Fortescue Metals Group Ltd (ASX: FMG) is back in the headlines with news it is considering a pivot-shift in strategy regarding its magnetite operations at its Iron Bridge project.

At the time of writing, shares in the iron ore juggernaut are changing hands at $21.07 apiece, up 3.44%, after closing the session at $20.37 last Friday.

The gain is supported by broad sector strengths on Monday, with the S&P/ASX 300 Metals & Mining Index (ASX: XMM) jumping 1.47% from the open at the time of writing.

Aside from this, iron ore price action remains under considerable pressure since its selloff in mid-July. Spot and futures prices have melted more than 45% since then.

What’s up with the Fortescue share price today?

Shares in the iron ore giant opened the session down at $19.83 apiece after pre-market activity on Monday, despite no price sensitive information being released.

However, the Fortescue share price spiked on the opening bell and is now trading well in the green, amid news of a shifting strategy at its Iron Bridge magnetite mine in WA.

According to reporting from The Australian, the company is understood to have already commenced works at the site using its own fleet. However, it is now facing a blowout of up to $1.2 billion in costs and capital expenditures at Iron Bridge.

The revision on expenses comes after labour costs and foreign exchange rates had already pushed maiden production at the site back by 6 months, according to the company.

Now Fortescue says the project is on schedule to deliver first production in December 2022 with revised capital investment forecasts of $US3.3-$US3.5 billion.

As such, it is reported the company is seeking a third-party contractor to overtake long-term mining operations at the site, as Fortescue itself seeks to minimise spending on diesel trucks in its push towards renewables.

Doing so would free up capital from its expense base and allow for a reallocation towards its renewables division.

Fortescue has made the commitment to divest completely from diesel trucks by 2030, amid Fortescue Future Industries’ quest to unlock the latest sustainable energy source.

Fortescue founder Andrew ‘Twiggy’ Forrest has also been lobbying hard for the government to phase out the US$7.8 billion diesel fuel rebate by 2025, The Australian reports.

The news follows a media update out of Fortescue’s camp last week, saying it had purchased two new “battery electric locomotives” to transport its iron ore to port.

The new locomotives are set to “cut emissions while also reducing fuel costs and [its] overall operational expense through lower maintenance spend”.

As it stands, Fortescue has been more active than usual lately on managing its portfolio and aiming to reduce exposure to ‘non-green’ fuel and energy sources such as diesel.

Aside from the above, Fortescue now has to fill the positions of a number of senior executives who have left the company in recent months, including its director of energy and chief executive.

Separately, iron ore markets have been lumpy since September 2021 and have traded largely sideways since that time.

Whilst traders have shown support for iron ore lately, it has faced resistance on several occasions at the US$121-$125/tonne mark and can’t seem to breakout past that point.

Fortescue Metals share price snapshot

It’s been a difficult year for Fortescue shareholders, having lost around 17% in the last 12 months of trading. However, the company’s shares have started the year well and are up 9% to date.

In the last month, Fortescue has regained support and has climbed almost 15% into the green, amid a slew of updates and the price of iron ore bouncing off its 52-week lows in December.

The post What’s impacting the Fortescue Metals (ASX:FMG) share price on Monday? appeared first on The Motley Fool Australia.

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The author has no positions 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 Pro Medicus Limited (ASX: PME) share price is out of form again on Monday.

In early trade, the health imaging technology company’s shares have fallen 5% to $51.51.

This means the Pro Medicus share price is now down 17.5% since the start of the year.

Why is the Pro Medicus share price falling?

Investors were selling down the Pro Medicus share price last week amid weakness in the tech sector and a bearish broker note out of Morgans.

In respect to the latter, the broker downgraded the company’s shares to a reduce rating with a $54.59 price target.

Morgan made the move on valuation grounds following recent share price strength, which it felt had run ahead of fair value in the short term.

It commented: “We continue to view PME as a high quality name with a competitive product and long-term contracted revenues, but remain cautious on short-term valuation grounds, trading at 150x FY22F PE.”

