In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is back on form and on course to record a strong gain. At the time of writing, the benchmark index is up 0.75% to 7,192.1 points.

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

Galan Lithium Ltd (ASX: GLN)

The Galan Lithium share price is up over 5% to $1.52. Investors have been buying this lithium explorer’s shares after it announced “outstanding results” from second long-term pump test at Hombre Muerto West Project in Argentina.

New Hope Corporation Limited (ASX: NHC)

The New Hope share price is up 8% to $5.80. This follows another rise by the coal Nymex price overnight. According to CommSec, the coal Nymex price rose a further 1.1% to US$203.25. This was despite the US dollar gaining in value and putting pressure on most commodities. Whitehaven Coal Ltd (ASX: WHC) shares are also rising strongly today.

TechnologyOne Ltd (ASX: TNE)

The TechnologyOne share price is up 5% to $13.01. Investors have been buying this enterprise software provider’s shares following the release of a strong full year result. For the 12 months ended 30 September, TechnologyOne reported an 18% increase in revenue to $369.4 million and a 15% increase in profit before tax to $112.3 million. The latter was at the top end of the company’s guidance range.

Virgin Money UK (ASX: VUK)

The Virgin Money share price is up 12% to $2.85. This follows the release of the UK based bank’s full year results. For the 12 months ended 30 September, Virgin Money UK reported a 43% increase in statutory profit before tax to 595 million pounds (A$1 billion). The bank ended the period with an exit net interest margin (NIM) of 1.86%. It also announced a share buyback worth approximately $90 million.

The post Why Galan Lithium, New Hope, TechnologyOne, and Virgin Money UK shares are rising appeared first on The Motley Fool Australia.

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More reading

• Why are ASX 200 coal shares smoking hot on Tuesday?
• Guess which ASX 200 share is rocketing 13% on a ‘milestone year’
• Here’s how I’d invest $20,000 in ASX shares today to double my money
• TechnologyOne share price races 5% higher on strong FY22 growth
• Time to buy? Which ASX 200 shares are trading on single-digit P/E ratios?

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 recommended TechnologyOne 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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The S&P/ASX 200 Index (ASX: XJO) is having a healthy day of green ink so far this Tuesday. At the time of writing, the ASX 200 has gained a pleasing 0.74% and is back over 7,190 points. But those gains are nothing compared to what is happening with ASX 200 coal shares today.

Coal shares are on fire (in a good way) this session. Take Whitehaven Coal Ltd (ASX: WHC) — Whitehaven shares have put on an eye-popping 8.52% so far today, taking the company to $9.17 a share.

Yancoal Australia Ltd (ASX: YAL) shares are also performing strongly. This ASX 200 coal share is up 6.86% to $5.215 a share. New Hope Corporation Limited (ASX: NHC) is doing even better. New Hope shares have enjoyed a 7.81% rise so far this Tuesday to $5.80 a share.

ASX oil shares like Woodside Energy Group Ltd (ASX: WES) are also enjoying some pleasing rises this Tuesday. In fact, the S&P/ASX 200 Energy Index (ASX: XEJ) is currently the best-performing sector on the entire ASX 200 Index. It’s up 2.39% at the time of writing.

So what’s going on with coal today that is eliciting these stupendous gains?

What’s lighting up ASX 200 coal shares today?

Well, it’s hard to say. We are seeing some strong pricing in the coal markets themselves. Coal is currently trading at US$349.35 per tonne, up a meaningful 3.66% since last week. That will no doubt be helping to grease the wheels of ASX 200 coal shares today.

We have some other news that could be playing a role too. As my Fool colleague Brooke discussed this afternoon, the South African coal industry is reportedly battling blockades on coal transport rail lines.

The blockades are being conducted by a group of former employees at coal miner Cerrejon. It’s possible this news is helping to lift coal prices and sentiment in coal miners due to potential supply issues.

So it could be a combination of these factors that is behind the rather extraordinary boost that ASX 200 coal shares are enjoying today. No doubt investors won’t be complaining.

