The Lake Resources NL (ASX: LKE) share price has tumbled into the red this afternoon despite a strong performance from many of the company’s fellow S&P/ASX 200 Index (ASX: XJO) lithium stocks.

Right now, the Lake Resources share price is $1.19, 1.65% lower than its previous close.

For context, the ASX 200 is down 0.99% right now while the S&P/ASX 200 Materials Index (ASX: XMJ) is recording a 0.29% gain.

Let’s take a closer look at what might be going on with the lithium share today.

Is this driving the Lake Resources share price today?

Shares in Lake Resources have tumbled into the red this afternoon after spending much of the day in the green.

It comes as lithium shares lead the way in the materials sector. The Allkem Ltd (ASX: AKE) share price is currently the sector’s best performer, followed by that of Pilbara Minerals Ltd (ASX: PLS). They’ve gained 5% and 3.15% respectively.

Their strong performance comes after Pilbara Minerals released its full-year earnings this morning, detailing its maiden profit. The company posted $1.2 billion of revenue, $814.5 million of earnings before interest, tax, depreciation, and amortisation (EBITDA), and $561.8 million of net profit after tax (NPAT).

Of course, such exciting news from the lithium giant may have turned the market’s attention to some of its peers. Though, Lake Resources shares appear to have missed out.

It’s also worth noting that recently Macquarie upgraded its outlook for lithium. Such bullish sentiment might also be driving some lithium shares to outperform today.

The broker tipped lithium carbonate and hydroxide prices to stay higher for longer than previously expected and predicted spodumene will reach US$5,000 a tonne on a quarterly average, as my Fool colleague Brendon reported yesterday.

That might mean more blue (or green) skies for the Lake Resources share price in the future.

The stock is already 10% higher than it was at the start of 2022. It has also gained 113% since this time last year.

The post Why is Lake Resources underperforming other ASX 200 lithium shares right now? appeared first on The Motley Fool Australia.

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• Is the Flight Centre share price a buy ahead of Thursday’s FY 2022 earnings report?
• Is the Santos share price a buy following the company’s monster profit?
• Pilbara Minerals share price charges higher on strong FY22 result

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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The Camplify Holdings Ltd (ASX: CHL) share price is down 5.56% in afternoon trade, having earlier posted intraday losses of more than 13%.

Camplify shares closed yesterday at $2.52 and are currently trading for $2.38 each.

The company, which provides a peer-to-peer digital marketplace platform that connects recreational vehicle owners with hirers, released its full-year results for the 12 months ending 30 June (FY22) this morning.

Here are the highlights.

Camplify share price drops on growing losses

• Revenue of $16.4 million, up 94% year on year
• Net loss after tax of $8.2 million, compared to a $2.1 million loss in FY21
• Net cash outflows of $6.1 million, compared to net cash inflows of $16.4 million in FY21
• Total equity at 30 June of $9.4 million, down from $14.1 million the prior year

What else happened during the year?

The company noted its business was impacted by pandemic-related travel restrictions for much of the 2022 financial year.

It attributed its strong revenue growth to a 61% increase in hirer revenue and a 280% increase in van sales from FY21.

Cost of sales was up, however, increasing from $2.6 million in the prior year to $6.3 million in FY22.

Gross profit margins fell to 46%, down from 62% in the prior year. Margins were impacted by increased insurance premiums and a revenue recognition change. Camplify said its increased insurance costs will be passed on in full in FY23.

The retention rate of hirers, a key focus area for Camplify, increased to 25% during the year, up from 20% the previous year. The company also grew its customer database by some 88,000 customers.

What did management say?

Commenting on the results, Camplify CEO Justin Hales said:

Camplify is a business with significant growth potential, and substantial scalability opportunities. Camplify has delivered on its strategic outcomes in FY22 by clearly building on customer demand to record four quarters of continued growth.

As growth continues in FY23 based on customer demand, Camplify will position the business to ensure scalability, and automation will deliver improved bottom line results, on our road towards profitability.

