The Novonix Ltd (ASX: NVX) share price has been a strong performer on Tuesday.

In afternoon trade the shares of the integrated developer and supplier of high-performance materials, equipment, and services for the lithium-ion battery industry are up 17% to $1.83.

Why is the Novonix share price surging higher?

Investors have been buying the company’s shares today following the release of an announcement.

According to the release, the company has appointed Professor Jeff Dahn as its Chief Scientific Advisor, effective July 1.

Prof. Dahn is a leading researcher in the field of lithium-ion batteries and materials and currently holds the title of NSERC/Tesla Canada Industrial Research Chair with Dalhousie University. He has co-authored 730 papers and has 73 inventions with patents issued or filed. These include some of the early patents related to Lithium-Nickel-Manganese-Cobalt-Oxide cathode material in 2001.

The release explains that Prof. Dahn will provide advice with respect to Novonix initiatives across its battery materials and research businesses, as well as key customer and business development projects.

In addition to this role, Prof. Dahn and the Dalhousie University research team in Halifax, Nova Scotia will continue to work alongside electric car giant Tesla.

Novonix’s Chief Executive, Dr. Chris Burns, commented: “We are extremely excited to have Prof. Dahn join the Novonix team and become involved in our initiatives to develop and supply world-leading materials to the lithium-ion battery sector. I am personally pleased to have the opportunity to work together with Prof. Dahn again as his insights, industry contacts and experience will be a huge asset for our business.”

Prof. Dahn revealed that he was very pleased to be working with Novonix.

He said: “I have always wanted to be able to help local Nova Scotian businesses in the battery space and I’m happy to be taking on this advisory role. The Novonix team is comprised of creative scientists and engineers who are doing exciting and novel work. I am thrilled to have this opportunity.”

More reading

• These 3 ASX shares all posted massive gains today

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.

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The Hazer Group Ltd (ASX: HZR) share price is surging today, up 14.07% at the time of writing to $1.23 a share. That represents a market capitalisation of $177.8 million.

Hazer shares closed at $1.07 yesterday and opened at $1.13 today before climbing as high as $1.27 soon after. These levels are a new all-time high for the company. It also puts Hazer up more than 80% in the past month, and more than 200% over the past 12 months.

So what is the Hazer Group? And why is the Hazer share price rocketing today?

Lazer, blazer, Hazer?

Hazer Group is a company that, in its own words, is “pioneering a low-cost, low-emission hydrogen and graphite production process [the Hazer process]”. Hazer says this process enables the effective conversion of natural gas and similar feedstocks into hydrogen and high quality graphite, using iron ore as a process catalyst.

Using this technology, the company aims to “play a significant role across three multi-billion dollar global markets” by producing hydrogen at a lower cost than alternative methods.

It does so by taking methane (a potent greenhouse gas) and breaking it down using the ‘Hazer process’ into its elements of hydrogen and carbon (in graphite form). It then is able to sell the hydrogen as a fuel and the graphite as a low-cost industrial input.

Hazer notes that hydrogen has a global market worth around US$100 billion. Hydrogen is used in many commercial applications such as ammonia production and in the petroleum industry. It is also touted as a potential fuel for zero-emission vehicles and electricity generation.

Meanwhile, graphite has many industrial applications as well. This includes (as Hazer points out) lithium-ion batteries that are found in electric vehicles. The company also notes that traditional graphite extraction is highly damaging to the environment as it usually involves large open-cut mines. It also necessitates the use of harsh petroleum products in the refining process. Hazer’s graphite requires none of these for production.

Why is this company’s share price surging today?

Normally a share price move like we’ve seen with Hazer today is spearheaded by a company announcement or some other big news. But strangely, there appears to be no obvious catalyst for the moves we are seeing today.

The company’s last announcement to the markets was back on 12 January. And that was just some fairly unnotable information regarding the company’s recent annual general meeting. We did also see a notice that one of  Hazer’s directors, Tim Goldsmith, had picked up a hefty parcel of shares. But that was back on 4 January.

As such, we can probably put today’s moves down to good old-fashioned buying pressure. ASX data shows that trading volume today hit 1.8 million shares, well above the company’s 5-day average of just under 1.5 million.

In fact, the volume has either been at, or exceeding, this average over the past 5 days. We could just be witnessing a classic momentum story here.

