The S&P/ASX 200 Index (ASX: XJO) is back on form on Thursday and charging higher. In afternoon trade, the benchmark index is up 0.7% to 7,257.7 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are pushing higher:

Collins Foods Ltd (ASX: CKF)

The Collins Foods share price is up 6.5% to $12.76. Investors have been buying the quick service restaurant operator’s shares after it announced an agreement with KFC Europe. According to the release, Collins Foods will become KFC’s corporate franchisee in the Netherlands. This means Collins Foods has the rights to develop, manage, and operate the KFC business in the country. The agreement provides a framework for the development of up to 130 new KFC restaurants over a 10-year period.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price is up 6% to $1.98. The catalyst for this rise was the release of an update on its Ngungaju Plant. The release reveals that the lithium miner has now started the commissioning of the plant after a period in care and maintenance. Management expects the old Altura Mining operation’s production to increase to approximately 180,000 to 200,000 dry metric tonnes (dmt) from mid-2022 onward.

Sezzle Inc (ASX: SZL)

The Sezzle share price has jumped 9% to $5.38. Investors have been buying this buy now pay later (BNPL) provider’s shares after US retail giant Target launched Sezzle’s BNPL service across its store network. The two parties signed a three-year deal earlier this year. Affirm is also being offered to Target’s customers.

Super Retail Group Ltd (ASX: SUL)

The Super Retail share price is up over 7% to $12.33. This strong gain appears to have been driven by a bullish broker note out of UBS. According to the note, UBS has upgraded the retailer’s shares to a buy rating with a $13.50 price target. The broker believes Super Retail is well-placed to benefit from an increase in consumer spending post-lockdowns.

The post Why Collins Foods, Pilbara Minerals, Sezzle, & Super Retail are pushing higher appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Pilbara Minerals jumps, Whitehaven Coal sinks
• Why is the Collins Foods (ASX:CKF) share price climbing 5% today?
• Pilbara Minerals (ASX:PLS) share price higher on lithium project update
• Top broker upgrades the Super Retail (ASX:SUL) share price to buy
• Why the Sezzle (ASX:SZL) share price is storming 9% higher on Thursday

Motley Fool contributor James Mickleboro owns shares of Collins Foods Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Super Retail Group Limited. The Motley Fool Australia owns shares of and has recommended Super Retail Group Limited. The Motley Fool Australia has recommended Collins Foods 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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Most investors in BHP Group Ltd (ASX: BHP) shares are well aware of the company’s copper and iron ore operations. However, fewer people likely know that BHP also mines nickel, which is used to make lithium-ion batteries for electric vehicles (EVs).

This fact has become much more relevant in recent days, with BHP entering a memorandum of understanding (MOU) with Prime Planet Energy & Solutions (PPES) and Toyota Tsusho Corporation (TTC) (TYO: 8015).

Under the MOU, BHP will supply nickel sulphate to PPES from its new production plant in Nickel West, Western Australia.

BHP shares are trading relatively flat on Thursday. At the time of writing, the mining giant’s shares are at $36.60, down 0.14%.

BHP is positioning for EV demand

Firstly, for some background, PPES was formed as a joint venture between Toyota Motor Corporation (TYO: 7203) and Panasonic (TYO: 6752). The formed entity operates as one of Japan’s leading lithium-ion battery producers.

According to a press release, BHP plans to supply PPES with the nickel sulphate it requires to produce its cells. As a result, Toyota is effectively the mining company’s second automotive manufacturer customer.

This follows Tesla Inc (NASDAQ: TSLA) signing a supply agreement with BHP in July — a point in time when BHP shares were trading above $45 apiece.

In addition, the trifecta of companies will collaborate to establish a more sustainable battery supply chain. For instance, end-to-end raw material traceability, ethical sourcing, and human rights reporting are elements in focus.

BHP will also explore the recycling of battery scraps and used batteries at its Nickel West facility.

Commenting on the development, BHP Nickel West asset president Jessica Farrell stated:

Demand for nickel in batteries is estimated to grow by over 500 per cent over the next decade to support increasing demand for electric vehicles. We have invested in our Nickel West facilities and power agreements so that we can now deliver some of the world’s most sustainable and lowest carbon emission nickel to customers.

We are excited to work with our partners to potentially increase the use of electric vehicles at our operations and further advance our sustainability agenda.

BHP estimates that there will be 314 million EVs on the road by 2035. If that is the case, the demand for materials required in batteries is set for an explosive surge. Hence, BHP is vying to grab its share of the potential market opportunity.

