The Wesfarmers Ltd (ASX: WES) share price is slightly in the red today amid mixed economic data.

Wesfarmers shares are down 0.19% at the time of writing and trading at $44.055. However, in earlier trade, the shares climbed 0.52% before retreating. For perspective, the S&P/ASX 200 Index (ASX: XJO) is currently down 0.15%.

Let’s take a look at what could be weighing on the Wesfarmers share price today.

Consumer confidence falls, business conditions lift

Wesfarmers is a retail giant that owns Bunnings, Kmart, Target, Priceline and Officeworks, among other major brands.

Wesfarmers is not the only consumer share that is relatively flat today. The Coles Group Ltd (ASX: COL) share price is up 0.18%, while Woolworths Group Ltd (ASX: WOW) shares are up just 0.03%.

ANZ-Roy Morgan data, released today, shows consumer confidence fell 0.9 points to 84.6 in the past week. This follows the Reserve Bank of Australia lifting interest rates by 25 basis points.

ANZ head of Australian economics David Plank said:

Consumer confidence dropped by 1.1% last week, despite the smaller than expected 25bp rate hike by the RBA. The decline was bigger than the 0.5% decline following September’s 50bp rate increase. 

Westpac Melbourne Institute Index of Consumer Sentiment data, also released today, showed sentiment fell 0.9% in October.

However, chief economist Bill Evans highlighted the RBA’s “smaller than expected” rate rise “averted a much bigger fall”. He added:

The index remains in deeply pessimistic territory at a level comparable to the lows briefly reached during the pandemic and the extended weakness experienced during the Global Financial Crisis.

Meanwhile, a NAB monthly business survey released today shows business conditions lifted three points to +25 index points in September.

NAB said wholesale and retail conditions rose “notably” during the month.

Commenting on these business conditions, NAB chief economist Alan Oster said:

Conditions are now higher than their pre-COVID peak, which shows just how strong demand is at present.

The current level of conditions are only exceeded by the post-lockdown surge in early 2021.

Wesfarmers paid a fully franked final dividend of $1 per share in FY22.

Wesfarmers share price snapshot

Wesfarmers shares have fallen 19% in the past year, while they have lost nearly 26% year to date.

For perspective, the ASX 200 has shed nearly 9% in the past year.

The retail giant has a market capitalisation of about $50 billion based on the current share price.

The post What’s driving the Wesfarmers share price on Tuesday? appeared first on The Motley Fool Australia.

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More reading

• Could ASX 200 shares represent a ‘phenomenal opportunity’ right now?
• What’s the outlook for ASX dividend shares for the rest of 2022?
• Can you buy Bunnings Warehouse shares on the ASX?
• Despite the recent market rout, Wesfarmers shares actually delivered in Q1. Here’s the lowdown
• Have ASX 200 retail shares been worth buying so far in FY23?

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 positions in and has recommended COLESGROUP DEF SET and Wesfarmers Limited. 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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1) After the euphoria of early last week – with the S&P/ASX 200 Index (ASX: XJO) jumping 3.75% higher on Tuesday followed by another 1.74% on Wednesday – it’s hard to find any green shoots, especially after Friday’s hotter than expected US payroll numbers, which sent shares sharply slower and bond yields sharply higher.

• “Fears are rising that the global financial system will seize up.”
• “JPMorgan CEO Jamie Dimon Expects US Recession in Six to Nine Months”
• “Cathie Wood Warns of ‘Serious Losses’ in Automobile Debt”
• “Australian Consumer Sentiment ‘Deeply Pessimistic,’ Westpac Says”
• “A global bond sell-off is gathering pace…”

Even Treasurer Jim Chalmers joined in the chorus, as quoted in The Age…

“It’s increasingly becoming the expectation of the global economic community that we could be facing what would be the third substantial global economic downturn in the past decade and a half…”

This inflation shock – and ensuing financial and economic damage – has got some way to run.

On the brightside…

a) We’re closer to the end than the beginning, and a lot of the damage to share portfolios has already been done.

b) Stock markets turn before the economy. 

c) Unlike post the COVID Crash, where stock markets roared higher in the blink of an eye, this time you have time on your side… time to research, time to steadily deploy capital, time to wait for AGM updates.

