The Xero Limited (ASX: XRO) share price has dropped into the red on Thursday following a broad market selloff.

In afternoon trade, the cloud accounting platform provider’s shares are down 2.5% to $73.72.

Where next for the Xero share price?

While the Xero share price hasn’t had a great start to the month, analysts at Goldman Sachs believe things could get better. Particularly if Xero delivers some strong numbers next week when it releases its half year results for FY 2023.

According to the note, ahead of next week’s release, the broker has retained its buy rating and lifted its price target slightly to $112.00.

Based on the current Xero share price, this implies potential upside of 52% for investors over the next 12 months.

What did the broker say?

Goldman highlights that trading conditions appear to have been solid based on a recent update from rival Intuit (Quickbooks). It commented:

Near-term industry momentum solid: with Intuit upgrading 1Q23 revenue growth guidance to be >25% in the quarter given SMB/Tax strength (vs. GSe XRO 1H23 rev +28%). This is supported by positive top-line visitation / engagement datapoints with: (1) 2Q23 visitation share stable to improving – we highlight Canada (+ve) & UK (improved post recent weakness); and (2) App downloads remaining solid with robust AUS growth, consistent performance in UK/NZ/ROW while Planday is softer.

However Xero App integration numbers declined in each region which followed the transition to the new app-store and fees across all apps in Aug-22 (prev. just new). Finally we note Xero cost growth appears to be moderating with Nov-22 job vacancies for Xero at c.35% of PcP levels, noting employees are the largest portion of XRO’s cost base.

All in all, based on the above, the broker is expecting a solid half year update next week and sees plenty of value in the Xero share price at current levels.

The post What’s the outlook for the Xero share price in November appeared first on The Motley Fool Australia.

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• How are ASX 200 tech shares faring after the overnight NASDAQ plunge?
• Top ASX shares to buy in November 2022
• Why are ASX 200 tech shares getting bashed around today?
• Why I’d buy and hold this ASX 200 share until 2030
• How I’d build a portfolio by investing in top ASX shares now

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 Xero. The Motley Fool Australia has positions in and has recommended 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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The Bitcoin (CRYPTO: BTC) price is down 1% over the past 24 hours. BTC is currently trading for US$20,297.

Ethereum (CRYPTO: ETH), the world’s number two crypto, has slipped 3% to US$1,542.

With equities under pressure following the latest interest rate hike from the Federal Reserve, both tokens are holding up fairly well today.

But the same can’t be said for their performance over the last year.

On 10 November last year, the Bitcoin price reached all-time highs of US$68,790. It’s down a painful 71% since that record.

The Ethereum price notched its own record highs six days later. On 16 November Ether was trading for US$4,892. It’s fallen 69% from that virtual high water mark.

Facing these kinds of headwinds, two of Australia’s pioneering crypto exchange-traded funds (ETFs) are pulling the plug.

Ethereum and Bitcoin price falls hampered these ETFs

Cosmos Asset Management launched the Cosmos Purpose Bitcoin Access ETF (CBTC) and Cosmos Purpose Ethereum Access ETF (CPET) earlier this year.

The Bitcoin ETF made its debut on the Cboe Australia exchange (formerly Chi-X) on 12 May, as The Motley Fool covered here. At that time, the Bitcoin price had already taken a big tumble but was still trading for around US$30,000.

While crypto investors had hoped that may be the bottom for the Ethereum and Bitcoin price rout, we know now that’s not how it panned out.

With the funds under pressure, yesterday Cosmos informed investors that it “will be applying to revoke the funds’ quotation on Cboe”.

Trading in both the Cosmos Bitcoin ETF and Ethereum ETF was halted on Monday. Cosmos stated, “Trading on the funds will continue to be halted pending the outcome of the application to Cboe.”