BHP shares in review

It has been a wild ride for BHP shareholders over the past year. A couple of months ago, we would have been telling a completely different story about the returns provided by BHP shares. However, the swift drop in the iron ore price has left its mark on the mining giant’s share price.

In the past year, the mining company has gained 2%. For comparison, the S&P/ASX 200 Index (ASX: XJO) has delivered a return of 20%.

The company is trading on a price-to-earnings (P/E) ratio of 19.13 based on the current BHP share price.

The post Own BHP shares? Here’s the latest on the miner’s nickel and EV battery play appeared first on The Motley Fool Australia.

More reading

• What is the BHP (ASX:BHP) share price outlook?
• These were the 5 worst performing ASX shares in September
• Why is the BHP (ASX:BHP) share price trading at 10-month lows?
• Why the BHP (ASX:BHP) share price tanked 17% in September
• 2 ASX 200 dividend shares named as buys for October

Motley Fool contributor Mitchell Lawler owns shares of Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Tesla. 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 Wesfarmers Ltd (ASX: WES) share price is rising this Thursday. The positive price movement comes as the retail conglomerate confirms it has acquired nearly a fifth of takeover target Australian Pharmaceutical Industries Ltd (ASX: API).

At the time of writing, shares in the company are trading for $54.51 – up 0.82%. For context, the S&P/ASX 200 Index (ASX: XJO) is 0.75% higher.

Let’s take a closer look at today’s news.

Wesfarmers up the stakes with its stake in API

In a statement to the ASX, Wesfarmers confirmed its acquisition of 95.1 million shares in API – or roughly 19.3% of the company. The purchase was made pursuant to an agreement with API’s largest shareholder, Washington H. Soul Pattinson and Co. Ltd (ASX: SOL).

Wesfarmers says this is not the end of its interest in API. The retail conglomerate says it still wishes to purchase 100% of API for $1.55 per share.

Wesfarmers also says now it owns nearly a fifth of API, it will use its voting power to try and stop Sigma Healthcare Ltd (ASX: SIG) buying the retail pharmacist. Sigma submitted a mostly scrip bid for API, ratcheting up the bidding war for the retail pharmacist. The Wesfarmers share price, however, was not too affected by this news.

The company paid Soul Patts $1.38 per share and has agreed to pay the remainder should its bid for API be successful.

Wesfarmers managing director Rob Scott said:

Wesfarmers continues to see opportunities to invest in and strengthen the competitive position of API and its community pharmacy partners. Exercising our option to acquire 19.3 per cent of API reflects the group’s commitment to the transaction and the continued progress of the Wesfarmers proposal.

What else has affected the Wesfarmers share price recently?

Another story that might have affected the Wesfarmers share price in recent days was the news the Australian Competition and Consumer Commission (ACCC) would not stand in the way of its subsidiary, Bunnings, acquiring privately held Beaumont Tiles.

The Wesfarmers share price ended that day higher.

The watchdog said Bunnings doesn’t currently have a large presence in tile sales in Australia. However, it did warn it will pay particularly close attention to any further acquisitions the home improvement and lifestyle retailer might make.

ACCC chair Rod Simms said of the takeover and his organisation’s decision:

Specialist tile retailers have a far more extensive range [than Bunnings], displayed in dedicated tile showrooms with specialist staff who can provide design and product advice to customers and referrals to tilers…

Stronger competition may pose challenges for some tile retailers, but it is unlikely to lead to a substantial lessening of competition in this market.

Wesfarmers share price snapshot

Over the past 12 months, the Wesfarmers share price has increased by more than 18%. Year-to-date, shares in the company are up 6%. It should be noted both these figures are poorer than the performance of the ASX 200 Index.

Wesfarmers has a market capitalisation of approximately $61.2 billion.

The post Wesfarmers (ASX:WES) share price lifts in latest push for API appeared first on The Motley Fool Australia.

More reading

• Australian Pharmaceuticals (ASX:API) share price lifts following Wesfarmers 19% stake
• The final Wesfarmers (ASX:WES) dividend will be paid out today. Here’s what you need to know
• 5 things to watch on the ASX 200 on Thursday
• Here’s what happened to the Wesfarmers (ASX:WES) share price in September
• Here’s why the Wesfarmers (ASX:WES) share price is down 4% in a week

Motley Fool contributor Marc Sidarous 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 Washington H. Soul Pattinson and Company Limited and Wesfarmers 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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There’s no doubt ASX shares have been shaky the past month.

