The Zip Co Ltd (ASX: Z1P) share price has been volatile in 2021 so far and now there’s a question of whether it’s good value or not.

The buy now, pay later business has been down to $6.70 this year, but it has been as high as almost $14. So, it has seen a hefty decline since February 2021.

Last week the company gave an update for its FY21 fourth quarter.

The numbers

It reported record group quarterly revenue of $129.9 million, up 104% year on year. Zip pointed to record monthly revenue in June, annualising at $537.2 million.

Zip has seen record quarterly transaction volume of $1.8 billion, up 116% year on year. There were also record transaction numbers for the quarter of 14.2 million (up 230% year on year).

Customer numbers increased by 87% year on year to 7.3 million.

Zip is continuing to executive on its global strategy, agreeing to require the remaining shares in both Twisto Payments (in Europe) and Spotii (in the Middle East). The quarter also saw Zip launch organically into Canada and Mexico.

The business revealed very strong growth in the US. American revenue improved by 280% to $64.3 million, transaction values increased 247% to $857.1 million and US transaction numbers went up 250% to 4.9 million. Revenue as a percentage of total transaction value (TTV) was maintained at 7%, continuing to deliver “market-leading” unit economics.

In its first full quarter of trading, the Zip UK segment saw revenue of $1 million, with a transaction volume of $13.9 million.

‘Zip Business’, which is focusing on small businesses, saw revenue growth of 39% quarter on quarter to $3.2 million. That was on volume of $38.7 million, an increase of 79% quarter on quarter (or 430% year on year).

Zip managing director and CEO Larry Diamond said:

We are now a truly global player with a presence in 12 months, and this is a real point of difference as we target global retailers and fulfil our mission to become the first payment choice every day.

We believe Zip can become the most fair and responsible brand in the world, on the side of merchants and consumers.

Is the Zip share price a buy or not?

There are very differing opinions about the buy now, pay later business.

Citi is very positive on the business, with a buy rating and a price target of $10.25. That suggests Zip shares could rise around 50% over the next 12 months. The ability to shop anywhere Visa is accepted with Quadpay in the US offers a good positive for the broker.

But there’s also the broker Macquarie Group Ltd (ASX: MQG) with sell rating and a price target of $6.15. That suggests a decline of almost 10% over the next 12 months. The broker isn’t sure about Zip’s move to change the name of Quadpay to Zip considering it’s the name Quadpay that consumers know. The broker is also concerned about rising competition in the US.

The post Is the Zip (ASX:Z1P) share price a buy or a sell? appeared first on The Motley Fool Australia.

More reading

• Leading brokers name 3 ASX shares to sell today
• Here’s how the Macquarie (ASX:MQG) share price has performed against the financial sector
• Zip (ASX:Z1P) share price tumbles 4% on Monday. Here’s why
• These are the 10 most shorted ASX shares
• 6 ASX shares to rocket when COVID Delta passes

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended ZIPCOLTD FPO. 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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If you’re looking to diversify your portfolio, then you might want to look at adding a little exposure to the resources sector.

But which shares should you consider? Two lithium miners that could be worth considering are listed below. Here’s why they are highly rated:

Galaxy Resources Limited (ASX: GXY)

The first ASX mining share to consider is Galaxy. It is a leading lithium producer that owns the world class Mt Cattlin operation in Western Australia. It also has the James Bay asset in Canada and Sal De Vida asset in Argentina.

In addition, Galaxy is on the verge of merging with rival Orocobre Limited (ASX: ORE). It is a lithium miner with operations in Argentina. This includes the Olaroz Lithium Project in the Jujuy Province of northern Argentina and Borax Argentina in the Salta-Jujuy region.

If the merger goes ahead as planned, management believes it will create a new force in the global lithium sector. The merged entity will also be the world’s fifth largest lithium chemicals company with a diversified production base and exciting growth platform. Management also sees opportunities to unlock significant synergies in the future.

Macquarie is very positive on Galaxy as well. Last week it put an outperform rating and $4.90 price target on the company’s shares. It also put an outperform rating and $8.60 price target on Orocobre’s shares.

Mineral Resources Limited (ASX: MIN)

Another ASX mining share to look at is this mining and mining services company.

