The Woolworths Group Ltd (ASX: WOW) share price closed up a slender 0.1% yesterday to finish the day at $39.35 per share.

Woolworths’ share price managed to shake off the broader selling trend, which saw the S&P/ASX 200 Index (ASX: XJO) close the day down 0.3%.

It’s been 3 weeks now since the supermarket giant reported its full year results for the 2021 financial year (FY21). With that in mind we take a look at how Woolworths shares have been tracking since releasing those results.

But first, a quick recap…

What results did the ASX 200 retail giant report for FY21?

Investors were keeping a keen eye on the Woolworths share price when the company announced its FY21 results before market open on 26 August.

Among the key results, Woolies reported a 5.7% year-on-year increase in group sales to $67.28 billion.

With COVID-19 seeing many people confined to their homes, or reluctant to venture into public spaces, the company’s eCommerce sales reached $5.60 billion, a massive 58.1% increase compared to FY20.

Woolworths chair Gordon Cairns commented on the surge in eCommerce, saying, “[O]ur investment in eCommerce over many years … has helped to drive sales of over $5.5 billion this year. Despite this increased investment, normalised Group ROFE [Return on Funds Employed] increased 1.4 points during the year to 15.1%.”

Woolworths’ earnings before interest and tax of $3.66 billion were up 13.7% year-on-year, while net profit after tax (NPAT) leapt 22.9% to $1.97 billion.

The strong results enabled Woolies to declare a final dividend of 55 cents per share, up from a final dividend of 49 cents per share in FY20.

On the same day, Woolies also reported its intention to conduct a $2 billion off-market share buyback.

How has the Woolworths share price moved since reporting those results?

On the day it reported, 26 August, the Woolworths share price gained 0.4%, closing at $40.99 per share.

Since market open on the reporting day, Woolies shares have lost 3.3%. By comparison, the ASX 200 is down 1.4% over that same period.

The post How has the Woolworths share price performed since reporting results? appeared first on The Motley Fool Australia.

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• How does the Wesfarmers (ASX:WES) dividend compare to Woolworths?
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• 4 ASX shares just got a massive boost

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 Australian share market is home to a good number of shares offering attractive dividend yields.

But which ones should you buy over others? Here’s are two that analysts rate highly right now:

Coles Group Ltd (ASX: COL)

This supermarket giant could be a dividend share to consider buying. This is due to its favourable dividend policy and positive long term outlook.

That positive outlook is being underpinned by its strong market position, store expansions, cost cutting, and focus on automation.

Morgans is feeling bullish about Coles. In response to its full year results last month, the broker retained its add rating and lifted its price target to $19.80. This compares favourably to the latest Coles share price of $17.03.

In addition, the broker is forecasting dividends of 61 cents per share in FY 2022 and then 62 cents per share in FY 2023. This implies fully franked yields of 3.6% and 3.65%, respectively.

Mineral Resources Limited (ASX: MIN)

Another ASX dividend share to consider is Mineral Resources. If you don’t mind investing in the resources sector, then it could be a top option.

Particularly given its exposure to lithium, which is one of the hottest commodities around at present. In addition, Mineral Resources is still benefitting from favourable iron ore prices, albeit not as much as it was a few months ago.

The team at Macquarie are very positive on the company. Last week the broker retained its outperform rating and $77.00 price target.

Its analysts are also forecasting fully franked dividends per share of $2.57 in FY 2022 and then $2.29 in FY 2023. Based on the latest Mineral Resources share price of $52.42, this will mean yields of 4.9% and 4.4%, respectively, over the next two financial years.

The post 2 buy-rated ASX dividend shares with attractive yields appeared first on The Motley Fool Australia.

More reading

• How does the Wesfarmers (ASX:WES) dividend compare to Woolworths?
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• The latest ASX 200 mining shares to get hit by broker downgrade
• Coles (ASX:COL) share price on watch amid latest push to Kmart market
• 4 ASX shares just got a massive boost

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 owns shares of and has recommended COLESGROUP DEF SET. 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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In September 2021 so far, the Brickworks Limited (ASX: BKW) share price has gone up by 7%. But what could happen next for the construction materials business?

