The Insurance Australia Group Ltd (ASX: IAG) share price has suffered a sharp fall over the past month. This is nothing new, however. Its shares have been on a rollercoaster ride since COVID-19 arrived on the world stage.

At the end of today’s market session, the insurance giant’s shares finished down 0.22% to $4.45 apiece. This means that the IAG share price has fallen by more than 16% since this time last month.

How has IAG performed recently?

The IAG share price has continued to decline since its most recent trading update in early November.

The company told investors it was expecting a rise in net natural perils claim costs for FY22. Severe storm and hail activity experienced in South Australia and Victoria during October were the cause.

In total, net natural perils claim costs for the current financial is forecasted to be around $1,045 million. This is a significant increase from the company’s previous estimates of $765 million.

IAG was forced to downgrade its FY22 insurance margin guidance range between 10% to 12%. Originally, the insurance margin level was in the 13.5% to 15.5% range. Lower vehicle claims made by customers were partly offset by inflationary pressure on claims costs in the company’s motor and home portfolios.

Pleasingly, gross written premium (GWP) improved in the first quarter of FY22, lifting in the mid-single-digit range.

While still trying to navigate its way through the tough trading conditions, IAG was recently hit with civil penalty proceedings.

The Australian Securities and Investments Commission (ASIC) took the embattled insurance company to the Federal Court of Australia over IAG’s failure to pass on the full discounts to a large number of NRMA customers. This relates to policyholders to took up NRMA Home, Motor, Caravan and Boat Insurance between March 2014 and September 2019.

IAG did self-report the issue to ASIC when it conducted a review in 2019 and has since embarked on a remediation program.

About the IAG share price

It’s been a rollercoaster ride for IAG shares, having moved unpredictably over the past 12 months. Its shares are currently down 15% since this time last year, and down 5% in 2021.

Based on valuation metrics, IAG has a market capitalisation of around $11.02 billion, with approximately 2.47 billion shares on issue.

The post Here’s why the IAG (ASX:IAG) share price is down 16% in a month 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 owns shares of and has recommended Insurance Australia 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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Shares in Kogan.com Ltd (ASX: KGN) have had a rough start to November so far. The eCommerce company has been plagued with concerns of ongoing inventory mismanagement since the latter part of 2020. As a consequence, the former darling has become a popular company to short.

The Kogan share price lacked direction in the context of today’s session. After the closing bell, shares were at $9.14, up 0.22%.

A cyclical company currently out of fashion

It doesn’t take a rocket scientist to work out it hasn’t been a good time for Kogan shares over the last 12 months.

A backlog of inventory equating to increased warehousing costs has taken its toll on the company’s earnings for the past three quarters. While the bottom-line dwindled, so too has the Kogan share price, falling 53% since this time a year ago.

Overall, the market seems divided over whether now is a good time to buy Kogan shares. Some analysts and fund managers think yes, others are not so keen.

For instance, Chris Stott from 1851 Capital joined Livewire back in September to share his argument for rating the eCommerce company a sell. At that point in time, Stott highlighted his belief that Kogan was still dealing with inventory issues. In addition, the fundie expected this issue to continue for a while longer.

It seems much of the market would agree to some extent. Kogan shares have featured prominently in the 10 most shorted ASX shares recently. In our latest 10 most shorted ASX shares, the Ruslan Kogan-led business found itself in second place with a short interest of 10.7%.

Despite this negative sentiment, the company posted gross sales and active customer growth in its recent first-quarter update for FY22. In the same update, Kogan revealed it had resolved previous inventory pressures.

However, short levels have remained elevated since this announcement, indicating that perhaps the market had anticipated better results.

Contrarian take on the Kogan share price

The sentiment seems heavily skewed towards the negative end of the spectrum for Kogan, which would make Credit Suisse’s outperform rating quite a contrarian perspective. Analysts at Credit Suisse believe the eCommerce company will continue to benefit from the online shopping shift.

As such, the broker has a $13.88 price target on the Kogan share price. This would suggest a potential upside of 51%.

The post Why are Kogan (ASX:KGN) shares being shorted in November? appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler owns shares of Kogan.com ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia owns shares of 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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The Selfwealth Ltd (ASX: SWF) share price has dropped by 18% in the last month.