Mineral Resources owns the Wodgina operation. It is one of the largest known hard rock lithium deposits in the world with a production life of over 30 years. The company also has the Mt Marion Lithium project in its portfolio. This project is operated by Mineral Resources under a life-of-mine mining services contract and is jointly owned by it and Jiangxi Ganfeng Lithium.

Another commodity the company has exposure to its iron ore. This is through the Iron Valley Iron Ore project and the Koolyanobbing Iron Ore project in Western Australia.

Demand for these two commodities is very strong at the moment. As a result, they are commanding very high prices, which bodes well for Mineral Resources’ profits and dividends.

It is for this reason that Macquarie is very positive on Mineral Resources. The broker currently has an outperform rating and $75.00 price target on its shares.

The post Analysts rate these ASX lithium miners as buys appeared first on The Motley Fool Australia.

More reading

• Here’s why the Mineral Resources (ASX:MIN) share price is up 27% in the last month
• Guess which sector this week’s top performing ASX 200 shares come from
• Brokers name 3 ASX shares to buy today
• Why BHP, Damstra, Galaxy, & Piedmont Lithium shares are racing higher
• Why the Pilbara Minerals (ASX:PLS) share price is up 9% this Thursday

Motley Fool contributor James Mickleboro owns shares of Galaxy Resources 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 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 Origin Energy Ltd (ASX: ORG) share price is starting this Tuesday off on a positive note. Origin shares at the time of writing, are up 0.67% to $4.50 a share. That’s not quite as buoyant as the S&P/ASX 200 Index (ASX: XJO), which is up 0.36% today to a new all-time high as we speak. But it’s still a good performance.

However, Origin’s good graces don’t hold up as well if we zoom out a little. This energy company remains down 6.8% year to date in 2021 so far, and an even more disappointing 21.5% over the past 12 months.

The pain doesn’t end there either. Origin is also down 18.2% over the past five years. Additionally, at today’s share price, an investor can pick up Origin shares for the same price as what it would have cost them back in early 2004.

This might be music to at least some investors’ ears though. As any dividend investor would know, lower share prices mean higher starting dividend yields. And, as an energy utility company, Origin is already known as an ASX dividend heavyweight.

So on today’s pricing, Origin shares offer a trailing dividend yield of 5%. This stems from Origin’s last two dividend payments – a final dividend of 10 cents a share that was paid out in October last year. And an interim dividend of 12.5 cents per share that was paid out on 26 March this year. Both dividends were unfranked.

But that’s all in the past now, so what of the future? Is the Origin share price a buy for this 5% dividend yield – objectively a very attractive yield, especially in this era of near-zero interest rates?

Are Origin shares a buy for the 5% dividend yield today?

Well, one broker who is answering in the affirmative today is investment bank Goldman Sachs. Goldman currently rates the Origin share price as a ‘buy’, with a 12-month share price target of $6.40 a share. That implies a potential upside of just over 42% on the current share price.

Goldman is bullish on Origin as it sees the rising oil price as a cushion for the current low price of wholesale electricity that is battering Origin’s near-term prospects. Goldman sees FY2022 as a tough year for the company, but it also sees the headwinds it’s facing as temporary beyond FY2022.

But what about Origin’s dividend, the reason we’re all here? Well, Goldman Sachs also sees plenty of upside in this department too. The broker reckons Origin’s annual dividend will rise to 26.5 cents per share for FY2021, and keep rising until it hits 39.4 cents per share in FY2023.

That implies a potential forward FY2023 yield of 8.78% on the current Origin share price.

The post Should you buy Origin Energy (ASX:ORG) shares in July 2021 for the 5% dividend yield? appeared first on The Motley Fool Australia.

More reading

• Why Magellan, Origin, Piedmont Lithium, & WiseTech Global are dropping
• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a solid gain. At the time of writing, the benchmark index is up 0.5% to 7,429.6 points.

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

BlueScope Steel Limited (ASX: BSL)

The BlueScope share price is up 4.5% to $24.03. Investors have been buying the steel producer’s shares following the release of its preliminary full year results. That result revealed that BlueScope outperformed its second half EBITDA guidance. This led to the company achieving full year underlying EBITDA of ~$1.72 billion. Management advised that this was driven by both strong demand and pricing.