First let’s look at the last month or so of interesting updates.

Brickworks’ latest operational update

It has been a challenging operating environment for Brickworks in Australia over the last couple of months.

On 9 August 2021, Brickworks announced that it was curtailing operations at a number of New South Wales and Queensland facilities.

The company noted that brick dispatches abruptly reduced by 80% during the pause in construction activity across Sydney in late July.

Management said the partial re-commencement of construction activity in August has resulted in some improvement, however brick sales are/were at only 50% of pre-lockdown levels, resulting in multiple storage yards reaching full capacity. Therefore, Brickworks decided to curtail production at two of its five brick kilns across the state, representing 30% of total production capacity.

The building materials business also said that the impact is similar across its other building products businesses. Operations at its precast facility in Wetherill Park was significantly reduced and it has removed one production shift at its roof tile plant in Brisbane that supplies the Sydney market.

NSW is its largest and most profitable market, which is now having a “material” impact on its building products Australia earnings.

Its major capital projects were also being affected by restrictions, such as the new masonry plant at Oakdale East.

The Brickworks share price fell by 6% between the day of that announcement and 30 August 2021.

An acquisition

A week before that shutdown announcement, the company announced it was spending US$51.1 million to buy certain assets from Southfield Corporation, including the Illinois Brick Company (IBC). IBC is the largest independently owned and operated brick distributor in the US, with 17 showrooms and distribution outlooks across Illinois and Indiana.

Management said the acquisition supports the company’s growth strategy in North America. It will build scale and fills the gap within Glen-Gery’s existing direct distribution network. IBC will also underpin significant sales volume.

A positive update from Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Brickworks owns around 40% of Soul Patts, which recently gave an update about its expected profit. Due to the fact that Soul Patts is an investment house, its investment holdings’ performance has a major impact on its regular net profit each year. The performance of Soul Patts can have a very sizeable impact on the Brickworks share price.

Aside from referencing the expected record earnings from its property division, driven by the continued increase in the value in the trust, there were two other elements.

In New Hope Corporation Limited’s (ASX: NHC) latest quarterly report, it expects FY21 earnings before interest, tax, depreciation and amortisation (EBITDA) to be $372 million. This was due to thermal coal prices currently being at a 10-year high.

Soul Patts also said that its 100%-owned mining business, Round Oak, is expecting to report a regular net profit to be in the range of $64 million to $68 million. This is a “significant” improvement on FY20’s regular net loss of $43 million as commodity prices rose and a number of mines went from development to production.

What next for the Brickworks share price?

In operational terms, Brickworks is looking forward to restrictions lifting in its major Australian markets. The ongoing development of the large industrial properties in its property trust for Amazon and Coles Group Ltd (ASX: COL) is expected to significantly increase the value and rental profit of the trust.

Investors can now look towards the release of the 2021 financial year result. This is due to be released on 23 September 2021.

One of the brokers most optimistic about Brickworks is Citi, which rates it as a buy with a price target of $27.20.

Using Citi’s profit expectations for the upcoming result, the Brickworks share price is valued at 15x FY21’s estimated earnings.

The post The Brickworks (ASX:BKW) share price has gained 7% in September. What’s next? appeared first on The Motley Fool Australia.

More reading

• Got money to invest for dividends? Here are 2 ASX shares that could be buys
• ASX 200 edges higher, Soul Patts (ASX:SOL) falls, Hansen (ASX:HSN) declines
• Here’s why the Brickworks (ASX:BKW) share price is lifting on Monday
• ‘Price makers’: 2 ASX shares to protect against inflation
• The Brickworks (ASX:BKW) share price is now trading on a forecast 2.5% fully franked dividend yield

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Brickworks. The Motley Fool Australia owns shares of and has recommended Brickworks and Washington H. Soul Pattinson and Company 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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On Wednesday the S&P/ASX 200 Index (ASX: XJO) was out of form and dropped into the red. The benchmark index fell 0.3% to 7,417 points.

