The BrainChip Holdings Ltd (ASX: BRN) share price is fired up on Tuesday despite no announcements from the company.

At the market open, the artificial intelligence (AI) technology company’s shares started off at $1.13.

However, throughout the day, the shares have gradually climbed to reach an intraday high of $1.21, up 6.14%.

Let’s take a look at what’s moving the BrainChip share price today.

Why is BrainChip soaring on Tuesday?

Investors are bidding up the BrainChip share price following a broader uptick in the S&P/ASX All Technology Index (ASX: XTX).

After touching a 23-month low of 1,756 points, the ASX tech sector has continued to rebound strongly as investor confidence grows.

Today, the benchmark index for Australian technology-orientated companies is up 1.77% to 2,299 points, making it the best-performing sector.

The market appears to have shrugged off the weaker-than-expected revenue from Nvidia Corporation and other semiconductor companies.

Currently, the NASDAQ 100 futures are in the green by 0.23% as Wall Street looks ahead to more earnings results and inflation data. This will provide a clearer sign on how the economy is tracking and if another rate hike is around the corner.

The July consumer price index in the US is due to be released on Wednesday.

Whatever happens on the NASDAQ will undoubtedly impact the ASX following the latest inflationary report.

Investors may want to keep a close eye on this piece of information.

BrainChip share price snapshot

Since the beginning of March, the BrainChip share price has been in a sideways channel around the $1 mark.

This is a sharp contrast from when its shares were fetching $2.34 at the start of 2022.

Nonetheless, if you invested 12 months ago, you’d be up 116%.

BrainChip presides a market capitalisation of approximately $1.95 billion.

The post Why is the BrainChip share price bouncing 6% higher today? appeared first on The Motley Fool Australia.

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• This US investment house has made tens of millions from Brainchip. Guess which other ASX share it’s backing
• Here are the top 10 ASX 200 shares today
• Why did the BrainChip share price rocket 36% in July?
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why BrainChip, Fortescue, PointsBet, and Zip shares are dropping

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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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.

Contrary to popular belief, the metaverse is not a new notion. The term was coined by bestselling author Neil Stephenson in his science fiction novel Snow Crash all the way back in 1992. That said, there’s no doubt that the concept has been generating more headlines of late as a host of businesses race to cash in on this idea of a persistent 3D virtual world backed by technologies including virtual reality (VR), augmented reality (AR), artificial intelligence (AI), and blockchain.

Generally speaking, investors tend to view metaverse-centric companies such as Roblox Corporation (NYSE: RBLX) and Unity Software as riskier investments, but there are some exceptions. Let’s have a look at two safer stocks that offer investors a great chance to profit from the creation of the metaverse. And by safe, I mean these companies are already strongly profitable and cash-flow positive, but still have tremendous upside potential in the metaverse arena.

1. Nvidia 

Nvidia‘s (NASDAQ: NVDA) graphics processing units (GPUs) and system-on-a-chip products are widely relied upon for gaming and 3D simulation, cryptocurrency mining, and the development of other business applications, many of which will be foundational to the metaverse. Likewise, its on-the-rise NVIDIA Omniverse platform has a chance to revolutionize the world as we know it. In essence, Omniverse is a platform designed for 3D real-time simulation and design collaboration. For example, BMW Group has used the platform to design a future car factory, creating and simulating an exact “digital twin” of the facility. Between Nvidia’s hardware and its Omniverse platform, it’s one of the companies with the most potential upside in the metaverse.

In its fiscal 2023 first quarter, which ended May 1, Nvidia’s total sales soared 46.4% year over year to $8.3 billion, and its adjusted earnings per share increased 49.5% to $1.36. On the profitability front, its adjusted gross and operating margins expanded by 90 and 255 basis points, respectively, to 67.1% and 47.7%. During the quarter, the tech giant also generated $1.4 billion in free cash flow, bringing its total over the past 12 months to $7.9 billion. As of the end of the quarter, Nvidia had $20.3 billion in cash and marketable securities on the books. For the year, Wall Street analysts expect the company’s revenues and earnings to climb by 23.9% and 20.3%, respectively, to $33.3 billion and $5.34 per share.

Those are rock-solid growth rates, and given that its shares have plunged by 36% since the start of 2022 and its current price-to-earnings ratio of 50.9 is well below its 5-year average of 59.0, Nvidia appears to be a smart investment today. 