2) Despite all that doom and gloom, despite stocks on Wall Street falling for a fourth day in a row, and despite US futures turning down, in late afternoon trading, the ASX 200 index is flat on the day, a modest gain in the BHP Group Ltd (ASX: BHP) share price saving the day.

Australia is expected to dodge recession, saved once again by high commodity prices. That might save investors in commodity stocks, but does nothing to help those outside that narrow band of companies. For us, the pain goes on.

3) Helloworld Travel Ltd (ASX: HLO) today reaffirmed its FY23 guidance after reporting a “strong first quarter,” with all three months of the quarter delivering positive EBITDA.

The year on year comparisons  – total transaction volume was up 352% on the same period last year – are virtually meaningless because last year’s trade was severely restricted by the pandemic. 

As ever, it’s the outlook statements that provide most value, with Helloworld – stating the obvious – saying travel is improving, adding “despite the economic downturn, travel continues to be regarded as a non-discretionary component of the family budget.”

The market reacted with a collective yawn, with the Helloworld share price virtually unchanged on Tuesday, trading at around $2, some way off its pre-pandemic highs of over $6.

The dream of the locked down share traders post March 2020 was a v-shaped recovery in travel stocks like Helloworld and Webjet Limited (ASX: WEB). Yes, like just about every other stock, they jumped nicely off the COVID bottom, but both the Helloworld and Webjet share prices are essentially flat over the last 16 months. 

It remains a long road ahead, with the COVID headwinds now replaced by an upcoming economic downturn. At 13 times forecast EBITDA, Helloworld shares hardly look cheap. 

4) Speaking of economic downturn, although I’d suggest many households haven’t directly yet felt the impact of the RBA’s interest rate rises, they know there’s pain ahead.

JP Morgan CEO Jamie Dimon took it one step further, quoted on Bloomberg as saying he expects “serious” headwinds are likely to push the US and global economies into recession by the middle of next year. Excerpt:

Dimon said the S&P 500 “may have a ways to go” in its decline, and that “it could be another easy 20%.” The index is down almost 25% this year. “The next 20% will be much more painful than the first,” he told CNBC. “Rates going up another 100 basis points are a lot more painful than the first 100 because people aren’t used to it.”

Ouch. Dimon’s no perma-bear, and as the head of one of Wall Street’s biggest and most highly respected investment banks, has seen how such violent moves in markets can lead to something cracking.

“The likely place you’re going to see more of a crack and maybe a little bit more of a panic is in credit markets, and it might be ETFs, it might be a country, it might be something you don’t suspect.”

5) We’ve already seen some cracks, with the ill-fated inflationary UK budget seeing government bonds (aka gilts) spike higher, resulting in some forced selling by pension funds.

Such unexpected behaviour in what is supposed to be a stable and safe bond market has already had reverberations as far as Australia, with funds managed by both Magellan Financial Group (ASX: MFG) and GQG Partners Inc (ASX: GQG) being hit with redemptions from UK domiciled institutional clients. 

The Magellan share price continues to trade around 9-year lows as it struggles with a brutal cocktail of poor performance, a falling stock market, management changes, a loss of a major institutional mandate, client redemptions, and now this UK panic, the latter being completely outside its control.

Magellan shares currently trade at $10.25 giving the company a market capitalisation of around $1.9 billion. Measures on how far the once mighty Magellan has fallen can be seen from today’s valuation metrics based on its last reported results, for the year ended June 30th 2022.

• 2.1 times net tangible assets
• $963 million cash, financial assets and investments
• 4.4 times net operating cash flow, 4.8 times earnings
• Fully franked dividend yield of 17.5%
• No debt

Loathe as I am to consider investing in a business that’s clearly struggling at the moment, I’ve put it on my radar. Should Jamie Dimon’s “more of a crack” come to pass, Magellan shares could easily trade at not much more than book value. It wouldn’t be the only bargain, but it would probably be one of the higher quality stocks on sale.

The post ASX 200 flat despite top investment banker warning stocks could ‘easy’ fall another 20% appeared first on The Motley Fool Australia.

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More reading

• Did ASX travel shares do well in September?

Motley Fool contributor Bruce Jackson has positions in GQG Partners Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Helloworld Limited. The Motley Fool Australia has positions in and has recommended Helloworld Limited. The Motley Fool Australia has recommended Webjet 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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Shares of ASX 200 banking giant Westpac Banking Corp (ASX: WBC) are rangebound today and currently trade less than 1% in the green at $21.60.

