The PlaySide Studios Ltd (ASX: PLY) share price is having a very strong day on Tuesday.

In morning trade, the game developer’s shares are up 14% to 68 cents.

At one stage, the PlaySide share price was up as much as 28% to 76 cents.

Why is the PlaySide share price rocketing higher?

Investors have been scrambling to buy PlaySide shares today after the company announced an agreement with Facebook and Instagram owner Meta Platforms (NASDAQ: META).

According to the release, following a successful concept pitch, Meta has engaged PlaySide to design, develop, and create a mixed reality interactive software product to be playable on its Quest suite of virtual reality devices.

What are the terms?

PlaySide notes that it will receive payments for the development of the game and will also receive a share of net revenues from the game in perpetuity.

The development payments will be received at agreed milestones, which are consistent with industry benchmark requirements for progressing the game to launch. The agreement is effective immediately and work on the title is expected to commence in the current financial year.

PlaySide’s CEO, Gerry Sakkas, commented:

This deal marks the next evolution of our work in the studio, as we leverage our abilities to conceptualise and develop exciting games in a revenue-share arrangement with a leading global technology company. Meta is bringing virtual reality and mixed reality into the mainstream with its Quest suite of products, and we are excited about the opportunity to demonstrate our domain expertise with this game.

Meta will no doubt be hoping that this game gives its often ridiculed Metaverse platform a much-needed boost. Maybe legs will be included this time!

The post Guess which ASX gaming share is surging 28% on a deal with Meta appeared first on The Motley Fool Australia.

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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. 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 Meta Platforms, Inc. The Motley Fool Australia has recommended Meta Platforms, Inc. 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 0.53% in the green today, but one ASX lithium share is charging far higher.

The Green Technology Metals Ltd (ASX: GT1) share price is leaping 10% today on lithium news. For perspective, the broader S&P/ASX 200 Index (ASX: XJO) is 0.39% in the green today.

Let’s take a look at what this ASX lithium share reported to the market today.

High grade intercepts

Green Technology Metals reported the “highest grade drill intercept to date” at the McCombe deposit within the Root Project.

This 100% owned project is located about 200km west of the company’s Seymour Project in Ontario Canada.

Assay results showed drilling intersected with up to 4.06% lithium oxide (Li2O). Results included:

• 8 metres (m) at 1.72% Li2O from 64 m (including 2m at 4.06% Li2O from 64.6m) at drill hole RL-22-0013
• 8.4m at 1.32% Li2O from 102 m (including 1m at 3.91% Li2O from 103.6m) at drill hole RL-22-0014
• 13.4m at 1.24% Li2O from 28.9 m (including 1m at 3.16% Li2O from 29.3m) at drill hole RL-22-0015
• 6.3m at1.52% Li2O from 66.3 m (including 1.0m at 2.38% Li2O from 70.7m) at drill hole RL-22-0016A

So far, 31 drill holes have been drilled at the McCombe deposit and two diamond drill rigs are operating around the clock.

The company said it is on track to make a mineral resource estimate at the project in quarter one of 2023.

Commenting on the news, Green Technology CEO Luke Cox said:

Recent assay returns have confirmed that McCombe is higher grade than originally interpreted based on historical data.

The Root Project as a whole is also developing into a much larger complex, with McCombe potentially joining with Morrison to form a structure over several kilometres long, and recent spodumene discoveries at Root Bay confirming it extends east and west along a magnetic high.

Green Technology share price snapshot

The Green Technology Metals share price has exploded nearly 178% in the past year, while it is climbing 113% in the year to date.

For perspective, the ASX 200 has fallen nearly 3% in the last year.

This ASX lithium share has a market capitalisation of nearly $212 million based on the current share price.

The post Guess which ASX lithium share is leaping 10% on a new discovery appeared first on The Motley Fool Australia.

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• 3 ASX mining shares leaping higher on new discoveries 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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Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares have been the worst performing S&P/ASX 200 Index (ASX: XJO) big four stock of this year so far – dumping 11% year to date.

