At lunch on Wednesday, the S&P/ASX 200 Index (ASX: XJO) is on course to record another disappointing decline. The benchmark index is currently down 0.75% to 7,263.2 points.

Here’s what is happening on the ASX 200 today:

Life360 shares crash on quarterly update

The Life360 Inc (ASX: 360) share price has crashed lower after the tech selloff offset the release of the location technology company’s quarterly update. Life360 reported a 129% increase in revenue to US$52.7 million and a 73% jump in annualised monthly revenue to US$166.1 million. This was driven by a 36% increase in monthly active users to 38.3 million. And while Life360 reported a large decrease in its cash balance, this was due to the Tile acquisition. On a pro forma basis, its cash balance actually increased slightly over the period.

Northern Star shares under pressure

The Northern Star Resources Ltd (ASX: NST) share price is tumbling after a poor quarterly update offset a rise in the gold price. According to the update, the gold miner has increased its costs guidance due to issues at the Pogo operation. Northern Star now expects all-in sustaining costs (AISC) of A$1,600 to A$1,640 per ounce in FY 2022. This is up from its previous guidance of A$1,475 to A$1,575 per ounce.

Coronado has record quarter

The Coronado Global Resources Inc (ASX: CRN) share price is pushing higher today after the release of a record quarterly update. Thanks to a sky high coal price, Coronado reported record quarterly revenue of $947 million. This was up 22.3% on the previous record of US$775 million recorded in the prior quarter.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Wednesday has been the Downer EDI Limited (ASX: DOW) share price with a 4.5% gain. This follows the release of the contract services company’s investor day presentation. The worst performer by some distance has been the Life360 share price with a 20% decline. This follows weakness in the tech sector and the release of its quarterly update.

The post ASX 200 midday update: Coronado has record quarter, Life360 and Northern Star sink appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro owns Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Life360, Inc. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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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.

Apple (NASDAQ: AAPL) has held its ground despite the severe sell-off in technology stocks this year, with shares of the iPhone maker down just 10% in 2022 as compared to the 25% drop in the Nasdaq-100 Technology Sector index.

Investors, however, can expect Apple stock to get a nice boost when it releases its fiscal 2022 second-quarter results for the three months ended March 26, on April 28. Let’s look at what’s expected from Apple in Q2 and why the stage seems set for another round of solid numbers from the tech giant.

Solid iPhone demand could help Apple exceed expectations

When Apple released its fiscal first-quarter results in January this year, the company decided against issuing formal guidance, citing “continued uncertainty around the world in the near term.” However, CFO Luca Maestri did point out on the company’s January earnings conference call that Apple could “achieve solid year-over-year revenue growth and set a March quarter revenue record despite significant supply constraints.”

Maestri also added that the supply chain constraints in the March quarter are likely to be less than what the company experienced during the fiscal first quarter, which ended in December. This explains why Wall Street expects Apple to deliver $94 billion in fiscal Q2 revenue — a 5% increase over the prior-year period’s record revenue of $89.6 billion.

The year-over-year increase may appear a tad slow at first glance. However, investors shouldn’t forget that the late launch of the iPhone 12 in the first quarter of fiscal 2021 (period ended December 2020) meant the demand for the device had carried forward into Q2 2021 (March 2021). For comparison, the iPhone 13 models have been on sale since the fourth quarter of fiscal 2021, so Apple is facing tougher year-over-year comparisons.

Still, Maestri’s commentary is an indication that the demand for Apple’s products remained strong last quarter. Even analysts are anticipating something similar as the higher end of Apple’s Q2 revenue estimate sits at $100.4 billion, which would translate into double-digit year-over-year growth for the company.

It won’t be surprising to see Apple hit the higher end of Wall Street’s guidance. Morgan Stanley analyst Katy Huberty forecasts a 10% year-over-year increase in iPhone shipments in the second quarter, driven by robust demand for the iPhone 13 lineup. The company had shipped an estimated 60 million iPhones in the year-ago quarter, indicating that it may have shipped around 66 million iPhones this time.

Huberty has also raised her iPhone average selling price (ASP) estimate to $878 from the prior estimate of $848. The increase in Apple’s iPhone ASP can be credited to a more favorable sales mix. According to Huberty, the iPhone 13 accounted for 69% of Apple’s smartphone sales last quarter, with another 16% coming from the iPhone 12 lineup. So 5G devices are estimated to have accounted for 85% of Apple’s iPhone sales last quarter. That should have favorably impacted the company’s top and bottom lines as it is enjoying impressive pricing power in the 5G smartphone era.