Back to hold

That downgrade didn’t last long. In light of the sharp pullback in the Pro Medicus share price last week, this morning Morgans upgraded its shares to a hold rating with the same price target.

While it acknowledges that its shares still trade on lofty multiples despite last week’s selloff, the broker sees enough value to warrant a more positive rating.

Though, it isn’t necessarily recommending investors start buying shares just yet. Morgans thinks the $50 mark is a good entry point.

Morgans commented: “Given the valuation, happy to remain active and trim overweight positions but long-term thematic and earnings visibility remains strong to retain a core holding for the long-term. Looking for weakness for an entry price around A$50 for new positions.”

The way the tech sector is performing right now, investors may not have long to wait for a buying opportunity at the $50 level.

The post What’s going on with the Pro Medicus (ASX:PME) share price? appeared first on The Motley Fool Australia.

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• ASX 200 (ASX:XJO) midday update: Afterpay hits 52-week low, energy shares rise

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. owns and has recommended Pro Medicus Ltd. The Motley Fool Australia owns and has recommended Pro Medicus Ltd. 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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Owners of Santos Ltd (ASX: STO) shares had an exciting 2021. And, according to forecasting by S&P Global Platts analytics, they might be in for a strong 2022 too.

The research house recently released its outlook for energy commodities’ prices, wherein it predicted demand for fossil fuels will increase this year.

Of course, that will likely impact Santos’ profit margins and, therefore, its share price. At the time of writing, the Santos share price is $6.85.

Let’s take a closer look at what might move oil prices this year.

Could this drive the Santos share price this year?

According to S&P Global Platts, oil prices will likely stabilise in 2022 as COVID-19 becomes less disruptive and demand for oil increases.

This is likely good news for those who hold shares in oil producers such as Santos or Woodside Petroleum Limited (ASX: WPL).

Analysts from the research house expect the supply of fossil fuels will increase over 2022, potentially even exceeding demand. It stated:

We project that oil demand will increase by over 4 million [barrels per day (b/d)] in 2022. Even in a case where COVID proves to be more disruptive than expected, oil demand will still increase by almost 3 million b/d at a minimum, as vaccinations continue to build globally, and importantly, in countries with high GDP per capita. Oil demand growth could exceed 6 million b/d if we revert to normal more quickly. The strength in demand will push refinery runs and utilization rates (even including increased refining capacity) close to their historical ranges, improving margins.

Additionally, S&P Global Platts noted, “fears about the impact of new coronavirus variants, like Omicron, on demand will add to volatility but are likely overblown.”

It predicts, as more of the world’s population receive COVID-19 jabs, the likelihood that outbreaks will impact oil demand will lessen.

It also expects oil inventories to recover in the first quarter, leading oil prices to stabilise.  

Finally, demand for diesel is expected to stay high. It will likely be driven by lessening bottlenecks in supply chains and more planes launching into the sky.

What else could impact oil prices?

However, supply of oil could be hampered if a US-Iran nuclear deal isn’t implemented and sanctions continue.

S&P Global Platts predicts such a deal will be penned by March, with full sanctions relief by April. That could see Iran boosting global supply by 1.4 million barrels per day by the end of this year.

Though, without a deal oil prices could surge. The research house stated:

[T]he key test will come in the third quarter as summer demand challenges supply resilience – the absence of an Iran deal could leave the market vulnerable to breaking US$100 per barrel if combined with any other disruptive event.

In December, the Australian Department of Industry, Science, Energy and Resources predicted the oil price won’t surpass US$85 per barrel during financial year 2022.

Carbon outlook

Some might have hoped 2022 would spell the beginning of a new age of decarbonisation, particularly following COP26. However, that likely won’t be the case.

The research body expects carbon emissions from energy combustion will increase 2.5% in 2022, reaching new record levels.

Additionally, certain elections are expected to bring risks for domestic environmental policy agendas. S&P Global Platts noted:

Midterm elections in the US could derail the Biden Administration’s environmental agenda, while Australia’s opposition party is looking to oust the more conservative government by making stronger environmental targets a priority. These elections are reminders that “all politics are local” and the fates of global agreements are often determined by domestic elections, public sentiment, and policy shifts.