2. Meta Platforms

As evidenced by its name change from Facebook to Meta Platforms (NASDAQ: META), this company is fully committed to its metaverse transformation. The social media giant’s Reality Labs business segment is focused on developing VR and AR hardware and software, such as its Oculus Quest 2 headset, in addition to other metaverse platforms like Horizon Worlds. In the second quarter, Meta’s research and development spending rose by 42.6% year over year to $8.7 billion as it continued to ramp up its investments in the space. Meanwhile, Reality Labs booked a $2.8 billion operating loss, wider than its $2.4 billion loss in the same quarter a year ago.

It will take time for the company’s metaverse plans to come to fruition, but investors shouldn’t fret. The social media king has $40.5 billion in cash and marketable securities on the books, and has generated $35.8 billion in free cash flow over the past year. And its revenue from advertising — the backbone of its business — totaled $28.2 billion in the quarter, equal to 98% of total sales.

In short, Meta is well-funded to further its metaverse ambitions, all while enjoying a steady stream of income from its world-class ad business via its Facebook platform. Today, the Facebook platform boasts 2.9 billion monthly active users, equal to more than one-third of the global population. And similar to Nvidia, Meta has had a rough year in the stock market up to this point. Its shares have fallen by about 50% since the beginning of 2022. That has dragged its price-to-earnings ratio down to an all-time low of 13.6, well below its five-year average of 27.9. 

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

The post Here are 2 safe Metaverse stocks for risk-averse investors 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. Luke Meindl 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., Nvidia, and Roblox Corporation. The Motley Fool Australia has recommended Meta Platforms, Inc. and Nvidia. 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 DevEx Resources Ltd (ASX: DEV) share price is riding an enormous wave on Tuesday after announcing the discovery of high-grade uranium. 

DevEx shares are currently swapping hands for 38.5 cents a share, 28.33% higher than yesterday’s closing price. Earlier today, the company’s shares hit 43 cents a share, an intraday spike of more than 43%.

The ASX minerals explorer seems to have struck early success at its 100%-owned Nabarlek Uranium Project. 

Let’s get stuck into some further details on the company’s project milestone.

What has DevEx found? 

The Nabarlek Uranium Project is located in Alligator Rivers Uranium Province in the Northern Territory.

The Nabarlek uranium mine is considered Australia’s highest-grade uranium deposit with past production of 24Mlbs @ 1.84% U3O8. The DevEx drill campaign has uncovered the following uranium equivalent intercepts:

• 10.7m @ 1.20% eU3O8 from 123.4m, incl 3.2m @ 3.05% eU3O8
• 9.1m @ 0.15% eU3O8 from 50.5m, incl 0.4m @ 0.80% eU3O8

The region presents a major opportunity for the company as uranium may play a central role in a low-carbon future.

As well, electric vehicles need electricity to recharge and uranium can act as a primary energy source. 

This likely explains why optimism has rocketed the DevEx share price today.

The drill result ultimately means DevEx now knows such high-quality uranium exists. As a result, the drilling programme will be expanded with a second rig arriving shortly, according to the company. 

Management upbeat about future prospects

DevEx managing director Brendan Bradley said: 

Our 2022 drilling programme at Nabarlek is off to a flying start, with the early success at Nabarlek South and North Buffalo clearly demonstrating the scale and quality of the opportunity in this highly endowed uranium field. The historic Nabarlek uranium mine has shown that these high-grade deposits can exist within a lens of between 30m and 75m in length.

It’s important to focus on Bradley’s comment about the quality of the opportunity. The company’s fortunes are not yet set in stone because the uranium deposits need to be extracted before they can be sold. 

My view on the DevEx share price

In the last twelve months, the DevEx share price has risen by around 64%.

It’s certainly taken the opposite trajectory to the S&P/ASX 200 Index (ASX: XJO) which has fallen by around 7% in the last year.  

DevEx has a current market capitalisation of $121 million at the time of writing. 

I believe it’s important to understand the enormity of this discovery. It’s essentially moved DevEx further away from the proof of concept stage and closer to commercialisation. 

DevEx shares are a less speculative investment now but what does the future hold for the uranium market when more deposits are discovered by competitors? 

Also, what is the likelihood of there being an oversupply? 

These are some of the risks I’d be considering in evaluating DevEx as a potential investment. 

The post Guess which ASX mining share is surging 43% on a new uranium find appeared first on The Motley Fool Australia.

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Motley Fool contributor Raymond Jang 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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ASX lithium shares are charging higher today.