That’s despite the share brokerage company continuing to grow at a very quick pace.

Both FY21 and the first quarter of FY22 showed a high level of growth.

FY21 report

Whilst the FY21 result wasn’t within the last month, it may have featured in investors’ minds in recent months.

The last financial year saw revenue growth of 135% to $18.4 million, with a 105% increase in active traders. Operating cashflow was a positive $1.1 million in FY21, driven by “strong” revenue growth and disciplined cost control.

Selfwealth has been working on diversifying its revenue streams. US trading was launched in December 2020 and was adopted by 29% of total active traders within the first six months.

The company said it demonstrated its scalable business model in FY21, with increasing profitability. The gross profit margin increased from 33.4% in FY20 to 41.4% in FY21. Operating expenses increased by 41% compared to revenue growth of 135%.

Selfwealth’s mission is to increase its market share to be the number two in online trading. It said it was number four at the time. The company said it is the top platform for attracting people switching from banks and other platforms.

The Selfwealth share price has fallen by around 17.5% since the release of the FY21 result.

FY22 first quarter update

Just over a month ago, the business reported the first quarter of its FY22.

It has reported accelerating quarter on quarter growth. Active traders increased 13% to 107,461, quarterly trade volume grew 22% to 435,620 and client cash rose 15% to $600 million. The operating revenue rose by 7.8% quarter on quarter to $5.5 million and 32% year on year.

Selfwealth has been working on increasing engagement through content, with new development and investment webinars attended by thousands of customers every week.

It has also been working on adding value with production innovations like instant deposits, live pricing and integration of ESG data.

After a capital raising a few months ago, the business has been increasing its investment and it’s seeing the advantages of that, with expectations the company will keeping benefiting for the rest of the year and beyond.

Selfwealth experienced a cash outflow of $1.1 million for the quarter to 30 September 2021. It ended the quarter with $17.5 million of cash with no debt.

AGM

The latest market sensitive announcement that may have impacted the Selfwealth share price was the annual general meeting (AGM).

At the AGM, it outlined the business case for Selfwealth, its FY21 result and the FY22 first quarter numbers.

The company is also on track in the second quarter of FY22 for cryptocurrency and new international markets. It’s also looking to refresh its user interface and add more education and content for members.

In the third quarter it’s looking to launch ‘dynamic notifications’, tax reporting, provide a advisor platform update, community insights and the news feed 1.0.

Then, in the fourth quarter of FY22, it’s working on new products, news feed 2.0 and the dynamic trading feature.

Selfwealth says that it has high growth potential on a scalable platform with diversified revenue and significant operating leverage.

Selfwealth share price snapshot

Whilst Selfwealth shares may be down more than 50% over the last nine months, it has risen more than 70% over two years and 210% from the bottom of the COVID-19 crash.

The post Why has the Selfwealth (ASX:SWF) share price dumped 18% in a month? 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. 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 Ansell Limited (ASX: ANN) share price tumbled to an 18-month low today. But several leading brokers reckon this is the time to buy its shares.

Shares in the glove maker shed 2.6% to $30.51 when the S&P/ASX 200 Index (Index:^AXJO) closed 0.8% stronger on Friday.

The Ansell share price hasn’t been this weak since May last year and investors are dumping it after yesterday’s annual general meeting.

Ansell share price hit by uncertainty

Management stuck to its FY22 guidance and said that earnings per share (EPS) could drop 9% or increase by 2%.

That’s an unusually big range and doesn’t do much for investor confidence. The upside to downside ratio doesn’t look enticing either on first blush.

While investors aren’t impressed by the commentary at the AGM, a number of brokers come out to reiterate their “buy” recommendation on the company.

Why the Ansell share price is still a buy

“Management flagged earnings will be 2H weighted, on near term COVID costs, inflationary pressures and price adjustments needing time to flow through,” said Morgans.

“While the company is coming off COVID highs, those gains only relate to certain areas of its portfolio (ie Exam/single use gloves) so are unlikely to be entirely reversed, with increased investments reflective of management’s confidence in the long term potential of the business.”

Morgans has an “add” recommendation on the Ansell share price with a 12-month price target of $41.87 a share.