The S&P/ASX 200 Index (ASX: XJO) has plunged 5.5% since its 13 August high, sending it ever so close to correction territory.

And we’re now into October, which is traditionally the ‘month of crashes’.

“Think back to the Wall Street Crash of October 1929, Black Monday of October 1987, the Great Financial Crisis that started in October 2007,” said Switzer Financial director Paul Rickard.

“…or even the “mini-crashes” of 1989, 1997 and 2002.”

What changes should we make to our ASX shares?

With such a dip, it’s tempting for investors to fiddle with their portfolios.

But stop it.

Since the dawn of time, experts have warned stock investors to not try to time the market. And that message is especially vital during turbulent times like this.

AIM Funds, in a recent memo to clients, stated its team always remembers one piece of old school advice.

“There are two types of investors when it comes to market timing: those who cannot do it, and those who know they cannot do it.”

Investing is a long-term game of compounded returns, and trying to time the market is antithetical to that.

“Investors will only enjoy the effect of the compounding process if they remain invested for the medium to longer-term,” the memo read. 

“An investor’s friend is time, conviction, fundamental research and a business ownership mindset.”

If someone makes money out of timing the market, it is a rare fluke — because logic and history dictates no one can do this intentionally and consistently.

AIM’s memo pointed out a couple of reasons why short-term timing never works.

Missing the biggest market rises

Firstly, selling out in anticipation of a correction or crash inevitably leads to missing out on stock rises.

“Not surprisingly, the big ‘up’ days tend to be clustered around the big ‘down’ days during periods of increased volatility,” the memo read. 

“Giving in to the temptation to ‘get out’ on the big down days dramatically increases the risk of missing the rebound.”

To demonstrate this, AIM cited a JP Morgan study where a hypothetical $10,000 was invested in the S&P 500 Index (SP: .INX) on 3 January 2000.

That amount would have become $32,431 by 31 December 2020, which equates to a yearly return of 6.06%.

“Missing the 10 biggest ‘up’ days cuts that compound rate of return to 2.44%, while missing the 20 biggest days reduces it yet further to a paltry 0.08% per year.”

If you miss the 30 best days, that portfolio actually goes backwards over those 21 years, ending up with a negative -1.95% return per year.

“‘Getting out’ to avoid the psychological pain of short-term paper losses is not worth the increased risk of long-term damage to returns, in our opinion.”

Stock markets are second-level systems

The AIM team also pointed out that share markets are “second-level systems” that are impossible to predict correctly.

“It is not enough to accurately predict an event; one must also correctly predict what the market was anticipating prior to the event and then correctly deduce how the market might react to the new information,” the memo read.

“We think that getting all 3 of those variables correct – and then being right on the timing, to boot – is nigh-on impossible to do [repeatedly].”

Corrections, pullbacks and crashes are all an “unavoidable” part of investing, according to AIM.

“When seen in perspective as a period of prudent capital allocation with a margin of safety, is more likely to provide opportunity than lasting damage.”

Again looking at the S&P 500 as an example, it has copped a correction of 10% or more 36 separate times since 1950.

“If there have been 36 double-digit drawdowns over the past 70-odd years, it works out that investors should expect this to happen with a frequency of about once every 2 years.”

The post Warning: 2 reasons why you can’t time the market appeared first on The Motley Fool Australia.

More reading

• Why is the Whitehaven Coal (ASX:WHC) share price is slumping 7% today
• Could the Rio Tinto (ASX:RIO) share price reach $123 by the end of 2021?
• Scentre (ASX:SCG) share price lifts amid Westfield Direct launch
• Prophecy (ASX:PRO) share price rockets 22% on major US health deal
• Why has the Appen (ASX:APX) share price hit three 52-week lows in the last fortnight?

Motley Fool contributor Tony Yoo 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 Whitehaven Coal Ltd (ASX: WHC) share price is tumbling on Thursday.

At the time of writing, the coal-producing company’s shares are down 7.24% to $3.33.

Despite this weakness, the Whitehaven Coal share price has still doubled since the beginning of this year.

What’s going on with the Whitehaven Coal share price?

Investors might be left scratching their heads after taking a look at energy shares today. Reports continue to point towards coal supply shortages. As a result, supply and demand dynamics have kicked in, pushing the price of coal above $220 per tonne.