The post Why are ASX 200 coal shares smoking hot on Tuesday? appeared first on The Motley Fool Australia.

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• Why is the Whitehaven share price soaring 8% on Tuesday?
• Guess which ASX 200 share is rocketing 13% on a ‘milestone year’
• One million more Sayona shares just hit the market. Here’s the latest
• Why did Macquarie just switch out ANZ for CBA shares?
• Will ASX 200 tech company Novonix deliver a profit in 2023?

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 Mineral Resources Limited (ASX: MIN) share price is up 3.7% today to $86.09 at the time of writing.

Shares in the $15 billion diversified miner are up 45% this year and a big driver of this investor confidence is its lithium business.

ASX lithium shares have been all the rage this year. Global demand is rising as the electric vehicle (EV) manufacturing industry ramps up.

Let’s take a look at what’s happening.

Will lithium keep driving the Mineral Resources share price up?

Mineral Resources has four business branches — iron ore, energy (gas), mining services, and lithium.

It holds a stake in two of Australia’s largest hard-rock lithium mines — Mt Marion and Wodgina in Western Australia.

Mt Marion is owned 50:50 with one of the world’s largest lithium producers, Ganfeng Lithium Group Co Ltd (SHE: 002460).

Wodgina is owned 40:60 with US lithium giant Albemarle Corporation (NYSE: ALB).

Mineral Resources is already a global top-five lithium producer. That means it has a headstart on all the other lithium miners that have popped up in recent years and are still in the exploration stage.

Mineral Resources is producing lithium at scale at a time when lithium prices are sky-high due to EV demand.

The company has been able to take great advantage of this huge new channel of demand quickly, placing it “in the sun” for the next several years, according to managing director Chris Ellison.

According to The Age, Ellison reckons it will take some time for supply to catch up with demand.

Ellison said:

From finding dirt to having a (lithium) hydroxide plant running, it’s about six or seven years.

If we’ve got seven years in the sun, we’re gonna have a lot of fun.

Mineral Resources already provides 29% of the world’s hard rock lithium supply.

That’s a nice position to be in, given demand for lithium is forecast to outstrip supply until at least CY30.

According to research from Macquarie, the supply/demand imbalance is expected to be at its worst over CY24, CY25, and CY26.

What’s next for Mineral Resources’ lithium business?

Mineral Resources says it has big plans for its lithium division.

As per an investor presentation delivered at the company’s annual general meeting last week, Mineral Resources expects to double production at Mt Marion from 450,000 tonnes of lithium spodumene concentrate per annum to 900,000 tonnes by early 2023.

The company says 80% of the mine remains unexplored to date.

It also wants to “toll and convert” spodumene into lithium hydroxide. This is a refining process required for EV batteries.

To this end, Mineral Resources and Albemarle have just finished building one of the world’s largest lithium production facilities, the Kemerton lithium hydroxide processing plant.

The plant is fundamental to the companies’ joint venture to develop the Wodinga project.

They plan to ramp up the production of lithium hydroxide over the next two years.

Back in July, EV pioneer Elon Musk said lithium refining is where the real money is in the lithium arena today. He described refining as “like minting money” with “software margins” available.

Mineral Resources share price snapshot

The ASX mining share hit a new 52-week peak of $86.35 on 14 November. The Mineral Resources share price is up 103% over the past year and 15% in the past month.

The post Could Mineral Resources shareholders be in for ‘a lot of fun’? appeared first on The Motley Fool Australia.

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More reading

• Which are the best ASX lithium shares to buy now for 2023?
• Why are Mineral Resources shares hitting the headlines on Friday?
• Why is the Mineral Resources share price beating the ASX 200 on Thursday?
• Here are the top 10 ASX 200 shares today
• Why did ASX lithium shares have a dream run 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 recommended Macquarie Group 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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It’s been a bouncy day for the Qantas Airways Limited (ASX: QAN) share price this Tuesday. After a strong start this morning, which saw Qantas shares rise as high as $5.92, the airline has trended lower throughout the day. The Qantas share price is now going for $5.885, up 0.26% for the day thus far.