Drilling down to some of the biggest lithium stocks, the Lake Resources NL (ASX: LKE) share price is soaring 27.2%, shares in Core Lithium Ltd (ASX: CXO) have gained 9.3%; Allkem Ltd (ASX: AKE) shares are up 1.4%; and the Pilbara Minerals Ltd (ASX: PLS) share price is up 1.35%.

The big-name ASX lithium shares are handily beating the 0.2% gains posted by the All Ordinaries Index (ASX: XAO) at the same time.

So, what’s going on?

United States bill set to boost electric vehicle market

ASX lithium shares could be getting an extra boost today following the passage of a major spending bill in the US Senate addressing healthcare and climate change.

Of the roughly US$437 billion greenlighted by the Senate, some US$347 billion is earmarked for climate and energy spending.

It was a narrow victory for the White House-sponsored bill, with all 50 republicans voting against, tying the 50 democrats voting in favour. In the end, the bill passed 51 to 50 with a tiebreaking vote from Vice President Kamala Harris.

The House still needs to vote on the bill. But it’s widely expected to sail through that process, with democrats holding a majority of seats. President Joe Biden, an advocate of the bill, will then need to sign it into law.

So, how could this development further energise ASX lithium shares in the future?

Atop the wider focus on emissions reduction, the bill ends per-manufacturer limits for the US$7,500 tax credit for new electric vehicles (EVs).

As Electrek reported, the EV credit will be renewed commencing January 2023 and run for 10 years.

Under the previous legislation, EV tax credits had a cap of 200,000 cars per manufacturer. Tesla Inc and General Motors Company had already exceeded that cap “years ago”. Toyota Motor Corp exceeded the cap this quarter, with other EV manufacturers also looking to surpass that cap.

Importantly for ASX lithium shares, the bill includes language that stipulates “critical minerals” for the EV batteries must be sourced in the US, or from a nation with a free trade agreement with the US.

The US is eager to diversify its supply sources of critical battery minerals away from China, which has long dominated the industry.

How have these ASX lithium shares been tracking longer term?

Over the past 12 months, the Lake Resources share price has surged 98%.

The Core Lithium share price has performed even better, up 263% since this time last year.

Allkem is another ASX lithium share that has had a strong year, up 42%. The Pilbara Minerals share price is up 43%.

For some context, the All Ordinaries is down 7% over the 12 months.

The post Could this development further energise ASX lithium shares in FY23? appeared first on The Motley Fool Australia.

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• Why is the Core Lithium share price leaping 10% on Tuesday?
• Why is the Lake Resources share price powering up 17% today?
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Monday
• Why is the Lake Resources share price leaping 11% 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 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 Pointsbet Holdings Ltd (ASX: PBH) share price is currently up by 7%. That means that it’s now up by 12% for the week.

Pointsbet shares have gone up so much that it has risen by around 37% since 1 August 2022.

Today’s 7% rise comes at the same time that the S&P/ASX 200 Index (ASX: XJO) is up by just 0.1%. So, Pointsbet’s share price has experienced significant outperformance.

The Jumbo Interactive Ltd (ASX: JIN) share price is down 1.4% and the Tabcorp Holdings Limited (ASX: TAH) share price is up 0.7%. So, it’s not as though the entire ‘gambling sector’ is soaring.

The company hasn’t released any material information today. The last news that investors heard was the FY22 fourth quarter update. Updates can have an influence on the Pointsbet share price.

Quarterly recap

Looking at the overall numbers (which is Australia and the US combined), Pointsbet said that sports betting turnover for the quarter was $1.3 billion, up 32%. The sports betting gross win was up 24% to $122 million and (including iGaming) the total net win was up 41% to $85.8 million.

This meant that, for FY22, sports betting turnover was up 32% to $5 billion, the gross win went up 41% to $497.8 million and the overall net win (including iGaming) jumped 48%.

Pointsbet share price snapshot

Since the beginning of 2022, Pointsbet shares have fallen 44% despite today’s rise.

The post Investors are betting on the Pointsbet share price today, it’s up 7% appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
• Why is the Pointsbet share price up 8% on the ASX today?
• Why BrainChip, Fortescue, PointsBet, and Zip shares are dropping

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 Jumbo Interactive Limited and Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Jumbo Interactive Limited and Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Endeavour Group Ltd (ASX: EDV) share price has been one of the better performers on the S&P/ASX 200 Index (ASX: XJO) in recent times. Although Endeavour shares have only been on the ASX boards for a little over a year, the company has certainly made a big impact.

