This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

Shares of electric vehicle maker Tesla Inc(NASDAQ: TSLA) fell on Thursday, declining as much as 4.9%. As of 1.30 pm EDT, however, shares were down 4.1%.

The stock’s decline is likely primarily due to a bearish day in the market for growth stocks.

So what

Many tech stocks slid sharply on Thursday. Highlighting a bearish day in the market for tech stocks is the tech-heavy Nasdaq Composite (INDEXNASDAQ: .IXIC)’s 1.5% decline as of this writing. Many growth stocks like Tesla fell even more.

Growth stocks have struggled to fully rebound after getting pounded in the second half of February and early March. Shares of these stocks seem to be taking a breather after big gains in 2020. Tesla stock is down 18% since mid-February. Its shares, however, are still well above 2021 lows below $600 in early March. But they’re far from recovering to a high of more than $900.

A pullback in growth stocks has been largely attributed to rising 10-year Treasury yield rates. With improving return prospects in safer and alternative investments to equities, some investors may be pocketing gains from growth stocks and putting capital in bonds.

Now what

Tesla’s stock and business have been on a roll recently.

The company reported 46% year-over-year revenue growth in the fourth quarter of 2020 and analysts, on average, expect even faster growth this year.

Despite the stock’s pullback from highs earlier this year, shares are up 59% over the last six months and 682% over the past 12 months. The S&P 500 Index (INDEXSP: .INX) rose 18% and 57%, respectively, during those periods.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• Why are the Nasdaq’s highest-growth stocks panicking about a strong economy?
• We’re betting on ASX growth shares: global fund
• Don’t fall into the ‘rotation trap’
• How to invest in the Nasdaq Index on the ASX
• Elon Musk reviews title and decides ‘Technoking of Tesla’ is more fitting

Daniel Sparks has no position in any of the stocks mentioned. His clients may own shares of the companies mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends 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.

The post Why Tesla stock fell sharply on Thursday appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

from The Motley Fool Australia https://ift.tt/2OKDm1W

The AGL Energy Limited (ASX: AGL) share price is avoiding the market selloff today and pushing higher.

At the time of writing, the energy company’s shares are up over 1% to $9.56.

Why is the AGL share price pushing higher?

Investors have been buying AGL shares this morning for a couple of reasons.

One is the market selloff, which has led to an increase in demand for safe haven assets.

For example, the shares of fellow utility companies APA Group (ASX: APA) and Mercury NZ Ltd (ASX: MCY) are also rising during morning trade.

What else is supporting AGL’s shares?

Also giving the AGL share price a boost today has been the release of an announcement relating to the Portland Smelter in Victoria.

According to the release, AGL has finalised a new agreement to supply a proportion of the electricity requirement of the Portland Smelter aluminium smelter until July 2026. The agreement will take effect from 1 August 2021 when the existing supply contract ends.

AGL advised that the new contract represents a mutually beneficial outcome on commercial terms, for a volume of 275 MW. It also provides the company with some flexibility, including rights in relation to the short-term reduction of volume at times of peak demand.

AGL Managing Director & Chief Executive Officer, Brett Redman, said: “AGL recognises the importance of the Portland smelter to the communities it supports and as a large wholesale electricity user. The total Portland load comprises approximately 10 percent of Victoria’s total energy demand and we are pleased to play our part in securing its continued operations.”

Shareholders will no doubt be hoping this is the start of better times for the AGL share price. After all, year to date the company’s shares are down a disappointing 21%.

More reading

• Brokers are bullish about these 3 ASX 200 shares
• Why the Tilt Renewables (ASX:TLT) share price is soaring 15% today
• Goldman reaffirms its conviction buy on this ASX share on Yallourn shutdown
• The 3 highest paying ASX 200 dividend shares
• Amaysim (ASX:AYS) share price higher as company moves to delist

Motley Fool contributor James Mickleboro 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.

The post Why the AGL (ASX:AGL) share price is avoiding the market selloff appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3tBawjy

The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price is following the wider S&P/ASX 200 Index (ASX: XJO) lower today. The ASX 200 is down 1.05% while Sydney Airport shares are down 2.7%.