Margin pressure no deterrent

Meanwhile, Morgan Stanley is another with a bullish rating on Ansell. This is despite management warning of price pressure and skinnier margins. The margin squeeze in the first half is attributed to manufacturing constraints, elevated freight and price increases.

But the broker reckons there is too much bad news priced into the Ansell share price. It repeated its “overweight” rating on the shares with a 12-month price target of $51.35.

“Given a pronounced 2HFY22 skew, we believe the jury will remain out on ANN’s FY22guidance until at least the 1HFY22results and associated early read on 2HFY22trends,” said Morgan Stanley.

“At the current levels, ANN’s share price implies no permanency to any benefit from the pandemic to market share or market size.”

Bad news more than priced in

The analysts at Citigroup also believes the Ansell share price is oversold. This is despite the fact that the broker has cut its earnings forecast for the group.

“The issue for companies that have benefitted from the pandemic is that earnings will likely decline for the next few years,” said Citi.

“It is not obvious that there will be a catalyst over the next six months for the stock to re-rate despite its valuation.

“However, we expect that once the market focuses on the industry fundamentals post pandemic, we should see a re-rating to more normal PE multiples.”

Citi maintained its “buy” recommendation on Ansell but lowered its price target to $45.50 from $46.50.

The post Brokers think the tanking Ansell (ASX:ANN) share price will rebound appeared first on The Motley Fool Australia.

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Motley Fool contributor Brendon Lau owns shares of Ansell 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 recommended Ansell 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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Shares in mineral exploration company Metal Hawk Ltd (ASX: MHK) charged lower today to finish down 23%.

To close the session, the Metal Hawk share price was down at 32 cents, following a company update on its Berehaven Nickel project.

Metal Hawk reported it has completed a round of drilling at the Commodore nickel sulphide prospect located at the project.

The company has received assay results from the first diamond drill hole at the site. One hole intersected a concentration of 2.32% Nickel from 203.8 metres to 207.2 metres.

Here are the details out of the company’s corner today.

What did Metal Hawk announce?

The company provided assay results from four holes it had drilled at the site for 1,210 metres.

Judging from the commentary, the results were a mixed bag for Metal Hawk. One of the holes, BVD003 “did not intersect ultramafic rocks” and suggests the “fertile Commodore ultramafic unit to the south may be offset by up to 200m”.

Additional assay results from hole BVNC007 intersected a 3 metre zone of disseminated nickel sulphide mineralisation, grading 1.26% Ni from 165m.

The company will follow up this result very shortly with additional reverse circulation (RC) drilling, per the release.

Hole BVNC006, located at the north end of the Commodore site, intersected a 13 metre thick zone of high magnesium oxide (MgO) ultramafic rocks from 151m to 164m – but no mineralisation was observed.

Assays are pending for two separate drill holes which the company hopes will build on the additional test work it has received in recent times.

Investors haven’t bought on the news and don’t appear to be buying the results either. It is unclear if the market was expecting a better set of outcomes.

What else went down today?

Checking market quote data on the terminal provided by Bloomberg Intelligence, we see an abnormal amount of trading on Metal Hawk shares relative to previous days.

There was a total of 10 trades of over 140,000 Metal Hawk shares today, with one huge lot of 377,919 shares.

In fact, there was a total of 3,011,653 Metal Hawk shares traded today, over 950% more than its 4-week average volume, and a whopping 5,286% more than Thursday.

Not only that, this volume is 6.37% of Metal Hawk’s total share float. This equates to a total value of $1.07 million in the company’s shares that were bought and/or sold today.

With this type of market activity, in such enormous volumes relative to historical averages for Metal Hawk, the picture starts to form as to what might have pulled the rug from investors today.

What’s next for Metal Hawk?

Following completion of the drilling program, follow-up drilling is set to be carried out.

For instance, RC drilling is due to recommence shortly with a number of holes designed to test the position of the “fertile Commodore ultramafic unit”.

Aircore drilling is also underway as the company continues to explore prospective zones to the north and south of Commodore.

In addition, Programme of Works (PoW) applications have been submitted for additional regional drilling within the Company’s tenements.

Metal Hawk share price snapshot

In the past 12 months, the Metal Hawk share price has gained 27% after rallying a further 43% this year to date.