Perhaps investors got a case of the old cold feet over Qantas shares, considering what brokers at Macquarie have just come out and said about the company.

As an ASX broker, Macquarie runs a series of what are called model portfolios. These are portfolios that help and inspire clients to construct portfolios of their own.

According to reporting in The Australian today, Macquarie has just kicked Qantas out of its model portfolios.

Qantas shares depart from ASX broker’s model portfolio

Why? Here’s what the report said was behind the decision:

Forecasting a US recession next year, the investment bank’s strategy team has swung to backing defensive stocks, arguing risks are too high for a range of stocks that did well from the first phase of the rate rises this year.

So Qantas is among the stocks that don’t make this cut — according to Macquarie anyway. Other losers receiving the boot include Australia and New Zealand Banking Group Ltd (ASX: ANZ), Tabcorp Holdings Ltd (ASX: TAH), and Qantas’ fellow ASX travel share Flight Centre Travel Group Ltd (ASX: FLT).

Instead, Macquarie is turning to ‘defensive’ ASX shares in light of its perceived risk of a US recession. Some of the ASX shares that Macquarie is keeping in its model portfolios include Commonwealth Bank of Australia (ASX: CBA), Transurban Group (ASX: TCL), and APA Group (ASX: APA).

If there indeed is a recession in the United States next year, it could well have a negative effect on Qantas. Travel is most certainly a discretionary spending item, not a staple one. If the Australian economy, for example, experiences tough times, travel is one of the first things a family or a business will probably look to trim out of the budget.

Not what Qantas shareholders would want to hear right now, one would guess. The Qantas share price remains up more than 14% year to date in 2022 thus far. Earlier this month, Qantas shares hit a new post-COVID high of $6.17 a share.

The post Why Macquarie just dumped Qantas shares from its model portfolio appeared first on The Motley Fool Australia.

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• 4 quality, undervalued ASX 200 shares in an earnings upgrade cycle revealed: fund manager
• Why this fund manager sees tailwinds ahead for the Qantas share price
• Why this fundie has been buying up Qantas shares
• Buy these ASX 200 shares now before the market wakes up: fund manager
• Why did the Qantas share price face headwinds today?

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 APA Group. The Motley Fool Australia has recommended Flight Centre Travel Group Limited and Macquarie Group 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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The Whitehaven Coal Ltd (ASX: WHC) share price is roaring upward on Tuesday despite the company’s silence.

Right now, stock in the S&P/ASX 200 Index (ASX: XJO) coal miner is 8.05% higher at $9.13.

For comparison, the ASX 200 has gained 0.59% at the time of writing.

So, what might be driving the coal favourite higher? Let’s take a look.

What’s driving the Whitehaven share price higher today?

The Whitehaven share price is among the top performers on the ASX 200 on Tuesday amid soaring coal prices.

Newcastle coal futures lifted 3.66% in its most recent session, potentially helping to drive the S&P/ASX 200 Energy Index (ASX: XEJ) higher. Right now, the energy sector is leading the market with a 2.3% gain.

Whitehaven stock is posting the sector’s biggest gain right now, slightly ahead of the 7.4% lift recorded by shares in fellow coal stock New Hope Corporation Limited (ASX: NHC). Meanwhile, stock in ASX 200 coal miner Coronado Global Resources Inc (ASX: CRN) has risen 3.4%.

It’s hard to determine what might be driving coal prices higher. Though, it might have something to do with blockades on a rail line in South America.

The blockades are halting the transport of coal from mining giant Cerrejon on its way for export, Reuters recently reported. A group of former workers are behind the protest activity. They’re said to be demanding their jobs back.

Today’s gains included, the Whitehaven share price is a whopping 229% higher than it was at the start of 2022. It has also gained 278% since this time last year.

