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.

The S&P 500 has delivered impressive annual average returns over the past decade and investors should consider using this year’s sharp stock market decline as an opportunity to add some great companies to their portfolios at attractive valuations. Nvidia (NASDAQ: NVDA) and Applied Materials (NASDAQ: AMAT) are two such companies that are worth buying now.

Both tech stocks have generated healthy returns for investors over the past several years. A $100,000 investment in Applied Materials at the beginning of 2014 was worth roughly $1 million at the end of 2021, assuming the dividends were reinvested. Nvidia, on the other hand, generated much bigger returns, turning $100,000 into roughly $7.8 million over the same period.

The growth drivers that these companies are sitting on could help them deliver such eye-popping returns over the next eight years as well. Let’s see why Nvidia and Applied Materials have the potential to make more investors into millionaires by 2030.

1. Nvidia

Nvidia stock is up 20% so far this month, but shares of the graphics card specialist are still down 40% for the year. Investors who have been waiting to buy this tech stock may want to act while Nvidia’s valuation is still at a relatively attractive level.

The chipmaker is trading at 47 times trailing earnings and 33 times forward earnings estimates. Those multiples represent a discount to its five-year average price-to-earnings ratio of 58. The stock is tempting because the company is sitting on bigger catalysts as compared to 2014.

The company reported $4.1 billion in revenue in fiscal 2014, which ended on Jan. 26, 2014, when it was mainly known for selling graphics cards for powering personal computers (PCs). Nvidia had started making moves in the data center market at that time, and that has paid off handsomely over the years.

In the year ended Jan. 30, 2022, the company reported revenue of $26.9 billion, with the data center business producing $10.6 billion of the total

The good part is that the data center business isn’t done growing yet. Sales of data center accelerators such as CPUs (central processing units), GPUs (graphics processing units), and DPUs (data processing units) are expected to grow at 40% a year through 2030, generating nearly $156 billion in annual revenue at the end of the forecast period.

Nvidia is well placed to take advantage of this massive opportunity thanks to its solid market share in data center GPUs. More importantly, the company is all set to expand its addressable market in data centers when it enters the server processor market with its Grace CPUs next year, which have already been selected by several customers for deployment from the first half of 2023.

The data center market alone could turn out to be a massive tailwind for Nvidia through 2030 and give its top and bottom lines a big boost. Analysts are expecting the company’s earnings to grow at an annual pace of 23% for the next five years, but it won’t be surprising to see it clock faster growth for a longer time, thanks to opportunities in the data center and other emerging areas. The stock could rocket over the next eight years.

2. Applied Materials

Semiconductor stocks have taken a beating in 2022, with the PHLX Semiconductor Sector index down 27% so far this year. However, the demand for chips remains healthy thanks to the growing usage of chips in several applications ranging from smartphones to data centers to gaming consoles to cars and even factories.

Market research firm IDC forecasts a 13.7% increase in semiconductor sales this year to $661 billion. That’s significantly higher than the industry’s 2013 revenue of $305 billion. The semiconductor industry is expected to generate $1 trillion in annual revenue by 2030, according to McKinsey. Other third-party estimates peg the size of the semiconductor market at $1.2 trillion by 2030.

As such, the demand for the semiconductor manufacturing equipment that Applied Materials sells should remain strong in the long run. The company is already benefiting from a spike in capital spending by chipmakers, as evident from the 16% year-over-year increase in its revenue in the first six months of fiscal 2022, which started in November.

Analysts are upbeat about the company’s prospects and expect its earnings to increase at a compound annual rate of nearly 14% for the next five years. Even better, Applied Materials sports a dividend yield of 1.1%. While that may not look like much, it is worth noting that the company has increased its dividend for the past five years and has a payout ratio of just 12%. This suggests that Applied Materials could keep increasing its dividend. And the healthy prospects of the market it operates in make it look like the stock is capable of replicating its past gains.

Throw in the company’s valuation, and it is easy to see why buying Applied Materials stock looks like a no-brainer right now. The stock trades at just 13.7 times trailing earnings — a nice discount to the S&P 500’s multiple of 20. 

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

The post 2 Nasdaq growth stocks that could turn $100,000 into $1 Million by 2030 appeared first on The Motley Fool Australia.

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• Will Nvidia be a trillion-dollar stock by 2025?

Harsh Chauhan 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 Nvidia. The Motley Fool Australia has recommended Nvidia. 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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Dart Mining NL (ASX: DTM) shares are surging heading this afternoon.

