Key points

• Kogan share price hit a new 52-week low on Friday
• In response to its half year update, brokers have slashed their valuations
• Kogan fell well short of expectations again during the half

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The Kogan.com Ltd (ASX: KGN) share price has come under further pressure on Friday.

At one stage today, the ecommerce company’s shares dropped over 2% to a 52-week low of $6.02.

When the Kogan share price hit that level, it was down a whopping 72% from its 52-week high.

Why is the Kogan share price falling again?

Investors have been selling down the Kogan share price today after brokers gave their verdict on its half year trading update.

In case you missed it, Kogan disappointed the market again on Thursday when it revealed a big reduction in its earnings and a soft sales result which was boosted by an acquisition.

According to the release, Kogan achieved a 9% lift in first half gross sales during the first half. However, it is worth noting that the Kogan business reported a sales decline of 2.6% to $602.4 million, which was offset by the inclusion of the Mighty Ape business for six months compared to just one month a year earlier.

Mighty Ape reported gross sales of $95.6 million compared to its one-month contribution of $19.9 million in the first half of FY 2021.

But things got worse the further down the income statement you travelled as the true costs of generating those sales emerged.

Kogan reported a massive 58% decline in EBITDA to $21.7 million during the half. And once again, the six-month inclusion of the Mighty Ape business helped disguise the deterioration in the performance of the core Kogan brand.

Mighty Ape added $7.1 million to EBITDA for the six months, compared to $2.9 million for one month in the first half of FY 2021. Whereas the Kogan business reported a 70.1% reduction in EBITDA to $14.6 million.

Management blamed this on continuing supply chain interruptions, fluctuations in demand, higher logistic costs, and increased investment in marketing to grow its platform and scale the Kogan First loyalty program.

Broker reaction

The team at Credit Suisse wasn’t impressed with the half, with Kogan missing its earnings estimates by a significant margin. And while its analysts have retained their outperform rating, they have taken an axe to their price target and cut it by 34% to $9.16.

It was a similar story over at UBS. Its analysts were disappointed with its performance and appear concerned that higher operating costs could hold back its earnings recovery. Particularly given industry feedback pointing to higher digital marketing, warehousing, and logistic costs.

In light of this, the broker has retained its neutral rating and slashed its price target by 33% to $6.70.

The post Analysts give their verdict on the Kogan (ASX:KGN) share price appeared first on The Motley Fool Australia.

More reading

• Why Evolution, Cettire, Hipages, and Kogan shares are sinking
• ASX 200 (ASX:XJO) midday update: Premier impresses but Kogan disappoints again
• Here’s why the Kogan (ASX:KGN) share price just sank 15%
• Here’s why the Kogan share price has a lot of potential upside
• These are the 10 most shorted ASX shares

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 Kogan.com ltd. The Motley Fool Australia owns and has recommended Kogan.com 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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Key points

• Bill Ackman is one of the most famous fund managers in the world
• He runs Pershing Square Capital Management
• Now, it seems he is ‘buying the dip’ during this latest market correction

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As most of us would be aware, the past month or so has not been a fun one to have money in the markets. Even though the S&P/ASX 200 Index (ASX: XJO) is still in the green today, it remains down by roughly 9% so far in 2022. The US markets have faired even worse. The S&P 500 (SP: .INC) has lost 9.8% since the start of the year, while the Nasdaq-100 (NASDAQ: NDX) has seen its value drop by more than 15% over the same period.

So because all of these markets have dipped below 10% of their most recent all-time highs this week, we can now arbitrarily call this dip a ‘correction’ by the conventional investing playbook.

Market volatility and corrections can be an extremely stressful time for many investors, and fair enough. It’s never fun seeing the assets you’ve bought with your hard-earned cash get hammered so decisively, and over such a short span of time.