Santos share price snapshot

So far, 2022 has been good to the Santos share price.

It has gained 3.63% since the start of the year. Though, it is 5% lower than it was this time last year.

The post Own Santos (ASX:STO) shares? Here’s the outlook for oil prices in 2022 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 Bruce Jackson.

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Once a week I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Flight Centre Travel Group Ltd (ASX: FLT) remains the most shorted ASX share after its short interest stayed flat at 14.6%. Fears that the Omicron variant of COVID-19 is derailing the travel market recovery continue to weigh on investor sentiment.
• Kogan.com Ltd (ASX: KGN) has seen its short interest ease to 10.4%. This ecommerce company’s shares have come under pressure due to its very disappointing performance over the last 12 months and expectations that it will continue in FY 2022.
• Redbubble Ltd (ASX: RBL) has short interest of 9.4%, which is down week on week. Redbubble is another ecommerce company short sellers have been targeting due to its disappointing performance and concerns that it won’t improve quickly.
• Mesoblast limited (ASX: MSB) has short interest of 9.1%, which is down week on week. Last month Novartis terminated an agreement that could have been worth US$1.25 billion to Mesoblast. This could mean Mesoblast will need to raise funds again in the not so distant future.
• Zip Co Ltd (ASX: Z1P) has seen its short interest remain flat at 9.1%. Short sellers will be celebrating that Zip’s shares hit a 52-week low last week. Its shares have come under pressure due to the prospect of rising interest rates and reports that US regulators are looking into the BNPL market.
• Webjet Limited (ASX: WEB) has short interest of 8.6%, which is down week on week. As with Flight Centre, the emergence of the Omicron variant has spooked investors and put pressure on its shares.
• BHP Group Ltd (ASX: BHP) has short interest of 8.4%, which is up week on week. This appears to be driven by traders looking to profit from the unwinding of its dual listing. They have shorted its ASX shares and bought the cheaper UK shares which will eventually be repatriated.
• Polynovo Ltd (ASX: PNV) has seen its short interest rise to 7.6%. Short sellers continue to increase their positions despite the medical device company releasing a much-improved sales update last month.
• Betmakers Technology Group Ltd (ASX: BET) has entered the top ten with short interest of 7.3%. Investors may have concerns over the lofty multiples this betting technology company’s shares trade on.
• Appen Ltd (ASX: APX) has seen its short interest remain flat at 7.2%. This may be due to reports that some tech companies are bypassing artificial intelligence data services providers like Appen and taking things in-house.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

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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. owns and has recommended Appen Ltd, Betmakers Technology Group Ltd, Kogan.com ltd, POLYNOVO FPO, and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Appen Ltd and Kogan.com ltd. The Motley Fool Australia has recommended Betmakers Technology Group Ltd, Flight Centre Travel Group Limited, and Webjet Ltd. 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 Incitec Pivot Ltd (ASX: IPL) share price is pushing higher on Monday morning.

At the time of writing, the industrial chemicals company’s shares are up 1.5% to $3.35.

Why is the Incitec Pivot share price rising?

Investors have been bidding the Incitec Pivot share price higher today after it announced a key acquisition.

According to the release, the company has entered into an agreement to acquire 100% of the shares in Explinvest for 91 million euros (~A$142 million) on a debt free and cash free basis. This represents an expected acquisition multiple of 7.8x FY 2020 EBITDA.

This investment is expected to be earnings per share neutral in the first full year of ownership and earnings per share accretive from then on after synergies are realised. The acquisition will be funded from the company’s existing cash and debt reserves.

What is Explinvest?

Explinvest is the holding company of the Titanobel Group, which is a leading industrial explosives manufacturer and drilling, blasting, and technical services provider based in France.

Management believes the transaction is highly complementary to the existing operations of its Dyno Nobel business. This is due to it providing access to new markets where Dyno Nobel can leverage its premium technology offering through substitution and growth strategies.