Following such a tumble, one top broker has reportedly turned its back on ANZ in favour of shares in banking peer Commonwealth Bank of Australia (ASX: CBA). The CBA share price has lifted more than 4% since the start of 2022.

For comparison, the ASX 200 is down 5% year to date. Meanwhile, the S&P/ASX 200 Financials Index (ASX: XFJ) has slumped 2%.

So, why has Macquarie Group Ltd (ASX: MQG) reportedly swapped the big four banks’ positions in its model portfolio? Let’s take a look.

Why did Macquarie swap ANZ shares for CBA?

Shares in the ASX 200’s smallest big four bank have been dumped from Macquarie’s model portfolio in favour of the index’s largest banking stock, The Australian reports.

A model portfolio is a guide produced by an asset manager and provided to clients who can use it to build their own portfolio. Removing a company from a model portfolio doesn’t necessarily mean a broker tips it as a sell.

Macquarie Research commented on the changes, courtesy of the publication:

The portfolio changes we have made are done to reduce exposure to earnings risks, while still trying to minimise exposure to highly valued stocks. We also reduce exposure to stocks that benefit from higher bond yields and rotate to ‘bond proxies’. Our changes are also informed by what worked in past recessions.

It reportedly tips CBA as a quality bank share, directly replacing ANZ’s shares with those of CBA in its model portfolio. Macquarie isn’t the only broker seemingly more bearish on ANZ shares.

Morgans was said to have reduced its exposure to the big four banks, bar CBA, earlier this month, my Fool colleague Bernd reports. The broker apparently thinks their net interest margins (NIMs) have peaked amid a broader economic slowdown.

On the other hand, Citi was recently bullish on ANZ. It believes the stock could offer an 18% upside on its current price and growing dividends, as my colleague James reports.

The post Why did Macquarie just switch out ANZ for CBA shares? appeared first on The Motley Fool Australia.

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• Will ASX 200 tech company Novonix deliver a profit in 2023?
• 4 quality, undervalued ASX 200 shares in an earnings upgrade cycle revealed: fund manager
• 5 things to watch on the ASX 200 on Tuesday
• Why did the Mesoblast share price soar 9% today?
• Here are the top 10 ASX 200 shares today

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 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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If you’re looking for exposure to the resources sector, then you may want to consider BHP Group Ltd (ASX: BHP) shares.

That’s the view of analysts at Morgans, which continue to rate the mining giant as one of the best options in the sector.

What is Morgans saying about BHP shares?

According to a recent note, the broker has retained its add rating on the Big Australian’s shares with a $47.00 price target.

Based on where BHP’s shares are trading at present, this implies potential upside of almost 9% over the next 12 months for investors.

In addition, Morgans is expecting BHP to continue paying big dividends to investors. It is forecasting a fully franked $2.96 per share dividend from the miner in FY 2023. This equates to a generous 6.8% dividend yield, which stretches the total potential return to almost 17%.

Why is the broker positive?

Morgans likes BHP due to the company being a lower risk option in the sector. It also believes the company is well-placed to benefit from the global recovery from COVID-19 and highlights the resilience of its dividend profile.

Morgans commented:

We view BHP as relatively low risk given its superior diversification relative to its major global mining peers. The spread of BHP’s operations also supplies some defence against direct COVID-19 impact on earnings contributors. While there are more leveraged plays sensitive to a global recovery scenario, we see BHP as holding an attractive combination of upside sensitivity, balance sheet strength and resilient dividend profile.

Our long-term preference for BHP over RIO continues to pay dividends (literally), with BHP asserting itself as the better miner and with the stronger growth profile.

The post Broker tips 17% total annual return from BHP shares appeared first on The Motley Fool Australia.

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• Morgans names the best ASX 200 dividend shares to buy
• Why is the Rio Tinto share price trailing the ASX 200 on Monday?
• Why these 3 ASX 200 shares have done ‘particularly well’ and remain top holdings into 2023: fund manager
• Time to buy? Which ASX 200 shares are trading on single-digit P/E ratios?
• Are BHP shares in the buy zone following the latest OZ Minerals news?