Electric car companies like Tesla Inc (NASDAQ: TSLA) are all the rage right now. Could it be guilt by association?  Maybe it’s because sometimes when investors see that a company is up 55.7% year to date (and it only 19 January), they just assume it will keep going up. Or maybe someone knows something we all don’t yet.

Sometimes the markets give us a curveball when things aren’t as obvious as we’d like. But that’s investing for you!

More reading

• We have lift-off: Vulcan Energy (ASX:VUL) share price hits new heights
• Why the Lake Resources (ASX:LKE) share price jumped 16% to a 52-week high
• Top fundie Hyperion to launch new growth ETF
• Top broker says you should buy these oversold ASX gold stocks now
• Here’s why the Rhythm (ASX:RHY) share price hit an all-time high today

Sebastian Bowen owns shares of Tesla. 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.

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For their ninth consecutive trading session, Vulcan Energy Resources Ltd (ASX: VUL) shares are pushing higher. Upon opening this morning, the Vulcan share price raced to an all-time high of $14.20, up 57%. Vulcan is now catching its breath, with the company’s share price retreating to $10.36 at the time of writing, up 14.6% for the day.

The lithium focused mineral exploration company must have set a new year’s resolution – in true #newyearnewme fashion. It appears Vulcan is adhering to a strict, greens-only diet, with not a single red day of trading so far this year. Although, the abundance of green in 2021 is not exclusive to Vulcan.

Lithium glow up

It seems lithium is having its time in the sun. Continued demand for its use in electric vehicle (EV) batteries, a new Biden presidency, and government environmental mandates have all contributed to the lift in lithium prices of late.

China carbonate prices are at 14-month highs, as reported in Friday’s Fastmarkets Metal Bulletin global lithium wrap. Additionally, battery-grade lithium hydroxide gained 10.3% week over week as a result of the low availability of cheap materials.

Lithium miners regaining lustre

We have all seen the rapid growth in many EV shares abroad in the last six months. Tesla Inc (NASDAQ: TSLA) shares are up 655%, Nio Inc (NYSE: NIO) is up 339%, and Xpeng Inc (NYSE: XPEV) is up 125%. However, until recently many lithium mining shares lagged their offtake partners.

The weighing lithium price suppressed many lithium mining companies from achieving similar returns during this boom in recognition of the vehicle electrification trend.

However, now with the supportive commodity price, the market has rallied behind such companies. Other than the rise in the Vulcan Energy share price, there are also other examples of surging valuations among ASX lithium producers.

Vulcan share price, in good company

Although no other lithium miner/explorer/producer registers on quite the same level as the Vulcan share price performance, there are a few honourable mentions.

The Galaxy Resources Limited (ASX: GXY) share price, for instance, has appreciated 136% in the last 12 months. Its $1.41 billion market capitalisation makes Galaxy one of the biggest lithium producers on the ASX. Reportedly, the miner is now even examining the potential to ramp up its Mt Cattlin lithium mine to full capacity to capture the value in the higher commodity prices.

Pilbara Minerals Ltd (ASX: PLS) has returned a sturdy 220% in the last year. The Australian lithium producer has taken advantage of its recent strength by seeking to acquire Altura Mining Limited (ASX: AJM). The company is eying off capturing the continued lithium demand by broadening its explorations through the acquisition.

Piedmont Lithium Ltd (ASX: PLL) has notched up an impressive one-year return of 317%. Prior to late September last year, the Piedmont share price was trading at around 10 cents, then it all changed with one announcement. The United States-based lithium miner obtained a supply agreement with Tesla for its spodumene concentrate. Since then, the company has gone on to pen a deal with the Canadian miner Sayona Mining Ltd (ASX: SYA) to acquire the greater of 50% or 60,000 tonnes per annum of spodumene concentrate from Sayona. 

Falcon 9 or Starship for this Vulcan share price rocket?

As we all know, when it comes to New Year’s resolutions, often they get broken after the first month. The question is, when will the green streak break for the Vulcan share price?

More pressing, when it does, will it make a gracious reverse onto a stable platform – primed for its next launch? Or will it starship – dropping out of the air to crash in fiery flames?

Only time will tell, as shareholders await the company’s definitive feasibility study, following the recent release of its positive Pre Feasibility Study.