It also notes that Titanobel has a strong customer base in the mature and stable European market with exposure to the quarry and construction sector, the growing African hard rock sector, and the rapidly expanding mining of future facing minerals in the EMEA region.

Furthermore, Titanobel is supported by a well-established manufacturing base in France, which it believes will be key to the delivery of the Dyno Nobel strategy in the region.

Incitec Pivot’s Managing Director and CEO, Jeanne Johns, said: “Titanobel’s acquisition will fit well with our strategy of taking our core explosive business, for which we are recognised globally, to new markets. We are excited for the potential to service new clients and partners with our market leading technology.”

“The ability to build on Titanobel’s rich history, market position and regional presence is an exciting chapter in our growth journey, and we look forward to welcoming the Titanobel team to IPL. This acquisition further demonstrates the opportunities we have to grow our two high quality businesses and position them for the future,” Johns added.

The post Incitec Pivot (ASX:IPL) share price higher on $142m acquisition appeared first on The Motley Fool Australia.

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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 Bruce Jackson.

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The Novonix Ltd (ASX: NVX) share price is on the move on Monday morning.

At the time of writing, the battery materials company’s shares are up 7% to $9.98.

Why is the Novonix share price rising?

This morning the company announced the beginning of the process to have the Novonix share price listed on a second stock exchange.

According to the release, Novonix has filed a registration statement with the U.S. Securities and Exchange Commission (SEC) relating to a potential listing on the famous Nasdaq index. The U.S. listing is expected to take place after the SEC and Nasdaq have completed their review process and upon effectiveness of the registration statement.

Why list on the Nasdaq?

The company notes that establishing this program is part of an ongoing strategy to expand its reach to investors in the United States and make the company’s securities potentially eligible as a direct investment for North American institutions and fund managers.

As with its ASX listed shares, Novonix intends that its shares will trade on the Nasdaq under the ticker symbol NVX. It also stresses that the listing will not lead to the issuance of new shares. Rather the American Depository Receipts (ADRs) will be based on its ordinary shares currently on issue.

Novonix’s CEO, Dr. Chris Burns, said: “We believe NOVONIX was the first qualified supplier of high-capacity long-life synthetic graphite anode material to a major cell maker and is the only supplier with plans to provide large volumes of this key material in the U.S.”

“Our technological breakthroughs are helping to power the energy storage market, leading to better performance, longer life and lower costs. This listing furthers our long-term goal of reshoring the EV supply chain in North America and becoming a leader in the electrification economy,” he added.

The post Novonix (ASX:NVX) share price jumps 7% on Nasdaq listing plans appeared first on The Motley Fool Australia.

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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 Bruce Jackson.

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The Medibank Private Ltd (ASX: MPL) share price has travelled modestly over the course of the new year. This comes as the private health insurance giant continues to navigate its way through COVID-19.

At Friday’s market close, Medibank shares touched a 52-week high of $3.63 before slightly retracing to $3.60, up 5.88%.

In contrast, the S&P/ASX 200 Index (ASX: XJO) ended the day 1.29% higher at 7,453.3 points.

Investors may be wondering what’s ahead for Medibank in 2022. Below, we look at some of the key dates to watch out for.

What’s ahead for Medibank in 2022?

Australia’s leading health insurance provider recently released its calendar for the 2022 financial year.

The first date of note is just around the corner on 25 February, when Medibank plans to deliver its half-year results for FY22. Along with its six-month performance report, the company will also announce the 2022 interim dividend.

The ex-dividend date for the interim dividend is scheduled for the following week, on 4 March. This is when investors must have purchased Medibank shares to be eligible for the upcoming interim dividend payment.

The payment date for the interim dividend is set for 24 March, when investors will collect a portion of the company’s profits.

Medibank handed shareholders a fully franked interim dividend of 5.8 cents per share for the first half of FY21.

The above process will repeat itself with Medibank releasing its full-year results and full-year dividend sometime in August. Although these dates are yet to be released by the company.