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

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The Life360 Inc (ASX: 360) share price has returned from its trading halt and dropped into the red.

In morning trade, the location technology company’s shares are down 5% to $6.40.

Why is the Life360 share price dropping?

The Life360 share price weakness today has been driven by the company’s surprise decision to undertake a capital raising this week.

With the company on course to generate positive operating cash flow this time next year, many thought that another capital raising wouldn’t be required.

However, management has decided to shore up its balance sheet given the uncertain macroeconomic environment.

According to the release, Life360 has raised $50 million (US$33 million) via a placement to institutional investors at $6.30 per new share. This was the maximum price of the bookbuild range of $6.20 to $6.30 per share and represents a 6.4% discount to the Life360 share price prior to the halt.

What did management say?

As mentioned above, management explained that the placement was undertaken to strengthen its balance sheet in uncertain times. It explained:

The Placement is a prudent capital management initiative that provides a strong cash buffer at a time of uncertainty across the global macroeconomic environment.

Potential takeover?

Something that appears to have slipped under the radar, judging by the Life360 share price performance, is the company’s comments regarding a potential merger transaction.

It explained that it has “received inbound interest from potential parties that could result in a merger with another entity.”

No details have been provided in respect to who these parties are. Furthermore, management has warned that discussions are preliminary and there is no certainty that they will lead to any transaction.

It also highlights that the company receives inbound interest from time to time and only considers options that it believes are likely to result in an increase in shareholder value.

The post Life360 share price lower despite takeover talks appeared first on The Motley Fool Australia.

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• ‘Very bullish’: 3 small-cap ASX shares QVG is loving right now
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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 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 ASX share market is one of many markets to have seen significant volatility this year. For me, more volatility brings more opportunity.

I don’t know how high interest rates will go, nor when inflation will calm down. But, I do believe that the lower share prices that we’re seeing can help long-term returns because we can buy at better value today.

Past growth doesn’t mean that the future will match that. Returns can sometimes be bumpy.

However, the ASX share market has delivered an average return per annum of approximately 10% over the decades, though who knows what the next decade will bring. If an ASX share were to grow by an average of 10% per year, it would take less than eight years for me to double my money.

I believe the following three potential investments could be pleasing growth contenders to double my money in the coming years.

Betashares Global Cybersecurity ETF (ASX: HACK)

This exchange-traded fund (ETF) offers exposure to almost 40 companies that provide cybersecurity services to clients worldwide.

It’s a mix of global giants and smaller but growing players.

Readers may have heard of some of the international positions in the portfolio, such as Cisco Systems, Broadcom, Infosys, Palo Alto Networks, Crowdstrike, Fortinet, Verisign and Okta.

As BetaShares says, “With cybercrime on the rise, the demand for cybersecurity services is expected to grow strongly for the foreseeable future.”

Just look at two of the most recent high-profile examples of cybersecurity breaches in Australia, for Medibank Private Limited (ASX: MPL) and Optus. I think it is — and will continue to be — essential for organisations to pay for good cybersecurity systems.

According to BetaShares sources, the global cybersecurity sector was US$223.7 billion in 2022, and it’s expected to grow to US$478.7 billion in 2030. That would be a rise of 114%.

I’d put $10,000 into this ETF.

TechnologyOne Ltd (ASX: TNE)

The key focus of this tech company is to provide a global software as a service (SaaS) enterprise resource planning (ERP) solution. The idea is that customers can do everything through its software – asset management, human resources, payroll, supply chain management, business analytics and so on.

TechnologyOne revealed in its FY22 first-half result that its customer retention rate was higher than 99%, and more than 90% of its revenue was now recurring. Its net revenue retention rate in HY22 was 114% — that means existing customers paid 14% more revenue to the ASX share than they did before.

Management said this represented a “significant opportunity” in its existing customer base, adding it would “continue to double in size every five years”.

That’s certainly not guaranteed.

However, the company’s growing revenue and improving profit margins are compelling, in my opinion.