But some investors are taking advantage of this volatility to load up on shares at some cheap prices. One appears to be Bill Ackman. Ackman is a US-based fund manager who heads up Pershing Square Capital Management. Now a billionaire, Ackman is also one of the most famous fund managers in the world. So it goes without saying that this is an investor that might be worth paying attention to, especially in these uncertain times on the markets.

Top fundie Ackman ‘buys the dip’ with Netflix

Well, it appears Ackman is ‘buying the dip’ as it were. According to reporting in the Australian Financial Review (AFR) this week, Ackman has seized on the huge drop in the Netflix Inc (NASDAQ: NFLX) share price we’ve recently seen. Between 20 and 26 January, Netflix shares lost around 30% of their value. That put the company at pretty much 50% off its all-time high that we saw only back in November. This move seemed to have been sparked by Netflix’s most recent quarterly results, which detailed a slowdown in new subscriber growth for the company.

But according to the AFR report, Ackman’s Pershing Square has taken full advantage of this dip. The firm is now reportedly a top-20 shareholder of Netflix, which has a market capitalisation of US$171.29 billion.

Here’s why Ackman said he swooped:

The opportunity to acquire Netflix at an attractive valuation emerged when investors reacted negatively to the recent quarter’s subscriber growth, and management’s short-term guidance… We are all-in on streaming.

So that’s how one top investor is handling the volatility we have seen recently – by picking up large chunks of a favourite investment. Something to consider if we see things stay choppy for a while!

The post This world-famous fund manager is ‘buying the dip’. Here’s why appeared first on The Motley Fool Australia.

More reading

• Top two ASX 200 shares of 2022 to date revealed
• ASX 200 (ASX:XJO) midday update: ResMed and PointsBet disappoint
• 2 ASX dividend shares now offering big yields
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX shares 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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Netflix. 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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Key points

• Virgin entered voluntary administration during the first year of the pandemic
• Bain Capital bought the airline later that year for $3.5 billion
• The private investment firm is reportedly in talks to float the airline on the ASX

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ASX travel companies could face a new competitor on the market by 2023. Could Virgin Australia be looking to list on the ASX?

Virgin formerly traded on the ASX with the ticker VHA under the name Virgin Australia Holdings Ltd.

The airline entered voluntary administration in April 2020 amid COVID-19 travel restrictions. Bain Capital bought the airline in October 2020 for $3.5 billion.

When might Virgin become an ASX travel share once more?

Virgin Australia is looking at 2023 as a potential date for an initial public offering (IPO), according to The Australian. Sources told the publication that Bain Capital would assess a possible float midway through this year with a view to listing in 2023.

Bain Capital is a private equity firm headquartered in Boston, Massachusetts in the US.

No investment banks have been appointed to manage an ASX float but discussions are said to have taken place with advisors, according to the article. By 2023, the firm hopes Omicron fears will have played out, sources said.

This is not the first time talk of an ASX relisting has emerged.

In December, Virgin managing director Jayne Hrlicka confirmed the airline had received approaches to list on the ASX. However, she hosed down the speculation.

In a note to employees cited by The Financial Review, Hrlicka said:

Bain regularly receives proposals like this and no decisions have been made in relation to any potential relisting or other activity.

If and when there is something to say about future capital structures of Virgin Australia, you will hear it from us.

Bain Capital under every scenario will be our strategic partners and our major shareholder for many years to come.

Former Virgin shareholders were left devastated when the airline went into administration in 2020. Motley Fool Australia reported at the time that shareholders received nothing but regret for their shares. A federal court ruled they would not receive shareholder compensation.

ASX travel shares have had a mixed 12 months. The Qantas Airways Limited (ASX: QAN) share price has climbed 2.4% in the past year, while Flight Centre Travel Group (ASX: FLT) shares have returned 9.5%.

Regional Express Holdings Ltd (ASX: REX) shares have descended 26%, while Webjet Ltd (ASX: WEB) shares have fallen 4.4%.