But looking at Sydney Airport’s wider performance since 1 November 2020 – shares are up 12% – you’d be forgiven for thinking that business was picking up for the ASX 200 travel share.

It’s not.

Traffic drought

The Sydney Airport share price is sliding this morning following the release of the company’s February traffic figures.

The numbers reveal a slightly lower year-on-year decline than the airport’s January Airport Traffic Performance report. The January 2021 figures revealed total passenger numbers remained more than 94% lower than in January 2020, right before COVID-19 began its global march, bringing international and even most domestic travel in Australia to a virtual halt.

Still, before the pandemic struck, the February traffic figures just released would be nothing short of shocking.

Sydney Airport reported a 79.8% drop in its total passenger traffic compared to the previous corresponding period, with 623,000 passengers.

With state borders reopening later in February and domestic air travel slowly reviving, the 596,000 domestic passengers represent a 70.0% fall from February 2020 numbers.

Not surprisingly, the international passenger figures remain at a trickle. Only 27,000 international passengers passed through the airport in February, down 97.5% year on year.

Breaking it down to nationalities, Australians were the largest cohort of international travellers coming through the airport, with China number two, New Zealand number three, India number four and the United States number five.

Sydney Airport said, “The downturn in international passenger traffic is expected to persist until government travel restrictions are eased.”

Sydney Airport share price snapshot

Despite the drought in traffic, Sydney Airport shares gained 3.7% in February, as investors looked beyond the current restrictions towards the reopening as vaccines begin to roll out across the world.

Since the first successful vaccine rumours hit the news at the start of November, Sydney Airport shares are up by 12.5%. Over the past 12 months, shares are up by around 34%, compared to a 40% gain on the ASX 200.

Year to date, the Sydney Airport share price is down 4%.

More reading

• Vaccines have begun, what might this mean for ASX airport shares?
• ASX 200 Weekly Wrap: Calm restored to the ASX 200
• What this broker thinks about ASX travel shares after government’s stimulus package
• ASX 200 unmoved, Flight Centre soars, Afterpay keeps falling
• Insiders have been buying Sydney Airport (ASX:SYD) and this ASX share

Motley Fool contributor Bernd Struben 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.

The post Shocking new numbers reveal Sydney Airport (ASX:SYD) share price resilience appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2NyVs6E

The Wisr Ltd (ASX: WZR) share price is edging higher this morning after the neo-lender provided an update on its trading performance. At the time of writing, the Wisr share price is swapping hands for 21.5 cents, up 2.38%.

In comparison, the All Ordinaries Index (ASX: XAO) is currently slumping 0.92% lower for the day so far.

Quick take on Wisr

Founded in 2014, Wisr is an Australian non-bank lender that offers personal and business lending services. These include personal loans, financial products, and investment solutions, among other services.

According to Wisr, it offers consumers a more attractive option to traditional banks by delivering competitive interest rates and tailoring customer loans.

What’s boosting the Wisr share price?

Investors appear to be excited about the company’s recent accomplishments, sending the Wisr share price higher today.

According to this morning’s release, Wisr continues to deliver exceptional growth on its books.

For the two months ending 28 February 2021, the company reported a loan volume of $58.8 million. This reflects an increase of 138% over the prior corresponding period in which $24.7 million was achieved.

The robust result for the start of 2021 came from a record $35.5 million monthly loan volume for February. Wisr highlighted that this is a 52% jump on the previous month of January which saw $23.3 million in loan volume.

Addressable market opportunity

In its investor day presentation, the company noted that the consumer lending market stood at $93 billion in November 2020. Of this, Wisr holds a mere 0.22% market share with its $207 million warehouse facility.

Over the medium term, the company plans to extend its loan book to $1 billion, and aggressively capture a larger slice of market share.

Wisr share price snapshot

The Wisr share price has accelerated by nearly 170% in the past 12 months and is up 13% year to date. The company’s shares surged strongly in early 2020, reaching a 52-week high of 27.5 cents last July, before trending lower.