Japara Healthcare Ltd (ASX: JHC)

The Japara share price has jumped 18% to $1.38. The catalyst for this was news that the aged care operator has received a takeover offer from Calvary. The Catholic not-for-profit organisation has offered $1.40 cash per share. The Japara board has unanimously recommended shareholders vote in favour of the scheme.

OZ Minerals Limited (ASX: OZL)

The OZ Minerals share price has stormed 8% higher to $23.82. Investors have been buying the copper producer’s shares after the release of its second quarter update. OZ Minerals performed strongly during the quarter. This led to management making positive revisions to its FY 2021 guidance. It has increased its gold production guidance and reduced its cash costs guidance.

Temple & Webster Group Ltd (ASX: TPW)

The Temple & Webster share price is up 11% to $12.86 following the release of a strong full year result. According to the release, the online furniture and homewares retailer delivered an 85% increase in revenue to $326.3 million and a 141% jump in EBITDA to $20.5 million. This was driven by a strong increase in active customers, repeat use, and increased spending per active customer. The company also revealed that FY 2022 has started strongly, with revenue up 39% between 1 July and 24 July.

The post Why BlueScope, Japara, OZ Minerals, & Temple & Webster are storming higher appeared first on The Motley Fool Australia.

More reading

• ASX 200 midday update: BlueScope & OZ Minerals updates impress
• Japara (ASX:JHC) share price soars 18% on takeover news
• 2 top ASX growth shares reporting strong growth
• Why the BlueScope (ASX:BSL) share price hit a record high today
• Temple & Webster (ASX:TPW) share price charges 7% higher on strong FY 2021 result

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Temple & Webster Group Ltd. The Motley Fool Australia has recommended Temple & Webster Group 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 Nuix Ltd (ASX: NXL) share price is falling again today despite no news having been released by the company.

In fact, the most recent price sensitive news from the company hit the market in the middle of June. However, Nuix has been in the headlines multiple times since.

The Nuix share price is down 2.61% today. Shares in the technology company are swapping hands for $2.61.

Nuix shares also fell yesterday. Today’s drop brings its total losses for the week so far to about 6%.

Let’s take a look at the latest news about Nuix.

The latest news on Nuix

The Nuix share price is falling this week amid news of the Australian Securities and Investment Commission’s (ASIC) investigation into the company.

The company was back in the headlines on Sunday when The Australian reported ASIC Commissioner Cathie Armour has stood down from the body’s investigation into Nuix.

ASIC is currently investigating whether Nuix’s initial public offering (IPO) contained false statements.

Since its ASX debut in December 2020, the prophesied market darling has released 2 revenue downgrades, been the subject of an investigative media campaign, been investigated by the Australian Federal Police, and seen its CEO and CFO walk out.

Previously, Labor senator Deborah O’Neill questioned whether Commissioner Armour properly investigated Nuix’s IPO.

Armour is a former Macquarie Group Ltd (ASX: MQG) executive and, according to The Australian, has worked alongside Nuix board member Daniel Phillips.

Macquarie backed Nuix in the tech company’s float and still holds around 30% of Nuix’s shares.

In June, O’Neill used parliamentary privilege to flag Commissioner Amour’s involvement in Nuix’s IPO, saying:

What did Commissioner Armour not investigate? Why did she not investigate? What contact did she have from Macquarie in regard to this IPO that led her to such a complete abdication of responsibility in this regard? Did she even read the Nuix prospectus? Did any of her fellow commissioners at ASIC read and act on concerns validly raised?

Nuix shares fell 2.5% during the session following O’Neill’s comments.

Nuix share price snapshot

It’s no surprise the Nuix share price has been suffering on the ASX.

Right now, its shares have dropped 67% since its IPO, within which Nuix shares were offered to investors for $5.31 apiece. In early 2021 the Nuix share price hit its all-time high of $11.86.  

The company has a market capitalisation of around $850 million, with approximately 317 million shares outstanding.

The post The Nuix (ASX:NXL) share price is falling today. Here’s why appeared first on The Motley Fool Australia.

More reading

• ASX 200 Weekly Wrap: Just like that… ASX back to record highs
• These were the best performing ASX 200 shares last week
• Nuix (ASX:NXL) share price plunges 7% in 7 days
• Could the ASA send the Macquarie (ASX: MQG) share price plummeting?
• Nuix (ASX:NXL) share price: this fund manager still sees a ‘big opportunity’

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Nuix Pty Ltd. 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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The A2 Milk Company Ltd (ASX: A2M) share price is sliding again today, down 3% in late morning trade.