What’s next?

While not providing specific guidance, Camplify noted a big uptick in future booking values, boding well for the travel demand outlook in FY23.

As at 30 June, Camplify had $14.7 million in future bookings, compared to $7.0 million in FY21. The company stated, “This over doubling of future bookings clearly demonstrates from customers their intention to travel in FY23.”

Camplify share price snapshot

It’s been a difficult year for the Camplify share price, down 42% since the opening bell on 4 January. By comparison, the All Ordinaries Index (ASX: XAO) is down 8% year-to-date.

The post Camplify share price sinks 6% on growing FY22 losses appeared first on The Motley Fool Australia.

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More reading

• ‘Strong growth’: Expert says buy this ASX company that just doubled revenue
• Camplify share price leaps 6% as revenue more than doubles

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 Camplify Holdings Limited. 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 Service Stream Limited (ASX: SSM) share price is tanking after the company released its full-year FY22 preliminary results today.

Service Stream shares opened the session on Tuesday at 94 cents each. They then dipped as low as 82 cents in early trading — a 19.6% decline on the closing price of $1.02 yesterday.

The Service Stream share price has recovered a little to 85.2 cents at the time of writing.

Service Stream share price dives on 20% profit decline

The key metrics are as follows:

• Total group revenue of $1,563.8 million, up 94.5% on the prior corresponding period (pcp)
• Revenue from ordinary activities of $1,516.5 million, up 88.6% pcp
• Loss from ordinary activities of (36,324,000), down 224.1% pcp
• Adjusted net profit after tax (NPAT) of $31.4 million, down 19.4% pcp
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) from operations of $91.1 million, up 13.7% pcp
• Generated $98.7 million of operating cash flow before interest and tax (OCFBIT), up 24% pcp
• EBITDA to OCFBIT cash conversion of 108%
• Net debt of $81.3 million and closing net leverage of 1.52 times as at 30 June
• Final dividend of 1 cent per share declared (fully franked).

The essential services provider described FY22 as “challenging” but also “transformational” due to its acquisition and “successful” integration of Lendlease Services.

What else happened in FY22?

Service Stream announced the Lendlease Services acquisition on 21 July 2021 along with a $185 million capital raising to fund the purchase. Service Stream completed the deal on 1 November 2021.

The company said:

The subsequent integration program, including the realisation of $17m in targeted synergies, continues to be delivered over the 18-24 month period with the business making solid progress during the year. Profit contribution across the acquired business was in line with diligence expectations…

The company said its “balance sheet remains in a strong position, with significant headroom to support future growth”.

Service Stream said “strong post acquisition cashflows” meant the company could resume paying dividends. The company ceased paying dividends in August 2021 to help fund the Lendlease acquisition. It did not pay a final dividend for FY21 nor an interim dividend for FY22.

The ex-dividend date is 19 September and shareholders will receive their payments on 5 October.

What did management say?

Service Stream Chair Brett Gallagher said:

The Board have been delighted by the way in which Management has navigated the business through the headwinds of the FY22 financial year and managed the acquisition of Lendlease Services. It is pleasing that the fundamentals of our business remain robust and performance over this transformational year enables the resumption of dividends.

The Board remains confident that our specialist capabilities and service offerings uniquely position the business across a stable and dependable client base of utility, telecommunications and road asset owners and operators.

What’s next?

Today’s results are preliminary and unaudited. The company explained: “Due to unforeseen and significant COVID-19-related disruptions to a significant number of personnel, certain audit processes and procedures are still to be finalised before the Company releases its audited FY22 full-year accounts to the ASX. Service Stream expects audited accounts to be released on Friday 26 August 2022.”

Looking ahead to FY23, managing director Leigh Mackender said:

The Group is confident of delivering further revenue and profit growth during FY23 on the back of a full-year’s contribution from Lendlease Services, subject to successfully navigating any extreme adverse weather events and effectively managing continuing labour / resource challenges, supply chain impacts or other major market disruptions.