Assuming shipments of 66 million units, Huberty’s estimated ASP points toward $58 billion in iPhone revenue for the second quarter, up nearly 21% over the year-ago period’s iPhone revenue of $47.9 billion. As the iPhone is Apple’s largest source of revenue, producing 58% of its top line in the first quarter of fiscal 2022, a solid showing from this product line could help Apple deliver better-than-expected results.

Analysts are expecting the company to report earnings of $1.43 per share, which would be a small jump over the prior-year period’s figure of $1.40 per share. However, a combination of higher volumes and improved pricing should rub off positively on Apple’s bottom line and help it report stronger numbers.

More reasons to be bullish

Beyond the iPhone, Apple’s Mac and services businesses are also expected to aid the company’s growth. Mac shipments are estimated to have hit 7.2 million last quarter, ahead of the analyst estimate of 6 million units. As a result, Apple’s fiscal Q2 Mac revenue could come in at $9.5 billion, according to Huberty, compared to $9.1 billion in the prior-year period.

Meanwhile, the services business is estimated to have clocked nearly $20 billion in revenue last quarter, which would translate into an 18% increase over the year-ago quarter. The increase in Apple’s installed base of customers thanks to the higher sales of its devices and robust user engagement have been tailwinds for the services business, and the trend seems to have continued last quarter.

It is also worth noting that the services business carries a significantly higher gross margin as compared to the products Apple sells. So, impressive growth on the services front should have a positive bearing on the company’s earnings.

There are several reasons to believe Apple is headed for another record quarter. Stronger-than-expected numbers could send the tech stock soaring, which is why investors who are still on the sidelines may want to buy Apple before it becomes expensive. 

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

The post Why Apple stock could crush the market this earnings season appeared first on The Motley Fool Australia.

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Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Apple. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

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If you own Commonwealth Bank of Australia (ASX: CBA) shares you’ll want to know about a key change of leadership coming to the bank’s Board.

Here’s what to expect.

Who is taking over as Board chair?

In an announcement released this morning, CBA reported that Catherine Livingstone will retire from her role as Board chair in August, following the completion of the 2022 financial year statements and accounts.

Livingstone has been chair of the CBA Board since 1 January 2017.

Non-executive director Paul O’Malley will succeed Livingstone as chair, taking up the position on 10 August. O’Malley is currently chair of the CBA Board Remuneration Committee.

Commenting on her tenure, Livingstone said:

I have been honoured to serve as CBA’s chair through a time when the bank has addressed a number of complex challenges and in doing so, rebuilt its reputation as an organisation that seeks to deliver positive outcomes for its customers, people and shareholders.

During the coronavirus pandemic, CBA has demonstrated unequivocally that a strong, stable, well capitalised banking sector is vital to Australia’s economic and social wellbeing.

She said that now was an “appropriate time to hand over to the next chair to lead [CBA’s] ambitious agenda and guide the bank through its next phase”.

O’Malley added:

With the support of the Board, CEO and management team I am absolutely committed to helping CBA build on the strong progress achieved over recent years under Catherine’s leadership and continuing to deliver rewarding outcomes for all our stakeholders…

The bank is playing a leading part in supporting Australia’s economic growth agenda and its transition to both a sustainable and a digital economy… I am looking forward to helping lead this vibrant and important organisation through its next strategic growth phase and delivering outcomes for shareholders, customers and communities.

How have CBA shares been tracking?

CBA has come under pressure alongside the wider market in recent days.

At time of writing, CBA shares are down 1% to $103.79 per share.

Taking a step back, the CBA share price remains up 16% over the past 12 months, well outpacing the 3% gains posted by the S&P/ASX 200 Index (ASX: XJO) during that same period.

The post Own CBA shares? Meet the big bank’s new chair appeared first on The Motley Fool Australia.

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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 Bruce Jackson.

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It hasn’t been a great year for the Telstra Corporation Ltd (ASX: TLS) share price so far in 2022. Since the start of the year, Telstra shares have gone from $4.22 to the $3.97 they are commanding at the time of writing today (down 0.75% so far). That’s a year-to-date drop of 5.2%, just slightly more than the S&P/ASX 200 Index (ASX: XJO) has given back.

Some investors might be disappointed with this performance. After all, Telstra has been a fairly rewarding investment in recent years. Over 2021, the Telstra share price rose by a very pleasing 40% or so. The company also managed to keep its arguably generous annual dividend of a fully franked 16 cents per share intact over 2020 and 2021. This would have been of great comfort to many investors enduring savage dividend cuts from many other ASX blue-chip shares, over 2020 in particular.