After an impressive start to the year in January, Westpac joined the list of Australian banking majors in a volatility-driven period that’s extended to date.

In broad market moves, the S&P/ASX 200 Financials Index (ASX: XFJ) is also flat on the day and trades less than 1% in the red.

The Westpac share price return is plotted next to this index on the chart below for the past 12 months. Note the striking similarity in direction closeness of fit.

Can Westpac catch a bid?

It was a difficult period for Westpac shares throughout the pandemic. The banking giant has failed to claw back losses incurred as a result of the March 2020 sell-off, unlike several of its peers.

Although, a closer look at its numbers helps explain why this may be so.

Westpac delivered a return on equity (ROE) of 7.4% in its last filing and currently trades at a price-to-earnings ratio (P/E) of 15.75 times.

The share is also priced at a price-to-book ratio of 1.09 times, whereas it trades at approximately 17 times cash flow.

Compared to the GICS Financials Industry median, Westpac sits behind its peers on each of these metrics. A summary of its performance against major banking peers is observed below, taken/calculated from the financial statements of each name.

Company Name	ROE – %	Operating Margin – %	Net Margin – %	P/E
Westpac Banking Corp (ASX: WBC)	7.4%	46.4%	26.1%	15.75
Australia and New Zealand Banking Group Ltd (ASX: ANZ)	10.9%	53.7%	35.2%	10.72
Commonwealth Bank of Australia (ASX: CBA)	12.8%	57.1%	41.5%	17.54
National Australia Bank Ltd (ASX: NAB)	11.1%	54.2%	40.2%	14.81
Bendigo and Adelaide Bank Ltd (ASX: BEN)	7.5%	40.8%	30.0%	10.50
Bank of Queensland Limited (ASX: BOQ)	7.9%	43.5%	30.0%	10.85
Macquarie Group Ltd (ASX: MQG)	18.0%	26.7%	35.9%	12.96
Median	10.9%	46.4%	35.2%	13.0
Average	10.8%	46.1%	34.1%	13.3

A cohort of brokers still believe Westpac has legs to run as well. For example, analysts at UBS led by John Storey recently upgraded Westpac shares to a buy and $27 price target in a recent note.

Storey said the broker is “positive on the net interest margin environment” in the wake of the series of interest rate hikes passed onto banking customers this year.

This is important, Storey says as a large chunk of Australian residential mortgages are set to mature in the next 2 years. Westpac is well positioned to capture this tailwind, he goes on to add.

Westpac’s net interest margin was 2.06% in FY21, – ahead of the industry’s 2% – and this will be a key number to watch in the bank’s FY22 results in the first week of November.

Meanwhile, analysts are forecasting Westpac to deliver a 6.12% dividend yield over the next 12 months [at the current share price], according to Refinitiv Eikon data.

Furthermore, a total of 6 out of 14 brokers covering the company rate its shares a buy right now, per Refinitiv.

The consensus price target on this is $24.24, implying a 12% return potential should this number be correct.

Westpac shares are down 17% in the past 12 months.

The post Can perennial ASX 200 banking bridesmaid Westpac finally find love? appeared first on The Motley Fool Australia.

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More reading

• What’s the outlook for ASX dividend shares for the rest of 2022?
• Were ASX 200 bank shares a safe place to park cash in Q1?
• Goldman Sachs names 2 ASX 200 dividend shares to buy next week
• The Westpac share price has fallen the most of the ASX 200 big four banks over the past year. So, is it a cheap buy?
• How did the Westpac share price manage to beat the ASX 200 in September?

Motley Fool contributor Zach Bristow 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 Bendigo and Adelaide Bank Limited. The Motley Fool Australia has recommended Macquarie Group Limited and Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The All Ordinaries Index (ASX: XAO) has dumped 13.4% since the start of 2022, and this mining technology share has been among its weights. But could the RPMGlobal Holdings Ltd (ASX: RUL) share price be about to turn its suffering around?

The team behind the Forager Australian Shares Fund (ASX: FOR) think so.

The company’s stock makes up the exchange traded fund’s (ETF’s) biggest holding, and its earnings are tipped to soar in financial year 2023 (FY23). Beyond that, the experts believe an enticing takeover offer could soon hit the table.