Total annual recurring revenue (ARR) was $288 million in the first half of FY22 – it’s expected to grow to at least $500 million in FY26. Additionally, TechnologyOne expects good growth in the United Kingdom, which could be a sizeable growth market for the company if successful.

The company’s profit before tax margin is expected to rise from 31% to 35% in the “coming years”.

I’d invest $5,000 into TechnologyOne shares.

Adairs Ltd (ASX: ADH)

Adairs is a growing retailer of homewares and furniture through three different businesses – Adairs, Mocka and Focus on Furniture.

The business has seen a massive drop this year, and the Adairs share price is down by 44% in the year to date. Simply getting back to the price it commanded at the start of the year would require a rise of more than 80%.

Having said that, I think the company has a good shot of achieving long-term growth.

Adairs plans to grow its product range across the three businesses, which can help it increase its market share. New and upsized stores can help – there is a link between sales and floor space, and Adairs intends to grow its in-store floor space by at least 5% per annum over the next five years.

The retailer is also building its membership, which in turn will help sales. Each member spends around $400 per annum, according to Adairs.

With the newly acquired business, Focus, it wants to roll out at least 30 new stores nationally. The company also plans to continue improving its online offer to boost e-commerce sales.

Finally, Adairs wants to grow its total sales from $564.6 million in FY22 to more than $1 billion over five years.

I’d invest the final $5,000 into Adairs.

The post Here’s how I’d invest $20,000 in ASX shares today to double my money appeared first on The Motley Fool Australia.

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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 ADAIRS FPO, BETA CYBER ETF UNITS, Cisco Systems, CrowdStrike Holdings, Inc., Fortinet, Okta, Palo Alto Networks, and VeriSign. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Broadcom Ltd. The Motley Fool Australia has positions in and has recommended ADAIRS FPO and BETA CYBER ETF UNITS. The Motley Fool Australia has recommended CrowdStrike Holdings, Inc., Okta, and 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 TechnologyOne Ltd (ASX: TNE) share price is on the move on Tuesday morning following the release of the company’s full year results.

At the time of writing, the enterprise software provider’s shares are up 5% to $12.95.

TechnologyOne share price higher on strong FY 2022 growth

• Total revenue up 18% to $369.4 million
• Total annual recurring revenue (ARR) up 25% to $320.7 million
• Software-as-a-Service (SaaS) ARR up 43% to $274.2 million
• Profit before tax up 15% to $112.3 million
• Profit after tax up 22% to $88.8 million
• Final dividend of 10.82 cents per share
• Special dividend of 2 cents per share

What happened in FY 2022?

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.

This was driven by adoption of the TechnologyOne global SaaS ERP solution, which has been exceeding the company’s expectations. Management revealed that customer adoption drove SaaS ARR of $274.2 million, up 43% year over year.

TechnologyOne now has over 800 large scale enterprise organisations, with millions of users, leveraging its fourth generation SaaS ERP, CiA, for mission critical activities. This makes TechnologyOne the largest single instance SaaS ERP offering in Australia.

The company also had a lot of success in the UK market, with its ARR almost doubling to $17.5 million.

Management commentary

TechnologyOne’s CEO, Ed Chung, appeared to be rightfully very pleased with the result. He commented:

 Our ability to deliver these results is due to TechnologyOne’s clear vision, strategy, culture and our significant investment in R&D.

Our strategy is clear – we strive to deliver a compelling customer proposition, providing our customers with any device, any time access from anywhere around the globe, as well as a simple and cost-effective way to run their enterprise.

We also exceeded our ambitious annual recurring revenue (ARR) targets and ended legacy licences. I’m proud to announce that we have successfully completed our strategy ahead of schedule. No other ERP company in the world has successfully made the transition to SaaS without impacting its customers and/or its profit growth.

The post TechnologyOne share price races 5% higher on strong FY22 growth appeared first on The Motley Fool Australia.

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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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As we approach the final month of 2022, many market watchers are likely setting their sights on the new year and glancing back at all that’s been happening on the S&P/ASX 200 Index (ASX: XJO) this year. And not many ASX 200 shares have been battered as much as former tech favourite Novonix Ltd (ASX: NVX).