Will the market be able to bounce back from this on Thursday? Here are five things to watch:

ASX 200 expected to rebound

The Australian share market looks set to rebound on Thursday. According to the latest SPI futures, the ASX 200 is expected to open the day 33 points or 0.45% higher this morning. This follows a strong night of trade on Wall Street, which saw the Dow Jones rise 0.7%, the S&P 500 climb 0.85%, and the Nasdaq jump 0.8%.

Telstra Strategy Day

The Telstra Corporation Ltd (ASX: TLS) share price will be on watch today when it holds its highly anticipated Strategy for the Future Investor Day event. A note out of Goldman Sachs reveals that it expects this to be “a continuation of the current strategy (simplicity and customer focus, network leadership and improved efficiency) but with a tilt towards growth (such as Energy, Health, FWA, Enterprise 5G).”

Oil prices surge higher

It could be a very good day for energy producers such as Oil Search Ltd (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) after oil prices surged higher. According to Bloomberg, the WTI crude oil price is up 3.1% to US$72.63 a barrel and the Brent crude oil price has risen 2.5% to US$75.46 a barrel. Oil prices climbed after US data revealed a greater than expected drawdown of supplies.

Gold price softens

Gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a subdued day after the gold price dropped. According to CNBC, the spot gold price is down 0.7% to US$1,794.70 an ounce. US Federal Reserve tapering uncertainty is weighing on the safe haven asset.

Shares going ex-dividend

A number of shares are going ex-dividend on Thursday and could trade lower. This includes investment company Seven Group Holdings Ltd (ASX: SVW), casino operator SKYCITY Entertainment Group Limited (ASX: SKC), and New Zealand telco Spark New Zealand Ltd (ASX: SPK).

The post 5 things to watch on the ASX 200 on Thursday 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 owns shares of and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Investors that are looking to strengthen their portfolio with some blue chip ASX 200 shares may want to look at the two listed below.

Here’s why these blue chip ASX 200 shares are rated as buys:

BHP Group Ltd (ASX: BHP)

The first ASX 200 blue chip share to look at is BHP. The Big Australian’s shares have pulled back materially recently following a sharp decline in the iron ore price.

However, it is worth noting that the price of the steel making ingredient is still notably higher than the mining giant’s production costs.

It also has diverse operations and is benefiting from rises in other commodity prices.

Macquarie remains very positive on the company. In fact, earlier this week the broker put an outperform rating and $55.00 price target on BHP’s shares. Its analysts are also forecasting generous dividend payments in the coming years.

ResMed Inc. (ASX: RMD)

Another ASX 200 share to look at is this sleep treatment-focused medical device company.

Over the last decade, ResMed has become one of the leaders in the sleep treatment market. This has been driven by its high level of investment in R&D and acquisitions. Combined, the company now has a portfolio of industry-leading hardware and software products.

This leaves it well-placed to benefit from the growing sleep treatment market. Management estimates that there are ~1 billion people suffering from sleep apnoea worldwide, with only ~20% of these sufferers currently diagnosed.

ResMed also looks well-placed to benefit from the shift to home healthcare and a major product recall from a key rival.

Credit Suisse is a fan of ResMed. Last week the broker retained its outperform rating and lifted its price target on the company’s shares to $44.00. It believes ResMed is well-placed to grow at above industry rates. The broker also feels the market is under-appreciating the potential market share gains it will make from the aforementioned product recall.

The post 2 ASX 200 blue chip shares analysts rate as buys appeared first on The Motley Fool Australia.

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• Why AGL, BHP, IRESS, & Lendlease shares are dropping
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• ASX 200 midday update: Pilbara Minerals jumps, bank shares fall
• The latest ASX 200 mining shares to get hit by broker downgrade
• How have these ASX 200 iron ore shares performed since reporting results?

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 recommended ResMed. The Motley Fool Australia has recommended 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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The JB Hi-Fi Limited (ASX: JBH) share price has dropped 9% over the last month. Could that make the electronics retailer a buy after theoretically becoming better value?

Whilst the JB Hi-Fi share price has looked like a bit of a rollercoaster over the last 12 months, it’s actually only down by around 3% in the past year. Since the bottom of the COVID-19 crash, the company has seen a sizeable recovery – it has risen almost 90% despite the recent decline.