The Endeavour share price is currently trading at $7.80, down 0.95% for the day so far. But that still puts Endeavour up almost 15% year to date in 2022 thus far.

It also means Endeavour shares have risen 12.7% over the past 12 months, and a pleasing 28% since the company first listed in its own right back in June 2021.

In contrast, the ASX 200 remains down 7.5% in 2022 thus far, and down by 6.84% over the past 12 months. So Endeavour has been a bona fide market beater.

So we’ve already established that Endeavour has the capacity to outperform the broader markets. But here are two more reasons why I like the Endeavour share price for investment today.

The first reason why I like the Endeavour share price: Dividends

The first is dividends. So Endeavour used to be part of Woolworths Group Ltd (ASX: WOW) before it was spun out last year. Woolworths shares have always been a solid income investment, and today the company has a dividend yield of 2.46%.

But since Endeavour left the Woolworths nest, it has taken its dividends to the next level. Its first dividend was the final payment of 7 cents per share, fully franked, that investors received in September last year.

This year, Endeavour upped the ante, delivering an interim dividend of 12.5 cents per share, also fully franked. That’s an increase of close to 80% on its first payment.

Today, these payments give Endeavour a trailing dividend yield of 3.21%. That’s a solid yield and one that exceeds what its old parent company currently has on the table.

The second reason: The nature of the business

The second reason I like the Endeavour share price today is the inherent nature of the business. Endeavour is a consumer staples company that primarily sells alcoholic beverages.

Its BWS and Dan Murphy’s bottle shop chains are well known in Australia and have considerable market share and brand recognition. Alcohol is a vice and sales tend to be fairly stable, regardless of the economic climate.

This makes Endeavour a very recession-resistant company that will likely prosper in good times and bad. And that makes it a useful addition to any ASX share portfolio in my view. 

So that’s why I like the look of the Endeavour share price today. The company has had a very successful start to ASX life on its own terms, and I don’t see any reason why this success can’t continue.

At the current Endeavour share price, this ASX 200 company has a market capitalisation of $14.09 billion.

The post Here are 2 reasons why I like the Endeavour share price today appeared first on The Motley Fool Australia.

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

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The Core Lithium Ltd (ASX: CXO) share price is taking off on Tuesday, marking its fifth consecutive day in the green.

The stock is trading at $1.50 at the time of writing. That’s 9.93% higher than it was at yesterday’s close and 33% higher than it was this time last week.

For context, the S&P/ASX 200 Index (ASX: XJO) is up 0.08% right now having gained 0.4% over the last week.

So, what’s going on with the Core Lithium share price today? Let’s take a look.

What’s driving the Core Lithium share price higher?

The Core Lithium share price is surging upwards alongside many of its ASX lithium peers.

Indeed, the S&P/ASX 200 Materials Index (ASX: XMJ) is currently up 0.6%, led by the Lake Resources N.L. (ASX: LKE) share price. It’s leapt 23% to trade at $1.33 right now.

Other ASX 200 lithium shares are also up, with Liontown Resources Limited (ASX: LTR) and Allkem Ltd (ASX: AKE) rising 8.2% and 1.8% respectively.

Interestingly, there’s been no major news from any of the lithium favourites today. Though, there has been a bit going on with the sector this week.

Firstly, ASX lithium producers were found to be best in class in terms of environmental, social, and governance (ESG) criteria, The Canberra Times reported yesterday.  

Pilbara Minerals Ltd (ASX: PLS) and Mineral Resources Limited (ASX: MIN) reportedly topped the list compiled by Benchmark Mineral Intelligence.

Meanwhile, bullish guidance from major US lithium solutions producer Albemarle has hit headlines this week.

The company’s CEO Kent Masters expects the lithium market will continue to be tight for most of this decade, the Financial Times reports.

Such a happening would likely support lithium prices for years to come, bringing good news for the material’s producers.

The Core Lithium share price has gained 138% since the start of 2022. It’s also 266% higher than it was this time last year.

The post Why is the Core Lithium share price leaping 10% on Tuesday? 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 Corando Global Resources Inc (ASX: CRN) share price is up 7% after the coal mining company announced a massive earnings increase in its half-year FY22 results.

Shares in Coronado are currently trading for $1.615 apiece, up 6.6% on their previous closing price of $1.515.