The post Why is the Whitehaven share price soaring 8% on Tuesday? appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX 200 shares today
• Why Liontown, Lovisa, Myer, and Whitehaven Coal shares are pushing higher
• Time to buy? Which ASX 200 shares are trading on single-digit P/E ratios?
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Whitehaven share price: ‘incredibly expensive’ or ‘ridiculously cheap’?

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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a decent gain. At the time of writing, the benchmark index is up 0.6% to 7,184.3 points.

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

Best & Less Group Holdings Ltd (ASX: BST)

The Best & Less share price is down 12.5% to $2.38. This morning the retailer released a trading update and revealed that like for likes (LFL) sales are down 7.4% during the first 20 weeks of FY 2023. The damage is being done predominantly online, with online LFL sales down 32.9% and LFL store sales down a modest 2.3%.

Cettire Ltd (ASX: CTT)

The Cettire share price is down a further 9% to $1.29. Investors have been selling this online luxury products retailer’s shares in recent sessions following news that its CEO was selling down his holding again. Cettire’s CEO, Dean Mintz, sold 41 million shares at a 13% discount of $1.46 per share for a total consideration of approximately $60 million. Cettire’s shares have now dropped 23% since the sale.

Life360 Inc (ASX: 360)

The Life360 share price is down 5% to $6.40. This morning this location technology company announced the completion of a $50 million institutional placement. These funds were raised at a 6.4% discount of $6.30 and will be used to shore up its balance sheet given the uncertain macroeconomic environment. Not even news that Life360 has received takeover interest has been able to keep the Life360 share price from falling today.

Paradigm Biopharmaceuticals Ltd (ASX: PAR)

The Paradigm share price is down 11% to $1.51. Investors have been selling this pharmaceutical company’s shares after it announced the exit of its CEO after less than five months in the role. No reason was given for the exit. Paradigm has acted fast and named its founder and former CEO, Paul Rennie, as its new leader.

The post Why Best & Less, Cettire, Life360, and Paradigm shares are sinking today appeared first on The Motley Fool Australia.

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• Why is this ASX All Ords biotech share crashing 12% today?
• Life360 share price lower despite takeover talks
• Why A2 Milk, Cettire, Coronado, and Perpetual shares are dropping
• Guess which All Ords insider is selling a whopping $60m worth of their company’s shares
• 3 ASX All Ordinaries shares having a cracker session on Thursday

Motley Fool contributor James Mickleboro has positions in Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360, Inc. 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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The S&P/ASX 200 Materials Index (ASX: XMJ) is rising 1% today, but three ASX mining shares are soaring even higher.

The Aston Minerals Ltd (ASX: ASO), Besra Gold Inc (ASX: BEZ) and Auteco Minerals Ltd (ASX: AUT) share prices are all lifting today.

So let’s take a look at why these ASX mining shares are rocketing higher today.

Aston Minerals

Aston Minerals shares are surging 8.57% today. The company reported extensive nickel and cobalt at the company’s Bardwell Prospect. This is part of the Edleston Project in Canada. Significant intercepts included:

• 217.35 metres (m) at 0.28% nickel and 0.012% cobalt starting from 288.5m, ending in mineralisation
• 304.38m at 0.25% nickel and 0.011% cobalt from 15.2m
• 269.5m at 0.27% nickel and 0.01% cobalt starting from 138.5m, ending in mineralisation

Early drilling of the B2 also intersected with “substantial mineralisation”.

Commenting on the results, managing director Dale Ginn said:

To discover such a large mineralised unit with such a considerable step out from the areas of known mineralisation provides a high degree of confidence towards the scale potential of this project.

Besra Gold

Besra Gold shares are exploding 97.5% today after soaring more than 100% in earlier trade. The company reported bonanza grade gold intercepts at the company’s Bekajang project in Malaysia. These results included more than 47 metres of mineralisation at BKDDH-27 and greater than 22 metres of mineralisation at BKDDH-23.

Commenting on the results, CEO Dr Ray Shaw said:

The potential implications of the exceptional grades intercepted during our recent drilling, demand priority follow-up, and may lead to a fundamental revision and upgrade of Bekajang’s potential.