Based on valuation grounds, Wisr commands a market capitalisation of around $230 million, with close to 1.1 billion shares outstanding.

More reading

• Why the WISR Ltd (ASX:WZR) share price is racing higher today

Motley Fool contributor Aaron Teboneras 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.

The post Wisr (ASX:WZR) share price jumps on strong trading update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/38W8Adl

The Afterpay Ltd (ASX: APT) share price may be under pressure today following the US market’s heavy tech-driven selloff. 

What happened to the Nasdaq overnight? 

The Nasdaq Composite (NASDAQ: .IXIC) closed 3.02% lower on Thursday night as rising 10-year Treasury yield rates continued to threaten equity markets. 

The global economy is showing signs of life as vaccine efforts attempt to put COVID-19 at bay. As economic growth starts to pick up the pace, inflation is likely to follow suit.

And when inflation starts to pick up, so does the question of whether or not central banks need to increase interest rates. The recent advance in yields reflects the anticipation of higher inflation and interest rate hikes being brought forward. 

Tech and growth sectors are most sensitive to rising interest rates. While these are the stocks that outperformed the market when yields were crashing, they could also be the ones to underperform when yields rise. 

What does this mean for the Afterpay share price?

Since mid-February, the Afterpay share price hasn’t been able to catch a break lately, losing ~30% of its value. Its shares have continued to face mounting pressure today, down 2.6% at the time of writing. 

It appears Afterpay’s recent weakness is largely outside its control, with the S&P/ASX Information Technology (INDEXASX: XIJ) slumping 13.60% in the past month. 

The US tech-heavy selloff on Thursday night could spark further weakness in the Afterpay share price. This, in turn, could be exacerbated by the heavy selling of the third-largest buy now, pay later player in the US, Affirm Holdings Inc (NASDAQ: AFRM). 

The Affirm share price finished the overnight session down 8.26% to a near all-time low of $74.39. Its shares debuted on the Nasdaq back on 13 January 2021 at an initial public offering (IPO) price of US$39. Affirm’s shares closed at $97 on the first day of listing before running to as high as $146.90 just one month later.

The recent concerns over rising interest rates and weakness in tech shares have managed to erase all of Affirm’s gains. 

More reading

• 5 things to watch on the ASX 200 on Friday
• 2 ASX growth shares for smart investors to buy
• Top brokers name 3 ASX shares to sell today
• Afterpay (ASX:APT) share price drops on scathing broker note
• Why the Afterpay (ASX:APT) share price is down 7% in 2021

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why the Afterpay (ASX:APT) share price may be under pressure today appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2QmDlSr

The Creso Pharma Ltd (ASX: CPH) share price is trading lower on Friday despite the release of a positive announcement.

At the time of writing, the cannabis company’s shares are down over 2% to 22.5 cents.

What did Creso Pharma announce?

This morning Creso Pharma announced that its wholly owned Canadian subsidiary, Mernova Medicinal, has secured three new purchase orders.

According to the release, the orders have a total value of C$177,122.40 (A$183,019.551) and include the first purchase order for Mernova’s Pre-roll Joint range, sold under the Ritual Sticks brand.

The release explains that the Ritual Sticks offering is comprised of new Pre-roll Joints which utilise the company’s top-quality indoor grown, hand trimmed, hang dried, cured, artisanal, craft cannabis.

The company advised that to produce the line of Pre-roll Joints, Mernova exclusively utilises only the same high-quality cannabis that is sold under the Ritual Green brand.

The launch of the offering follows considerable product development initiatives, as well as a lengthy registration process with Health Canada.

Management notes that the Pre-roll market unlocks another significant addressable market for Mernova.

“A major achievement”

Mernova’s Managing Director, Jack Yu, believes this purchase order is a major achievement for the business.

He said: “Receiving our first PO for our Ritual Sticks brand of Pre-roll Joints is a major achievement for Mernova, and is the result of considerable R&D to select the right equipment and develop our processes. We wanted to produce the best Pre-roll joints possible, and are very excited to get our new products in the hands of customers in the coming weeks, so that they can provide their feedback.”