In support of our strategy for continued growth and diversification, the priorities for the coming year include finalising the Lendlease Services integration, realising remaining business synergies and securing organic growth opportunities across each of the Group’s core markets.

Service Stream share price snapshot

The Service Stream share price is up more than 6% year to date and down 4% over the past 12 months.

The post Service Stream share price crashes 19% on ‘challenging’ FY22 appeared first on The Motley Fool Australia.

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More reading

• Camplify share price sinks 6% on growing FY22 losses
• Why Altium, Ansell, Monadelphous, and Pilbara Minerals shares are charging higher
• Why is the Credit Corp share price crumbling 6% today?
• Why is the Allkem share price acing it on Tuesday?
• Why is the Woodside share price having such a cracker of a day?

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

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The S&P/ASX 200 Index (ASX: XJO) is on course to record a second sizeable decline in as many days. At the time of writing, the benchmark index is down 1% to 6,975.7 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are charging higher:

Altium Limited (ASX: ALU)

The Altium share price has rocketed 20% higher to $35.99. This follows the release of the electronic design software company’s full year results which smashed expectations. Altium was guiding to revenue of US$213 million to US$217 million with an EBITDA margin at the lower end of 34% to 36%. However, it delivered revenue of US$220.8 million and an EBITDA margin of 36.7%. The team at Bell Potter were particularly impressed.

Ansell Limited (ASX: ANN)

The Ansell share price is up over 8% to $27.30. Investors have been buying this health and safety products company’s shares following the release of its full year results. Ansell reported a 3.7% decline in sales revenue to US$1.95 billion and a 32.1% drop in EBIT to US$228.1 million. While not great on paper, this was better than the market was expecting from Ansell.

Monadelphous Group Limited (ASX: MND)

The Monadelphous share price is up 6% to $12.12. This morning this engineering company released its full year results and revealed 1.2% decline in revenue to $1.93 billion but an 11% lift in net profit after tax to $52.2 million. This result was driven by record maintenance and industrial services revenue, which grew 19.4% to $1.17 billion.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price is up 3% to $3.27. This follows the release of a full year result which revealed stunning profit growth in FY 2022. Thanks to sky high lithium prices and strong production, the company reported EBITDA of $814.5 million for the 12 months. This was up from just $21.4 million a year earlier.

The post Why Altium, Ansell, Monadelphous, and Pilbara Minerals shares are charging higher appeared first on The Motley Fool Australia.

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More reading

• Why is the Allkem share price acing it on Tuesday?
• Wall Street Slumps | Pilbara Minerals stunning profits | Kogan shares look cheap, Altium shares less so…
• Monadelphous share price leaps 12% on record maintenance and industrial services revenue
• Ansell share price surges 10% as full-year revenue comes in at US$1.9b
• Pilbara Minerals share price charges higher on strong FY22 result

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 Altium. The Motley Fool Australia has recommended Ansell Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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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.

Tesla‘s (NASDAQ: TSLA) 3-for-1 stock split proposal won shareholder approval at the 2022 annual shareholders’ meeting this month. Now, the electric vehicle maker is gearing up for its second stock split after close of trading on Aug. 24. Shareholders of record on Aug. 17 will receive a stock dividend of two extra shares for every one share they currently own.

If you’ve been wondering how stock splits work and what will happen to your Tesla shares, here are three quick items to jot down. 

1. You’ll have more Tesla shares after the stock split

A stock split increases the number of shares outstanding, giving investors more shares in their account for every one share they previously owned.

After a stock split, the value of each share will be reduced to a lower price. This makes it easy for more retail investors to get their hands on a whole share of stock, because the stock price appears more affordable. If you’re already an investor, your shares will be split into bite-sized pieces, but the total value of your shares will not increase. 