The ASX lithium share closed yesterday at 6.2 cents each and hit an intraday high of 8.4 cents late morning, a 35% gain. At the time of writing, the Dart Mining share price has settled at 7.3 cents apiece, a still healthy rise of 17.74%.

Here’s what’s stoking investor interest in the microcap lithium stock today.

Why is this tiny ASX lithium share surging today?

The Dart Mining share price is rocketing after the company reported it’s entered into an earn-in agreement for its Dorchap Lithium Project with Sociedad Química y Minera de Chile (NYSE: SQM). The agreement was reached with its wholly owned subsidiary SQM Australia Pty Ltd.

SQM is a global lithium miner and producer, and holds a 50/50 joint venture with Wesfarmers Mt Holland Lithium Project, located in Western Australia.

According to the agreement with the tiny ASX lithium share, SQM has the right, but not the obligation, to sole fund exploration expenditure totalling $12 million over the next six years.

During the first earn-in period, SQM could earn an initial 30% interest in the Dorchap Lithium Project, located in Victoria, by sole funding exploration expenditure of $3 million over the next three years.

During the second and third earn-in periods, which run for a combined additional three years, SQM could earn another 40% interest in the lithium project by funding another $9 million in exploration activities.

SQM can opt to enter into a joint venture agreement with the ASX lithium share at any point after it’s earned its initial 30% interest in Dorchap on terms yet to be agreed

Dart Mining will be the initial manager of the project during the earn-in phase.

Commenting on the agreement, Dart Mining chairman James Chirnside said:

The collaboration with SQM brings world class technical and operational expertise to a very worthy exploration target. Dart Mining was the first exploration company to discover Lithium on the East Coast of Australia in 2016.

Through Dart’s persistence and early exploration efforts, the project is finally getting the recognition it deserves. We have a clear pathway for project exploration through to the next stage, and our partnership with SQM will ensure that we are able to both attain that objective and enhance our knowledge and understanding of the project within an accelerated timeframe.

Dart Mining share price snapshot

Dart Mining’s big intraday leap today erases much of the losses sustained by the ASX lithium share in 2022.

The Dart share price is now down around 6% year to date compared to a loss of 11% posted by the All Ordinaries Index (ASX: XAO).

The post Guess which tiny ASX lithium share is rocketing 35% on Tuesday appeared first on The Motley Fool Australia.

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• Why are ASX buy now, pay later shares rocketing higher today?
• The Adairs share price has soared 20% in July. Why I think it’s still a buy
• Why is Whitehaven share price climbing 5% today?
• Is it safer to buy large-cap ASX shares during a bear market?
• Why has the Nickel Industries share price surged 13% in a week

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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It’s been a very bumpy day of trading so far today on the ASX boards. As it currently stands, the All Ordinaries Index (ASX: XAO) has gained just 0.13% and is hovering at just over 7,000 points. But no one seems to have told the ASX buy now, pay later (BNPL) shares.

BNPL shares are having an absolutely jubilant day. Take the Zip Co Ltd (ASX: ZIP) share price. As we looked at earlier, Zip shares are having a cracker. The ASX’s biggest BNPL share has rocketed by 20.47% so far today to back over $1 a share.

That comes after the company rose as high as $1.07 at one point this morning (up 24%). It’s the first time in two months that Zip shares are asking dollars, not cents.

But it’s not just Zip shares at the party. Zip’s BNPL rival that was left at the altar last month – Sezzle Inc (ASX: SZL) – is up more than 20% so far today at 31 cents a share. Again, Sezzle went as high as 34 cents this morning, a gain of more than 30%.

Or take Splitit Ltd (ASX: SPT). Splitit shares have risen a healthy 14.3% so far today to 24 cents each.

Interestingly, Block Inc (ASX: SQ2), the now-owner of the old BNPL pioneer Afterpay, is not crashing the BNPL party. In stark contrast to these other BNPL shares, Block shares have been smashed today, currently down close to 4%. But Block is not a pureplay BNPL share and is headquartered over in the US. So that might explain this disparity.

So what’s lighting a rocket under the BNPL space today?

Why are ASX BNPL shares like Zip having such a cracker today?

Well, unfortunately, it’s not quite clear. Zip, nor any of the other ASX BNPL shares, has released any news or announcements today. Or indeed this week so far. So we can only speculate.