More reading

• What does the Biden administration mean for ASX shares? 
• Why the Greenvale (ASX:GRV) share price surged 9% today
• Why the Vulcan Energy (ASX:VUL) share price is up 4,000% in 12 months
• The Vulcan (ASX:VUL) share price is hitting new highs today. Here’s why
• Here’s why the Sayona (ASX:SYA) share price has surged 235% higher this week

Mitchell Lawler owns shares of Tesla. 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.

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The Lake Resources N.L. (ASX: LKE) share price has continued its positive run on Tuesday.

Earlier today the lithium-focused mineral exploration company’s shares were up 16% to a 52-week high of 18 cents.

Why is the Lake Resources share price at a 52-week high?

This morning Lake Resources announced that shallow drill testing is underway on-site at its flagship Kachi Lithium Brine Project, Argentina. This is part of the development activities required for the Definitive Feasibility Study (DFS).

According to the release, geophysical studies have assisted the planning of the shallow wells. These will be followed by further geotechnical studies, in addition to recent works conducted on proposed sites for Lilac Solutions’ direct lithium extraction demonstration plant and for the future production plant.

Pleasingly, the company advised that it is well financed for the DFS and these activities. Late last year it raised ~$3.4 million through its controlled placement agreement with Acuity Capital. These funds will be used towards the Kachi DFS, further exploration, and working capital.

Novonix update.

In addition to this, the company provided an update on its work with Novonix Ltd (ASX: NVX).

The release explains that Novonix continues its test work on Lake’s high purity lithium carbonate.

If all goes to plan, this will be used together with commercial battery cathode precursor materials to form a NMC622 cathode that will then be processed into NMC622 lithium-ion batteries for testing.

Management notes that this will enable Lake and its potential customers to make direct comparisons of Lake’s lithium product’s performance in familiar battery chemistries. Initial indications are anticipated to be reported next month.

Lake’s Managing Director Steve Promnitz commented: “Lake has started 2021 on the front foot by formally launching our Kachi DFS, and ramping up engagement with investors and potential industry partners. Interest in the sector has never been stronger in environmentally responsible, direct lithium extractions.”

More reading

• Top fundie Hyperion to launch new growth ETF
• Top broker says you should buy these oversold ASX gold stocks now
• Here’s why the Rhythm (ASX:RHY) share price hit an all-time high today
• Here’s why the Newcrest (ASX:NCM) share price is underperforming
• Is the JB Hi-Fi (ASX:JBH) share price overvalued now?

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.

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The ASX is set to welcome a new exchange-traded fund (ETF). Hyperion Asset Management has made a name for itself in recent years with its top-performing managed funds.

Hyperion, which focuses on growth investing as its primary strategy, currently offers 2 managed funds, a “Global Growth Companies fund” and an “Australian Growth Companies Fund”. Both funds have delivered objectively impressive performances.

Hyperion tells us that the Global Growth Fund has returned an average of 23.49% per annum since its inception in 2014 (net of fees). The Australian Growth Companies Fund has delivered 12.75% per annum since its inception in 2002.

Perhaps it’s this success that is sparking some growth plans at Hyperion. According to reporting in the Australian Financial Review (AFR) this week, Hyperion is on the move. The report states the fundie is “readying to launch” an active ETF to “capture growing demand to invest in its top-performing global strategy”.

The Fund Manager reckons the new global growth ETF will hit the ASX boards around late March, and will reportedly have the ticker code HYGG. The AFR reports that the move is coming as Hyperion is experiencing fund inflows of “more than $100 million a month” into the unlisted Global Growth Fund.

The new listed fund will apparently charge the same management fee as its unlisted cousin – a 0.7% per annum management fee as well as a 20% performance fee if the fund exceeds its global benchmark.

Hyperion’s Deputy Chief Investment Officer, Jason Orthman, stated the following on the fee structure: “It’s pretty disruptive when a lot of our larger (peers) are (charging) well over 100 basis points and some of them are double the 70 basis points“.

Going for growth with Tesla

Hyperion attributes much of its Global Growth Fund’s outperformance to a “high-conviction bet” on Tesla Inc (NASDAQ: TSLA). Tesla is the electric car and battery manufacturer headed by the famous Elon Musk. Its share price has exploded in recent years – up more than 654% in the past year alone, and up more than 2,000% since May 2019. Hyperion reports that Tesla still makes up around 12% of its portfolio, and Hyperion isn’t selling yet.