Let’s say you have one share of Tesla’s stock. On the day of the 3-for-1 stock split, the company will grant you two additional shares. Each share in your portfolio would be valued at one-third the price of the original share. If one Tesla share is trading at $900 before the stock split, you’ll have three Tesla shares valued at $300 each after the stock split. As you can see, the total value of your shares is still $900. 

Here’s how many shares you will have after the stock split based on the number of shares you have on record as of Aug. 17. All you have to do is look at the number of shares you have now, and multiply the total by three. That’s how many shares you’ll have after a stock split. 

• 1 share of Tesla stock = 3 shares 
• 2 shares of Tesla stock = 6 shares 
• 3 shares of Tesla stock = 9 shares 
• 4 shares of Tesla stock = 12 shares 
• 5 shares of Tesla stock = 15 shares

2. You won’t have to report the stock split itself on your tax return

A stock split doesn’t increase a company’s market capitalisation or increase the value of your shares. You may have more shares in your account, but the original value of your shares remains the same. Therefore, a stock split in itself is not considered a taxable event. There are no IRS reporting requirements you need to adhere to during tax time. 

3. You may have to pay taxes if you sell your extra Tesla shares

Although a stock split in itself is not taxable, selling stock for a profit after a stock split can lead to taxes. This is the case if you sell stock in a taxable brokerage account. Earning money in the stock market leads to capital gains taxes. You will be taxed at the short-term or long-term capital gains tax rate, depending on how long you had your Tesla stock before selling it. Your brokerage firm will send you the details of your transaction, so you can properly report the sale to the IRS during tax time. 

Stock splits can be exciting and pain-free in the eyes of the investor. You wake up to more shares in your account after a stock split, and you don’t have to worry about any tax obligations. But as soon as you decide to sell, you’ll need to report your moves to the IRS. Before you make a move after a stock split, pay attention to the impact it will have on your portfolio and taxes, so you won’t be surprised later. 

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

The post 3 things you should know about the Tesla stock split appeared first on The Motley Fool Australia.

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More reading

• Why Tesla shares are falling ahead of its stock split
• Why Tesla stock dropped Monday
• Why Tesla stock was up again today
• Investors should wait for these 2 signals before buying Tesla
• Why today’s jump in Tesla shares surprised investors

Charlene Rhinehart, CPA has positions in Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Tesla. 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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Despite its century-long history as an ASX listed investment company (LIC), the Australian Foundation Investment Co Ltd (ASX: AFI) share price, or AFIC for short, continues to attract investor attention in 2022.

Perhaps this is due to AFIC’s continuing ability to outperform ASX-based index funds like the Vanguard Australian Shares Index ETF (ASX: VAS).

Or perhaps it’s due to AFIC’s long history. Whatever the reasons, the fact remains that today, AFIC has a market capitalisation of almost $9.5 billion, making it one of the largest passive investment vehicles on the ASX.

LICs like AFIC aren’t normal ASX companies. They instead invest their capital in other assets (including ASX shares) on behalf of their investors.

So now that AFIC has reported its preliminary earnings for the 2022 financial year, it might be a good time to look back and see how this LIC’s portfolio has changed over FY 2022.

The first thing to note is that AFIC’s investment portfolio had a tough financial year. Back in June 2021, the LIC reported that its net asset backing per share (before tax) stood at $7l45. Fast forward to 30 June 2022 and this had shrunk 11% to $6.63. But let’s dig into the specifics.

AFIC’s not-so-different ASX share portfolio of FY2022

At the end of FY21, AFIC reported that its top 10 shares were as follows

1. Commonwealth Bank of Australia (ASX: CBA), with a portfolio weighting of 8.8%
2. BHP Group Ltd (ASX: BHP) at a weighting of 7.3%
3. CSL Limited (ASX: CSL) at 6.9%
4. Wesfarmers Ltd (ASX: WES) at 4.9%
5. Westpac Banking Corp (ASX: WBC) at 4.5%
6. Macquarie Group Ltd (ASX: MQG) at 3.8%
7. Transurban Group (ASX: TCL) at 3.8%
8. National Australia Bank Ltd (ASX: NAB) at 3.3%
9. Woolworths Group Ltd (ASX: WOW) at 2.7%
10. Australia and New Zealand Banking Group Ltd (ASX: ANZ) at 2.7%