Medibank share price snapshot

Based on valuation grounds, Medibank presides a market capitalisation of roughly $9.91 billion, with approximately 2.75 billion shares on issue.

The company currently has a trailing dividend yield of 3.53% and a price-to-earnings (P/E) ratio of 22.50.

The post Own Medibank (ASX:MPL) shares? Here are some key dates to watch in 2022 appeared first on The Motley Fool Australia.

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

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Ethereum (CRYPTO: ETH) has always existed for a different reason to Bitcoin (CRYPTO: BTC). 

Ether fans would probably argue it has a more altruistic purpose.

While Bitcoin is purely used as a store of value, the Ethereum blockchain network is used to facilitate smart contracts. The technology has facilitated now-familiar concepts like non-fungible tokens (NFTs) and decentralised finance (defi).

However, Ether has always played bridesmaid to Bitcoin in the cryptocurrency rankings.

The two assets are the most recognisable names but Ether has never managed to quite overtake the market capitalisation of Bitcoin.

But this might finally happen in 2022.

“If Ethereum flips Bitcoin in terms of market capitalisation, it will change the sentiment of the crypto market,” said Saxo Market cryptocurrency analyst Mads Eberhardt.

“We are arguably approaching the year with the highest probability of it happening since Ethereum caught up with Bitcoin’s lead in 2021 with more authentic use-cases and adoption.”

Ethereum 2.0 could be a game changer in 2022

According to Eberhardt, Ethereum’s major upgrade ETH 2.0 — released this year — could really secure the future of the cryptocurrency.

“To make a long story short, ETH 2.0 will make Ethereum significantly more scalable, more secure, and more sustainable,” he said.

“The latter is extremely important, as there is likely no future in proof-of-work, which is the current consensus mechanism of Bitcoin and Ethereum.”

The trouble with the current proof-of-work reward system is that the computers that do all the work on Ethereum currently require an enormous amount of power.

And that’s not sustainable in a carbon-aware world.

“It is simply too easy to heavily regulate the industry based on solely the sustainable argument while institutions have a good reason to keep a safe distance when the industry is not green.”

ETH 2.0 is due out in the first half of this year.

“Though please be prepared that we are possibly talking Q3, or maybe Q4, since Ethereum Foundation and its developers are known to postpone deadlines.”

Rise of layer 2 currencies

Both Ethereum and Bitcoin are known as layer 1 cryptocurrencies because they possess their own settlement layer.

But neither can get through thousands of transactions per second in their own right. And that’s where layer 2 cryptocurrencies come in.

“For crypto to gain global adoption, and be the settlement layer of the digital age, L2s are indeed needed as they presumably scale cryptocurrencies [indefinitely] in the future,” said Eberhardt.

“In 2021, L2s started to gain traction, but 2022 will likely be the year where they become a solid part of the crypto market, ultimately showing that cryptocurrencies can scale.”

The post Can Ethereum overtake Bitcoin in 2022? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo owns Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Ethereum.  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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There are plenty of S&P/ASX 200 Index (ASX: XJO) shares that have growth potential.

But only some companies are rated as good buys at the moment because of the valuations.

The ASX is known for some giant businesses such as Commonwealth Bank of Australia (ASX: CBA), CSL Limited (ASX: CSL) and BHP Group Ltd (ASX: BHP).

However, these two names are a fair bit smaller but have compelling factors going for them:

Bapcor Ltd (ASX: BAP)

Bapcor describes itself as Asia Pacific’s leading provider of vehicle parts, accessories, equipment, service and solutions.

The public may know the ASX 200 share best for its retail business Autobarn and its trade business Burson Auto Parts. However, it also has the premium retail offering Autopro, service businesses like Midas, ABS, Shock Shop and Battery Town, as well as numerous specialist wholesale businesses like truck parts, electrical parts and so on.

The Bapcor share price has taken a dive after the announcement of the accelerated departure of the managing director, and falling out with the board.