The higher global price of coal sent the company’s adjusted earnings before interest, tax, depreciation, and amortisation (EBITDA) up a massive 3,204% from the HY21 figure.

Let’s check the details of the company’s results for the half year ending 30 June 2022.

Coronado’s half-year earnings highlights

• Revenue US$1,978 million, up 147.4% from HY21
• Net income US$562 million, up 685% from HY21
• Adjusted EBITDA US$849 million, up 3,204% from HY21
• Group average realised met price per tonne sold US$292.8/t, up 193.4% from HY21
• Half-year dividend declaration of US$125 million, or US 7.5 cents per CDI

Coronado’s revenues were spurred by an increase in metallurgical coal pricing, as well as higher global demand for steel. Another factor in its favour was the reduced global supply of coal during HY22 amid the conflict in Ukraine.

However, one headwind the company reported for this half of the year was lower sales and production volumes. These were affected by wet weather, maintenance, and geological problems, Coronado said. 

Another issue was higher costs per tonne sold. The company cited inflation, lower production volumes, and increased royalties as the main causes.

What else happened in FY22?

In June, Coronado was included in the S&P/ASX 200 Index (ASX: XJO).

The company also released a sustainability report outlining its plans to reduce emissions and better care for the environment.

Coronado’s share price slipped 3% amid the company’s annual general meeting in May. This selloff was despite the metallurgical coal index reaching a record price of US$670 per tonne in March.

What did management say?

Coronado Managing Director and CEO Gerry Spindler made the following comments regarding the company’s performance:

Coronado’s half-year Adjusted EBITDA eclipses the highest full-year Adjusted EBITDA ever reported in the history of Coronado. These strong results are due to the higher price environment, which has resulted in record price realisations for our high-quality metallurgical coal products, but also from the structural changes made to our business over the past 12 – 18 months that have allowed us to take advantage of the improved markets.

Spindler also gave guidance for what the rest of the year could look like:

As we look to the second half of 2022, the prospect of strong financial returns remains despite recent reductions in Metallurgical coal prices. Coronado’s capital investment in its operations drives the second half weighted production plans, which we anticipate will see us deliver production levels exceeding 2021 levels and lower second half costs.

What’s next?

The company cited a number of headwinds. These include the war in Ukraine, the continuing lockdowns in China, and the global demand for thermal coal leading to an increase in energy prices.

The company also said the increase in the price of coal is expected to revert back to median levels in the near future.

As such, Coronado has revised its guidance for FY22. 

The company’s mining cost per tonne sold has been increased to $79-$81, up from $69-$71 per tonne sold. The company expects its salable production (MMt) to fall in the low range of 18-19 and its Capex to fall in the high range of $170 million to $190 million.

Coronado share price snapshot

The Coronado share price is currently up 30% year to date and 68% for the last 12 months. 

The company has a current dividend yield of 12.5% and a market capitalisation of around $2.7 billion.

The post Coronado share price jumps on 3,200% earnings surge appeared first on The Motley Fool Australia.

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Motley Fool contributor Matthew Farley 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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BHP Group Ltd (ASX: BHP) shares are in focus as the company is currently trying to buy the S&P/ASX 200 Index (ASX: XJO) copper miner OZ Minerals Limited (ASX: OZL).

BHP is a huge business. According to the ASX, it has a market capitalisation of $198 billion.

OZ Minerals is a pretty big business for the ASX, with a current market cap of $8.56 billion. However, it is absolutely dwarfed by BHP.

BHP’s bid for OZ Minerals was a cash offer of $25 per share. This was a 32.1% premium to the last closing OZ Minerals share price.

But, the board of OZ Minerals has already decided to reject the offer. BHP noted that the cash offer would deliver “immediate value” to OZ Minerals shareholders. It said it would also de-risk any value which may or may not be reflected in the OZ Minerals share price.

BHP’s CEO Mike Henry noted that the company is facing a “deteriorating external environment” and increased “operational and growth-related funding challenges”.

Is the offer for OZ Minerals good value?

According to analyst Dylan Kelly from broker Ord Minnett, the offer already “overvalues” OZ Minerals. Now, the $25 offer represents a new price floor that could increase in a “drawn-out sale process” as reported by The Australian.

Kelly also said that:

Compared to our previous discounted cash flow valuation of about $21 a share, it would appear BHP is overpaying relative to its fundamentals.

But, OZ Minerals is now “in play” in terms of a potential deal.