What has happened for JB Hi-Fi within the last month?

Just under a month ago, JB Hi-Fi handed in its FY21 result.

The company shows that its total sales increased by 12.6% to $8.9 billion. Of that total revenue, $1.1 billion of the revenue was online – an increase of 78.1%. Its online offerings are supported by the supply chain and logistics capabilities.

It benefited from operating leverage throughout the business, which helped earnings before interest and tax (EBIT) increase by 53.8% to $743.1 million and net profit after tax (NPAT) went up 67.4% to $506.1 million.

The Australian divisions generated a large majority of the profit.

JB Hi-Fi Australia saw the cost of doing business decrease by 91 basis points to 11.2%. This helped its EBIT rise 33.6% to $523 million, with the EBIT margin improving by 142 basis points to 8.8%.

The Good Guys experienced a reduction of the cost of doing business by 100 basis points to 11.7%, thanks to store wages remaining well controlled. EBIT soared 90.2% with the EBIT margin improving 318 basis points to 7.9%.

The JB Hi-Fi share price has essentially fallen almost 10% since the release of its report and trading update.

If the result showed such strong growth, what was in the trading update?

Trading update

The retailer’s sales for the first month and a half of FY22 were materially stronger than FY20, with each division reporting sales growth of at least 14.8%.

However, compared to FY21, sales were down. JB Hi-Fi Australia sales were down 14.6% and The Good Guys sales were down 8.1%, but JB Hi-Fi New Zealand sales were up 8.4% in New Zealand dollar terms.

Management said it remains an uncertain retail environment, particularly with COVID-19 and the related restrictions. But, the company continues to see heightened customer demand compared to two years ago.

Is the JB Hi-Fi share price good value?

JB Hi-Fi says that it is underpinned by five unique competitive advantages: scale, a low cost operating model, quality store locations, supplier partnerships and multichannel capability.

One of the brokers that has a optimistic price target on JB Hi-Fi is Credit Suisse, with a price target of $53.66. That suggests the broker believes the electronics retailer could see its share price rise almost 20% over the next year, if Credit Suisse is right.

However, the ongoing lockdowns in Australia’s two biggest cities are expected to hurt FY22 revenue with restrictions expected to continue for the rest of the month.

Based on the broker’s numbers, it’s expecting the retailer to pay a grossed-up dividend yield of 6.5%. The JB Hi-Fi share price is valued at 14x FY22’s estimated earnings.

The post The JB Hi-Fi (ASX:JBH) share price is down 9% in a month. Is it a buy? appeared first on The Motley Fool Australia.

More reading

• Got money to invest for dividends? Here are 2 ASX shares that could be buys
• 5 things to watch on the ASX 200 on Friday
• How have ASX retail shares performed during the August 2021 earnings season?
• Why the JB Hi-Fi (ASX:JBH) share price is edging lower today
• 2 ASX dividend shares that just delivered even bigger payouts

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 EML Payments Ltd (ASX: EML) share price has been tumbling lately despite no news having been released by the company.

In addition to falling, the financial services company’s stock has been flying off the shelves.

An average month sees around 3.7 million shares in EML Payments swapping hands. However, over the last 6 sessions, more than 15 million have been traded.

At market close, the EML Payments share price is $3.86, 0.26% higher than its previous close and 8.75% lower than it was 6 trading days ago.

Let’s take a look at what might be driving EML Payments’ stock lower lately.

What’s up with EML Payments lately?

The EML Payments share price has had a rough trot lately despite the company maintaining its silence.

In fact, the last time the market heard from EML Payments was when the company released a transcript of its investor briefing on 20 August

So, what might have caused EML Payments’ stock to plunge 9%?

Perhaps it’s being driven down alongside that of its peers on the S&P/ASX All Technology Index (ASX: XTX).

Right now, the All Technology Index is 2.95% lower than it was 6 days ago, having fallen 95.6 points in that time. That’s despite the index’s 0.8% gain today.

Additionally, the company’s high volume of trades suggests it might be being targeted by short sellers.