Auteco Minerals

The Auteco Minerals share price is surging 11% today. Auteco reported drilling at the Tyson discovery has intersected with the company’s highest grade gold to date. The Tyson discovery is within the company’s Pickle Crow gold project in Ontario, Canada. The “bonanza” intersection of 1,020 grams per tonne is outside the existing inferred resource.

Commenting on the results, CEO Darren Cooke said:

The recent Tyson results continue to demonstrate that we are onto a significant new mineralised system that has not been historically mined.

The post 3 ASX mining shares rocketing higher on new finds appeared first on The Motley Fool Australia.

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• 2 ASX shares perfect for the current climate: expert
• Warren Buffett owns these 5 value stocks
• Why is this ASX All Ords biotech share crashing 12% today?
• Guess which ASX 200 share is rocketing 13% on a ‘milestone year’
• Why is the Polynovo share price on ice today?

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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Even though interest rates have already risen a whopping 275 basis points in just six months, there is a lag before the impact truly hits.

That’s because it takes time for the rate rises to be enacted by mortgage providers then to flow on to home loan repayments. Some Australians might be on a fixed rate and that term may have temporarily shielded them from the rate hikes.

This lag is visibly seen in the unemployment rate, which still remains low by historical standards.

So with the worst economic times still ahead of Australia, which are the ASX shares best placed for endurance?

Baker Young managed portfolio analyst Toby Grimm had a couple of ideas:

‘We see attractive value’

Gold is traditionally seen as a safe-haven asset in times of economic distress.

But while 2022 has been pretty turbulent, the gold price has stubbornly remained depressed.

If, like Grimm, you think this is due for a turnaround, Silver Lake Resources Limited (ASX: SLR) might be worth considering.

“We see attractive value as we expect an improving operational performance amid potential for a long-awaited rally in the gold price,” Grimm told The Bull.

The Silver Lake share price is down 321% year to date.

He admitted recent results have disappointed, but it was not the be-all and the end-all.

“Gold production of 59,935 ounces in the September quarter marginally missed market expectations due to lower grades and maintenance at its Deflector mine,” said Grimm.

“However, Silver Lake’s other assets performed well and, with higher grades anticipated moving forward, Silver Lake retained full-year guidance.”

According to CMC Markets, four out of six analysts that cover the stock currently recommend it as a strong buy.

Investing for 2024

For a longer term prospect, Macquarie Group Ltd (ASX: MQG) shares are looking ripe for Grimm.

“The company’s diversified business model is appealing,” he said.

“The company’s latest half-year net profit after tax of $2.305 billion to September 30, 2022 was up 13% on the prior corresponding period, but down 13% on the period ending March 31, 2022.”

With the economy slowing down, the current financial year won’t light the world on fire. But for Grimm, Macquarie stocks are for looking beyond that hump.

“The full year will be tough, but we believe the investment bank is positioned for an earnings recovery in 2024.”

After an up-and-down 2022, the Macquarie share price now sits about 15.4% down from where it started the year. The dividend yield is now at 3.64%.

Grimm’s peers are in general agreement with him. CMC Markets shows nine of 14 analysts rate Macquarie as a buy, with eight of those thinking it’s a strong buy right now.

The post 2 ASX shares perfect for the current climate: expert appeared first on The Motley Fool Australia.

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• Looking to buy Macquarie shares? The bank is ‘positioned for an earnings recovery’: fundie
• Over half of millennials own shares. Here are 3 ASX share ideas to start your own portfolio
• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?
• Morgans names 2 of the best ASX 200 dividend shares to buy
• Are ASX share investors getting their mojo back?

Motley Fool contributor Tony Yoo has positions in Macquarie Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group 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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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.

Warren Buffett is one of the greatest investors of our time and his company Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B), regularly beats the S&P 500, a broader benchmark for the market, on annual performance. One of the ways Buffett and Berkshire are able to do so is through Berkshire’s massive $345 billion equities portfolio, from which Buffett and the rest of his team purchase and sell select stocks.