Today is not the first day we have seen renewed interest in BNPL shares. Zip has been on the up for a few weeks now. In fact, the company has put on an impressive 130% or so since only 30 June.

We have seen a number of well-received developments out of Zip in particular over the past few weeks. These could be spurring investors into BNPL shares today.

The first was the news that the planned merger between Zip and Sezzle had been scrapped. At the time, this news sent Zip shares higher, and Sezzle shares lower. But all appears forgiven on the Sezzle side of the ledger today.

Perhaps more significantly, Zip gave investors a well-received quarterly update just last week. This showed that the company’s revenues over the three months to 30 June grew by a healthy 27% to $160.1 million. The company also reported that transactions and customers were also up significantly over the period.

Thus, it’s very possible that the goodwill from this announcement is still flowing into the entire ASX BNPL space today.

Whatever the reason, it’s certainly a pleasing day for almost all ASX buy now, pay later share investors this Tuesday.

The post Why are ASX buy now, pay later shares rocketing higher today? appeared first on The Motley Fool Australia.

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• Zip share price soars 24% to break $1 mark for first time in 2 months
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• Swings and roundabouts: What’s with the Zip share price today?

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

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The Adairs Ltd (ASX: ADH) share price has been a strong performer in July with FY23 starting well for the ASX retail share.

But, despite the strong run-up of Adairs shares, I believe the company still offers good value.

The business that sells homewares and furniture has seen investor sentiment change. Even though it has recovered some of its lost ground in 2022, it’s still down by 43% this year.

After such a heavy decline, I think the business is now much better value.

Adairs share price valuation

FY22 was significantly impacted by COVID-19 lockdowns and store closures. Management said that this cost the business many millions at the earnings before interest and tax (EBIT) level.

However, there are profit estimates out there that still suggest Adairs is going to generate solid profit in FY23 and then grow in FY24.

Profit projections on CMC Markets suggest earnings per share (EPS) of 27.7 cents in FY23 and then 31.6 cents in FY24.

Using the current Adairs share price, that puts the business at eight times FY23’s estimated earnings and seven times FY24’s estimated earnings.

I think a price/earnings (p/e) ratio of under 10 for a business that has a good chance of growing earnings in the longer term makes it seem good value.

Great dividend

One of the benefits of a low p/e ratio is that it means the dividend yield can be quite high because the earnings multiple is low.

Dividends can form a sizeable part of the overall returns. If investors don’t recognise the attractiveness of the earnings potential, then the cash returns of the dividends can certainly make up for it.

CMC Markets has estimates for what the Adairs dividend may be in the next couple of financial years. In FY23, Adairs could pay an annual dividend of 17.5 cents per share and then, in FY24, it could pay a total dividend of 20.8 cents per share.

At the current Adairs share price, that translates into grossed-up dividend yields of 10.9% and 13% respectively. If those dividends are paid, the dividends alone would be pretty good returns.

I think earnings can grow

The next 12 months looks uncertain. Rising interest rates and inflation could certainly have an impact on the economy and Adairs’ earnings.

I’m not sure how much certainty we can get from trying to guess what the interest rate will go up to in the short term, when inflation will peak, and so on.

But, I think the heavy fall of the Adairs share price makes up for the uncertainty. After all, there’s usually something to be uncertain about.

Adairs says that its Focus on Furniture acquisition has attractive growth potential with a store roll-out, online growth, and expansion of its categories and ranges. There is also an opportunity for Adairs and Focus to leverage their skills and assets. In five years, Adairs is hoping this business can generate at least $250 million of sales.

With furniture business Mocka, Adairs wants to grow brand awareness, expand its range, and add a physical presence. For this, it can utilise its existing store networks.

Finally, with Adairs-branded stores, it can grow its total retail floor space with new and upsized stores. Adairs can also grow its membership numbers, grow its online sales, expand its range, and offer customers an even better service.

I think all of these factors could be helpful for the Adairs share price over time.

The post The Adairs share price has soared 20% in July. Why I think it’s still a buy appeared first on The Motley Fool Australia.

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• Why the Adairs share price could be a bargain in FY23
• Does the FY23 outlook make ASX retail shares look like bargains?
• What were some of the key lessons for ASX investors in FY22?

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

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The Whitehaven Coal Ltd (ASX: WHC) share price has been among the best performers on the ASX 200 on Tuesday.

In afternoon trade, the coal miner’s shares are up 5% to $6.40.

Why is the Whitehaven share price charging higher?

Investors have been bidding the Whitehaven Coal share price higher despite there being no news out of the miner today.