For context, supply chain disruptions and carbon emission reduction targets have left countries short-handed on energy supplies. Reports have stated the shortage in China has led to factory shutdowns, shortened operating hours, and left residents without power.

Analysts at Goldman Sachs estimate around 44% of China’s industrial operations have been impacted to some extent by the energy shortage. In turn, coal-based energy producers have been forced to secure supply at any cost. Unfortunately, the available supply is scarce as many suppliers have been hit by heavy rainfall and flooding.

Similarly, a story from ABC News out on Tuesday indicated that India could soon run out of coal. This might have serious implications considering coal accounts for more than 70% of the country’s electricity supply. According to the data, around 80% of India’s power plants had less than a week’s worth of coal remaining.

However, this morning the onslaught of seemingly ever-increasing coal prices has had a reprieve. According to coal futures, prices have slipped 15.7% from a peak of approximately $270 per tonne. In response, the Whitehaven Coal share price looks set to break its 3-day green streak.

Recapping the company

The upwards pressure on coal prices has certainly been beneficial to the Whitehaven Coal share price. In the past 12 months, shares in the coal producer have gained 209%. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) has climbed 20% higher.

Furthermore, investors will be hoping the stronger commodity price will reflect improved financials in the next reporting period. Looking back, Whitehaven reported $1.564 billion in revenue for the year ending 30 June 2021, this was down 9.3% on the prior year.

Lastly, the bottom line swung to a considerable $543.9 million loss at the end of FY21.

The post Why is the Whitehaven Coal (ASX:WHC) share price is slumping 7% today appeared first on The Motley Fool Australia.

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• ASX 200 (ASX:XJO) midday update: Pilbara Minerals jumps, Whitehaven Coal sinks
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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. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It has been a difficult couple of months for the Rio Tinto Limited (ASX: RIO) share price because of the falling iron ore price.

For example, since this time in August, the mining giant’s shares have fallen 26% to $96.68.

This means the Rio Tinto share price has given back its year to date gains and is now down 16% in 2021.

Can the Rio Tinto share price bounce back and hit $123 by the end of the year?

While the recent weakness in the Rio Tinto share price is disappointing for shareholders, one leading broker sees it as a buying opportunity for non-shareholders.

According to a note out of Goldman Sachs this week, its analysts have retained their buy rating but trimmed their price target on the company’s shares to $123.40.

Based on the current Rio Tinto share price, this implies potential upside of 28% over the next 12 months.

In addition, Goldman expects Rio Tinto to pay an US$8.28 (A$11.37) per share fully franked dividend in FY 2022. This represents an 11.8% dividend yield at current prices, which increases the total potential return to almost 40%.

What did the broker say?

Goldman is bullish on the Rio Tinto share price for four key reasons. One of those is its attractive valuation.

It explained: “Valuation: trading at 0.8xNAV and discounting a long run iron ore price of US$59/t (vs. GSe long run of US$67/t real).

The broker also notes that Rio Tinto is in a position to generate significant free cash flow, which will support bumper dividend payments in the near term.

“Strong FCF and dividend yield: FCF/dividend yield in 2022 (14%/12% yield) & 2023 (12%/11%), and a still attractive 9% FCF yield in 2022 at a lower US$80/t scenario,” the broker said.

And while Goldman Sachs isn’t expecting production growth over the next six months, it believes 2022 will herald a return to growth

It explained: “Return to production growth in 2022: RIO is not a growth story over the next 6 months (we forecast -4% Cu Eq growth for RIO at the group level in 2021) it is a FCF story in our view, however, we see the company returning to growth in 2022 & 2023 with a 5% and 3% increase in Cu Eq production respectively.”

Finally, the broker is a fan of the mining giant due to its exposure to aluminium.

Goldman said: “Compelling low emission aluminium exposure: In addition to copper production growth, RIO has one of the highest margin, the lowest carbon emission aluminium businesses in the world, with over 2.2Mt of Ali production powered by hydro, and we think the ELYSIS inert anode technology could be worth billions.”

All in all, if everything goes to plan, this broker sees potential for the Rio Tinto share price to reach $123.00 again by the end of the year.

The post Could the Rio Tinto (ASX:RIO) share price reach $123 by the end of 2021? appeared first on The Motley Fool Australia.

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• Rio Tinto (ASX:RIO) share price dips on new contract news
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• Rio Tinto (ASX:RIO) share price lifts as CEO eyes critical minerals expansion

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 Scentre Group (ASX: SCG) share price is up 1% in early afternoon trading, to $3.02 per share.