Commenting on the decision, Dan Annan, CEO of Cosmos, said (courtesy of The Australian Financial Review):

While we strongly believe in the asset class, we are all disappointed with this result. The ETFs are ring-fenced by independent external service providers, which is a key transparent risk mitigation structure across all asset classes… We will continue to follow the process in the best interests of all unitholders.

Both crypto ETFs look to be a casualty of fast-rising global interest rates.

The Bitcoin price reached its records when rates across the developed world were at historic lows, with central bankers predicting several more years of low rates.

The post Ethereum and Bitcoin price crash spells the end for these Aussie crypto ETFs appeared first on The Motley Fool Australia.

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More reading

• Up 18% in a month, could it still be worth buying Ethereum at its current price?
• The Bitcoin price leapt 10% in October. Here’s why
• Why one of the smartest investors bought Bitcoin and thinks you should too
• The Bitcoin price may be decoupling from US stocks. Is this why?
• Why are Bitcoin, Ethereum, and Dogecoin leaping higher today?

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 positions in and has recommended Bitcoin and Ethereum. The Motley Fool Australia has positions in and has recommended Bitcoin and Ethereum. 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 CSL Limited (ASX: CSL) share price is falling today amid the company providing an update on its research and development progress at an investor briefing.

CSL shares are currently down 1.84% to $277.52 apiece. For perspective, the S&P/ASX 200 (ASX: XJO) is 1.86% in the red.

Let’s take a look at what is going on with the ASX healthcare share.

Research and development update

A seemingly positive investor presentation has done little to help the CSL share price today.

In its presentation, CSL said it is continuing to focus on next-generation mRNA vaccines. The company also highlighted some recent achievements.

For example, Etranacogene dezaparvovec (CSL222) gene therapy for haemophilia B treatment has been accepted for review by the Food and Drug Administration in the USA and the European Medicines Agency in Europe. This will be the first gene therapy treatment for haemophilia B if approved.

Further, CSL highlighted phase three results for garadacimab (CSL321, anti-FX11a), an investigational first-in-class monoclonal antibody. This is a potential long-term treatment for patients with hereditary angioedema.

The trial has met efficacy objectives and showed tolerability and safety. The company aims to file for approval of this treatment in the next calendar year.

CSL also noted the Vifor business, acquired this year, adds therapies including nephrology, dialysis and iron deficiency.

Head of research and development and chief medical officer Dr Bill Mezzanotte said:

CSL is on the leading edge of innovation in areas we know well and we have strategically and methodically built a pipeline that has never been more robust with diverse sources of innovation, from in-house and external sources, that include the disruptive scientific platforms of gene therapy and sa-mRNA.

CSL highlighted it invested about $1.16 billion in research and development in the 2022 financial year.

What else has CSL been up to?

On Wednesday, CSL revealed it has entered a licensing agreement with Arcturus Therapeutics Holdings Inc (NASDAQ: ARCT) to access late-stage self-amplifying mRNA vaccine platform technology.

Arcturus is developing mRNA vaccines, including a potential COVID-19 vaccine.

Commenting on the news, CSL chief operating officer Paul McKenzie said: “These combined capabilities will accelerate our journey in mRNA.”

However, the CSL share price ended the day 0.19% lower.

CSL share price snapshot

The CSL share price has descended 11% in the past 12 months, while it has lost 4.5% this year to date.

For perspective, the ASX 200 has lost about 7% in the past year.

CSL has a market capitalisation of more than $134 billion based on the current share price.

The post What’s happening with the CSL share price today? appeared first on The Motley Fool Australia.

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More reading

• Here’s why brokers rate these blue chip ASX 200 shares as buys
• Top brokers name 3 ASX shares to buy today
• Why is the CSL share price falling on Wednesday?
• Did the CSL share price fall or rise in October?
• Bell Potter names 9 ‘champion’ ASX 200 shares to buy for the next five years

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 positions in and has recommended CSL Ltd. 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 All Ordinaries Index (ASX: XAO) may be sinking today but that hasn’t stopped a couple of ASX healthcare shares from racing higher.