A2 Milk already holds the unfortunate title as leader of the Dogs of the S&P/ASX 200 Index (ASX: XJO) over the past 12 months. That’s the list of the 10 worst performing shares on the ASX 200.

And with the A2 Milk share price down 68% since this time last year, the company edges out ASX 200 tech share Appen Ltd (ASX: APX), down 66%, for the worst performing share.

Year-to-date, A2 Milk is the third worst performing share on the ASX 200, down 46% so far in 2021. Appen, in case you’re wondering, is down 50% this calendar year.

What’s going on with the A2 Milk share price?

The A2 Milk shares hit an all time closing high of $19.83 per share on 3 July 2020. At time of writing it’s trading for $6.19 per share, down 69% from the record.

Though it’s worth noting that investors who bought shares when the company first listed in April 2015 will still be sitting on paper gains of more than 1,000%.

The A2 Milk share price received a bit of a reprieve earlier this month when the company reported it had acquired a 75% interest in Mataura Valley Milk, with China Animal Husbandry Group retaining the other 25%.

And it’s China that many analysts are pointing to as putting pressure on the A2 Milk share price. Specifically, fears of increased regulation on dairy products as the Chinese government ramps up regulations across numerous imports.

The resurgence of COVID-19 in Australia and the resulting lockdowns also appear to be driving concern over shorter-term demand.

The post A2 Milk (ASX:A2M) share price slides 3% in morning trade appeared first on The Motley Fool Australia.

More reading

• ASX 200 midday update: BlueScope & OZ Minerals updates impress
• Lynas share price soars, BHP and Rio on watch, A2 on the naughty list. Scott Phillips on Nine’s Late News
• Why a2 Milk, Cann, Flight Centre, & GPT shares are tumbling lower
• Here’s why the Bubs (ASX:BUB) share price is down 4% on Monday
• These are the 10 most shorted ASX shares

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 A2 Milk. 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 Limited (ASX: QAN) share price is gaining this morning, despite no news having been released by the company.

However, the ASX 200 travel giant isn’t alone in the green. Many of its peers are also seeing gains this morning amid news Victoria and South Australia are preparing to end their lockdowns.

Right now, the Qantas share price is $4.72, 2.61% higher than its previous close.

That’s particularly impressive when compared to the broader market.

Currently, the S&P/ASX 200 Index (ASX: XJO) is up 0.39%, while the All Ordinaries Index (ASX: XAO) is gaining 0.37%.

Let’s take a closer look at the Qantas share price’s moves today.

Lockdowns ending, ASX 200 travel shares up

While Sydney is still in the midst of a battle against COVID-19’s delta strain, Victoria and South Australia are set to gain a semblance of normality from midnight tonight.

Whether the good news for the 2 southern states is reflecting in the Qantas share price isn’t clear.

However, Qantas isn’t alone in having a good day on the ASX. The airline’s ASX 200 travel peers are also being boosted higher.

The Webjet Limited (ASX: WEB) share price is currently up 2.07%, while shares in Flight Centre Travel Group Ltd (ASX: FLT) are 1.73% higher.

Unsurprisingly, the Sydney Airport Holdings Pty Ltd (ASX: SYD) share price isn’t taking part in today’s sea of green. It’s down 0.38% at the time of writing.

Qantas share price snapshot

Despite today’s gains, the Qantas share price isn’t out of the red yet.

Right now, shares in Qantas are trading for 3.4% less than they were at the start of 2021. However, they are going for 28.8% more than they were this time last year.

The airline has a market capitalisation of around $8.6 billion, with approximately 1.8 billion shares outstanding.

The post The Qantas (ASX:QAN) share price gained 3% on Tuesday morning appeared first on The Motley Fool Australia.

More reading

• Plumbing, health, tech: 3 ASX shares to buy for instant diversification
• Webjet (ASX:WEB) share price weakens as COVID cases continue
• Why a2 Milk, Cann, Flight Centre, & GPT shares are tumbling lower
• Flight Centre (ASX:FLT) share price slides amid news Sydney lockdown could last until September
• These are the 10 most shorted ASX shares

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It’s head above the clouds for the BHP Group Ltd (ASX: BHP) share price.