Both of these results are well ahead of the S&P/ASX 200 index (ASX: XJO)’s gain of around 16% in the last year.

The post Here’s why the Metal Hawk (ASX:MHK) share price crashed 23% today appeared first on The Motley Fool Australia.

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The author Zach Bristow 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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Today, the S&P/ASX 200 Index (ASX: XJO) finished the week on a positive note, breaking a four-day red streak. At the end of the session, the benchmark index finished 0.92% higher at 7,449.8 points.

The stars aligned for commodities overnight as oil, gold, and iron ore prices lifted. In response, both ASX-listed miners and oil companies had a good showing to cap off the week. Following closely behind were tech names and consumer staples. The only sector not able to push higher on Friday was healthcare.

However, the question is: which shares delivered the biggest returns to investors on the ASX today? Here are the ten stocks that rose to the occasion:

Top 10 ASX shares countdown today

Looking at the top 200 listed companies, Pexa Group Ltd (ASX: PXA) was the biggest gainer today. Shares in the electronic conveyancing company surged 7.3% after its largest shareholder, Link Administration Holdings Ltd (ASX: LNK) received another takeover offer today. Find out more about Pexa Group here.

The next biggest gaining ASX share today was James Hardie Industries PLC (ASX: JHX). Shares in the materials manufacturer rose 5.29% despite no announcements from the company. However, investors might still be trading off of the record quarterly result released on Tuesday. Uncover the latest James Hardie details here.

Today’s top 10 biggest gains were made in these ASX shares:

ASX-listed company	Share price	Price change
Pexa Group Ltd (ASX: PXA)	$17.06	7.30%
James Hardie Industries PLC (ASX: JHX)	$56.55	5.29%
Champion Iron Ltd (ASX: CIA)	$4.47	5.18%
IGO Ltd (ASX: IGO)	$9.89	5.10%
Imugene Ltd (ASX: IMU)	$0.585	4.46%
Pilbara Minerals Ltd (ASX: PLS)	$2.44	4.27%
Orica Ltd (ASX: ORI)	$15.39	4.06%
Zip Co Ltd (ASX: Z1P)	$5.93	4.04%
Uniti Group Ltd (ASX: UWL)	$4.035	4.00%
Rio Tinto Ltd (ASX: RIO)	$92.34	3.59%

Our top 10 ASX shares today countdown is a recurring end-of-day summary to ensure you know which companies were making big moves on the day. Check-in at Fool.com.au after the market has closed during weekdays to see which stocks make the countdown.

The post Here are the top 10 ASX shares today 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 shares of and has recommended Link Administration Holdings Ltd and ZIPCOLTD FPO. The Motley Fool Australia has recommended Uniti 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 BARD1 Life Sciences Ltd (ASX: BD1) share price was a very strong performer on Friday.

At one stage, the diagnostics company’s shares were up as much as 44% to $1.43.

The BARD1 share price gave back some of these gains but ultimately ended the day 41% higher at $1.40.

Why did the BARD1 share price rocket higher?

Investors were bidding the BARD1 share price higher today following the release of an update on a patent.

According to the release, US Patent No: 11137402 titled “Lung Cancer Diagnosis” has been issued by the United States Patent and Trademark Office.

The issued patent covers methods for detecting antibodies to BARD1 peptides, methods for diagnosing lung cancer, and kits for lung cancer diagnosis.

It certainly has been a long time coming. The release explains that patent application was filed in November 2014 and will be active until February 2035. This gives BARD1 plenty of time to seek to monetise the technology in the massive US market.

BARD1’s CEO, Dr Leearne Hinch, appeared to be pleased with the news.

She said: “This patent family enforces intellectual property protection in the US for a potential BARD1-Lung cancer test that detects autoantibodies associated with lung cancer.”

What is BARD1?

BARD1 describes itself as an Australian diagnostics company with an innovative portfolio of diagnostic technologies and products.

It is focused on developing and commercialising diagnostic solutions for healthcare professionals and patients. The company has commercialised the hTERT test used as an adjunct to urine cytology testing for bladder cancer and the EXO-NET pan-exosome capture tool for research purposes.