The RPMGlobal share price is currently trading at $1.635. That’s 23% lower than it was at the start of 2022.

So, why do the fundies believe the mining tech stock’s tumble will soon turn around? Keep reading to find out.

Could this ASX All Ords share be a FY23 winner?

The team behind the Forager Australian shares ETF first locked eyes on RPMGlobal shares three years ago. Now, they’re expecting their investment to really pay off.

Forager senior analyst Alex Shevelev today noted the company shifted its revenue model from an upfront payment to a subscription-style model a number of years ago.

That appeared to impact its shorter-term profitability and made its growth look less likely.

A few years later, in FY22, the company’s subscription revenue had grown to $26.2 million. Sadly, its expenses also surged, leaving RPMGlobal with just $4.5 million of earnings before interest, tax, depreciation, and amortisation (EBITDA).

But that’s all expected to change this financial year. The company forecasts its EBITDA to reach $14.2 million in FY23. Looking to the horizon, Shevelev said:

Next year we’re going to see a tripling in EBITDA, which is starting to show that really strong operating leverage that the business has.

By and large, as upside to a case of continuing to hold this business, if we hold it through to next year business will be trading at 14 times earnings and at 8% free cash for yield.

For a business of its quality growth potential, that is a very good valuation starting point.

RPMGlobal tipped to be potential takeover target

Beyond that, the fundie believes the ASX All Ords share could soon be the subject of an appealing takeover offer.

That’s if the company’s CEO and managing director Richard Mathews’ past pursuits are anything to go by. Shevelev commented:

The other very interesting thing here is, we’ve got a managing director, Richard Mathews, who’s done this before. He’s built up quite a business here and he’s … historically … built them up and then subsequently sold them off.

Now, it helps that two of [RPMGlobal’s] larger competitors have recently been bought out at valuations that imply for RPMGlobal 2 [times] to 2.5 times the current share price, and we think with Richard Mathews’ background, we’re more likely than not to see an offer like that materialise.

The post This embattled ASX All Ords mining share is gearing up to be a FY23 winner: fundie appeared first on The Motley Fool Australia.

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More reading

• In a sea of red, these ASX All Ords shares are leaping higher on Monday
• Could oversold ASX growth shares now be a buying opportunity for value investors?
• These were the 5 best-performing ASX All Ords shares in September
• Experts reveal 2 ASX shares primed for growth despite a slowing economy
• 3 ASX All Ords shares that marched higher 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 positions in and has recommended RPMGlobal Holdings. The Motley Fool Australia has recommended RPMGlobal Holdings. 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 Core Lithium Ltd (ASX: CXO) share price is leaping higher today.

Core Lithium shares are climbing 2.19% and are currently trading at $1.165 each. For perspective, the S&P/ASX 200 Index (ASX: XJO) is up 0.07% today.

Let’s take a look at how Core Lithium is performing.

Lithium shares rise

The Core Lithium share price is rising, but it is not the only ASX lithium share enjoying a good day.

Piedmont Lithium Inc (ASX: PLL) shares are up 3.59%, the Allkem Ltd (ASX: AKE) share price is rising 5.34%, Mineral Resources Limited (ASX: MIN) shares are climbing 4.08%, while Pilbara Minerals Ltd (ASX: PLS) is up 1.15%.

This follows multiple lithium giants lifting on Wall Street overnight.

Albemarle Corporation (NYSE: ALB) shares jumped 2.04%, Livent Corp (NYSE: LTHM) rose 2.08%, and Sociedad Quimica y Minera de Chile (NYSE: SQM) leapt 2.03%.

As my Foolish colleague James noted today, investors appear to believe lithium prices will remain elevated amid strong demand and supply challenges.

Meanwhile, Core Lithium delivered promising news to the market yesterday. An official opening was held for the Finniss Lithium mine in the Northern Territory. This is Australia’s only lithium mine in production outside Western Australia, the company said.

Core Lithium CEO Gareth Manderson said:

Core is bringing production online at a time of high lithium prices, strong global demand and constrained supply.

Core Lithium share price snapshot

The Core Lithium share price has exploded 168% in the past year, while it has lost 27% in the past month.

For perspective, the ASX 200 has shed 8.5% in the past year.

Core Lithium has a market capitalisation of more than $2 billion.