Shares in the iron ore major opened 3.06% higher to a record high of $53.50 on Tuesday.

At the time of writing, the BHP share price is up 2.72% to $53.32.

Why the BHP share price continues to set all-time highs

Chinese iron ore prices make headway this week

Last week was a volatile week for the BHP share price, battling both challenges from the broader S&P/ASX 200 Index (ASX: XJO) and iron ore markets.

Iron ore prices on China’s Dalian Commodity Exchange experienced their steepest weekly drop in 17 months last Friday after authorities imposed steel production caps in multiple cities.

According to Mining.com, “Steel producers in Anhui, Gansu, Fujian, Jiangsu, Jiangxi, Shandong, and Yunnan have been told to limit their output to 2020 volumes amid China’s intensified efforts to curb carbon emissions.”

This could be a reason why the BHP share price tumbled 5.07% from $51.87 to $49.24 between Monday and Tuesday last week.

Encouragingly, the most-traded September iron ore futures contract in China has tipped higher this week from approximately US$172 to US$178.

Commentary from Navigate Commodities managing director Atilla Widnell, reported by Mining.com said:

We’re fundamentally and technically bullish in the short term, with arrivals of iron ore cargoes landing in China expected to fall faster than domestic consumption over the past and coming week.

There certainly isn’t sufficient supply availability from the seaborne market to feed Chinese steel consumption growth in the second half, particularly for long products.

It’s not just iron ore that’s pushing higher

While iron ore is a driving factor behind the BHP share price, the company is a diversified producer of petroleum, copper, coal and nickel.

Commodity prices, more broadly speaking, have rallied strongly across the board since the initial COVID-19 selloff in 2020.

Bloomberg’s commodity index, a basket of energy, metal and agriculture prices, has rallied 41.08% in the past 12 months and 23.8% year-to-date to a 5-year high.

The post BHP (ASX:BHP) share price hits new all-time high on Tuesday appeared first on The Motley Fool Australia.

More reading

• Lynas share price soars, BHP and Rio on watch, A2 on the naughty list. Scott Phillips on Nine’s Late News
• What to expect from the ASX 200 during earnings season
• BHP (ASX:BHP) share price lifts amid news $7.5b project will proceed
• Here’s why the BHP (ASX:BHP) share price is up almost 10% in a month
• ASX 200 Weekly Wrap: Just like that… ASX back to record highs

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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Santos Ltd (ASX: STO) shares have had a choppy year to date, posting a return of 4% since January 1.

It’s certainly been interesting times for the oil and gas giant of late.

This earnings season, there are several key inflection points Santos shareholders might consider examining in a bit closer detail.

What could impact Santos shares during reporting season?

We discuss three of the key points below:

Oil Search merger

On 20 July, Santos confirmed that it had submitted a $23 billion merger proposal to the Oil Search Ltd (ASX: OSH) board in late June.

The proposal originally implied a transaction price of $4.25 per Oil Search share, which represented a 12.3% premium at the time.

According to Santos, merging the 2 oil and gas giants “is a logistical combination of two industry leaders to create an unrivalled regional champion of size and scale”.

Oil Search pushed back and claimed the proposal “did not offer appropriate value for Oil Search shareholders or as a basis on which discussions should be progressed”.

Since this time, Oil Search has again stipulated the offer must be in favour of its shareholders in order to close the transaction.

Santos’ proposal now stands at a ~7.6% premium to Oil Search’s share price at close yesterday. It also stands to reason Oil Search will continue to fight for a better deal for its shareholders.

Oil Search interim chief executive Peter Fredricson recently said of the Santos offer:

It’s a little bit like someone wants to gets engaged and give you a diamond ring but we gave the diamond ring back and said no thanks. They need to come back with a couple more carats in the diamond ring.

The saga continues in the merger narrative for these two entities.

Record production rates at new well

Santos reported on 26 July it had produced the “highest initial rate from an individual well in field history” at its production well at the Van Gogh Phase 2 development in Western Australia.

The well produced a peak rate of 23,000 barrels of oil per day, “well ahead of expectations” according to Santos.

Santos has the majority 52.5% interest at Van Gogh, with the remainder owned by Inpex Corp.