In addition, it has a cancer diagnostic pipeline which includes tests in development for ovarian and breast cancers, and research-stage projects for prostate and pancreatic cancers.

The BARD1 share price has now more than doubled in value in 2021.

The post BARD1 (ASX:BD1) share price ends stellar day up 41% 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 Macquarie Group Ltd (ASX: MQG) share price has been an outstanding performer over the past 12 months. But is the investment bank’s future growth baked in now after a year of strong gains?

In afternoon trading on Friday, Macquarie shares bounced above the $200 mark once again.

On a year-to-date basis, the share price is up 42.7%. For anyone lucky enough to have picked up shares at the 52-week low of $126.51 in January 2021, their return on investment (ROI) is an impressive 59%.

Despite this exceptional performance, two fund managers think there’s still more on the table. Let’s take a look at what they think of the Macquarie share price going forward.

More good times to come for the Macquarie share price?

The past year has been a very rewarding period for investors in the ASX financial sector. In fact, the sector has been the market’s best performer. This is thanks to a strong bounceback in bank revenue and earnings following encouraging monetary policy from the central bank.

Macquarie Group has also been a beneficiary of the improving economic situation globally. In its FY22 first-half result, the company reported a more than doubling of its net profit, increasing 107% to $2.04 billion.

At the same time, assets under management increased 31% to A$737 billion at the end of September. Considering the level of growth, investors might be cautious of reversal, or at least a slowdown, in the business.

However, two fund managers recently shared optimistic perspectives for the Macquarie share price.

In an interview with Livewire, Pengana’s Rhett Kessler and Alphinity’s Stuart Welch both gave the ASX-listed investment bank a buy.

For Welch, the bank offers a well-managed business that has a strong track record for adapting to changing times. The fundie suggested the shift towards green investments is simply another iteration within the company’s journey, as it becomes a major player in net-zero emission ambitions.

Adding to this, Welch noted:

The retail side is taking share from the majors with better service levels and standards. In many respects, the business is doing really well and looks pretty reasonably valued. So it’s a buy for us.

Kessler also tagged the Macquarie share price a buy. While agreeing with Welch, Kessler added that Macquarie maintains strong talent within the company. Given the amplifying contest for talent, the fundie considers the investment bank well-positioned on this front.

The post The Macquarie (ASX:MQG) share price has gained 40% this year. Is it still good value? appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler owns shares of Commonwealth Bank of Australia and Macquarie Group 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 shares of and 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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Shares in software company Vection Technologies Ltd (ASX: VR1) are charging higher to trade 22% in the green at 19.5 cents.

Vection shares have swung upwards in almost vertical fashion in the past 2 days after the company released its enterprise sales and FY22 total contract value (TCM) update as of 9 November FY22 on Wednesday.

In its report, the company recognised strong sales growth inits defence, military and law enforcement segment. This was backed by strengths in its AEC and real estate divisions.

Let’s take a closer look.

But first – what is Vection?

Vection Technologies is a multinational software company that focuses on real-time technologies to help companies in their digital transformation.

Through a combination of 3D, Virtual Reality, Augmented Reality, and CAD solutions, Vection claims it can help companies and organisations to innovate and create value.

At the time of writing, Vection has a market capitalisation of $165 million.

Vection share price soars on growth momentum

The company grew both its military, defence and law enforcement plus AEC & real estate divisions since last reporting its FY22 TCV.

During October, the company saw a 58% growth in FY22 TCV compared to its FY22 first quarter values.

As it stands at 9 November, the company’s TCV is at approximately $8 million, with a strong pipeline of opportunities underpinning its FY22 outlook.

Vection attributes the bolus of growth in contract value to the adoption of its artificial intelligence (AI) integrated solutions through partner channels in the defence segment from the Middle East.

It expects individual sales that are driving the TCV growth to complete within various dates by the end of December 2021.

The release also notes that “quarterly cash receipts may vary depending on the solution and/or service provided to the end customer, and any individually material contract award will be separately announced to the market as applicable”.

Separately, the company’s XR integrated technology suite is “strategically positioned to drive enterprises’ digital transformation”.

Curiously, Vection also reckons this digital transformation is accelerated by the recent ‘metaverse’ trends observed in software circles.