Let’s now take a look at AFIC’s top 10 shares as of 30 June 2022:

1. Commonwealth Bank at 8.8%
2. CSL at 7.9%
3. BHP at 7.1%
4. Transurban at 5.1%
5. Macquarie Group at 4.5%
6. Wesfarmers at 3.8%
7. NAB at 3.7%
8. Westpac at 3.7%
9. Woolworths at 3.2%
10. Amcor CDI (ASX: AMC) at 2.6%

So as is evident, there really haven’t been too many dramatic changes to AFIC’s ASX share portfolio over FY22. BHP and CSL have swapped places. And AFIC has traded in some Westpac and ANZ shares for more NAB and Macquarie shares.

But this is probably what AFIC’s investors expect. After all, the LIC prides itself on its long-term investment horizon and performance. And we know that a high portfolio turnover can increase transaction costs and taxes.

As of 31 July 2022, AFIC has returned an average of 12.2% per annum over the past 10 years (including dividend and franking returns). At the current AFIC share price, this ASX LIC has a dividend yield of 3.11%.

The post How has the AFIC ASX share portfolio changed over FY22? appeared first on The Motley Fool Australia.

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More reading

• Why is the AFIC share price sliding today?
• The CBA share price looks downright expensive
• Why I prefer AFIC shares to an ASX 200 index fund today
• Keen to bag the next AFIC dividend? Read this
• Why did the AFIC share price have such a top run in July?

Motley Fool contributor Sebastian Bowen has positions in CSL Ltd. and National Australia Bank Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd. The Motley Fool Australia has positions in and has recommended Amcor Limited and Wesfarmers Limited. The Motley Fool Australia has recommended Macquarie Group Limited and Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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1) So much for the start of the next bull market…

Overnight, US stocks posted their worst day since June as investors doubted (again) whether the Federal Reserve will temper its monetary policy tightening.

According to Bloomberg, hedge funds are positioned to profit should Federal Reserve Chair Jerome Powel “effectively rule out a dovish pivot” at the central bank’s Jackson Hole symposium later this week.

Stocks had rallied from their June lows as 10-year US bond yields fell from around 3.5% to 2.5% as markets hoped for an easing in the pace of interest rate rises.

Source: Trading Economics

But all that has come to a screeching end as bond yields have reversed their fall, now back up to 3%.

Interest rate expectations will continue to drive the direction of stock markets in the short-term, as they should. 

Longer-term, for stock pickers, underlying earnings growth will drive the share prices of individual companies, as they should.

2) The S&P/ASX 200 Index (ASX: XJO) has followed Wall Street’s lead lower, although falls have been modest as large-cap stocks have held up reasonably well on the back of higher commodity prices. 

The BHP Group Ltd (ASX: BHP) share price and the Fortescue Metals Group Limited (ASX: FMG) share price both rose on the back of a gain in the iron ore price. Both stocks trade on very attractive fully franked dividend yields.

The Pilbara Minerals Ltd (ASX: PLS) share price jumped 4% higher after the leading ASX-listed lithium company reported a massive 577% increase in sales revenue to $1.2 billion and a maiden full year profit of $562 million. 

Pilbara said it was “buoyed by exceptionally strong global demand for lithium raw materials and positive pricing conditions for spodumene concentrate, particularly in the second half of the year.”

The company is one of the poster children for the rise in demand in electric vehicles, and these are a stunning set of results. But high demand inevitably incentivises increased supply, something Credit Suisse analyst Matthew Hope recently said could lead to a looming period of oversupply.

Successful investing in commodity stocks requires a good degree of market timing combined with a dose of luck. 