“One thing that sets us apart is that we use only the same high-quality cannabis as sold under our Ritual Green brand of dried flower. We expect these products to open a much broader market for Mernova, as they are priced as entry-level products, which should help introduce our products to a much larger customer base, and they offer a level of convenience that many will appreciate.”

Mr Yu revealed that Mernova is experiencing strong sales growth and appears confident this will continue.

He explained: “Mernova continues to witness very strong sales growth and the additional purchase orders received recently are validation of this. Our brand recognition has increased considerably over the last few months, particularly in Nova Scotia, and Mernova has generated a reputation as one of the best craft cannabis growers in Canada. Most importantly, our ongoing sales growth has put the business on a fast track towards a stable, and recurring revenue-generating model.”

“We expect demand for our products to continue, particularly with the introduction of our Pre-roll Joint range, and we look forward to updating shareholders on new purchase orders in the near term,” he concluded.

More reading

• Why the Creso Pharma (ASX:CPH) share price is rocketing 16% higher today
• Creso Pharma (ASX:CPH) to commence phase II clinical trials
• How Mexico could turbocharge ASX cannabis shares
• What’s with the Creso Pharma (ASX:CPH) share price today?
• The Creso (ASX:CPH) share price fizzles despite new distribution deal

Motley Fool contributor James Mickleboro 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.

The post Creso Pharma (ASX:CPH) share price lower despite cannabis sales update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3s1RylK

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The Nasdaq Composite (NASDAQ: .IXIC) was the stock market leader throughout most of 2020, powering ahead to much greater gains than its fellow major benchmarks. In particular, high-growth stocks that were able to hold up well despite the recessionary conditions in the broader economy stood out as big winners and rewarded their shareholders handsomely.

However, that narrative has changed lately. As of 11 a.m. EDT on Thursday, the Nasdaq was down another 1.7%, building on losses that have taken the index into correction territory even as other benchmarks were at or near record highs. Moreover, it seems as though the Nasdaq is falling even though Fed chair Jerome Powell told investors Wednesday that the economy appeared to be in solid shape.

There’s one possible answer for this apparent disconnect. If investors are actually paying attention to a common way of valuing high-growth stocks, then the Fed’s nonchalance about a key impact that a stronger economy could bring might explain the near-panic among shareholders of those stocks.

More damage in Nasdaq high-growth stocks

To be clear, Thursday’s declines weren’t monumental by themselves. Tesla Inc (NASDAQ: TSLA), for instance, was down just 3%. MercadoLibre Inc (NASDAQ: MELI) saw a 4% slump, while Zoom Video Communications Inc (NASDAQ: ZM) lost 3% and Atlassian Corporation (NASDAQ: TEAM) took a 5% hit.

However, those declines are just the latest in a series of drops for these stocks and many like them. Tesla is trading about 25% lower than its all-time highs from just a couple months ago. Zoom has given up roughly 40% from its record levels late last year. The move seems to reveal skepticism about whether the growth stocks have seen their shares rise too far, too quickly.

What the Fed has to do with high-growth stocks

It might seem as though the Federal Reserve’s actions wouldn’t necessarily have any impact on high-growth stocks. Investor interest in these companies has been so high that access to capital hasn’t been a problem. Many of them have more than enough cash to make it through tough times in the future, and some of them are even cash-flow positive and can sustain themselves simply by maintaining current business levels.

However, the recent rise in interest rates due to inflationary fears has been troubling to investors. One potential impact is that if you value a company based on the discounted value of its future financial results, then higher interest rates make the performance that comes further into the future less valuable. With rates at zero, it almost doesn’t matter from a valuation standpoint whether a company makes money now or five years from now, and low rates reward companies that defer smaller profits now in favour of larger profits later. That’s been the basis for the huge run-ups in these stocks.

Higher interest rates reverse that trend. Suddenly, companies will get rewarded for producing results now rather than later. Valuations on companies that will take years to play out will take a hit.

Seize the opportunity

For long-term investors, that actually might be good news. It would signal that the Nasdaq stock price declines aren’t about fears that companies aren’t going to be able to live up to their full potential. Rather, it just reduces the value put on those same strong future results.