Here’s why these two All Ords shares are smashing the index on Thursday:

Immutep Ltd (ASX: IMM)

The Immutep share price is up 5% to 31 cents. This morning the biotechnology company announced that a late-breaking abstract relating to its phase II TACTI-002 trial has been accepted for an oral presentation at the Society for Immunotherapy of Cancer (SITC) Annual Meeting 2022 this month.

The release notes that the presentation will include new clinical data for eftilagimod alpha (efti), its first-in-class soluble LAG-3 protein, in combination with pembrolizumab in 1st line non-small cell lung cancer (NSCLC) patients.

Last month, fast track designation was granted by the US FDA for efti in combination with pembrolizumab in 1st line NSCLC. This offers the potential for expedited development and review.

Rhythm Biosciences Ltd (ASX: RHY)

The Rhythm Biosciences share price is up almost 9% to $1.24. Investors have been buying this cancer diagnostics technology company following the release of an announcement relating to its ColoSTAT product.

According to the release, the company has continued the expansion of its international regulatory footprint after successfully registering ColoSTAT with the New Zealand national database of Medical Devices. This allows the lifesaving colorectal cancer detection technology to be marketed and sold in the country.

Rhythm’s CEO and managing director, Glenn Gilbert, commented:

Bowel cancer is the second highest cause of cancer death in New Zealand and a growing issue with 1 in 10 now diagnosed under the age of 50. ColoSTAT is a simple blood test which has the potential to make a material impact on health outcomes through mass screening for higher participation to achieve early diagnosis. We look forward to working with the Ministry of Health’s National Screening Unit to enhance New Zealand’s National Bowel Screening Programme.

The post 2 ASX healthcare shares smashing the All Ords today appeared first on The Motley Fool Australia.

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• 2 US stocks Wall Street thinks could deliver 50% or more upside
• How did the Sayona Mining share price perform in October?
• Is Bendigo Bank the best bet for dividends out of all the ASX 200 bank shares?
• How are ASX 200 tech shares faring after the overnight NASDAQ plunge?
• Why is the Domino’s share price down 13% in two days?

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

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

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

While market sell-offs can be brutal, they also open up opportunities to purchase some stocks that were previously trading near uninvestable levels. According to Wall Street analysts, two companies that have come down to that point are Cloudflare (NYSE: NET) and Datadog (NASDAQ: DDOG).

On average, analysts see 57% upside for Cloudflare and 56% for Datadog. That’s quite a turnaround in one year, but is it realistic? 

The businesses

First, it’s helpful to understand what these two do. Both are rapidly growing tech companies whose valuations reached unsustainable levels in 2021, contributing to their significant decline. To be clear, the businesses are both performing admirably; it was the exuberance of 2021 that caused their terrible stock performance.

Cloudflare’s product allows its clients to host websites on its servers, eliminating the need to purchase expensive networking equipment that can quickly become obsolete. Cloudflare’s 275-plus data centers in cities worldwide also place the information closer to website users, making the website load incredibly fast. With more than 151,000 paying customers, Cloudflare has a large base of customers that are expanding their use quarterly.

As businesses deploy more cloud solutions, it’s becoming harder for IT teams to monitor how all their software solutions function. Datadog’s platform solves this issue through its cloud monitoring service, allowing users to see how data flows function and to solve problems quickly when they arise. Datadog’s product is more niche than Cloudflare’s, but it still has about 21,200 paying customers. 

Although many businesses are tightening their budgets to prepare for an economic downturn, both companies posted solid revenue growth in the second quarter:

Company	YOY Revenue Growth
Cloudflare	54%
Datadog	74%

Data source: Cloudflare and Datadog. YOY: year-over-year.

These aren’t small revenue streams, either; Cloudflare’s and Datadog’s second-quarter sales were $235 million and $406 million, respectively.

However, no matter how fast a business grows, there is always a reasonable price to pay for it. From a price-to-sales (P/S) standpoint, both companies were too expensive last year.