The metaverse has recently been defined by newly Facebook’s (Now Meta) Mark Zuckerberg as a place where one can meet, attend meetings, work and even play using a VR headset, glasses or a smart device.

Put simply it is a virtual version of the real world. And Vection reckons recent momentum in the industry will bode in well for its earnings potential moving forward.

Investors have been quick to secure a spot in Vection’s equity on the back of the results, sending its share price from a low of 14 cents to the current market price in just 2 days.

Vection share price snapshot

In the past 12 months the Vection share price has climbed 56% after rallying over 62% this year to date.

Each of these returns are well ahead of the benchmark S&P/AX 200 index (ASX: XJO)’s return of around 16% in that time.

The post Here’s why the Vection (ASX:VR1) share price has boomed 40% in 2 days appeared first on The Motley Fool Australia.

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The author Zach Bristow 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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Shares in halloysite-kaolinite and graphite player Itech Minerals Ltd (ASX: ITM) are roaring today and now trade up 21% at 29 cents.

Itech shares have been in the green all session following a company update on its interests at the Eyre Peninsula Kaolin Project in South Australia.

The company has received analytics on the first batch of 10 historical drill hole samples at the Ethiopia Prospect, located at the Peninsula.

Results show significant total rare earth element oxides (TREO) in all 10 holes and over 1,100 parts per million (ppm) of total rare earth element oxides in clay fraction.

With these results, let’s analyse the extent of what Itech released today.

Why is the Itech Minerals share price charging higher?

For a bit of background, Adelaide Exploration Ltd first identified thick intervals of high purity kaolin clay at the site in 2007 over an area of 1km squared.

A preliminary 10 holes were sub-sampled at the time to assess potential of resource and mineralisation, and there were some notable results obtained.

Itech has since resampled the 10 holes and undertaken a kaolin beneficiation process, which has led to an upgrade in the average rare earths grade by 184%.

The results obtained from the resampling confirm Itech’s view “of the dual potential for high purity kaolin and coincident ion adsorption clay (IAC) rare earth element (REE) mineralisation”.

Specifically, the TREO were found in each of the 10 holes sampled, with an average beneficiation to 180% in the clay fraction.

The rare earth’s intersected display a large percentage of neodymium and praesidium. Both are critical elements for the production of permanent magnets in electric vehicles and renewables.

In its own analysis, Itech explained that the rocks found at the Ethiopa prospect are naturally enriched with both of these rare earths, in addition to a mineral called feldspar.

Over millennia, the rocks become weathered by rain and organic matter and end up producing slightly acidic groundwater. It is this phenomenon that sees the feldspar converted to kaolin clay, where the ‘tightly bound’ rare earths then disperse throughout the clay minerals.

One benefit of this occurrence, Itech says, is that contaminants like uranium and iron are removed by the weathering process, “leaving the rocks enriched in kaolin clays with loosely bound [rare earth’s] and quartz grains”.

What’s next for Itech Minerals?

Now that it has confirmed the bolus of its hypothesis, the company has since resampled an additional 12 drill holes to analyse for the “full suite” of rare earths.

It is analysing the holes with values of the element Cerium – also a rare earths element – above 100ppm.

One hole, labelled ETH-029, has a concentration of over three times the Cerium in the best samples submitted for analysis to date.

Results from the sampling are expected to take 5–6 weeks according to Itech, as it concurrently awaits further drilling approvals.

Itech says the results from this round of test work will help focus the drilling program on areas with the best potential to strike resource and mineralisation.

What did management say?

Speaking on the announcement, Itech Minerals managing director, Mike Schwarz said:

The nature of high purity kaolin and REE mineralisation at Ethiopia opens the path for the potential of an extremely low-cost source of these two critical minerals. Processing of the high purity kaolin increases the REE grades and extracting the REEs makes a higher quality kaolin product, potentially leading to more financially robust project economics.

After listing in late October, Itech has already gained 42.5% for early investors. Whilst it is still early days, this is well ahead of the benchmark S&P/ASX 200 index (ASX: XJO)’s return in that time.

The post Itech Minerals (ASX:ITM) share price rockets 21% on rare earth update appeared first on The Motley Fool Australia.

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The author Zach Bristow 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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