Buffett has long been known as a value investor. He tries to find stocks that are trading below their intrinsic value and that the market missed or simply ignored. Over time, value investors believe these stocks will appreciate nicely as the market wakes up and takes notice.

Considering how successful Buffett has been with this strategy, let’s look at five value stocks the Oracle of Omaha currently owns and see if they have helped his business succeed.

1. HP

Known as the original start-up out of Silicon Valley, HP (NYSE: HPE) has been making computers and printers for decades. While the company may not be seen as the innovator it once was, HP has become a stock that traditional investors have warmed up to for the basic reason that it prints plenty of cash profits and uses that to pay shareholders.

For fiscal 2022, HP is projecting free cash flow of between $3.2 billion and $3.7 billion. The company is also on track to return more than $5 billion to shareholders through dividends and share repurchases in the current fiscal year. With an annual dividend yield of close to 3.4%, HP stock trades at just over five times earnings.

2. Citigroup

After investing in nearly every other large US bank over the past few decades, Buffett and Berkshire purchased a nearly 3% stake in the embattled bank Citigroup (NYSE: C) earlier this year. Citigroup is an obvious value play, with its stock trading at just 60% of its tangible book value, or net worth. Shareholders are right to question the stock at the moment after the company has been dealing with regulatory issues regarding its risk management and internal controls, and after years of lagging returns.

But now, CEO Jane Fraser, who took over Citigroup in early 2021, commenced a big transformation plan which includes selling off most of the bank’s international consumer banking operations. This will make the bank simpler and focus on higher-performing businesses. Citigroup still has a lot of work to do, but if management can clean up the regulatory issues and create a more focused operation, getting back to full tangible book value should be quite doable. While Buffett waits, Citigroup is paying an annual dividend yield in excess of 4%.

3. Kraft Heinz

The multinational food and beverage company Kraft Heinz (NASDAQ: KHC) is often referred to as Buffett’s biggest mistake. Berkshire teamed up with 3G Capital in 2013 to purchase Heinz for $23 billion. They would eventually merge the company with Kraft in 2015, at which time shares opened around $71.

Today, shares sit at $38, so Berkshire has lost a good deal of money on the investment. Still, Berkshire continues to own more than 26% of the company. Kraft Heinz still has nearly $19.3 billion of long-term debt, but management made some serious progress in reducing that debt, grew free cash flow in recent years, and it also pays more than a 3% dividend yield.

4. Ally Financial

The large digital consumer bank Ally Financial (NYSE: ALLY), which specializes in auto lending, is another bank Buffett is purchasing stock in while its below tangible book value, and which pays an extremely healthy dividend yield of roughly 4.6%. Ally took off during 2020 and 2021, as the chip shortage and lack of auto inventory led to high car prices and huge demand, particularly among vehicles, enabling Ally to strongly grow its retail auto loan book.

But investors are now concerned about loan losses as consumer finances get drained and as many expect a recession next year. Ally is still originating auto loans — and at very high yields — and management seems to be taking a conservative approach to credit. If loan losses don’t exceed management’s built-in expectations, then I’d suspect Berkshire has a winner here.

5. Jefferies Financial

Berkshire recently unveiled its small purchase of shares in investment bank Jefferies Financial (NYSE: JEF) during the third quarter. Similar to Citigroup and Ally, Jefferies also has an attractive valuation, trading just over tangible book value. The bank also pays out more than a 3% dividend yield.

The broader investment banking sector struggled this year, as equity and debt underwriting significantly slowed down in the face of falling equity valuations and market volatility. But Jefferies is reportedly gaining market share and Berkshire and Jefferies own a mortgage business together, so Berkshire likely got to know management pretty well.

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

The post Warren Buffett owns these 5 value stocks appeared first on The Motley Fool Australia.