The post Are Virgin Australia shares set to rejoin the ASX soon? appeared first on The Motley Fool Australia.

More reading

• When will Flight Centre (ASX:FLT) pay a dividend again?
• What might the WA border closure mean for the Webjet (ASX:WEB) share price?
• Qantas (ASX:QAN) share price falls amid rollercoaster day for ASX travel shares
• 3 ASX shares to buy right now that are famous Aussie brands
• The Flight Centre (ASX:FLT) share price just hit a 5-month low. Is now the time to buy?

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 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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S&P/ASX 200 Index (ASX: XJO) shares as a whole haven’t gotten off to the strongest of starts in 2022.

After gaining 13% in 2021, the ASX 200 is currently down 9.5% since the opening bell on 4 January, as at intraday trading on Friday morning.

Yesterday the index even entered a technical correction for the year, defined as any pullback of more than 10%.

With today’s intraday gains factored in, and going from the closing bell on 31 December, the ASX 200 has dropped 7.5%.

Some stocks, as you’d expect, have done it much harder. Others have managed to post strong gains.

With the first 4 weeks of 2022 now behind us, below we look at the top two ASX 200 shares to have held so far in the new year.

Top two ASX 200 shares for 2022

Our top performer is, drum roll please, AGL Energy Limited (ASX: AGL).

The AGL share price is up 14.4% in 2022, trading for $7.02 per share.

AGL received some positive broker coverage earlier in January, with Credit Suisse and JP Morgan joining the bullish bandwagon for the outlook of the Aussie power company in 2022.

Credit Suisse came out with a price target of $8.50 per share with JP Morgan targeting $7.55 per share. Both forecasts would see the AGL share price have significantly more upside from here.

For income investors, AGL also pays a compelling 9.2% trailing dividend yield, unfranked.

The number 2 performer

Moving on, the second best performing ASX 200 share of 2022 is Woodside Petroleum Limited (ASX: WPL).

The Woodside share price is up 12.7% since the closing bell on 31 December, currently at $24.85 per share.

Among other tailwinds, the oil and gas giant has benefited from soaring oil and LNG prices.

On 31 December, international benchmark Brent crude oil was trading for US$77.78 per barrel. At time of writing, the same barrel is fetching US$89.34, up 15%.

Woodside also delivered a strong quarterly report on 20 January, indicating a surge in quarterly revenue and record revenue for the 2021 financial year. Woodside reported it expects FY21 revenues to come in at US$6.97 billion, up from US$3.61 billion in FY20.

Management of the ASX 200 energy share also forecast a year-on-year increase in production for FY22.

Woodside pays a 2.3% trailing dividend yield, fully franked.

The post Top two ASX 200 shares of 2022 to date revealed appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: ResMed and PointsBet disappoint
• 2 ASX dividend shares now offering big yields
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX shares today
• 3 reasons not to panic in this ASX 200 correction

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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Key Points

• AnteoTech shares sink on additional request for information by the TGA
• The company submitted a performance report last week to the TGA
• Study timeline date impacted by Omicron outbreak and staff shortage across healthcare system

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The AnteoTech Ltd (ASX: ADO) share price is freefalling today regardless of the All Ordinaries (ASX: XAO) edging higher.

At the time of writing, the nanotechnology company’s shares are down 23.81% to 24 cents. This brings its week’s losses to a tad over 35% for shareholders.

In comparison, the broader ASX index is up 0.19% to 7,128.2 points.

AnteoTech receives additional request information

Investors are selling AnteoTech shares after digesting the company’s update regarding its EuGeni Reader and COVID-19 Rapid Diagnostic Test (RDT).

In its release, AnteoTech received a request for further information for its COVID-19 RDT by the Therapeutic Goods Administration (TGA). This relates to the collection of additional clinical data, together with other aspects of information.

The latest update follows the company’s submission last week providing a performance report of the RDT’s detection of SARS-CoV-2 variants.