However, it is worth noting that the energy sector is having a strong day today. This has seen the S&P/ASX 200 Energy index rise 2.2% this afternoon. Concerns over supply appear to be supporting the prices of energy products such as coal and oil.

What else?

Also potentially giving the Whitehaven Coal share price a lift is the countless bullish broker notes that have been released recently.

One of those came out of Citi, which has upgraded the company’s shares to a buy rating with a $7.85 price target. This implies potential upside of over 22% for investors from current levels.

Elsewhere, the team at at Ord Minnett have slapped a buy rating and even greater price target of $8.00 on the company’s shares.

Both brokers were pleased with the Whitehaven Coal’s fourth quarter update and its significant cash flow generation.

The post Why is Whitehaven share price climbing 5% today? appeared first on The Motley Fool Australia.

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• Why Ansell, EML, Suncorp, and Whitehaven Coal shares are charging higher

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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ASX shares have been under pressure this year amid soaring inflation and fast-rising interest rates.

While we’re not technically there yet, many newer investors are looking at what may be their first bear market unfolding.

Is bigger safer?

With that in mind, many investors on the hunt for relatively safer ASX shares in a time of broadly falling prices will be running their slide rules over both the smaller and larger end of the market looking for some safety.

Turning to the charts, so far in 2022 the S&P/ASX 20 Index (ASX: XTL) – which contains the 20 largest-cap ASX shares – is down 7.4%

By comparison, the S&P/ASX Small Ordinaries Index (ASX: XSO) – which contains all the companies included in the S&P/ASX 300 aside from those in the S&P/ASX 100 – is down 21.1% year-to-date.

Over the longer term, however, the picture changes.

The ASX 20 is up 17.2% over the past five years compared to a gain of 19.6% posted by the Small Ordinaries.

So, what does that tell us about the relative safety of ASX blue chips in a falling market?

What the experts are saying about ASX shares in a bear market

For some expert insight, we defer to Hugh Dive, chief investment officer at Atlas Funds Management, and Hugh Giddy, senior portfolio manager at IML.

Asked by Livewire whether sticking to the biggest 20 ASX shares was a safer option with a looming bear market, Giddy said, “If you buy a big stock, of course, it’s safer in terms of they’re probably not going to go bust.”

As for whether that’s a better option for investors over buying a mid or small-cap stock, Giddy added:

Safety really comes from the franchise of the business, the balance sheet and so on… If you look at Zip Co (ASX: ZIP) and Sezzle (ASX: SZL) and so forth, they would no longer be anywhere near the top 20 because the franchise is not that strong. It’s a competitive market. They didn’t have the best balance sheet. They certainly didn’t have much in the way of earnings. So top 20 doesn’t mean safe.

Dive pointed out that historically many ASX shares don’t manage to remain in the top 20 list for long:

If you look at the top 20 from 20 years ago, most of them underperformed. AMP (ASX: AMP) is down 90%, NAB (ASX: NAB) is off 10-15%, Lendlease (ASX: LLC) is similar.

I think only three or four companies in that top 20 from 20 years ago have actually outperformed the ASX. A lot of these companies are still around, but they are shadows of their former selves. So simply buying an ASX top 20 stock doesn’t mean safety.

Dive added that in times of market dislocation, the biggest ASX shares do “tend to work a bit better in that they have sympathetic bankers and equity holders that can raise money. Smaller companies… are fighting for their corporate lives at the moment.”

The post Is it safer to buy large-cap ASX shares during a bear market? appeared first on The Motley Fool Australia.

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More reading

• The Adairs share price has soared 20% in July. Why I think it’s still a buy
• Why is Whitehaven share price climbing 5% today?
• Why has the Nickel Industries share price surged 13% in a week
• Broker says Allkem share price can rise 60% from here
• Zip share price soars 24% to break $1 mark for first time in 2 months

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 ZIPCOLTD FPO. 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 shares have been under pressure this year amid soaring inflation and fast-rising interest rates.

While we’re not technically there yet, many newer investors are looking at what may be their first bear market unfolding.

Is bigger safer?

With that in mind, many investors on the hunt for relatively safer ASX shares in a time of broadly falling prices will be running their slide rules over both the smaller and larger end of the market looking for some safety.