The post Why is the Core Lithium share price in the green today? appeared first on The Motley Fool Australia.

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More reading

• Why Cettire, Moneyme, Piedmont Lithium, and Superloop shares are racing higher
• Why is the Piedmont Lithium share price having such a stellar run on Tuesday?
• If I’d invested $1,000 in Core Lithium shares at the start of 2022, here’s what I’d have now
• Can ASX lithium shares charge higher over the rest of 2022?
• Why Actinogen, Core Lithium, Fortescue, and Galileo Mining shares are pushing higher

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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is fighting hard to stay in positive territory. At the time of writing, the benchmark index is up slightly to 6,672.4 points.

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

Cettire Ltd (ASX: CTT)

The Cettire share price is up 2% to 85.2 cents. This follows the release of a first quarter update that revealed that the online luxury fashion retailer has started FY 2023 strongly. Cettire’s gross revenue grew 62% over the prior corresponding period to $84.4 million during the quarter. This was driven by the year over year doubling of its active customers to 287,626 and improvements in repeat customer spending.

Moneyme Ltd (ASX: MME)

The Moneyme share price is up 5.5% to 38.5 cents. Investors have been buying this digital consumer credit company’s shares following the release of a first quarter update. Moneyme revealed a 148% increase in gross revenue to $57 million and a 183% increase in gross customer receivables to $1.28 billion.

Piedmont Lithium Inc (ASX: PLL)

The Piedmont Lithium share price is up over 3.5% to 86.5 cents. This follows a strong night of trade for this lithium developer’s US listed shares on Wall Street. In addition, a number of battery materials shares are outperforming on Tuesday.

Superloop Ltd (ASX: SLC)

The Superloop share price is up 10% to 70 cents. After the market close on Monday, Superloop announced a mutual preferred network partnership agreement with Uniti Group. The broad-reaching partnership covers various retail, wholesale and network elements with Uniti to be offered through Superloop’s branded Consumer, Business and Wholesale segments. The agreement is expected to be immediately accretive to Superloop’s EBITDA in FY 2023.

The post Why Cettire, Moneyme, Piedmont Lithium, and Superloop shares are racing higher appeared first on The Motley Fool Australia.

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More reading

• Why is the Piedmont Lithium share price having such a stellar run on Tuesday?
• Guess which ASX ecommerce share is rocketing 17% higher today
• Why is the Sayona Mining share price rocketing 13% on Tuesday?
• These were the 5 worst-performing ASX All Ords shares in September
• Why Block, Nick Scali, Piedmont Lithium, and Premier Investments are sinking today

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 SUPERLOOP FPO. The Motley Fool Australia has recommended Cettire Limited. 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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S&P/ASX 200 Index (ASX: XJO) shares have seen plenty of ups and downs this year. Inflation and higher interest rates have surprised and worried investors.

But with all of the declines the market has seen this year, should investors be jumping at the chance to buy into some ASX 200 shares?

Bell Asset Management’s chief investment officer and portfolio manager Ned Bell is optimistic. This could mean good things for ASX 200 shares.

Time to be optimistic at these prices?

Talking to the Australian Financial Review, he noted that there are some uncertainties in some areas, along with changes in the economic outlook. He said:

Markets are mechanisms for pricing in what’s going to happen in the future, and this year has been the worst imaginable. It’s like we’ve had five years’ worth of bad news in one year.

When there’s a market drawdown, a crisis, there’s always an investment bank – the canary in the coal mine.

It’s usually Deutsche, but occasionally Credit Suisse comes from behind. With the volatility we’ve seen, particularly in the UK, it’s inevitable that [there’s] some hedge fund or pension fund that’s going to blow up.

But to be honest with you, I’m not of the view that there are a huge amount of corporate calamities on the horizon. Global corporates are actually in pretty good shape.

However, he thinks interest rate rises from the US Federal Reserve are starting to have the desired effect. You’d hope so, with many shares down heavily.

Bell said:

I think we’re getting to the point where inflation is starting to look better, and you’re starting to see a bit more weakness in the jobs market.

I think the Fed will be looking at that and thinking the violent impact of numerous rate rises is starting to have the desired effect. And once the market starts to realise that maybe the Fed is moving into a period whereby they’ll be tapping the brakes, not slamming on the brakes, I think that could be a big trigger for a sharp rally.