Currently, the TGA is collaborating with AnteoTech on how best to address the clinical data requirements.

Late last year, the company supplemented its EuGeni studies by conducting a prospective clinical trial at the Alfred Hospital and Burnet Institute in Melbourne. This was conducted through a prospective clinical trial to further evaluate the performance of the EuGeni SARS- CoV-2 Ag RDT.

AnteoTech stated that the trial could provide further data in which the TGA may need to meet the clinical data requirements.

However, due to the current Omicron outbreak and healthcare staff shortage, the study timeline has been pushed back.

About the AnteoTech share price

Despite today’s heavy losses, the AnteoTech share price has advanced by more than 120% over the past 12 months.

The company’s shares reached an 8-month high of 41.5 cents last week, before crashing back down.

Based on today’s price, AnteoTech has a market capitalisation of roughly $473.78 million, with more than 1.97 billion shares outstanding.

The post Why is the AnteoTech (ASX:ADO) share price is plummeting 23% on Friday appeared first on The Motley Fool Australia.

More reading

• Why Anteotech, Appen, Boral, and Kogan shares are rising today
• AnteoTech (ASX:ADO) share price gains 42% in a week amid RAT race
• Why AnteoTech, BrainChip, City Chic, and ResMed shares are charging higher
• AnteoTech (ASX:ADO) share price surges amid ambition to join scramble for RATs
• Why Anteotech, Brainchip, RAIZ, and Santos shares are pushing higher

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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At lunch on Friday, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a much-needed positive note. The benchmark index is currently up 1% to 6,903.7 points.

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

ResMed’s Q2 update misses expectations

The ResMed Inc. (ASX: RMD) share price is edging lower today after its second quarter update fell a touch short of expectations. The sleep treatment company reported a 12% increase in revenue to US$894.9 million and a 12% lift in net income to US$201.8 million. Goldman Sachs commented: “2Q22 revenue came in -3% below consensus (Visible Alpha Consensus Data), driven primarily by -4-7% misses in devices (largely a reflection of limited component availability and broader supply chain challenges).”

Newcrest shares fall

The Newcrest Mining Ltd (ASX: NCM) share price is falling today following a decline in the gold price and the release of its second quarter update. In respect to the latter, for the three months ended 31 December, Newcrest delivered gold production of 436koz and copper production of 26kt. This was an increase of 10% and 7.7%, respectively, quarter on quarter. This led to half year gold production of 832.3koz. Investors appear to be doubting whether Newcrest will have what it takes to achieve its FY 2022 guidance of 1,800koz to 2,000koz.

PointsBet sink following Q2 update

The PointsBet Holdings Ltd (ASX: PBH) share price is sinking today following the release of its second quarter update. The sports betting company reported an 11% increase in group turnover to $1,326 million and net win growth of 61% to $71.9 million. However, also growing were its losses. PointsBet’s operating loss widened to $51.8 million.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Friday has been the Champion Iron Ltd (ASX: CIA) share price with a 6% gain. This morning Citi retained its buy rating and lifted its price target on the iron ore miner’s shares to $6.50. Going the other way, the worst performer has been the PointsBet share price with a 6.5% decline following its update.

The post ASX 200 (ASX:XJO) midday update: ResMed and PointsBet disappoint appeared first on The Motley Fool Australia.

More reading

• PointsBet (ASX:PBH) share price sinks 6% as losses widen to $52m
• Newcrest (ASX:NCM) share price down 4% following Q2 update
• 2 ASX dividend shares now offering big yields
• ResMed (ASX:RMD) share price on watch after Q2 update disappoints
• 5 things to watch on the ASX 200 on Friday

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 Pointsbet Holdings Ltd. The Motley Fool Australia has recommended Pointsbet Holdings Ltd and ResMed Inc. 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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Key points

• OZ Minerals shares are down 11% so far since last Friday’s close
• Despite the bearishness, the team at Citi upgraded its rating to a buy
• The broker raised its price target on the stock by 8% to $29.10 in doing so
• Meanwhile, analysts at Jefferies dropped their recommendation from a buy to a hold, alongside a suite of other brokers

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The OZ Minerals Ltd (ASX: OZL) share price has been in the red since the market open today and is now trading 2.63% lower at $24.84.