And, indeed, the Australian Securities and Investments Commission reported that between 3.3% and 3.6% of the company’s outstanding shares were shorted each day between Wednesday and Friday last week.

However, It’s more than possible that the EML Payments share price isn’t being driven down by short sellers. As market watchers know, sometimes there isn’t a particular rhyme or reason as to why a stock gains or falls.

EML Payments share price snapshot

The EML Payments share price’s poor recent performance has added to its woes on the ASX.

Right now, the company’s shares are trading for 9% less than they were at the start of 2021. However, they have gained 28% since this time last year.

The post The EML (ASX:EML) share price has lost 9% in 6 days. What’s happening? appeared first on The Motley Fool Australia.

More reading

• 2 ASX shares that may be worth looking at this weekend
• Here’s why the EML (ASX:EML) share price is up 8% in the last month
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended EML Payments. The Motley Fool Australia owns shares of and has recommended EML Payments. 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 Fortescue Metals Group Limited (ASX: FMG) share price is lingering around year-to-date lows. At around $17.90, Fortescue shares are being wounded by continued weakness in iron ore prices.

The latest iron ore update from Fastmarkets flagged “depressed demand in certain regions of China, where steelmakers are facing energy-consumption and emissions-control measures.”

Iron ore prices continued to post declines on Tuesday, down another 1.75% to US$121.67/t.

The Fortescue Metals share price finished today down 1.44% at $17.82 apiece.

Analysts expect more declines

Analysts from JPMorgan and Westpac both expect iron ore prices to fizzle towards the US$100/t mark, according to the Australian Financial Review (AFR). So, what could this mean for Fortescue shares?

Westpac’s senior economist, Justin Smirk, flagged that China’s iron ore demand may weaken leading into its Beijing Winter Olympic Games.

We’ve been here before with China trying to ensure blue skies leading into the 2008 Beijing Summer Olympics where we saw iron ore prices pull back quite a lot.

We are going to get more bouts of volatility heading into the blue skies period which will result in more mill closures in the fourth quarter this year.

Westpac lowered its year-end iron ore price forecast from US$175/t to US$125/t. It downgraded its year-end 2022 forecast from US$110/t to US$100/t.

JP Morgan was also concerned about China’s weak demand. That’s after its “steel production turned negative” in the second half of 2021.

“Following the typical June peak, it is normal to see a seasonal downturn into July and August. However, the drop appears to be related to general economic weakness, exacerbated by tightening pollutions controls, and relatively low steel mill profitability,” said Lyndon Fagan, a research analyst at JPMorgan.

The broker lowered its 2021 iron ore price forecast from US$181/t to US$165/t. It cut its 2022 projections from US$150/t to US$125/t.

Fortescue share price snapshot

The Fortescue share price is down 24% year to date and up just 0.68% in the last 12 months.

The post Fortescue (ASX:FMG) share price at year-to-date lows, analysts slash iron ore forecasts appeared first on The Motley Fool Australia.

More reading

• The Fortescue (ASX:FMG) share price is down 31% in 7 weeks. What’s next?
• Leading brokers name 3 ASX shares to sell today
• The latest ASX 200 mining shares to get hit by broker downgrade
• How have these ASX 200 iron ore shares performed since reporting results?
• Fortescue (ASX:FMG) share price struggles amid new production curbs in China

Motley Fool contributor Kerry Sun 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 Qantas Airways Ltd (ASX: QAN) share price finished Wednesday’s trading session flat after spending the morning in the red. The late afternoon gains came as several media outlets reported the airline operator is set to resume international flights.

At the closing bell, Qantas shares ended the day unchanged at $5.43 apiece.

Qantas prepares for take-off

Investors appear buoyant on the quick recovery of the travel market, sending Qantas shares higher today.

The company is relaunching its first commercial international flights in mid-December to several popular destinations from Sydney, Melbourne and Brisbane.

On December 18, services to London, Los Angeles, Singapore, Vancouver will operate pending border openings.

In the following days, more scheduled flights will follow to Tokyo, Hawaii and Fiji. Furthermore, New Zealand routes are expected to restart before Christmas.