3) Amongst other ASX 200 companies reporting today, going the other way is the Endeavour Group Ltd (ASX: EDV) share price, down 10% to $7.45.

Spun out of Woolworths Group Ltd (ASX: WOW), Endeavour is the home to a portfolio of pubs plus liquor chains Dan Murphys and BWS.

According to the AFR, CEO Steve Donohue told analysts he expects the market will return to normal after two bumper years. Supply chain costs dinged profits in the second half, “a factor that some on the investor call say is driving the plunge in the company’s shares today.”

The falling Endeavour Group share price might also have something to do with it trading on an earnings multiple of 27 times and a dividend yield of just 2.7%. The risks look to be to the downside.

4) Speaking of downside, the Kogan.com Ltd (ASX: KGN) share price is on the nose after reporting a small loss as revenue slipped by 8% and gross profit declined by 9%.

CEO Ruslan Kogan admitted his bet that the pandemic acceleration of sales was not going to stop was wrong. This led to Kogan holding excess inventory and an associated increase in variable costs and marketing costs to sell through the inventory.

Kogan.com scrapped its final dividend as it “works through a period of consolidation to return to growth in profits.”

Having reset the business to this more normal trading environment, Kogan is banking on the continued growth of online shopping and its huge range of products delivered to customers’ doors at great prices.

With a market capitalisation of $380 million, and net cash of $31 million, Kogan shares look cheap, trading at around 0.5 times sales. 

July trading saw adjusted EBITDA of $1.5 million, giving shareholders hope the turnaround is taking shape. If only we weren’t staring at an economic slowdown as interest rate rises start to kick in to discretionary spending…

Still, Kogan shares could be worth a look, especially if the share price falls back down to around the $3 mark.

5) Despite the Nasdaq slumping 2.55% overnight, and Zoom Video Communications cutting its annual revenue forecast, saying it’s losing sales from consumers and small business faster than anticipated, founding member of the now defunct WAAAX stocks – Altium Limited (ASX: ALU) – is proving there’s life yet in tech stocks, with Altium shares soaring almost 20% after reporting results that smashed expectations.

While Altium shareholders are popping the champagne corks today, like many other growth stocks, the Altium share price has been smashed so far this year, down over 20%. Still, when you compare it to fellow ASX 200 tech stocks like Block Inc (ASX: SQ2) and Xero Limited (ASX: XRO) – down 39% and 38% respectively year to date – it’s not as bad as it could have been. 

Unfortunately, quality doesn’t come cheap. Altium shares trade on 84 times trailing earnings.

The post Wall Street Slumps | Pilbara Minerals stunning profits | Kogan shares look cheap, Altium shares less so… appeared first on The Motley Fool Australia.

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• Pilbara Minerals share price charges higher on strong FY22 result
• Endeavour share price drops 9% despite $495 million profit
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Motley Fool contributor Bruce Jackson has positions in Block, Inc. and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Block, Inc., Kogan.com ltd, Xero, and Zoom Video Communications. The Motley Fool Australia has positions in and has recommended Block, Inc., Kogan.com ltd, and Xero. The Motley Fool Australia has recommended Zoom Video Communications. 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 Commonwealth Bank of Australia (ASX: CBA) share price slipped 0.29% on the release of its annual report earlier this month. And released alongside the company’s earnings was its inaugural climate report, produced in partnership with the CSIRO.

Astoundingly, the report found a significant chunk of the bank’s home loan portfolio could be at increasing risk of natural catastrophes.

Let’s take a closer look how climate change could put a disastrous dint in CBA’s portfolio.

Right now, the CBA share price is $97.63, down 1.34% on the day.

$31.2b of CBA home loans at risk of climate change

Floods, cyclones, and fires could pose a greater risk to Australian homes – and to CBA – than those holding shares in the bank may have thought.

Recent analysis found $31.2 billion of its Australian home loans are at risk of such disasters, which are likely to be exacerbated by climate change.