Data source: YCharts.

Even now, many would contend that 20 times sales is also too expensive. But the bigger picture for these companies is their prospects and growth, making the valuation more palatable.

The road ahead is bright

Both Cloudflare and Datadog operate in massive markets. Datadog believes its market could be $53 billion by 2025, and Cloudflare sees its total addressable market at $135 billion by 2024. While it’s impossible for one company to capture an entire market completely, these two have a long way to go before they saturate their market opportunity.

And both companies are teetering on the brink of profitability. In the second quarter, Datadog had a mere $3.1 million in operating losses, and Cloudflare is projecting an operating profit for its full-year 2022. Unlike some tech companies that are laying off part of their workforce even to get remotely close to breaking even, these two are on the brink.

These two factors are significant reasons both stocks still command a premium price. Wall Street also expects these stocks to maintain their valuation; analysts forecast Cloudflare and Datadog to grow their revenues by 36% and 38%, respectively, in 2023. And there is likely further upside beyond that point.

I think both stocks are strong buys because of their massive opportunities, but investors must be committed to holding the stocks for at least three to five years. This will allow investors to wait out market downturns like the one we are in right now. For Datadog and Cloudflare, the best days are still ahead, and investors should take positions accordingly. 

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

The post 2 US stocks Wall Street thinks could deliver 50% or more upside appeared first on The Motley Fool Australia.

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More reading

• 2 ASX healthcare shares smashing the All Ords today
• How did the Sayona Mining share price perform in October?
• Is Bendigo Bank the best bet for dividends out of all the ASX 200 bank shares?
• How are ASX 200 tech shares faring after the overnight NASDAQ plunge?
• Why is the Domino’s share price down 13% in two days?

Keithen Drury has positions in Cloudflare, Inc. and Datadog. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Cloudflare, Inc. and Datadog. 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.

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

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The Sayona Mining Ltd (ASX: SYA) share price had its highs and lows in October, but overall finished flat.

Sayona shares closed at 23.5 cents on 30 September. At market close on 31 October, Sayona shares were fetching this exact same price. For perspective, the S&P/ASX 200 (ASX: XJO) lifted 6% in the same timeframe.

Let’s take a look at what impacted the Sayona share price in October.

Up and down

The Sayona Mining share price was up and down like a yo-yo in October.

Sayona shares soared 13% on 4 October on the back of positive lithium news. Sayona launched a pre-feasibility study for lithium carbonate production at its North American Lithium (NAL) operation in Quebec. Piedmont Lithium Inc (ASX: PLL) has a 25% stake in this project, with Sayona holding the other 75%.

Commenting on the news, managing director Brett Lynch said:

We look forward to examining the results of the PFS, as we work towards becoming a leading integrated producer and the largest in North America, amid accelerating demand from the battery and electric vehicle sector.

The Sayona Mining share price descended 15% between market close on 4 and 20 October.

On 5 October, Sayona Mining shares fell nearly 7.69% despite a seemingly positive update from the company. Sayona Quebec CEO Guy Laliberté described the agreement as “another important step” on the road to restarting operations at the mine.

Sayona launched a pre-feasibility study for the Moblan Lithium Project in northern Quebec, Canada. However, as my Foolish colleague James noted, profit taking and industry weakness at the time may have impacted the company’s share price.

What else?

In further news, on 18 October, Sayona advised a CA$43 million Quebec rail contract had been signed to transport lithium from the North American Lithium operation to port.

Sayona shares rocketed 18% higher between market close on 20 October and 25 October before pulling back nearly 8% up to the 31 of October.

In news on 27 October, Sayona Mining advised the NAL project is “picking up speed” with 96% of procurement and permitting complete. The project is on track to restart in quarter one of 2023.

On the final day of October, Sayona released a quarterly activities and cash flow report. Sayona has cash at hand of about $159.234 million.