But now the Telstra share price has somewhat stagnated in 2022, many investors might be wondering where the ASX 200 telco is heading next.

Is the Telstra share price a buy or a sell today?

Well, one broker who reckons the future is bright for Telstra shares is Morgans. As my Fool colleague covered last week, Morgans has recently rated Telstra as an “add” with a 12-month share price target of $4.56. If that came to pass, it would give Telstra an upside of almost 15% on current pricing. That’s not including any dividend returns either. Speaking of, Morgans is expecting the telco to keep its 16 cents per share annual dividend flowing for the rest of FY2022 and in FY2023.

The broker also likes what it sees in Telstra’s new T25 cost-cutting strategy, which comes after the successful implementation of its predecessor, T22. This, Morgans says, results in a sunny outlook for the company.

So that’s what one ASX broker reckons Telstra shares have in store.

Earlier this month we also heard from another ASX broker in Morgan Stanley. As we covered at the time, Morgan Stanley also slapped a buy rating on Telstra shares, replete with a 12-month share price target of $4.60. That’s even more bullish than Morgans. This broker is pencilling in substantial earnings growth through to FY2025.

Thus, it appears more than one ASX broker thinks Telstra shares are a buy today. It will be interesting to see if their predictions prove accurate.

In the meantime, the current Telstra share price gives this ASX 200 telco a market capitalisation of $46.65 billion, with a dividend yield of 4.02%.

The post Down 5% in 2022, is the Telstra share price a buy today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen owns Telstra Corporation 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 owns and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Another quarter of growth is putting the Life360 Inc (ASX: 360) share price in the spotlight today.

Moments after the morning bell, shares in the location safety tech company were trading down 18% to $4.40. The negative sentiment follows a dreadful showing by tech shares on the US market overnight, with the Nasdaq Composite Index (NASDAQ: .IXIC) falling 3.95%.

At the time of writing, the Life360 share price is trading at $4.40, down 17.6%. Let’s take a look at the company’s latest earnings.

Life360 share price dives despite growth

Highlights of Life360’s results for the quarter ending 31 March 2022 include:

• Consolidated revenue up 129% from the corresponding quarter to US$52.7 million
• Underlying revenue (excluding acquisitions) increased 64% year on year
• Consolidated annualised monthly revenue up 73% year on year to US$166.1 million
• Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) loss of US$12.6 million
• Global monthly active users reached 38.3 million, up 36% year on year
• Cash at the end of the quarter of US$98.2 million, down from US$231.3 million at the end of December

What else happened during the quarter?

While the headline metrics appear positive for the Life360 business, it doesn’t seem to be enough for the share price today.

Notably, the broader market continues to rotate away from tech plays that are currently unprofitable. For Life360, the cash has continued to flow outwards in the March-ending quarter.

Specifically, the company landed more than US$50 million in receipts from customers. However, most of this was consumed by staff, administration, and marketing costs. When it came to the net line, Life360 recorded US$37.8 million in net cash used in its operating activities.

Additionally, the Tile acquisition removed a further US$96.2 million from the company’s piggybank during the quarter. However, Life360 is targeting positive cash flow by late 2023 with the integration of Jiobit and Tile.

What did management say?

Commenting on the quarterly figures, Life360 CEO Chris Hulls said:

Life360 continued its significant business momentum, delivering strong results across key operational metrics in the March 2022 quarter.

We added 71,000 net new subscribers, an increase of more than 160% from the March 2021 quarter. Monthly Active Users (MAU) also showed a significant increase, with an 8% quarter-on-quarter gain to 38.3 million, translating to 36% year-on-year growth.

In regards to the financial side of Life360, Hull stated:

We’ve also adjusted our strategic plan in light of market conditions, and are now targeting cash flow breakeven by Q4 of CY23, with our first full year of cash flow breakeven in CY24. This target will be assisted by the accelerated integration of Jiobit and Tile into Life360 as a single business unit.

What’s next?

Looking ahead, shareholders might have been disappointed by the company’s resumed earnings guidance — propelling the Life360 share price downwards today.

According to the report, underlying EBITDA for CY22 is expected to come in at a loss of between US$32 million to US$38 million. Although, core subscription revenue is slated to grow by 50% or more.

Life360 share price snapshot

The past year has been a volatile ride for those following the Life360 share price. At its peak, shares were fetching $13.94. Now, at $4.40 apiece, the company’s shares are down roughly 25% from a year ago.