Turning to the charts, so far in 2022 the S&P/ASX 20 Index (ASX: XTL) – which contains the 20 largest-cap ASX shares – is down 7.4%

By comparison, the S&P/ASX Small Ordinaries Index (ASX: XSO) – which contains all the companies included in the S&P/ASX 300 aside from those in the S&P/ASX 100 – is down 21.1% year-to-date.

Over the longer term, however, the picture changes.

The ASX 20 is up 17.2% over the past five years compared to a gain of 19.6% posted by the Small Ordinaries.

So, what does that tell us about the relative safety of ASX blue chips in a falling market?

What the experts are saying about ASX shares in a bear market

For some expert insight, we defer to Hugh Dive, chief investment officer at Atlas Funds Management, and Hugh Giddy, senior portfolio manager at IML.

Asked by Livewire whether sticking to the biggest 20 ASX shares was a safer option with a looming bear market, Giddy said, “If you buy a big stock, of course, it’s safer in terms of they’re probably not going to go bust.”

As for whether that’s a better option for investors over buying a mid or small-cap stock, Giddy added:

Safety really comes from the franchise of the business, the balance sheet and so on… If you look at Zip Co (ASX: ZIP) and Sezzle (ASX: SZL) and so forth, they would no longer be anywhere near the top 20 because the franchise is not that strong. It’s a competitive market. They didn’t have the best balance sheet. They certainly didn’t have much in the way of earnings. So top 20 doesn’t mean safe.

Dive pointed out that historically many ASX shares don’t manage to remain in the top 20 list for long:

If you look at the top 20 from 20 years ago, most of them underperformed. AMP (ASX: AMP) is down 90%, NAB (ASX: NAB) is off 10-15%, Lendlease (ASX: LLC) is similar.

I think only three or four companies in that top 20 from 20 years ago have actually outperformed the ASX. A lot of these companies are still around, but they are shadows of their former selves. So simply buying an ASX top 20 stock doesn’t mean safety.

Dive added that in times of market dislocation, the biggest ASX shares do “tend to work a bit better in that they have sympathetic bankers and equity holders that can raise money. Smaller companies… are fighting for their corporate lives at the moment.”

The post Is it safer to buy large-cap ASX shares during a bear market? appeared first on The Motley Fool Australia.

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More reading

• Why has the Nickel Industries share price surged 13% in a week
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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 ZIPCOLTD FPO. 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 Nickel Industries Ltd (ASX: NIC) share price is up and away again during early Tuesday afternoon trading.

This comes after the company announced this week that its 80%-owned Angel Nickel power plant has started commissioning.

At the time of writing, the nickel producer’s shares are up 2.91% to $1.06 each. This means the company’s shares have gained 6% since Friday’s market close and 13% in the last week.

What’s charging Nickel Industries shares forward?

In yesterday’s announcement, Nickel Industries advised its 380-megawatt power plant within the Indonesia Weda Bay Industrial Park is now online.

The news seemed to appease investors which led the Nickel Industries share price to climb 3% for the day.

In comparison, the S&P/ASX 200 Index (ASX: XJO) fell slightly by 0.02%.

Nickel Industries stated that the commissioning of the power plant is currently ahead of schedule. This follows the early commissioning of the project’s 4 RKEF lines between January to May this year. This was originally projected for October 2022.

Angel Nickel has been operating at around 80% of nameplate capacity because of power restrictions within the IWIP electricity grid. However, with its own power source now available to tap into, production levels are expected to increase to approximately 130% of nameplate capacity.

Furthermore, Angel Nickel’s four RKEF lines are estimated to save around 20% on electricity charges. These lines account for roughly 25% of total operating cash costs.

Nickel is a key component in lithium-ion batteries, which are used in generating power for electric vehicles. The silvery-white metal is able to produce a lot more energy into batteries than cobalt. On top of that, cobalt is considered a more expensive metal and has fewer purposes across industries.

Nickel Industries’ managing director Justin Werner commented:

The early commissioning of the Angel RKEF lines more than 6 months ahead of schedule allowed us to significantly bring forward nickel production. With Angel’s power plant now commissioned this should allow us to ramp up to approximately 130% of name plate capacity, which will greatly increase nickel metal production and assist to materially decrease Angel operating costs.

Nickel Industries share price snapshot

After zipping to an all-time high of US$43,000 per tonne in mid-March, the price of nickel has spectacularly erased its historic gains.

Subsequently, this impacted the Nickel Industries share price which fell to a 52-week low of 88.5 cents on 15 July.

Year to date, the company’s shares are down 25%.