What would the takeover mean for BHP?

Reporting by the Australian Financial Review (AFR) pointed out that analysts at JPMorgan believe BHP should have tried to buy the business before 2020 when its share price was less than half what it is today. That was before the market had as much understanding about OZ Minerals’ growth projects.

OZ Minerals could go from 2% of BHP’s earnings before interest, tax, depreciation, and amortisation (EBITDA) to about 10% in the longer term.

The JPMorgan analysts said:

Aside from potentially making the Carrapateena block cave bigger, it’s hard to see the value uplift that BHP can create on OZL’s asset base…But it does make strategic sense.

OZL’s Prominent Hill underground asset is potentially sub-scale for BHP, however, should the company successfully convert the large, inferred resource into reserves, then at least it’s long life.

The AFR points out that OZ Minerals has two copper mines and BHP’s Olympic Dam (a copper, gold, and uranium deposit) is between them. Therefore, the deal would mean the combination of adjacent assets and the ability to share infrastructure to unlock extra capacity.

The AFR also reported that insiders had described the area as like a “chequerboard” because of how the copper was spread around.

More copper has been found 60km away at Oak Dam. But “people close to BHP” reportedly reject the idea that the bid for OZ Minerals suggests Oak Dam is “flawed or underwhelming”.

Why did Oz Minerals reject the offer?

OZ Minerals may make a deal hard to complete. It points out that there is a “strong long-term outlook for both the copper and nickel markets underpinned by increasing geological scarcity, global electrification and accelerating decarbonisation, to which OZ Minerals is highly leveraged.”

The board of OZ Minerals notes that the acquisition would deliver “significant synergies and other benefits” for BHP. The board thinks this is not reflected in the value of BHP’s proposal.

BHP share price snapshot

At the time of writing, the BHP share price is $39.07, down 0.13% for the day so far.

Over the past month, BHP shares have risen by 2.8%.

The post What could another acquisition mean for BHP shares? appeared first on The Motley Fool Australia.

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JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. 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 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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ASX 200 retail shares appear to be weathering the storm today despite consumer confidence falling. However, new figures from the ABS also show consumer spending lifted in the month of June.

Retail shares on the ASX 200 include JB Hi-Fi Limited (ASX: JBH), Harvey Norman Holdings Limited (ASX: HVN) and Wesfarmers Ltd (ASX: WES).

Let’s take a look at what is impacting ASX retail shares today.

Consumer insights

JB Hi-Fi shares are 0.91% in the green today, while the Harvey Norman share price is up 0.12%. Meanwhile, the Wesfarmers share price is rising 1.20%. The S&P/ASX 200 Index (ASX: XJO) is up 0.16%.

ANZ Roy Morgan research released today shows consumer confidence fell 4.5% last week. Inflation expectations also lifted 0.1 percentage point to 5.6%.

Confidence on ‘future financial conditions’ dropped 5.5%, while confidence in ‘current financial conditions fell’ 1.9%.

ANZ head of Australian economics David Plank said:

Consumer confidence declined 4.5% last week, to its lowest levels since April 2020,as the RBA increased interest rates by 50 basis points for the third month in a row to 1.85%.

Household inflation expectations increased 0.1 percentage point to 5.6% despite petrol prices falling for a fourth consecutive week. Demand for housing has been dropping, along with house prices.

Meanwhile, a research report out of Westpac shows the consumer sentiment index has dropped 3% from 83.8 in July to 81.2 in August. Confidence has fallen 22.9% since November 2021, the report said, stating:

This reading is on a par with the lows of the Covid and Global Financial Crisis although still well above the lows during the late 80/s/ early 90’s recession.

While consumer confidence is down however, the ABS has released statistics today saying household spending jumped 10.2% in June. Transport spending lifted 22.7%, while clothing spending rose 16.3%. Spending in hospitality venues like hotels, cafes and restaurants surged 17.1%, while recreation and culture spending jumped 15.5%.

Head of macroeconomic statistics Jacqui Vitas said:

This was off the back of consistent decreases in total household spending from March 2020 to February 2021, as responses to COVID-19 were experienced across the country. 

Spending categories most impacted from COVID-19 responses (transport, hotels, cafes and restaurants, and clothing and footwear) have now returned to pre-pandemic levels.

The post What’s impacting ASX 200 retail shares today? appeared first on The Motley Fool Australia.

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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 Harvey Norman Holdings Ltd. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd. and Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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