This poor performance is mostly in line with the broader technology sector. For example, the S&P/ASX All Technology Index (ASX: XTX) has fallen 21.4% over the past 12 months.

The post Life360 share price tumbles 18% as cash reserves get chewed up appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Life360, Inc. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Lithium Energy Ltd (ASX: LEL) share price has been a very strong performer on Wednesday after returning from a trading halt.

In morning trade, the lithium explorer’s shares are up 16% to $1.15.

Why is the Lithium Energy share price surging higher?

Investors have been bidding the Lithium Energy share price higher today after the lithium explorer released a very positive announcement.

According to the release, the company has now received all government approvals for exploration and drilling to commence at its Solaroz Lithium Brine Project in Argentina.

With all eight of Solaroz concessions (totalling 12,000 hectares) now approved, a major exploration programme is underway. This will comprise comprehensive geophysical surveys and a significant drilling programme.

The Solaroz Lithium Brine Project is located in the highly prospective lithium triangle in Argentina. It is in close proximity to operations owned by lithium majors Allkem Ltd (ASX: AKE) and Lithium Americas Corporation.

Management commentary

Lithium Energy’s Executive Chairman, William Johnson, was pleased with the news and believes it to be a significant milestone for the company. He said:

“The receipt of the final set of Government approvals for exploration at Solaroz is a significant milestone and major value catalyst for Lithium Energy. In our view, there is no better address in the world to be exploring for lithium than the prolific lithium triangle, and our ground is directly adjacent to or principally surrounded by two of the largest lithium discoveries globally owned by Allkem and Lithium Americas.

Furthermore, Allkem’s recent (April 2022) upgrade to their Olaroz Resource in concessions adjacent or nearby to those held by Lithium Energy has provided further support for the Company’s conceptual Exploration Target for Solaroz.

Exploration activity is already underway and will include geophysical studies and drilling across all of the highly prospective Solaroz concessions, with the objective of establishing a maiden JORC Mineral Resource of contained lithium in brine at Solaroz.”

Mr Johnson also highlighted that there has been a lot of mergers and acquisitions (M&A) activity in the region recently. He commented:

“There has been significant M&A activity in the area showing the global interest in the district and lithium brines in particular, and we are very excited to now be in a position to ramp up our exploration efforts at Soloroz.”

The post Here’s why the Lithium Energy share price is shooting 16% higher appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro owns Allkem Ltd. 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 Bruce Jackson.

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Shares of Iluka Resources Limited (ASX: ILU) are tracking south today following the release of the company’s quarterly activities and cash flow update.

At the time of writing, the Iluka share price is trading at $10.26 after sliding just over 1% into the red from the open.

Iluka share price slides as spot prices soar

Key highlights from Iluka’s quarter include:

• Zircon/Rutile/Synthetic Rutile (Z/R/SR) production of 180kt, up 44% on Q1 2021
• Strong Z/R/SR sales of 189kt, in line with Q4 2021
• Zircon sand prices increased US$100/tonne, effective 1 April 2022
• Spot prices for rutile and synthetic rutile are both at ten year highs
• Phase 1 complete of Eneabba development

What else happened for Iluka this year?

The company says that Australian operations performed in line with its expectations. For instance, its Cataby site in Western Australia produced 117,000 tonnes of heavy mineral concentrate (HMC), “in line with the mine plan”.

Whereas the Narngulu mineral separation plant in WA produced 76,000 tonnes of zircon, and its Synthetic Rutile Kiln 2 produced 54,000 tonnes of synthetic rutile.

Elsewhere, the company’s Sierra Rutile project in Sierra Leone produced 98,000 tonnes of HMC, a 14% gain from Q4 2021.

Earlier in the month, Iluka had advised of its plans to demerge its Sierra Rutile asset, pending shareholder approval. If successful, Sierra Rutile will then list on the ASX, Iluka says, as a ” West African focused mineral sands company”.

“[The project] will have the primary objective of maximising value from Sierra Rutile’s remaining deposits at Area 1 and developing the globally significant Sembehun project,” Iluka noted.

Finally, exploration and evaluation expenditure was $2.2 million for the quarter, slightly lower than $2.4 million in Q1 2021.

What’s next for Iluka?

Iluka says that it has increased the price of zircon sand by US$100 per tonne, effective from 1 April 2022.

“The company’s Q2 2022 zircon sales are fully contracted, reflecting tight supply despite a number of challenges facing the market,” it noted.

