be made that Coinbase’s infrastructure will power more transactions. The two biggest variables in question are the pace at which adoption of crypto payments moves, and the increasing number of crypto tokens supported by Google Cloud.     

While this is exciting for Coinbase, this is also a big win for Alphabet. While Amazon and Microsoft dominate cloud computing, Alphabet’s platform, Google Cloud, is quickly gaining market share. According to the terms of the partnership, Coinbase “selected Google Cloud as a strategic cloud provider to build advanced exchange and data services. In addition, Coinbase will use Google Cloud’s powerful compute platform to process blockchain data at scale, and enhance the global reach of its crypto services by leveraging Google’s premium fiber-optic network.” 

According to CNBC, Coinbase will move some of its existing applications away from Amazon’s cloud platform, AWS. This is a huge deal for Alphabet. While it is still early innings, Coinbase’s management has not allowed the crypto winter to deter its vision. Despite cratering asset prices and lower trading volumes, Coinbase’s leadership has focused relentlessly on the wider adoption of crypto, especially with large institutions. 

Keep an eye on valuation

Owen Lau is an equity research analyst with Oppenheimer. He currently has a Buy rating on the stock and a projected price target of $107. During a recent interview, he was asked about the implications of this partnership and what it could mean for Coinbase.

Interestingly, although not surprising, Lau did not explicitly state whether this deal would impact Coinbase stock in the short term. Instead, his rationale is that since the markets are still operating in a crypto winter, investors are best served acting with caution.

Coinbase is slated to release third-quarter 2022 earnings on November 3. While there may be some near-term volatility leading up to earnings, prudent investors should wait until after the earnings release to make a decision about the stock. While Coinbase is trading well-off its highs, it is still very much a speculative stock to own. It is highly likely that investors will learn more about the company’s progress with BlackRock, Alphabet, and any other potential partnerships during the call. 

One thing that is highly likely is that crypto is here to stay one way or another. Its role in the larger economy and financial markets will certainly evolve. However, investors should feel encouraged that the world’s largest financial and technology firms are not only involved with crypto but are also partnered with Coinbase specifically. Coinbase could be a good stock to own for investors with a long-term market outlook. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post This crypto stock just got a huge nod of approval appeared first on The Motley Fool Australia.

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• Here’s what one billionaire thinks about crypto right now

Adam Spatacco has positions in Alphabet (A shares), Amazon, Coinbase Global, Inc., and Microsoft. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Microsoft, Alphabet (A shares), Alphabet (C shares), Bitcoin, Coinbase Global, Inc., and Ethereum. The Motley Fool Australia owns and has recommended Bitcoin and Ethereum. The Motley Fool Australia has recommended Alphabet (A shares) and Alphabet (C shares). The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.       

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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The Zip Co Ltd (ASX: ZIP) share price is charging higher in morning trade.

At the time of writing, the buy now pay later (BNPL) provider’s shares are up 13% to 72.5 cents.

Why is the Zip share price charging higher?

The catalyst for the rise in the Zip share price today has been the release of the company’s first quarter update.

Here’s how it performed compared to the prior corresponding period:

• Transaction volume up 15% to $2.2 billion
• Transaction numbers up 33% to 19.6 million
• Revenue up 19% to $163.2 million
• Cash transaction margin steady at 2.2%
• Customer numbers up 50% to 12 million
• Active customers up 17% to 7.4 million
• Merchants up 70% to 94,100

What happened during the quarter?

For the three months ended 30 September, Zip reported a 15% increase in transaction volume to $2.2 billion and a 19% lift in revenue to $163.2 million. The latter reflects flat year on year revenue of $66.9 million in the US despite currency tailwinds and a 29% increase in ANZ revenue to $83 million.

Zip’s growth was underpinned by a 17% increase in active customers to 7.4 million, a 33% jump in transaction numbers to 19.6 billion, and a steady revenue margin of 7.4%.

As you might have noticed above, Zip has now split its customer numbers into two groups. An active customer is one that has transacted within the last 12 months, whereas a regular customer is one that has an open account. They may not have transacted in the last 12 months, but they still have the ability to do so.

Another positive is that the Zip US business saw credit loss rates decrease to 2.4% of total transaction value from 2.7% in the previous quarter. It also exited the quarter with an expected loss rate of below 2% for the September cohort, in line with target levels.

Finally, at the end of September, Zip had available cash and liquidity of $140.7 million. Management believes this will be sufficient to support the company through to cash EBTDA profitability.

Management commentary

Zip’s co-founder and Global CEO, Larry Diamond, was pleased with the progress the company is making. He said:

We are pleased to deliver another solid set of numbers as Zip resets and moves toward positive cash flow, taking control of our future. During the quarter we made great progress on our refreshed strategy to deliver sustainable growth, right-size our global cost base and accelerate our path to profitability.

With a more focused strategy on our core markets ANZ and the US, we substantially lowered credit losses, repaid $40m of debt, and completed an upsized $300m receivables funding transaction, demonstrating the resilience of the business model in the face of ongoing external volatility.

Mr Diamond also highlights that the cost of living crisis has supported demand for its offering. He said:

We continue to add new customers to the platform and provide increased benefits to both customers and merchants as they navigate a rising cost environment.

The underlying business remains strong, and with the simplification of the business following adjustments to strategy, we are well funded and positioned to execute ahead of seasonal peak volumes and beyond into H2 FY23. Zip’s simple, fair and easy to use product is becoming even more important to customers and we are well on our way to disrupting the traditional credit card model and providing people with control of their financial lives.

The post Zip share price charges 13% higher on Q1 update appeared first on The Motley Fool Australia.

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More reading

• Has ‘growth at all costs’ been the undoing of Zip shares and what now?
• If I’d bought $1,000 of Zip shares at their all-time high, here’s how much I’d have left
• After a horror year, what’s next for ASX BNPL shares in the new quarter?
• ‘Significant opportunity’ Zip share price turns red as CEO packs his bags for the United States
• Macquarie says Zip share price has further to fall

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 ZIPCOLTD FPO. 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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