If you can get the same strong business at a discount, you should jump at the chance. That’s the advantage long-term investors have, and now’s the time to look closely at some of the stocks the rest of the market is giving up on.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

More reading

• We’re betting on ASX growth shares: global fund
• Don’t fall into the ‘rotation trap’
• How to invest in the Nasdaq Index on the ASX
• Elon Musk reviews title and decides ‘Technoking of Tesla’ is more fitting
• ASX investors still can’t get enough of GameStop (NYSE:GME) shares

Dan Caplinger owns shares of MercadoLibre. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Atlassian, MercadoLibre, Tesla, and Zoom Video Communications. The Motley Fool Australia has recommended Zoom Video Communications. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Why are the Nasdaq’s highest-growth stocks panicking about a strong economy? appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

from The Motley Fool Australia https://ift.tt/3lrYDto

The drop in the market could soon be met with a circa $19 billion wall of capital as investors collect their second biggest dividend checks in history.

The S&P/ASX 200 Index (Index:^AXJO) tumbled 1% in morning trade. If it closes in the red, this will mark its third consecutive day of losses.

Naysayers believe that the latest sell-off is an ominous sign and the start of a long-awaited market correction.

ASX dividend bonanza

But not all experts are convinced. In fact, Bell Potter’s high-profile institutional dealer Richard Coppleson believes the market drop could be short-lived due to a “dividend bonanza”.

He wrote in his daily Coppo Report that total dividends declared from last month’s reporting season is the second highest on record at $26.9 billion.

The largest was two years ago when ASX shares handed out $27.8 billion in the half year.

Biggest weekly dividend payout from ASX shares

Most of these dividends will be paid in the week starting 22 March. There are 75 ASX companies that are slated to pay out $12.3 billion next week alone.

These include ASX dividend kings like the BHP Group Ltd (ASX: BHP) share price, Fortescue Metals Group Limited (ASX: FMG) share price and Telstra Corporation Ltd (ASX: TLS) share price.

The week after will see another 48 ASX shares return $6.3 billion to shareholders. There’s every chance that most of this cash could find it’s way back into the market. I mean where else would investors park the cash in this near zero-rate environment?

ASX shares would look particularly enticing if the market was to pull back further, in my view.

April is a good month for ASX shares

It’s also worth pointing out that the month of April tends to be a positive period for the ASX. In the past six years, our market has only fallen once in April, according to Coppleson.

This was back in 2015 when the ASX 200 retreated 1.7%. However, the index rallied substantially every April from 2016. The “worst” positive April was in 2019 when the top 200 benchmark added 2.3% for the month.

As you may have guessed, the best April was last year when the ASX 200 surged 8.8%. This was following the bottom of the COVID-19 bear market.

Foolish takeaway

The ASX dividend shares recovery is also a bullish signal for investors in itself. Companies will only increase their dividends if they are feeling confident about their trading outlook.

ASX company boards know it’s a cardinal sin to cut dividends and will only do so if their backs are to the wall.

They could have held off increasing their dividends if they thought more tough times were ahead. But most didn’t.

This isn’t to say that we won’t be facing more market turbulence ahead. Remember the saying “sell in May, go away”?

But those with a longer investment horizon should be feeling upbeat enough to put their cash to work if share prices weaken further.

More reading

• Fortescue (ASX:FMG) share price lower after raising US$1.5 billion
• Nasdaq slumps 3% overnight, ASX 200 tech shares under pressure today
• 5 things to watch on the ASX 200 on Friday
• ASX 200 drops, Webjet reveals B2B plan, Cimic wins again
• Could the run be over for the Fortescue (ASX:FMG) share price?

Motley Fool contributor Brendon Lau owns shares of BHP Billiton Limited and Telstra Limited. Connect with me on Twitter @brenlau.

The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post ASX weakness could be met with $19bn “dividend bonanza” appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3vFEMM4

The Zip Co Ltd (ASX: Z1P) share price has come under pressure on Friday morning.