High oil prices driving revenue

Santos recognised record revenue in 1H 2021, reaching quarterly sales revenue of $1.5 billion that led to a record $2.76 billion for the half.

The crude oil obtained at Van Gogh is set to return a premium above Brent Crude, enabling “further value to be realised beyond the current oil price”, according to Santos chief executive Kevin Gallagher.

Gallagher explained in the report that high commodity prices in the oil and gas spot markets had been a key catalyst to Santos’ revenue this year.

Santos also upgraded its guidance on full-year production, bumping estimates up to a range of 87 – 91 million barrels of oil for the year.

Foolish takeaway

The Santos share price has had an interesting walk through 2021 so far.

Perhaps the talking point on everyone’s lips is the ongoing merger saga with Oil Search.

In addition to this, investors may also want to consider the pricing impacts of the oil and gas markets on Santos’ share price.

Despite the recent event-driven momentum, Santos shares are down almost 10% over the last month.

Investors can expect Santos’ audited results to be released on Tuesday, 17 August.

The post Own Santos (ASX:STO) shares? What to look out for this reporting season appeared first on The Motley Fool Australia.

More reading

• ASX 200 midday update: BlueScope & OZ Minerals updates impress
• Oil Search (ASX:OSH) share price rises on solid Q2 update
• 5 things to watch on the ASX 200 on Tuesday
• Santos (ASX:STO) share price sinks despite record first oil announcement
• Oil Search (ASX:OSH) share price falls as boss demands bigger ‘diamond’

Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 has had a tremendous month thus far.

Since the start of July, shares in Wesfarmers have soared around 7% and are currently trading near record highs.

There have been several catalysts that have made Wesfarmers a top performer on the S&P/ASX 200 Index (ASX: XJO).  

Let’s take a look at what’s propelled the Wesfarmers share price.  

Investors embracing Wesfarmers strategy

With the Wesfarmers share price trading at record highs, it can be assumed that investors are embracing the conglomerate’s ambitious growth strategy.

The company recently reiterated its priorities of investing in new growth platforms and selling unwanted assets.

Wesfarmers, which operates household banners such as Bunnings, K-Mart, Officeworks and Target plans to leverage and scale its unique assets.

In addition, Wesfarmers has also managed to divest its coal business and expand into the burgeoning lithium sector. Recently, the company’s Mt Holland lithium project received ministerial approval.

Earlier this year, Wesfarmers demonstrated the potential of its growth strategy by reporting strong half year results.

The company delivered a 25.5% increase in net profit after tax of $1,414 million. This was fuelled by a 16.6% increase in revenue for the 6 months of $17,774 million.

Wesfarmers plans expansion into pharmaceuticals

The Wesfarmers share price recently received a boost following its proposed expansion into the pharmaceutical sector.

Earlier this month, the company launched a $687 million offer for Australian Pharmaceutical Industries Ltd (ASX: API).

The offer slated by Wesfarmers is to acquire 100% of API’s shares outstanding for $1.38 cash per share by way of a scheme for arrangement.

Wesfarmers management cited that the proposed acquisition of API would provide the company an attractive opportunity to enter the $25 billion pharmaceutical, beauty and wellbeing sector.

Wesfarmers cited the strong competitive position of API and intends to bring its capital and unique capabilities to support further investment.

The deal is subject to due diligence, ACCC clearance and approval from the API board and shareholders

Snapshot of the Wesfarmers share price

As highlighted earlier, the Wesfarmers share price has stormed around 7% higher in July to record highs. Overall, shares in Australia’s second largest retailer have soared around 22% higher since the start of the year.

The post Here’s why the Wesfarmers (ASX:WES) share price is up 7% in a month appeared first on The Motley Fool Australia.

More reading

• ASX 200 Weekly Wrap: Just like that… ASX back to record highs
• Here’s what the Wesfarmers (ASX:WES) dividend will pay you today
• Wesfarmers (ASX:WES) share price up as Catch involved in ACCC inquiry
• What a Wednesday! Wesfarmers (ASX:WES) share price hits new all-time high
• Lockdowns hurt, ASX falls, Wesfarmers climbs, and the Aussie set to fall? Scott Phillips on Nine’s Late News

Motley Fool contributor Nikhil Gangaram 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 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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