Sayona’s annual general meeting will be held on 16 November.

Share price snapshot

The Sayona Mining share price has lifted 40% in the past year, while it has soared 73% year to date.

For perspective, the ASX 200 has shed more than 7% in the past year.

Sayona has a market capitalisation of about $1.8 billion based on the current share price.

The post How did the Sayona Mining share price perform in October? appeared first on The Motley Fool Australia.

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• Could this news be helping the Sayona share price light up today?
• If ASX lithium shares are soaring, why is the ACDC ETF down 9% in 2022?
• Why Champion Iron, Lynas, Newcrest, and Sayona shares are storming higher
• Sayona Mining share price higher on lithium project update
• Here are the 3 most heavily traded ASX 200 shares on Wednesday

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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S&P/ASX 200 Index (ASX: XJO) bank shares have a reputation for paying high levels of income to shareholders. But, could Bendigo and Adelaide Bank Ltd (ASX: BEN) shares be the best source of dividends from the sector?

For context, Bendigo Bank is a pretty big business. It has a market capitalisation of $5.2 billion according to the ASX. However, it’s a fraction of the size of major banks of Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), Westpac Banking Corp (ASX: WBC) and Australia and New Zealand Banking Group Ltd (ASX: ANZ).

But, $1,000 invested in any of these businesses is still $1,000. It doesn’t necessarily matter what size the ASX 200 bank share is.

Is Bendigo Bank the best choice for dividends?

I’m going to use the estimates for the dividend on CommSec for FY23.

Bendigo Bank is expected to pay a grossed-up dividend yield of 8.5% in the current financial year, based on an expected payout of 54 cents per share.

CBA could pay a grossed-up dividend yield of 5.8% if it pays an annual dividend of $4.25 per share.

NAB is projected to pay a grossed-up dividend yield of 7.4%, based on a potential payout of $1.67 per share.

Westpac may pay a grossed-up dividend yield of 8.25% if it pays $1.39 per share in FY23.

ANZ is projected to pay a grossed-up dividend yield of 8.6% based on a potential annual dividend payment of $1.54 in FY23.

The final bank I’ll put in the mix is Bank of Queensland Limited (ASX: BOQ). According to Commsec, BOQ could end up paying a grossed-up dividend yield of 10.5% in FY23.

As we can see, Bendigo Bank’s expected yield is right up there with the big ASX 200 bank shares. In yield terms, it seems to rank evenly with the highest-yielding major bank.

However, BOQ seems to take the prize in terms of the potential dividend size in FY23.

Direction of the dividend

Bendigo Bank is expected to grow its dividend to 56 cents per share in FY24, which represents an attractive trajectory.

However, BOQ is expected to pay a similar-sized dividend in FY24, which would mean no growth.

Even so, the FY24 yield would be 10.4% from BOQ and 8.8% from Bendigo Bank.

Time will tell what the growth of the dividend is after FY24.

But, I can understand why investors may prefer one of the big ASX 200 bank shares for dividends because they may be viewed as more stable due to their size and ‘too big to fail’.

Foolish takeaway

I think that Bendigo Bank can be a good source of dividends in the coming years. But, it may not be the bank that delivers the most dividend income, or the most growth. However, I do think it can do quite well in the shorter term in this rising interest rate environment.

The post Is Bendigo Bank the best bet for dividends out of all the ASX 200 bank shares? appeared first on The Motley Fool Australia.

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More reading

• Coles shares underperformed the market last month. What’s next?
• ASX 200 dives on hawkish Federal Reserve interest rate policies
• 3 ‘bullish’ ASX shares to buy as FOMO grips the market: expert
• The Westpac share price soared 17% in October, what’s next?
• 5 things to watch on the ASX 200 on Thursday

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 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 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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S&P/ASX 200 Index (ASX: XJO) tech shares are deep into the red during the lunch hour on Thursday.