That’s about twice the 0.6% gains posted by the S&P/ASX 200 Index (ASX: XJO) at this same time.

Scentre’s share price gain today comes as the ASX 200 retail giant unveiled the launch of what it calls “Westfield Direct”.

What is Westfield Direct?

In a release this morning, that’s unlikely to have a material impact on the Scentre share price today, the company reported that Westfield Direct will allow Aussies to shop from any of Westfield’s 37 locations, 24 hours per day.

The new online service offers both click-and-collect and home delivery options, along with potential reward credits for members.

Scentre said that it is continuing to expand the offering, with new businesses continuing to join the more than 100 current existing business partners already participating

Commenting on the launch, Scentre Group’s chief customer and business development officer, Phil McAveety said:

We are bringing the Westfield experience to more people. This is fundamental to our customer strategy and our ambition to grow. Westfield Direct offers more convenience, flexibility and choice for customers to shop Westfield, any time, anywhere – still with the human connection they value.

Westfield Direct provides our business partners with the opportunity to increase the productivity of their physical store networks whilst alleviating the time-intensive and costly process of fulfilling and delivering orders. Westfield Direct also presents a significant growth opportunity for our SME retail partners, many of whom only have one or two physical stores with us and no online presence.

Scentre reported that it will provide an Aussie-based customer care team, reachable via live chat or email, to support the service.

Scentre share price snapshot

The Scentre share price has gained 8.1% year-to-date, almost in line with the 8.6% gain posted by the ASX 200.

Over the past month Scentre has outperformed the benchmark, with shares up 3.5% compared to a 3.6% loss on the ASX 200.

The post Scentre (ASX:SCG) share price lifts amid Westfield Direct launch appeared first on The Motley Fool Australia.

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

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The Prophecy International Holdings Limited (ASX: PRO) share price is on the move this Thursday. The computer software applications and services company announced a major deal that has seen investors snapping up its shares.

At the time of writing, the Prophecy share price is up 22.41% to 71 cents. Earlier in the day, it hit a fresh 52-week high of 74.5 cents.

A huge win for Prophecy

In today’s statement to the ASX, Prophecy advised it has signed a deal with United States-based health insurance company, Humana Inc (NYSE: HUM).

Founded in 1961, Humana is one of the biggest health insurance providers in the United States market. The company is ranked 41 on the Fortune 500 list, holding a market capitalisation of more than US$50 billion.

The deal will see Prophecy provide its software-as-a-service (SaaS) platform, eMite, to Humana for an initial 3-year period. This is expected to generate a minimum of $1.784 million in annualised recurring revenue (ARR), totalling $5.518 million.

eMite is a real time and historical customer experience and contact call centre analytics platform. The software product helps businesses visualise their customers’ pathway and understand the level of happiness during the journey.

The innovative platform aims to assist large enterprise and government customers to maximise customer service and revenue opportunity.

Last year, eMite was sold in more than 14 countries to a range of customers in the Genesys, Amazon and Avaya ecosystems.

CEO Brad Thomas commented on the news fuelling the Prophecy share price:

We are delighted to welcome Humana as a new eMite customer. Given Humana’s standing as one of the strongest participants in the US healthcare market, we are excited by the opportunity to strengthen Humana’s ability to provide high-quality, whole-person healthcare and support superior outcomes for patients across all of its lines of business.

A contract of this nature is material to Prophecy as it, along with other recently-signed eMite customers, boost the annualised recurring revenue (ARR) for the eMite business to more than A$10 million. This growth reflects our continuous improvement of eMite’s functionality as large enterprise and government have embraced cloud services.

Prophecy share price summary

Despite today’s massive gain, the Prophecy share price mostly travelled in circles over the past 12 months. However, following the latest contract win, its shares are now up around 35% for the period.

Based on the current price, Prophecy presides a market capitalisation of roughly $49.35 million, with approximately 64 million shares outstanding.

The post Prophecy (ASX:PRO) share price rockets 22% on major US health deal 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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The Appen Ltd (ASX: APX) share price has been on a slippery slope these last few weeks, down from a previous high of $9.48 on 23 September.

As they have trended down, Appen shares have subsequently set three new 52-week lows in the past 2 weeks – an ominous sign for shareholders.

Here’s what appears to be spurring on this slide into the abyss for the Appen share price.

Investors like earnings, earnings, earnings

To understand what’s behind this unfortunate performance for Appen’s shares we have to zoom out and take a look at what’s been leading the trend.