Are ASX 200 shares an opportunity?

According to reporting by the AFR, Bell is on a “buying spree” and he’s seeing good places to put money.

He said that extreme volatility means it’s a “phenomenal opportunity for long-term investors in quality companies”.

Bell pointed to a number of quality global shares that look good value.

But, I think that there are a number of ASX 200 shares that would also be worth looking at because of their price drops and their long-term prospects.

The Xero Limited (ASX: XRO) share price is down 50% in 2022 but the tech company keeps growing revenue. As well, it’s increasing its subscription prices and has a very high gross profit margin.

The Wesfarmers Ltd (ASX: WES) share price has fallen around 26% in 2022, however, the conglomerate is investing in its core businesses like Bunnings and Kmart Group, while also investing in new areas like health and lithium.

Pinnacle Investment Management Group Ltd (ASX: PNI) shares are down more than 45% in 2022, but the company’s portfolio of investment managers continues to perform well and Pinnacle recently expanded into Canada.

Finally, the Breville Group Ltd (ASX: BRG) share price has dropped over 40% this year, but the home appliance company is making investments for growth and is expanding geographically.

The post Could ASX 200 shares represent a ‘phenomenal opportunity’ right now? appeared first on The Motley Fool Australia.

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More reading

• Looking to buy Rio Tinto shares? Here’s why this fundie says there is ‘something terribly wrong’
• Why has the Whitehaven share price already dived 7% so far this week?
• The AGL share price plummeted 17% in the first quarter. What now?
• What’s the outlook for ASX dividend shares for the rest of 2022?
• Are ANZ shares an ASX 200 dividend buy right now?

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 PINNACLE FPO and Xero. The Motley Fool Australia has positions in and has recommended PINNACLE FPO, Wesfarmers Limited, and Xero. 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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Rio Tinto Ltd (ASX: RIO) shares are in the green today, up 0.5% to $97.98 apiece.

That leaves the S&P/ASX 200 Index (ASX: XJO) miner, which also pays a dividend yield of some 10%, down 1.5% in 2022, handily beating the 12% loss posted by the benchmark index.

That’s today’s price action.

Now, here’s why this fund manager has let loose on the mining giant.

Why this fundie says there is ‘something terribly wrong’

Fund manager Willy Packer is less than pleased with the pressured resignation of Energy Resources of Australia Ltd (ASX: ERA) chairman Peter Mansell along with two independent directors, Paul Dowd and Shane Charles. The trio handed in their resignations last week.

As the Australian Financial Review reported, Packer said the situation “reeks of something terribly wrong”.

Rio Tinto is the majority shareholder in Energy Resources. The stoush centres around the Jabiluka uranium project and the Ranger uranium mine. Both projects are located in the Northern Territory’s Kakadu national park.

But any development is opposed by the local Mirarr people. That reality was said to be taken into account in the project’s independent valuation.

Packer was clearly disappointed by the resignations. And he questioned whether any mines in Australia can be properly valued when the traditional owners have not given their consent.

“All mining projects in Australia require traditional owner approval, therefore, are all highly prospective projects worth zero until approved?” Packer said.

According to the AFR, Rio Tinto had lost confidence in the ERA board members over the way they were attempting to raise funds.

Under a new loan agreement, the previous independent valuation of the project will be canned. ERA shareholders will now have to await a new valuation before any revised share issue takes place.

According to Packer, Rio Tinto “shot the messengers and the umpires” after the original ERA valuation of 15.9 cents to 24.3 cents was higher than it wanted.

Packer continued:

How can a second report be considered independent if its preparation is conditional on certain constraints? In any event, what firm would put its hand up in the future to write another valuation report knowing that if it does not appease Rio, it will have its reputation dragged through the mud.

Atop questioning what firms may be willing to take on a second valuation report for the project, Packer wondered if anyone would be “brave enough” to replace the outgoing board members at ERA:

Rio has created a toxic situation, and we question who would be brave enough to join the ERA board and take on the personal risks involved in carrying out director’s duties cognisant of the Corporation Act in relation to the oppression of minority shareholders.

How have Rio Tinto shares performed longer-term

On top of the regular, and growing, dividend stream, Rio Tinto shares have gained 43% over the past five years. That compares to a 15% gain posted by the ASX 200 over that same period.