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Citigroup is an advertising partner of The Ascent, a Motley Fool company. Ally is an advertising partner of The Ascent, a Motley Fool company. Bram Berkowitz has positions in Citigroup and has the following options: long January 2024 $80 calls on Citigroup. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway (B shares) and Jefferies Financial Group Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended The Kraft Heinz Company and has recommended the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), short January 2023 $200 puts on Berkshire Hathaway (B shares), and short January 2023 $265 calls on Berkshire Hathaway (B shares). The Motley Fool Australia has recommended Berkshire Hathaway (B 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 Virgin Money UK CDI (ASX: VUK) share price is leaping 13.19% right now after the S&P/ASX 200 Index (ASX: XJO) bank dropped its financial year 2022 (FY22) earnings and news of more share buybacks last night. Right now, stock in Virgin Money is trading at $2.875 apiece.

Shares in ASX 200 bank Virgin Money soar on results and buyback

Here are the key takeaways from Virgin Money’s FY22 earnings. All figures have been converted from pounds sterling at today’s exchange rate (1 pound to $1.79 AUD).

• $1 billion after-tax profit – a 43% year-on-year increase
• $2.8 billion of underlying net interest income – a 13% lift
• Underlying operating income came to $3.1 billion – up 12%
• Net interest margin (NIM) lifted to 1.85% for the full year, and 1.86% in the final quarter
• 7.5 pence (13 cents) final dividend – up from last year’s 1 pence (1.9 cents) final dividend
• Announced an $89.5 million share buyback

Virgin Money’s total customer lending lifted 0.8% over the 12 months to September, reaching $130 billion while the bank’s underlying cost-to-income ratio (CIR) fell to 52%.

It said its higher NIM was due to rising rates and mix optimisation. It also reported record growth in current account sales and new credit card origination.

Additionally, the bank delivered $123.5 million of annualised gross savings and has committed to a “sustainable” 30% payout ratio.

Its CET1 ratio was “strong” at 15% while its cost of risk came in at 7 basis points.

What else happened in FY22?

The ASX 200 bank also pushed forward with its digital strategy in FY22. It automated 43% of key customer journeys and expanded its loyalty and reward programs.

While Virgin Money wasn’t directly exposed to the conflict in Ukraine, it was impacted by resulting higher costs, interest rates, and pressure on its customers and asset quality.

The company also announced a near-$90 million share buyback targeting its stocks listed in both London and Australia last night. The buyback is set to start today and acts as an extension to the slightly larger buyback announced in June.

What did management say?

Virgin Money CEO David Duffy commented on the results driving the ASX 200 bank stock higher today, saying:

2022 has been a milestone year for Virgin Money. We have good momentum while delivering a strong performance and improved returns for our shareholders.

We’ve changed the game in purpose-led flexible working to create an engaged, high-performing organisation that’s cost-efficient and agile, which will underpin targeted growth through further digital innovation.

While we have solid credit quality across our lending, we are aware that some customers will have to make difficult decisions in this environment, and we are proactively offering them help and support.

What’s next?

The company expects its NIM to be between $1.85% and 1.9% in FY23. Meanwhile, its CIR is tipped to improve to around 50% with further falls targeted for FY24.

It hopes to maintain its CET1 at above 14% this financial year amid macroeconomic uncertainty, with the measure set to return to its targeted 13% to 13.5% in FY24. It also anticipates its cost of risk to normalise around the cycle level of 30 basis points to 35 basis points.

The company’s digital wallet is expected to be launched in early in 2023 with more functionality to be added through the year.

Finally, the bank is targeting growth in Unsecured & BAU Business lending, which is tipped to moderate in 2023. It hopes to maintain its mortgage market share in the medium term.

Virgin Money share price underperforms ASX 200 in 2022

Today’s gains haven’t been enough to boost the ASX 200 bank share back into the longer-term green.

The stock has tumbled more than 16% in 2022 so far. It’s also currently 13% lower than it was this time last year.

For comparison, the ASX 200 has fallen 5% year to date and 2% over the last 12 months.

The post Guess which ASX 200 share is rocketing 13% on a ‘milestone year’ appeared first on The Motley Fool Australia.

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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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