However, the company continues to plan for growth. It wants to grow its total footprint from around 1,100 locations in FY21 to more than 1,500 over the next five years. It’s also improving its online offering and rolling out “improved concepts” to differentiate against competitors.

Bapcor also plans to grown its market share of own brand products, with the aim of earning a higher margin on those sales.

The business also plans to invest in technology and become more efficient, so that it can generate higher margins.

Growth into Asia is another area of focus. It has a small but growing Burson network in Thailand and it also owns a quarter of Tye Soon, an Asian auto parts business.

At the current Bapcor share price, it is valued at 16x FY24’s estimated earnings.

Cleanaway Waste Management Ltd (ASX: CWY)

Cleanaway Waste Management is an ASX 200 share that specialises in waste management, industrial and environmental services. It is one of the main providers of weekly bin collections.

The business has a number of facilities and processes to transform a significant amount of that waste into “valuable commodities” for different sectors. It is a business that is part of the ‘circular economy’.

This company is rated as a buy by the broker Macquarie Group Ltd (ASX: MQG). The price target is $3.70, suggesting a potential rise of almost 20% over the next year if the broker is right.

Cleanaway recently completed the acquisition of some post-collection assets in Sydney from Suez for $501 million.

Those assets includes landfill operations with more than 15 years of forecast available airspace, as well as several transfer stations with waste processing capacity and capabilities.

The acquired facilities will enhance and complement the ASX 200 share’s existing Sydney footprint and deliver an immediate post-collections solution for the Sydney region to internalise its waste, according to Cleanaway. It will immediately add to Cleanaway’s earnings and be paid for by debt.

In the 2020 calendar year, the Sydney assets generated net revenue of around $193.1 million and normalised earnings before interest, tax, depreciation and amortisation (EBITDA) of $76.9 million.

Cleanaway management said the addition of these assets is “transformational” for the NSW business.

Using Macquarie’s numbers, the Cleanaway share price is valued at 27x FY23’s estimated earnings.

The post 2 ASX 200 shares that could be top buys for growth appeared first on The Motley Fool Australia.

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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. owns and has recommended CSL Ltd. The Motley Fool Australia has recommended Bapcor and Macquarie Group 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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The Westpac Banking Corp (ASX: WBC) share price had an alright year in 2021.

Its stock gained a respectable 10.22%. That’s only just behind the performance of the S&P/ASX 200 Index (ASX: XJO), which rose 13%. However, all its big banking peers’ stock outperformed that of Westpac.

The share price of National Australia Bank Ltd. (ASX: NAB) led the way, gaining 27% last year.

Meanwhile, those of Commonwealth Bank of Australia (ASX: CBA) and Australia and New Zealand Banking Group Ltd (ASX: ANZ) increased 23% and 21% respectively.

That leaves Westpac with less than half the gains of its worst performing peer. What could have weighed so heavily on the bank’s stock in 2021? Let’s take a look.

Why did the Westpac share price underperform last year?

The Westpac share price performed remarkably well for much of 2021. Between the end of 2020 and 29 October 2021, the bank’s stock gained 32.5%.

Unfortunately, it figuratively fell off the cliff in November, tumbling 20% that month.

As The Motley Fool Australia reported at the time, the slump was likely spurred by the release of its full year results on 1 November.

The market was seemingly unimpressed by Westpac’s performance during financial year 2021.

That was despite the bank recording a 138% lift in statutory net profit and a 105% increase in cash earnings.

Westpac’s stock sank 7% on the day its results were released, and it continued to slide until the beginning of December.

From then, it staged a slight resurgence, gaining 4% over the final month of 2021. Though, that wasn’t enough to push the Westpac share price back into its big bank peers’ league.

Interestingly, the CBA share price followed a similar trajectory through November and December.

It fell nearly 11% in November, mostly due to the release of a quarterly update. Luckily, it outperformed the Westpac share price last month, gaining 8%.

The post Why did the Westpac (ASX:WBC) share price significantly underperform the other big banks in 2021? 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 recommended Westpac Banking Corporation. 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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