The post Looking to buy Rio Tinto shares? Here’s why this fundie says there is ‘something terribly wrong’ appeared first on The Motley Fool Australia.

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More reading

• Why has the Whitehaven share price already dived 7% so far this week?
• The AGL share price plummeted 17% in the first quarter. What now?
• What’s the outlook for ASX dividend shares for the rest of 2022?
• Are ANZ shares an ASX 200 dividend buy right now?
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has given back its morning gains and dropped slightly into the red. At the time of writing, the benchmark index is down a fraction to 6,667.6 points.

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

Baby Bunting Group Ltd (ASX: BBN)

The Baby Bunting share price has crashed over 21% to $3.07. This follows the release of a trading update at the baby products retailer’s annual general meeting. Although Baby Bunting delivered double-digit sales growth financial year to date, its earnings have fallen due to significant gross margin weakness. This has been partly driven by intense price competition and rising inflation.

Calidus Resources Ltd (ASX: CAI)

The Calidus Resources share price is down a further 23% to 36.5 cents. Investors have been selling this gold miner’s shares this week following a disappointing update. That update revealed softer than expected gold production during the latest quarter.

Pointsbet Holdings Ltd (ASX: PBH)

The Pointsbet share price is down 8% to $1.94. This is despite there being no news out of the sports betting company on Tuesday. However, it is worth noting that a number of tech shares are falling today after a poor night of trade on the NASDAQ index. This has seen the S&P/ASX All Technology Index drop 0.8% this afternoon.

South32 Ltd (ASX: S32)

The South32 share price is down 2% to $3.70. Investors have been selling this mining giant’s shares following the release of a broker note out of Goldman Sachs. According to the note, the broker has downgraded South32’s shares to a neutral rating and cut the price target on them by 22% to $3.70. This follows a sharp reduction in its earnings estimates to reflect lower commodity price forecasts.

The post Why Baby Bunting, Calidus, Pointsbet, and South32 shares are falling appeared first on The Motley Fool Australia.

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More reading

• South32 share price drops on broker downgrade
• Why did this ASX 300 retail share just crash 25%?
• Morgans names the ASX 200 mining shares to buy and sell
• Brokers say these are the ASX 200 mining shares to buy
• Why Lake, Pilbara Minerals, PointsBet, and PolyNovo shares are charging higher

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 Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Baby Bunting and Pointsbet Holdings 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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The Piedmont Lithium Inc (ASX: PLL) share price is charging higher on Tuesday.

In afternoon trade, the lithium developer’s shares are up 4% to 87 cents.

This compares favourably to the ASX 200 index, which is trading flat at the time of writing.

Why is the Piedmont Lithium share price charging higher?

Investor have been buying Piedmont Lithium’s shares despite there being no news out of the company.

However, it is worth noting that it isn’t the only lithium share rising today. A good number are outperforming the market today thanks to a strong showing in the battery materials sector.

This has seen the likes of Allkem Ltd (ASX: AKE) and Core Lithium Ltd (ASX: CXO) record gains of over 3% this afternoon.

What else?

It is also worth pointing out that Piedmont Lithium shares are now listed on the NASDAQ index as well as the Australian share market.

In fact, you could argue that the former is now the more important listing, with its Australian shares having a tendency to follow their lead.

So, with the Piedmont Lithium share price lifting 4% on the NASDAQ overnight, they have followed suit on the local market today.

Investors were buying its US shares on Monday night after lithium shares such as Albemarle, Livent and SQM rose on Wall Street. This was despite the rest of the market taking a bit of a tumble.

Investors appear to believe that supply constraints and strong demand for lithium will keep prices elevated for longer, putting these companies in a position to profit greatly over the coming years.

The post Why is the Piedmont Lithium share price having such a stellar run on Tuesday? appeared first on The Motley Fool Australia.

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More reading

• Why is the Sayona Mining share price rocketing 13% on Tuesday?
• Why Block, Nick Scali, Piedmont Lithium, and Premier Investments are sinking today
• September living up to its ‘worst month of the year’ reputation as ASX 200 finally cracks
• Down 6%, Piedmont Lithium shares take the foot off the gas
• The Piedmont Lithium share price is actually gaining today. What’s going on?

Motley Fool contributor James Mickleboro owns Allkem shares. 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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