At the time of writing, the ASX 200 itself is down 2%. The S&P/ASX All Technology Index (ASX: XTX) – which contains some smaller tech shares outside of the ASX 200 – is down 1.7%.

This comes after the US Federal Reserve lifted rates for a fourth consecutive session yesterday. The 0.75% interest rate increase brings the US target rate into the 3.75% to 4% range.

While that increase had been widely priced in by the markets, the hawkish post-announcement press address by Fed chair Jerome Powell was unexpected. And it was clearly unwelcomed by tech investors, with the Nasdaq Composite (NASDAQ: .IXIC) closing down 3.4%.

So, how are the big-name ASX 200 tech shares holding up?

How are ASX 200 tech shares faring after the Fed’s rate hike?

ASX 200 tech shares took Tuesday’s rate hike from the RBA in their stride. But they’re all losing ground in the face of some further likely rises from the Fed, the world’s most watched central bank.

In early afternoon trade, buy now, pay later (BNPL) stock Block Inc (ASX: SQ2), which acquired Afterpay in January, is down 6.5%.

Meanwhile, WiseTech Global Ltd (ASX: WTC), a provider of cloud-based software solutions for the logistics sector, has seen its share price slip by 1.1%.

Accounting software provider Xero Limited (ASX: XRO) is under pressure too, with shares down 2.3%.

And rounding off our list of big-name ASX 200 tech shares, administration services company Link Administration Holdings Ltd (ASX: LNK) is down 1.7%.

What did Powell say to spook investors?

The big sell-off in US tech stocks, and the pressure on ASX 200 tech shares today, really came post the Fed’s rate hike announcement.

That’s when Powell addressed a media conference, stressing that the Fed was not done with hiking rates yet and that inflation remained stubbornly high.

“We think we have a ways to go before we get to that level of interest rates that we think is sufficiently restrictive,” Powell told the conference.

The Fed chair added that the rate hikes had yet to have any material impact on taming inflation.

“The level of rates that we estimated in September, the incoming data suggests that’s actually going to be higher. There is no sense that inflation is coming down. We’re exactly where we were a year ago,” he said.

Companies priced with future earnings in mind are particularly vulnerable to rising rates. That’s because as the present cost of holding money goes up, the current value of those future revenue streams goes down.

The reverse will also hold true.

When interest rates finally top out, and eventually begin to head lower, well-placed ASX 200 tech shares should be some of the biggest beneficiaries.

The post How are ASX 200 tech shares faring after the overnight NASDAQ plunge? appeared first on The Motley Fool Australia.

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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 positions in and has recommended Block, Inc., Link Administration Holdings Ltd, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Block, Inc., WiseTech Global, 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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It has been another disappointing day for the Domino’s Pizza Enterprises Ltd (ASX: DMP) share price on Thursday.

In early afternoon trade, the pizza chain operator’s shares are down 9% to $54.70.

This means the Domino’s share price is now down 13% over the last two trading sessions.

Why is the Domino’s share price crashing?

The Domino’s share price has been sold off this week after the company released a disappointing trading update at its annual general meeting.

That update revealed that the company’s sales are down 1.8% year to date. This is being driven by inflationary pressures, high energy prices, and foreign exchange headwinds.

Domino’s CEO and managing director, Don Meij, commented:

We understand inflation, particularly high energy prices in Europe, are making customers consider every purchase – our answer to this is delivering a high-quality product at an affordable price.

Unfortunately, Domino’s earnings are also being impacted by inflationary pressures and this is expected to remain the case for a little while longer. The company advised that it “anticipates inflationary headwinds to continue into the 2023 calendar year; primarily raw ingredients, energy prices in Europe, and labour costs in some markets.”

As a result, the company’s earnings are expected to “be materially lower” in the first half of FY 2023.

For the full year, management expects a year over year decline including foreign exchange headwinds and “to deliver NPAT growth in FY23” on a constant currency basis.

Broker reaction

This update hasn’t gone down too well with brokers, which explains the weakness in the Domino’s shares price today.