Not only that, but it announced the final investment decision for the Eneabba Phase 3 asset. Iluka says this is a “fully integrated refinery for the production of separated rare earth oxides” and is located at Eneabba, WA.

“This [investment] decision was taken following the agreement of a risk sharing arrangement with the Australian Government, including a $1.25 billion non-recourse loan under the $2 billion Critical Minerals Facility administered by Export Finance Australia,” Iluka said.

Phase 3 will produce the high value rare earth oxides neodymium, praseodymium, dysprosium and
terbium. These are critical inputs across a range of industries and technologies including electric
vehicles, sustainable energy, advanced electronics, medical and defence applications. The refinery will have a total rare earth oxide capacity of 17.5 thousand tonnes per annum. Construction is scheduled to commence in H2 2022, with first production in 2025.

Iluka Resources share price snapshot

In the last 12 months, the Iluka share price has climbed more than 37% into the green and is up 1.5% this year to date.

However, in the past week, it has scaled back and is down 16% in that time.

The post Iluka Resources share price crumbles as quarterly results in line with ‘expectations’ appeared first on The Motley Fool Australia.

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Motley Fool contributor Zach Bristow 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 Bruce Jackson.

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The Firefinch Ltd (ASX: FFX) share price is tumbling in early trade, down 5.8%.

Shares in the ASX gold miner and lithium developer closed yesterday at $1.03 and are currently trading for 97 cents.

In fact, the S&P/ASX All Ordinaries Gold Index (ASX: XGD) is also well into the red this morning, down 1.4%.

Below we take a look at the highlights from the quarter just past, reported this morning by ASX share Firefinch.

What were the highlights from the past quarter?

The Firefinch share price is sliding after the company updated the market on its activities for the three months ending 31 March.

For context, the miner’s two projects are located in Mali. The company holds an 80% interest in the Morila Gold Mine and a 100% interest in the Goulamina Lithium Project.

At Morila, Firefinch reported continuing high-grade gold results from its drilling campaign at the Morila Super Pit. Additionally, the miner said significant results from one of the drill holes “may represent a new zone of mineralisation”.

The company reported substantial increases in its mineral resources at several deposits within Morila. According to Firefinch, the total mineral resources for the Morila Gold Project has reached 2.5 million ounces of gold.

Gold production for the quarter (Q1) met guidance, coming in at 10,874 ounces.

Firefinch reported production guidance for Q2 in the range of 17,000 to 20,000 ounces of gold. The miner maintained its full-year 2022 production guidance of 100,000 ounces of gold. It expects annualised production rates for the second half of the year to surpass 140,000 ounces of gold.

The company also provided updates on its Goulamina Lithium Project. Goulamina is among the largest undeveloped high-quality spodumene deposits in the world.

Partnering in a 50/50 joint venture with lithium battery materials supplier Ganfeng, Firefinch aims to bring that project into production.

Firefinch said all the required conditions have been met for Ganfeng’s investment in the project. During the quarter, Ganfeng contributed US$130 million in cash to the joint venture company.

The demerger of Goulamina into Leo Lithium Limited is reportedly proceeding on schedule.

Firefinch held cash and cash equivalents of $102 million as at 31 March.

Firefinch share price snapshot

Despite weakness over the last week, the past 12 months have seen the Firefinch share price rocket 193%.

By comparison, the All Ordinaries Index (ASX: XAO) has gained 3.5% over the past full year.

The post Firefinch share price tumbles 6% despite meeting gold production guidance appeared first on The Motley Fool Australia.

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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 Bruce Jackson.

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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.

Twitter (NYSE: TWTR) surprised Wall Street this week when it announced it had entered into an agreement to be acquired by billionaire Elon Musk, a move that would make the company private. With the acquisition price about 8% higher than where the stock is trading Tuesday morning, some investors may be tempted to try to profit from this delta. But investors should think twice before they play this game.

This deal comes with some serious risks and a good case can be made for selling Twitter stock today.

Important details you should know

Twitter announced Monday that Musk would buy the social media company for $54.20 per share in cash, valuing the company at about $44 billion. The move would take the company private, meaning shareholders would be paid cash at the time the deal is closed and Twitter shares would no longer be traded on the New York Stock Exchange.

The company seems excited about the deal. “The Twitter Board conducted a thoughtful and comprehensive process to assess Elon’s proposal with a deliberate focus on value, certainty, and financing,” said Twitter Chairman Bret Taylor in a press release. “The proposed transaction will deliver a substantial cash premium, and we believe it is the best path forward for Twitter’s stockholders.”