It is a massive positive sign for Qantas should the Australian federal government give the green light.

Previously, Qantas CEO Alan Joyce advised that only fully vaccinated passengers will be allowed to take off on the flying kangaroo. However, evidence of a negative PCR COVID-19 test may also be required for some destinations within 72 hours of boarding.

The international travel plan is based on the Australian population reaching an 80% vaccination target. On current projections, the population is estimated to hit this level by 15 November.

In the past week alone, almost 1 million Australians received the COVID-19 jab, reflecting a strong up-take.

While this is great news for Qantas, there still remain questions regarding hotel quarantine for passengers coming to and from Australia. The company noted that customers would be more accepting of home quarantine when flying as opposed to the expensive hotel option.

Qantas share price snapshot

Over the past 12 months, Qantas shares have travelled almost 40% higher with year-to-date up around 12%. However, this could significantly change in the coming weeks should Australia’s travel sector reopen.

Qantas commands a market capitalisation of roughly $10.2 billion with more than 1.8 billion shares on its registry.

The post Qantas (ASX:QAN) share price reverses day’s losses as first international flights scheduled appeared first on The Motley Fool Australia.

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• Qantas (ASX:QAN) share price slips as buyers line up for land package
• Lithium surge, Sydney Airport takeover, ACCC torches Qantas deal. Scott Phillips on Nine’s Late News
• ASX 200 (ASX:XJO) midday update: Sydney Airport jumps, Qantas falls
• Qantas (ASX:QAN) share price down after major blow from ACCC
• Qantas (ASX:QAN) share price gains amid new domestic flight offering

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 Alumina Ltd (ASX: AWC) share price has been outpaced by its ASX benchmarks over the last few weeks.

Whereas the S&P/ASX 200 Index (ASX: XJO) has slipped 2.6% into the red over the last month, Alumina shares have soared 19% in September alone and now trade at $2.12.

Let’s investigate further.

What’s fuelling the Alumina share price lately?

We can break the catalysts driving Alumina’s share price down into two segments.

The Alumina share price has been on the move since the company reported its FY21 earnings last month. Prior to this, it was trading sideways with lacklustre results.

In its earnings report, the company realised record production of 6.4 million tonnes and a higher realised price per tonne, despite lower profits year on year.

Alumina’s shares immediately gained some traction and started to march northwards in the days after its FY21 earnings release.

Let’s not forget aluminium prices

One other factor driving the Alumina share price stems from the relationship Alumina has with the underlying commodities it deals in.

Given Alumina is an ASX resources share that produces commodities, it is considered a price taker. As such, its share price will fluctuate with volatility in the broader commodity markets.

Alumina has a 40% stake in Alcoa World Alumina and Chemicals (AWAC), considered the largest aluminium venture in the western world.

The price of aluminium has been on an extended rally this year to date, having climbed 44% since January. Recently, Aluminium futures kissed US$3000/Tonne (T) for the first time since 2008.

Aluminium now trades at US$2,875/T, having climbed from US$2,706 since the beginning of September – a US$169/T increase in 2 weeks.

Because Alumina’s share price is sensitive to the price of aluminium, we can expect some reaction to the price rise.

What’s more, there is generally a lag in the relationship, from a few days to a few weeks.

Looking at the aluminium price chart, we can see it made a rapid move from US$2,535 to its 5-year high starting on 19 August.

Cross-referencing with Alumina’s chart, we can see it began to climb at pace from $1.67 on 27 August, eight days after the price action in the aluminium markets.

Considering the company’s record FY21 production and the unique relationship of its share price to the underlying commodities markets, it makes sense that Alumina’s shares have climbed almost 20% since September.

Alumina share price snapshot

The Alumina share price has climbed 15.5% this year to date, extending the return over the past 12 months to 42%.

These results have outpaced the broad index’s return of around 25% over the past year.

The post Alumina (ASX:AWC) share price cools off but it’s up 19% in September. Here’s why appeared first on The Motley Fool Australia.

More reading

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• Here are the 3 heaviest traded ASX 200 shares this Friday
• Here are the top 10 ASX 200 shares on Friday

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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