The battery technology and materials stock peaked at $12.47 in late 2021 before plummeting in 2022. The Novonix share price closed Monday’s session at $2.34 – 78% lower year to date and 81% off its all-time high.

Much of its suffering can be put down to the shift in market sentiment towards unprofitable shares. Particularly, those in the technology space.  

Many found themselves caught in the middle as central banks attempted to battle inflation by hiking interest rates. Higher rates mean more costly debt. And plenty of companies without positive cash flow rely on debt for growth.

But could all that be about to change for the ASX 200’s Novonix? Let’s take a look at when the company might post a profit.

How is Novonix looking in 2023?

To analyse if ASX 200 tech share Novonix might turn a profit in 2023, one much first look at its business.

Novonix operates in three segments: battery technology solutions, anode materials, and cathode activities.

Much of its receipts from customers – coming in at $2.8 million in the September quarter – come from its battery tech segment.

Though, that’s not nearly enough for the company to break even. It posted a $13.8 million outflow from operating activities in that period. Looking slightly further back, it revealed a $71 million loss for financial year 2022 in August.

Novonix ended the quarter just been with $181.8 million in cash – enough to fund an estimated 13.3 quarters.

Looking to the future, its profitability seemingly relies on its anode materials division. It’s working to produce artificial graphite anode material for use in lithium-ion batteries.

The company expects to be producing 10,000 tonnes of the material annually next year. It plans to expand that to 40,000 tonnes annually in 2025 and 150,000 tonnes annually in 2030.

However, the division’s expansion project is expected to cost around US$1 billion between 2023 and 2025. Of that, US$150 million might be granted from the United States’ Department of Energy, and the company is working to secure the rest.

So, with all that in mind, could the ASX 200 tech share turn a profit in 2023? Well, the future is always uncertain.

However, considering its major ramp-up in anode material production is still a few years away and its $71 million financial year 2022 loss, market watchers might not want to hold their breath.

The post Will ASX 200 tech company Novonix deliver a profit in 2023? appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Tuesday
• Why did the Mesoblast share price soar 9% today?
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• Why is the Rio Tinto share price trailing the ASX 200 on Monday?

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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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.

What happened

Shares of e-commerce giant Amazon (NASDAQ: AMZN) were down more than the markets today, declining 2.9% as of 11:30 a.m. EDT.

While the broader tech indexes were down as investors appeared to be trimming gains from the recent run-up in stocks, Amazon fell more, perhaps due to a negative Wall Street Journal article on the e-commerce giant regarding some recent customer satisfaction surveys.

So what

On Monday, the Wall Street Journal published an article on its home page whose thesis is that customer satisfaction at Amazon’s e-commerce unit might be waning. Right ahead of the holidays, that’s not a great headline, certainly for a company that preaches “customer obsession.”

The article cited three broad customer satisfaction surveys.

• First, Evercore ISI held its regular survey of Amazon customers, revealing that the proportion of customers that considered themselves “extremely” or “very satisfied” with Amazon came in at “just” 79%. While that’s higher than in the depths of the pandemic, when there were widespread delays, it is down from the peak rate of 88% from one decade ago.
• Furthermore, a different survey from the American Customer Satisfaction Index gave Amazon a score of 78 out of 100, its worst performance since 2000.
• Finally, consulting firm Brooks Bell also conducted a study of 1,000 Amazon customers, finding that roughly one-third reported late deliveries or products of low quality.

The findings are certainly concerning, since the general step-down in satisfaction is showing up in three different surveys. Of course, the effects of the pandemic are still being felt in terms of labor shortages and other factors. Furthermore, competing e-commerce sites don’t have nearly the volume that Amazon does, nor do they make the promises Amazon does, such as the recent push for one-day shipping. Amazon has kept ratcheting up its promises, giving it a higher bar to clear.

Still, there might be real problems here. The increase in third-party sellers on the platform could be causing some issues with product quality. Also, the ramp-up in advertising on the website could complicate customer searches if results are overloaded with ads from irrelevant or lower-tier brands. And the automation of customer service could be frustrating to people who wish to easily speak with a human being.