CBA chair Catherine Livingstone and CEO Matt Combyn commented in the bank’s climate report, saying:

As changes to the climate accelerate, Australia is likely to see more frequent and severe weather events such as droughts, floods, bushfires, and storms. These are some of the physical risks of a changing climate with the potential to impact economic productivity and community wellbeing.

Right now, 3.1% of CBA’s assessed exposures are located in areas with potentially increasing climate risks, such as cyclone-exposed coastal regions, low-lying flood plains, and rural areas close to urban fringes.

And such areas might soon expand. The report noted that, under a severe physical risk scenario for climate change by 2050, cyclones could migrate south. It stated:

If this happened in the north of New South Wales, where construction standards have not been designed to resist cyclones, material losses could be observed which are not currently reflected in our current estimates.

Currently, 38,000 properties mortgaged by the bank, with a combined value of $11 billion, are at risk of cyclones.

Another 56,000 – $19 billion worth – are at risk of flooding while 5,000 – worth a total of $2 billion – are at risk of fire.

It also found $14 billion of its home loans are in communities economically dependent on the coal value chain. Of course, much of that value is at risk of the climate transition.

CBA share price snapshot

The CBA share price has been outperforming the broader market so far this year.

It has slumped 4% since the start of 2022 and has dumped 2% since this time last year.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) has slipped 8% year to date and 6% over the last 12 months.

The post Own CBA shares? $31b of the bank’s home loans face increasing climate risks 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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The Monadelphous Group Ltd (ASX: MND) share price is rocketing today following the release of the company’s full-year results.

At the time of writing, the engineering company’s shares are up 7.52% to $12.30 each. Earlier today, they hit a high of $12.795 a share, 11.84% higher than yesterday’s closing price.

Monadelphous share price rises as record maintenance and industrial services revenue soars

Monadelphous delivered its FY 2022 results for the 12 months ended 30 June 2022. Here are some of the key financial highlights:

• Total revenue down 1.2% year-on-year to $1.93 billion
• Record maintenance and industrial services revenue up 19.4% to $1.17 billion
• Net profit after tax (NPAT) up 11% to $52.2 million
• Earnings per share (EPS) up 10.5% to 54.9 cents
• Final dividend of 25 cents per share, fully franked, bringing the full year dividend to 49 cents per share, up 8.9%
• Cash on hand up 4.3% to $183.3 million

What happened in FY 2022?

Monadelphous reported an outstanding financial performance on the back of positive market conditions throughout the year.

The business experienced strong demand for maintenance services across the resources and energy sectors. This was underpinned by customers maintaining high levels of production, capitalising on favourable commodity prices.

Monadelphous’ maintenance and industrial services division reported record revenue of $1.17 billion. Management highlighted the increased activity in oil and gas as well as Chile and PNG operations which drove the result.

In addition, the engineering construction division reported revenue of $774.4 million for the year. Revenue declined towards the backend of the financial year, however, as numerous projects were completed in the first half. This included BHP’s South Flank Project, Rio Tinto’s West Angelas Deposits C & D Project, and MARBL Lithium joint venture’s Kemerton lithium hydroxide plant.

On the bottom line, the company achieved an NPAT of $52.2 million, an increase of 11% on the prior corresponding period.

The Monadelphous board declared a final dividend of 25 cents per share, fully franked, yielding a dividend payout ratio of 90%.

What did management say?

Monadelphous managing director Rob Velletri talked about the favourable market conditions providing the company opportunities for growth. He said:

Demand for our maintenance services is expected to remain strong and resource developments in iron ore and oil and gas as well as the significant pipeline of investment in battery metals and renewable energy will provide a solid volume of construction prospects in the coming years. However, a highly competitive labour market will remain the major challenge.

What’s the outlook for FY 2023?

Looking ahead, Monadelphous advised that there’s a significant number of opportunities across resources and energy sectors in Australia and overseas.

In particular, the Australian iron ore industry is expected to “remain buoyant with capital and operating expenditures required to sustain iron ore production levels”.