Nickel Industries has a price-to-earnings (P/E) ratio of 12.56 and commands a market capitalisation of roughly $2.89 billion.

The post Why has the Nickel Industries share price surged 13% in a week appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why is the Nickel Industries share price 5% worse for wear today?
• These ASX 200 mining shares are getting buried. What’s happening?
• Could the Nickel Industries share price more than double from here?
• ASX 200 mining shares glide lower as expert reduces commodity targets

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 Nickel Industries Ltd (ASX: NIC) share price is up and away again during early Tuesday afternoon trading.

This comes after the company announced this week that its 80%-owned Angel Nickel power plant has started commissioning.

At the time of writing, the nickel producer’s shares are up 2.91% to $1.06 each. This means the company’s shares have gained 6% since Friday’s market close and 13% in the last week.

What’s charging Nickel Industries shares forward?

In yesterday’s announcement, Nickel Industries advised its 380-megawatt power plant within the Indonesia Weda Bay Industrial Park is now online.

The news seemed to appease investors which led the Nickel Industries share price to climb 3% for the day.

In comparison, the S&P/ASX 200 Index (ASX: XJO) fell slightly by 0.02%.

Nickel Industries stated that the commissioning of the power plant is currently ahead of schedule. This follows the early commissioning of the project’s 4 RKEF lines between January to May this year. This was originally projected for October 2022.

Angel Nickel has been operating at around 80% of nameplate capacity because of power restrictions within the IWIP electricity grid. However, with its own power source now available to tap into, production levels are expected to increase to approximately 130% of nameplate capacity.

Furthermore, Angel Nickel’s four RKEF lines are estimated to save around 20% on electricity charges. These lines account for roughly 25% of total operating cash costs.

Nickel is a key component in lithium-ion batteries, which are used in generating power for electric vehicles. The silvery-white metal is able to produce a lot more energy into batteries than cobalt. On top of that, cobalt is considered a more expensive metal and has fewer purposes across industries.

Nickel Industries’ managing director Justin Werner commented:

The early commissioning of the Angel RKEF lines more than 6 months ahead of schedule allowed us to significantly bring forward nickel production. With Angel’s power plant now commissioned this should allow us to ramp up to approximately 130% of name plate capacity, which will greatly increase nickel metal production and assist to materially decrease Angel operating costs.

Nickel Industries share price snapshot

After zipping to an all-time high of US$43,000 per tonne in mid-March, the price of nickel has spectacularly erased its historic gains.

Subsequently, this impacted the Nickel Industries share price which fell to a 52-week low of 88.5 cents on 15 July.

Year to date, the company’s shares are down 25%.

Nickel Industries has a price-to-earnings (P/E) ratio of 12.56 and commands a market capitalisation of roughly $2.89 billion.

The post Why has the Nickel Industries share price surged 13% in a week appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why is the Nickel Industries share price 5% worse for wear today?
• These ASX 200 mining shares are getting buried. What’s happening?
• Could the Nickel Industries share price more than double from here?
• ASX 200 mining shares glide lower as expert reduces commodity targets

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 Allkem Ltd (ASX: AKE) share price is having a strong day on Tuesday.

In afternoon trade, the lithium miner’s shares are up 3.5% to $10.57.

This means the Allkem share price is now up 35% since this time last year.

Can the Allkem share price keep rising?

The good news for investors is that one leading broker still sees plenty of upside in the Allkem share price.

According to a recent note out of Morgans, its analysts have retained their add rating and lifted their price target on the lithium miner’s shares to $16.72.

Based on the current Allkem share price, this implies potential upside of 58% for investors over the next 12 months.

What did the broker say?

Morgans was pleased with Allkem’s fourth quarter update, which revealed record free cash flow generation thanks to increased production and strong lithium prices.

The broker believes that this bodes well for FY 2023, particularly given the expectation for increased production as Naraha and Stage 2 Olaroz come online.

It commented:

AKE holds long lived brine assets that are well leveraged to the lithium carbonate price and Mt Cattlin looks to be highly profitable for its remaining life with high exposure to the spot market. Additionally the Naraha plant will give the company exposure to lithium hydroxide prices in addition to spodumene and carbonate.

We believe that the strong cash flows we’re anticipating in FY23 will make the value proposition more compelling than the uncertainties of the lithium market. We maintain our ADD rating with potential 12-month upside of 69% [now 58] but we note that the lithium market is still developing and comes with higher risks.

The post Broker says Allkem share price can rise 60% from here appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Allkem Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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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