Amazon likely can’t afford to pull back on those elements, because third-party sales have grown at a higher pace than first-party items, and advertising revenues have been one of the bright spots in Amazon’s earnings results over the past few quarters, even as e-commerce has struggled more broadly. The e-commerce unit has also dipped back into losses, so investing heavily in more in-person customer service would also increase costs.

AMZN PS Ratio data by YCharts.

Now what

The recent survey results aren’t a reason for long-term Amazon investors to panic even though the stock is down more than the market today. The WSJ notes that Amazon spent $1 billion last year combating counterfeiters, fraud, fake reviews, and other bad actors on the platform. Just a couple weeks ago, Amazon’s Counterfeit Crimes Unit helped identify and disrupt three major counterfeit networks in China, where 240,000 fake items were seized by authorities. Commenting on the WSJ article, an Amazon spokesperson also noted high ratings for its mobile app.

Amazon also has a history of tackling problems head-on and doing the difficult work to overcome them, which is why it’s enjoyed such long-term success. However, investors should keep a watch on these customer surveys as well as announcements from Amazon and its management team about how they are going to improve on these issues.

After a brutal year for tech stocks and with a potential recession looming, Amazon’s valuation on a price-to-sales basis is now the lowest it’s been since early 2015, just before it broke out the results from Amazon Web Services. As long as Amazon isn’t in terminal decline — and I don’t think it is — shares are looking like quite the deal these days for long-term-oriented investors. 

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

The post Why Amazon stock fell today appeared first on The Motley Fool Australia.

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Billy Duberstein has positions in Amazon. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, 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. The Motley Fool Australia has recommended Amazon. 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 AMP Ltd (ASX: AMP) share price has charged ahead in the past month, but is it still a buy?

AMP shares have leapt 10% from $1.165 at market close on 21 October to the current share price of $1.285. For perspective, the S&P/ASX 200 Index (ASX: XJO) has jumped 6% in the same time frame.

Let’s take a look at the outlook for the ASX financial share.

What’s ahead for AMP?

UBS equity analyst Scott Russell has placed a sell rating on the AMP share price. However, he has increased his price target from 95 cents to $1, the Australian Financial Review reported.

In comments cited by the publication, UBS analysts said:

AMP has successfully divested its insurance and funds management operations, which both simplifies the group and provides for a very strong balance sheet. Capital returns will likely defend the stock for the time being.

Thereafter we remain concerned by the mid-term outlook for the continuing businesses. AMP continues to face fundamental challenges across both banking and wealth management segments and the future shape of the group is unclear.

AMP is a major financial services company that has been operating for more than 170 years.

Meanwhile, Bennelong Kardinia Absolute Return Fund portfolio manager Kristiaan Rehder recently described AMP as a company that is “of particular interest”, having been “out of favour for some time”.

Commenting on AMP, Rehder said:

Our analysis shows that there’s considerable excess capital. And we think it can surprise the market in regards to the extent of its capital returns in the near term.

On the news front, as my Foolish colleague Brooke reported on 15 November, AMP’s sale of the Collimate capital is facing some regulatory delays. However, significant progress has been made towards this transaction. AMP said:

All parties are working constructively together towards completion, and we will update the market on the likely completion dates for both transactions as these approvals progress.

AMP share price snapshot

The AMP share price has climbed 10% in the past year, while it has soared 27% in the year to date.

For perspective, the ASX 200 has fallen more than 3% in the past year and 4% in the year to date.

AMP has a market capitalisation of about $4 billion based on the current share price.

The post Up 10% in a month, are AMP shares worth buying back into now? appeared first on The Motley Fool Australia.

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More reading

• Is it finally safe to buy ASX shares now?
• ASX 200 shares may have just hit the bottom: AMP economist
• Looking to buy AMP shares? Here’s the latest blow to the company’s major divestment
• Why did the AMP share price just crack a new 52-week high today?
• Don’t panic! Here are 7 reasons we can avoid a recession: AMP

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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