Appen shares tanked from a previous high of $13.82 in late August when the company released its FY21 earnings results.

In its report, the company recognised a 2% decrease in revenue and a 14.3% slide in EBITDA from the year prior.

This carried through its income statement, where net profits after tax (NPAT) slumped over 55% to just US$6.7 million.

Investors tend to reward companies who demonstrate strong earnings power and punish those who don’t by selling their shares.

We see the same happening from 25 August, where the Appen share price immediately slipped 27% to start off a string of what would be a series of new 52-week lows.

In fact, even though it has set a new 12 month low 3 times this past fortnight, since its earnings report the company’s shares have bottomed at new single-year low points 7 times to date.

Other factors weighing down the Appen share price

A recent spike in US Treasury yields is bad news for tech and growth type shares, as it ultimately impacts the valuations of these assets.

That’s because in most of these instances either the specific industry/sector, business, or product is expected to produce high cash flows out into the future, versus just around the corner.

So the higher the yield is on these US Treasury bonds, the lower a share’s valuation, and vice versa.

It also has a bearing on the market’s psychology, in that when yields hike up on government bonds – like the US Treasury bonds – investors tend to fly towards more stable, predictable asset classes.

For shares in general – but in particular tech and growth type shares – this stems a negative sentiment because the share market is typically seen as having more risk than the boring old bond markets.

So as US Treasury yields have popped up recently, this has had an impact on technology and growth type shares in general.

For instance, the S&P/ASX 200 All Technology Index (XTX) is leading the broad market’s loss this past month, slumping 7% in the red as of today.

That’s almost double the S&P/ASX 200 index (ASX: XJO)’s slip into the red of 3.8% in this time.

Appen share price snapshot

Taking a step back and analysing Appen’s share price over the long-term, the trend is no different – it is swimming in a sea of red this entire 12 months.

This year to date it has posted a loss of 65%, extending its loss in the past year to over 75%.

Both of these results are well behind the broad index’s return of around 25% this past year.

The post Why has the Appen (ASX:APX) share price hit three 52-week lows in the last fortnight? 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. owns shares of and has recommended Appen Ltd. The Motley Fool Australia owns shares of and has recommended Appen 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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As we embark on the second quarter of FY22, it’s a good time to look back and see how some of the major ASX 200 shares performed over the first quarter of the financial year.

So, let’s check out how the Commonwealth Bank of Australia (ASX: CBA) share price went over the period.

The first quarter of FY22 ran from 1 July to 30 September. Over this period, the S&P/ASX 200 Index (ASX: XJO) was fairly lacklustre. The ASX 200 started July at 7,313 points and ended up at 7,332.2 points on 30 September. That translates into a lukewarm gain of roughly 0.26% for those 3 months. 

So, how did the CBA share price stack up? CBA is the largest ASX 200 share by market capitalisation (and therefore weighting) at the present time, so whatever it does really impacts the broader market.

CBA shares started the new financial year off at a share price of $99.87. On Thursday last week, the CBA share price closed at $104.33 on the last day of the quarter. That puts CBA’s quarterly gains at a robust 4.47%. That’s more than 17 times what the ASX 200 delivered.

Not only that, but CBA also shelled out its most recent final dividend payment during the quarter, too. CBA shareholders received a fully franked dividend of $2 per share on 29 September.

That further boosts shareholder returns for CBA over this period. The bank’s $6 billion share buyback program, which was announced in CBA’s FY21 earnings report, would have helped as well.

Could CBA shares be a buy today?

With this impressive outperformance over the quarter just gone, many an investor might be wondering whether CBA shares are a buy today. Well, as my Fool colleague James covered late last month, one broker doesn’t think so.

Morgan Stanley slapped an ‘underweight’ rating on CBA in September, with a 12-month share price target of $90. That implies a potential 12-month downside of roughly 13% on today’s share price of $103.21 at the time of writing.

Morgan Stanley isn’t wild on Commonwealth Bank right now. It sees the actions that financial regulators are taking to cool the housing market as deleterious for CBA, which is the largest housing lender in the country.

At the current CBA share price, this ASX bank has a market capitalisation of $183 billion, a price-to-earnings (P/E) ratio of 21.86 and a dividend yield of 3.39%.

 

The post What happened for the CBA (ASX:CBA) share price in the FY22 first quarter? appeared first on The Motley Fool Australia.

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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 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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