Today’s slip continues an 11% run into the red that OZ Minerals shares have embarked on this trading week. They have also plunged by 12% over the past month.

Despite the weakness, the team at investment bank Citi are constructive on the OZ Minerals share price and revised its rating on the stock in a note today.

Citi upgrades OZ Minerals from neutral to ‘buy’

Investors were quick to punish OZ Minerals following the release of its Q4 earnings and activities update yesterday. Moreover, the company also laid out guidance that was weaker than expected, and the OZ Minerals share price ended the day 2.89% lower

Yet, despite the bearishness, the team at Citi have a contrarian flavour to its view and reckon the company can outperform in 2022.

The broker lifted its rating on the stock from neutral to a ‘buy’ in its assessment. Citi’s move is underscored by its positive outlook on copper, which the firm is also bullish on.

Copper shot to fame throughout the pandemic. However, prices have since cooled off and have been largely trading sideways since May last year. Even so, the brown metal is now trading 24% higher than it was 12 months ago and has a strong growth outlook given demand out of China and a growing addressable market.

These factors make OZ’s share price and earnings outlook more attractive given the risk-reward calculus that could be skewed in the investor’s favour.

“We concede Oz Minerals is not a free cash flow yield stock but its growth options and low-risk asset locations make it a standout on the global stage,” Citi said.

Citi also notes its buy thesis “requires investors to be on board with Citi’s multi-year decarbonisation-driven bull thesis of US$4.0/lb long term”.

The broker raised its price target on the stock by 8% to $29.10 in its research update, concurrently rating OZ Minerals as a ‘buy’ in doing so.

What do other brokers say about the OZ Minerals share price?

A slew of other brokers slashed their valuations on the company and readjusted their bullish stance on its outlook. Goldman Sachs, JP Morgan, Macquarie and Morgan Stanley wound back their valuations of the stock following the result.

Analysts at Jefferies also changed posture on the OZ share price following the revised guidance outlook that was provided in the company’s quarterly report.

“While we have increased our cumulative project capex estimates for Prominent Hill and Carrapateena out to 2025, we have also redistributed such that more is being incurred during 2022 and 2023,” the firm says.

The broker subsequently dropped its recommendation from a buy to a hold today, revaluing the company at $27.50 – in direct contrast to its counterpart Citi.

OZ Minerals share price snapshot

In the last 12 months, the OZ Minerals share price has climbed by around 33%. However, it has struggled this year to date and is down 12.5%.

The post The OZ Minerals (ASX:OZL) share price has dumped 11% this week. Is it a bargain? appeared first on The Motley Fool Australia.

More reading

• OZ Minerals (ASX:OZL) share price slips despite record $2 billion revenue
• 2 ASX shares to guide you out of this bloodbath: expert
• Leading brokers name 3 ASX shares to sell today
• Leading fund manager says these blue-chip ASX shares are buys right now
• 6 ASX shares involved with green metals

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 recommended 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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Needless to say, shareholders of Flight Centre Travel Group Ltd (ASX: FLT) have endured a turbulent journey over the past year or two.

Flight Centre was, of course, one of the worst-hit ASX shares of the original COVID-19 crash of 2020. But saying that, the past year has actually been very kind to this ASX travel company.

Until about a fortnight ago, the Flight Centre share price had gained roughly 20% over the preceding 12 months. Even as it stands today, Flight Centre shares are still up by 7.7% over the past year.

At the time of writing, the Flight Centre share price is $15.51, up 0.06% today.

Now, shareholders are awaiting the next set of results from Flight Centre. This will be the company’s half-year earnings report for FY2022, which is due on 24 February.