Furthermore, the strong hype surrounding the electric vehicle revolution is driving substantial investment in battery metals. This includes lithium, copper, nickel, and rare earths.

Monadelphous said these markets will present ongoing opportunities for its projects in Australia, South America, Mongolia, and Papua New Guinea.

Lastly, favourable conditions in the oil and gas sector are also buoyant with construction opportunities from new LNG projects currently in the pipeline. Demand for oil and gas maintenance services is anticipated to remain strong.

While Monadelphous spoke about the outlook, it did not provide any earnings or profit guidance for FY 2023.

Monadelphous share price snapshot

In 2022, the Monadelphous share price has gained 32% and is up 7% when looking over the last 12 months.

For context, the S&P/ASX 200 Industrials (ASX: XNJ) sector is down 3% for the current calendar year.

Monadelphous commands a market capitalisation of approximately $1.18 billion.

The post Monadelphous share price leaps 12% on record maintenance and industrial services revenue appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras 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 Estia Health Ltd (ASX: EHE) share price shows why you can’t only judge a company by its headline results.

Shares in the aged care provider are holding up well even after it turned in a net loss of $52.4 million for the financial year ending 30 June 2022.

The Estia share price is currently up 1% to $2.02, while the All Ordinaries (ASX: XAO) is down 0.6%.

Summary of Estia’s FY22 results

• Total revenue improved 2.2% to $680 million
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) Mature homes: $37.5m (FY21: $61.4m)
• COVID-19 costs impact: $42.3 million of net unrecovered costs
• Net loss after tax of $9.6 million before bed licence amortisation (NPATA)
• Net loss after tax of $52.4 million after bed licence amortisation, compared to a profit of $5.6 million in FY21
• No final dividend declared

What else happened?

The impact of COVID-19 on the sector is well documented. Some will say a lot of bad news is already reflected in the Estia share price, which is trading at the lower end of its 52-week trading range.

Further, there are signs of a silver lining to the company’s FY22 results. One was the $50.4 million in extra COVID costs to cover the likes of testing, quarantine, and personal protective equipment.

As the pandemic eases, these costs should ease and flow back to its EBITDA line. If this thinking holds true, FY23 EBITDA could show an improvement.

Additionally, the average occupancy rate remains high and stable at 91.6%, which is up from a low of 90% in February this year.

What may also be pleasing investors is Estia’s average incoming Refundable Accommodation Deposit (RAD), a standard room price set by the aged care home and paid by a refundable lump sum. This amount was $453,000, which exceeded the outgoing RAD by $47,000.

What Estia said about its FY22 results

Commenting on the results, Estia chief executive Sean Bilton said:

The commitment and loyalty of the aged care workforce has been exceptional during the last two years, notwithstanding the fact that rates of pay lag comparable sectors. The current Fair Work Commission work value case may provide a trigger for greater parity, making the sector more attractive to employees and facilitating the required growth and funding of the sector workforce.

The regulatory landscape is nearing a point where we should have a higher level of certainty for the first time in four years. The Group is well-placed to benefit from opportunities created by a more competitive and transparent sector

What’s next?

Despite Bilton’s positive commentary, the company painted a cautious outlook. It noted uncertainties remain, which may affect the financial performance of Estia.

The tighter regulatory requirements for the sector following the Aged Care Royal Commission also introduce another level of uncertainty.

Estia would only say that it will use capital in a disciplined way to take advantage of growth opportunities.

One has to wonder if mergers and acquisitions are part of the equation. After all, the turmoil in the sector has put the M&A spotlight on operators in this space.

Estia share price snapshot

The Estia share price has shed almost 10% over the past year, while the All Ordinaries has lost around 7%.

In contrast, its peer Regis Healthcare Ltd (ASX: REG) has gained 3.6% over the same period.

The post Estia share price lifts despite $50m loss appeared first on The Motley Fool Australia.

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Motley Fool contributor Brendon Lau 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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