As Twitter notes, the purchase price represents 38% upside over the stock’s closing price on April 1 — the day before Musk’s 9% stake in the company was disclosed.

But don’t forget to acknowledge the risks to this transaction. The biggest thing investors who currently own Twitter stock (or those considering buying it) should know is that there’s never a guarantee that an acquisition will be completed, even when the company being acquired has already entered into a “definitive agreement” with the acquirer.

Twitter, of course, was sure to disclose the risks to this transaction, noting that it is “subject to the approval of Twitter stockholders, the receipt of applicable regulatory approvals and the satisfaction of other customary closing conditions.”

What could happen if the deal falls through

There’s significant risk to holding. If the deal does not work out, Twitter shares could plummet. After all, the stock’s recent gain is almost entirely due to the likelihood of Musk buying the company at a price of $54.20 per share. Without this possible deal, and without the promise of Musk’s leadership, the stock could spiral downward as investors contemplate what a failed deal could mean for the company’s future.

It’s worth noting that all we know about the deal’s timing is that it is expected to close sometime this year. There are eight months left in the year. Would the risk of holding during that period really be worth just an 8% premium to today’s price? Probably not.

It’s also worth noting that since this isn’t a company buying Twitter, there may be a lower risk of any potential antitrust issues. Further, the financials behind the deal may be simpler — and the parties easier to deal with — than if this were a merger between two companies as opposed to a buyout buy a billionaire. Nevertheless, such a large deal from a single person is uncharted territory and could pose unforeseen risks. So investors should tread carefully when considering the probability of this deal closing.

All of this to say, a strong case can be made for selling Twitter stock today. And to those thinking of buying Twitter stock today, there’s good reason to stay on the sidelines. 

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

The post Elon Musk is buying Twitter. Is it time to sell? appeared first on The Motley Fool Australia.

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Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Twitter. 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 Bruce Jackson.

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

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The CSL Limited (ASX: CSL) dividend has remained unchanged following the company’s mixed financial performance in the first half of FY22.

Despite navigating a challenging environment dominated by the COVID-19 pandemic, the company’s results were in line with expectations.

The global biotech’s CSL Behring revenue stood the same compared to the prior corresponding period. However, its Seqirus business delivered robust results, achieving a 17% increase in revenue over H1 FY21.

Overall, CSL recorded a 2.8% drop in net profit after tax (NPAT) to US$1,760 million.

Nonetheless, the board opted to return the company’s profits to shareholders, reflecting a consistent dividend policy.

But let’s see how the CSL dividend stacks up against its rivals.

How does the CSL dividend stack up?

CSL paid an unfranked interim dividend of US$1.04 (A$1.42) per share to eligible investors last month.

When combined with its previous dividend of US$1.18 (A$1.58) apiece, this brings the total dividends over the last 12 months to US$2.22 (A$3.00). It’s worth noting that the final dividend paid in FY21 was the highest in the company’s history.

Based on the current CSL share price of $265.83, this gives a trailing dividend yield of 97%.

What about its competitors?

CSL’s largest direct competitors are internationals, namely the Spanish company Grifols and Japanese-owned Takeda Pharmaceutical Company. However, as neither are listed here in Australia, let’s compare the CSL dividend against ASX-listed Sonic Healthcare Ltd (ASX: SHL) and Ramsay Health Care Ltd (ASX: RHC).

Sonic Healthcare rewarded its shareholders with a fully franked interim dividend of 40 cents per share on 23 March. Including the prior final dividend of 55 cents equates to 95 cents per share over the 12 months.

The Sonic Healthcare share price is currently trading at $36.54, which gives it a dividend yield of 2.60%.

Ramsay Health Care distributed an interim dividend of 48.5 cents per share to shareholders late March. The company’s prior final dividend for FY21 came to $1.03 a pop, translating to a 12-month dividend of $1.515.

The Ramsay Health Care share price is trading at $82.05 at the time of writing, offering a dividend yield of 1.85%.

While comparing a dividend yield against sector peers is one point to consider when investing, it is also important to examine the total shareholder return for the past 12 months.

CSL shares have remained flat for the period, while Sonic Healthcare and Ramsay Health Care shares have climbed 1% and 22%, respectively.

CSL commands a market capitalisation of roughly $129.74 billion, making it the third largest company on the ASX.

The post How does the CSL dividend compare to its competitors? 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. owns and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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