But in the meantime, let’s talk about dividends.

Flight Centre used to be a relatively strong ASX dividend-paying share. Back in 2018, the company paid out 2 dividends. They were a 70 cents per share interim payment and a $1.07 per share final dividend.

In 2019, Flight Centre ratcheted this up significantly. Not only did the company pay an interim dividend of 60 cents and a final dividend of 98 cents, it also doled out a special dividend of $1.49 per share.

Unfortunately, Flight Centre shareholders’ dividend income stream has all but dried up. The company has not paid out any income whatsoever since that final dividend in October 2019.

So when might that change for Flight Centre? When will this company’s dividends take to the sky once more, if you’ll pardon the pun?

When will Flight Centre’s dividends get off the ground again?

Well, that’s a tough question. For Flight Centre to be able to pay out dividends again, it first needs to be profitable. An unprofitable company can’t fund dividend payments, at least not for very long.

And unfortunately, it doesn’t look like Flight Centre is close to being sustainably profitable. Back in its last quarterly trading update, Flight Centre reported a net operating outflow of $41 million for the 3 months to 30 September 2021. Over FY2021, the company also reported a net underlying loss of $507 million before tax.

So obviously with no positive cash flow, there can’t be any dividends for shareholders.

Until this situation reverses, it’s highly unlikely that Flight Centre will be able to fund dividend payments. So we’ll have to wait and see what Flight Centre’s half-year earnings tell us next month.

Given the emergence of Omicron, it’s unlikely that the company’s balance sheet over the second half of last year improved enough to reach strong profitability. But we shall have to wait and see what the company says next month to know for sure.

At the current Flight Centre share price, this ASX travel share has a market capitalisation of $3.09 billion.

The post When will Flight Centre (ASX:FLT) pay a dividend again? appeared first on The Motley Fool Australia.

More reading

• The Flight Centre (ASX:FLT) share price just hit a 5-month low. Is now the time to buy?
• These are the 10 most shorted ASX shares
• Flight Centre (ASX:FLT) share price falls amid potential legal action on borders
• ASX travel shares are nosediving today amid border opening delays
• Why did the Flight Centre (ASX:FLT) share price gain 7% in a month?

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel 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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Owners of Santos Ltd (ASX: STO) shares might want to keep an eye on the company’s Papua New Guinea assets amid rumours of a sell down.

One top broker flagged that the potential sale could bring a $3.25 billion payday for the oil and gas producer, while moving to sell its Alaskan interests could bring another $1.42 billion.

At the time of writing, the Santos share price is $6.99, 0.36% higher than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) has gained 0.43% this morning.

Let’s take a closer look at the sale Santos is reportedly gearing up for.

Santos may be eyeing asset sales

According to reporting by The Australian, Santos is actively moving to sell down its stake in PNG LNG – boosted by its takeover of Oil Search.

The merged group owns 42.5% of the LNG project after Oil Search’s 29% stake was added to Santos’ 13.5% holding.

Previously, the now-joined companies flagged that the merger would grant the resulting entity the flexibility to sell down some of its stake.

Now, Santos managing director and CEO Kevin Gallagher is reportedly pushing for a fast sale to Total – the operator of the Papua LNG project.

Santos and Oil Search flagged that the sell-down of PNG LNG would realign its interests across PNG LNG, P’nyang, and the Papua LNG project, improving coordination and accelerating the development of Papua LNG.

Total has no interest in PNG LNG or P’nyang.

The Australian reports that Total would be willing to buy as much of the project as Santos is willing to sell, with at least 10% needing to change hands to transfer voting rights.

Morgan Stanley has reportedly stated a 10% stake in the project could bring Santos as much as $3.25 billion if sold at a 25% discount on its valuation.

Additionally, Santos might be eyeing the sale of its stake in the Pikka Project – located in Alaska. The broker reportedly believes that the asset could bring a $1.42 billion payday.