According to a note out of Citi, its analysts have downgraded Domino’s shares to a neutral rating and cut their price target on them by over 20% to $66.60.

Elsewhere, Goldman Sachs has retained its neutral rating but cut its price target to $60.00. Goldman commented:

DMP reported FY23 first 17 weeks trading update with sales largely in-line with expectations though company guided for 1H23 earnings to be materially lower than pcp. Additionally, FY23 NPAT excluding ~A$7mn FX headwinds is expected to be above FY22 A$165mn but will be below if including FX impact. This is below Factset Consensus FY23 NPAT forecast of A$179mn and GS forecasts of FY23 A$170mn.

The post Why is the Domino’s share price down 13% in two days? appeared first on The Motley Fool Australia.

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More reading

• ‘Close to bottom’: Expert names 3 bargain ASX shares to buy right now
• 5 things to watch on the ASX 200 on Thursday
• Domino’s share price sinks 5% on AGM update
• 5 things to watch on the ASX 200 on Wednesday
• These were the best-performing ASX 200 shares in October

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 Dominos Pizza Enterprises 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 ripper year for many of the market’s favourite ASX coal shares – and one still looks to be trading at an attractive price, according to one expert.

Stanmore Resources Ltd (ASX: SMR) is an Aussie coal producer with assets in the Bowen and Surat Basins, where it mines metallurgical, known as coking, coal. It recently acquired all interest in what was BHP Mitsui Coal (BMC).

The Stanmore share price has rocketed around 200% since the start of 2022 amid soaring coal prices. It’s trading at $2.90 at the time of writing – more than 30% higher than it was this time last month.

Its year-to-date gains are on par with similar surges in S&P/ASX 200 Index (ASX: XJO) coal favourites Whitehaven Coal Ltd (ASX: WHC) and New Hope Corporation Limited. They’ve gained 245% and 148% respectively in 2022.

Glenmore Asset Management founder Robert Gregory previously posted a huge win, with a few notable coal shares helping the fund return more than 50%.

Now, the expert is bullish on the future of the smaller ASX coal miner, writing, via Livewire, that he believes it’s set to outperform over coming years.

Could this coal share outperform its ASX 200 peers?

There are many reasons behind Gregory’s bullishness on shares in ASX coal miner Stanmore.

The most obvious is its established, producing, and low-cost mines. The expert notes that its low-cost base better positions the company to push through falling coal prices.

On top of that, he notes coking coal prices are lower than their thermal cousins right now. Thus, they might face less volatility in the future. Though, commodity prices are notoriously hard to predict.

The federal government recently tipped thermal coal to average US$333 a tonne in 2022, falling to US$125 a tonne in 2024. Meanwhile, coking coal is expected to fall from around US$400 a tonne this year to US$220 tonne in 2024.

Of course, current high commodity prices mean Stanmore and other ASX coal producers are experiencing huge cash flows right now. Indeed, the company’s operating cash flow surpassed US$560 million in the first half.

As a result, Gregory tips its balance sheet to improve, driving it to a net cash position next year.

Speaking of, the expert flagged the ASX coal share’s valuation as another positive, writing:

At a stock price of $2.90, [Stanmore] trades on low EV/EBITDA multiples of 2.0-2.5 times in [calendar year 2022-2023], which seems too cheap given the quality of its asset base.

Stanmore isn’t the only ASX coal share market experts are tipping will rise.

Experts are divided about the future of the Whitehaven share price, however many are hopeful it could post notable gains. Meanwhile, others believe Yancoal Australia Ltd (ASX: YAL) shares are a value coal buy.

The post Up 30% in a month, the ASX coal share that still ‘seems too cheap’: expert appeared first on The Motley Fool Australia.

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More reading

• 5 ASX shares that have crushed the market this year
• Why Allkem, Karoon Energy, Stanmore Resources, and Whitehaven Coal are charging higher

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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