At the time of writing, the buy now pay later provider’s shares are down 4% to $8.11.

This means the Zip share price is now down 44% from the 52-week high of $14.53 it reached in February.

Why is the Zip share price sinking today?

Investors have been selling Zip and other ASX tech shares today after a very disappointing night of trade on Wall Street’s tech-focused Nasdaq index.

According to CNBC, the Nasdaq tumbled 3% lower overnight after bond yields surged higher.  

Apple, Amazon, and Netflix shares all fell more than 3%, while Tesla crashed almost 7% after the US 10-year Treasury yield jumped 11 basis points to a 14-month high of 1.75%.

In addition to this, the 30-year Treasury yield climbed 6 basis points to hit the 2.5% level for the first time since August 2019.

Why is this bad news for Zip?

There are a couple of reasons why this is bad news for the company and is weighing on the Zip share price.

The first is that rising bond yields impact valuations, particularly those that trade on lofty multiples like Zip and Afterpay Limited (ASX: APT). This is because as the risk-free rate increase, investors become less willing to pay over the odds for equities.

Another reason why rising bond yields could be bad news for Zip is the potential impact to the cost of its funding, which could weigh on margins.

It is partly for this reason that last week UBS downgraded Zip’s shares to a sell rating with a $6.40 price target.

Though, it is worth noting that not everyone is as bearish. Last month Morgans put an add rating and $12.10 price target on the company’s shares.

Based on the current Zip share price, this price target implies potential upside of 49%. It was pleased with its half year results and particularly its growth in the United States.

Time will tell which broker made the right call.

More reading

• Revealed: 4 least profitable industries in Australia
• Is the new CBA BNPL service bad news for Afterpay and Zip shares?
• Is the Zip (ASX:Z1P) share price a buy now or buy later?
• ASX 200 dips, CBA launches BNPL, Fonterra reports
• How much have investors made (or lost) on Zip (ASX:Z1P) shares?

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 ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Here’s why the Zip (ASX:Z1P) share price is now down 44% from its high appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/38RB5ZB

The Coles Group Ltd (ASX: COL) share price is edging lower today despite the release of a positive announcement.

In morning trade the supermarket giant’s shares are down almost 1% to $15.45.

What did Coles announce?

This morning Coles increased its green credentials by releasing its Climate Change Position Statement and announcing targets to reduce greenhouse gas emissions.

According to the release, the supermarket operator has committed to delivering net zero greenhouse gas emissions by 2050.

In addition to this, before then, the company intends to power its entire business by 100% renewable electricity by the end of FY 2025.

Another commitment is for Coles to reduce its combined Scope 1 and 2 greenhouse gas emissions by more than 75% by the end of FY 2030 from a FY 2020 baseline.

Coles’ CEO, Steven Cain, said: “We have already reduced Scope 1 and Scope 2 greenhouse gas emissions by 36.5% since 2009 and have been a leader in securing renewable energy. Our new targets for Scope 1 and 2 emissions commit us to an accelerated reduction in greenhouse gas emissions that exceed the climate change ambitions of the Paris Agreement and will help sustain Australia for generations to come by working together with our customers, suppliers and members of the community.”

Is the Coles share price in the buy zone?

The Coles share price has underperformed this year and was down 16% year to date prior to today.

One broker that is likely to see this share price weakness as a buying opportunity is Morgan Stanley. Last month its analysts put an overweight rating and $20.25 price target on the company’s shares.

Based on the current Coles share price, this price target implies potential upside of 31% for its shares over the next 12 months.

The broker is also forecasting a 57 cents per share fully franked dividend in FY 2021. This represents an attractive 3.7% yield currently.

More reading

• Is Coles (ASX:COL) a dependable ASX share to buy right now?
• 2 quality ASX dividend shares to buy today
• Why the Coles (ASX:COL) share price is still down 15% in 2021
• 2 ASX dividend shares to buy with yields above 4%
• ASX 200 Weekly Wrap: Calm restored to the ASX 200

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Coles (ASX:COL) share price lower after announcing greenhouse gas emissions targets appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3vIjL35