How has Santos been performing on the ASX?

While the ASX 200 has been suffering this year, the Santos share price has been performing relatively well.

It has gained 10% since the final close of 2021. Meanwhile, the ASX 200 has slipped 7%.

The post Is Santos (ASX:STO) about to enjoy a $3 billion payday? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• Why are ASX 200 energy shares tumbling on Tuesday?
• Why AGL (ASX:AGL) and Origin (ASX:ORG) shares tumbled today
• 5 things to watch on the ASX 200 on Monday

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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Key points

• The Firefinch share price is dropping 3% today
• The move coincides with its latest quarterly activities report
• Firefinch is positioning for production growth in gold and lithium

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The Firefinch Ltd (ASX: FFX) share price is falling today.

The price move follows Firefinch’s latest quarterly West African-based mining activities and cash flow update. At the time of writing, the Firefinch share price is down 3.17% to 61 cents.

So what’s been going on with the gold and lithium miner to make its share price drop?

Let’s take a deeper look…

Firefinch’s quarterly cash flow

The miner’s quarterly corporate snapshot (as of 31 December 2021) is as follows:

• Cash (and cash equivalents available) is $152 million
• $5.6 million in gold sold (proceeds not received by date)
• Share purchase plan “heavily oversubscribed” and raised $51.36 million at 58 cents apiece
• $100 million institutional placement at 67 cents a share completed in December

Since the end of the quarter, the Firefinch share price has decreased by 33%.

Further, the miner has had “aggressive growth plans” on its mind leading into 2022, as it aims to increase annual production.

In fact, it’s aiming to hit a target of 100,000 ounces of gold this year and double that by 2024. It also wants to rapidly progress its lithium site and believes it is now “fully funded” to hit these targets.

Now, moving away from its corporate targets — what practical advancements has the company? Let’s take a look…

Firefinch mining activity snapshot

Morila Gold Mine (Mali, West Africa):

• 11,115 ounces of gold produced (within guidance)
• A new “high grade” zone found in the eastern side of its Super Pit
• Pre-stripping of the pit underway (in order to increase production to 100,000 oz this year)
• Mining and haulage is underway at its Viper satellite pit
• Additional mineralisation at Viper location found and to be explored

Goulamina Lithium Mine (Mali, West Africa):

• The Lithium site received a post-tax, net present value (NPV) of $4.1 billion
• It had an internal rate of return (IRR) of 83% (more than double the prior definitive feasibility study)
• 50:50 joint venture with Jiangxi Genfeng Lithium Co Ltd to develop Goulamina is nearing “formal finalisation” (though still subject to conditions)
• Required Chinese regulatory approval achieved and Mali Government also in support
• JV parties agreed a final investment decision and early-stage engineering and drilling programs to begin
• Essential sterilisation of the waste rock facility underway
• Lithium production from the site expected early 2024

As announced in August, the Goulamina mine is set to be demerged from Firefinch and placed under its new entity, Leo Lithium Limited (Leo). In its latest update, Firefinch said the necessary regulatory documents were being prepared.

The demerger is scheduled for March but is still subject to shareholder approval (the miner has assured investors that no cost will be incurred). The ASX listing is expected by the end of the 2022 first quarter.

Firefinch share price summary

Over the past 12 months, the Firefinch share price has increased by a staggering 221%.

It saw its highest point of the year earlier this month at 92 cents apiece. This compares to its lowest point (almost a year to the day) of 17 cents.

But since its high point, the Firefinch share price has decreased, seeing a 7% drop coinciding with a Morila Gold Mine update. There was also a share price fall around the time of appointing Leo Lithium’s new managing director.

The company has a market capitalisation of $712 million and a price-to-earnings ratio (P/E) of -86.

The post Why is the Firefinch (ASX:FFX) share price suffering today? appeared first on The Motley Fool Australia.

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