The AFR quotes Hyperion’s Chief Investment Officer, Mark Arnold, on Tesla:

Our view is that it will be the most disruptive business that existed for a long period of time because it is attacking really large addressable markets…Tesla is actually way more innovative than Amazon. That’s bad news for the existing incumbent companies in those industries. They’ve been sort of asleep at the wheel for a long period of time.

Tesla isn’t the only high-octane growth stock that Hyperion loves right now either. According to the report, Mr Arnold is shunning the “old growth favourites” in the FAANG stocks Alphabet Inc (NASDAQ: GOOGL) and Facebook Inc (NASDAQ: FB) for more “controversial” holdings like Square Inc (NASDAQ: SQ) and PayPal Holdings Inc (NASDAQ: PYPL).

“Companies like Square and PayPal, with their electronic wallets, really have the potential to completely flip the whole banking industry on its head,” Mr Arnold told the AFR. “Our view has always been that we’re interested in only investing in the highest quality businesses we can find”.

More reading

• The worst mistake Tesla investors can make right now
• Stop worrying about a market crash: Do this instead
• Cathie Wood announces space ETF, what about the ASX space sector?
• Signal share price? An Elon Musk tweet and a WhatsApp controversy
• These ASX stocks just got a big upgrade on the back of Tesla (NASDAQ:TSLA)

Sebastian Bowen owns shares of Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends PayPal Holdings, Square, and Tesla and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended PayPal Holdings. 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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ASX gold stocks have lost their shine with investors but this is the time to be snapping up bargains in the sector.

That’s the view of Goldman Sachs who believe these stocks have been oversold despite today’s bounce.

While many ASX gold miners are outpacing the 1.1% jump in the S&P/ASX 200 Index (Index:^AXJO) this afternoon, most are still scrapping the bottom of their six-month trading range.

Why ASX gold stocks have lost their lustre

The bounce back in global economic growth and the start of mass COVID-19 vaccinations in countries like the UK and US have prompted investors to dump safe haven assets for cyclical stocks

This explains why the gold price has been falling over the past few months after hitting a record high of over US2,000 an ounce.

But Goldman Sachs doesn’t think the dip will last. If anything, the broker expects the gold price to shoot towards US$2,300 an ounce as early as this quarter!

New record gold prices for 2021

This is where the gold price is forecast to average for the entire 2021 calendar year. The gold price is currently trading around US$1,825 an ounce, suggesting there is significant upside if Goldman is right.

However, the broker believes the best bang for your investment dollar won’t be with the gold sector leaders. These heavyweights include the Newcrest Mining Ltd (ASX: NCM) share price and Evolution Mining Ltd (ASX: EVN) share price.

“Looking out to 2021, we think companies that can demonstrate production growth and advancing project pipelines in a supportive pricing environment will benefit,” said Goldman.

“We continue to view brownfields production and reserve growth as the clearest opportunity for value creation particularly in the mid-cap space.”

The best ASX gold stock to buy now

The ASX mid-cap gold stock that stands out is the St Barbara Ltd (ASX: SBM) share price. The stock is on Goldman’s “conviction buy” list as it’s trading at a wide discount. The SBM share price stands at around 0.52 times net asset value, or a 39% discount to the sector.

What’s more, the broker believes St Barbara will increase gold production by 36% by FY25 thanks to its brownfield projects.

Other ASX gold shares to buy

Another mid-tier gold producer on Goldman’s list of ASX stocks to buy is the Resolute Mining Limited (ASX: RSG) share price.

Resolute has the best free cashflow (FCF) generation potential among all the gold stocks under Goldman’s coverage. It’s expected FCF yield is 39% for this calendar year and there’s cost and production upside from its various projects.

The third emerging ASX gold stock to watch is the OceanaGold Corp (ASX: OGC) share price. Goldman is urging investors to buy the OGC share price as it’s trading at around a 33% discount to the sector.

The stock is also trading on a decent FCF yield of 11% in 2021 despite having to invest in Waihi and Haile underground projects.

More reading

• Here’s why the Newcrest (ASX:NCM) share price is underperforming
• ASX 200 up 1.2%: Bingo rockets, Rio Tinto update, Domino’s jumps
• 5 things to watch on the ASX 200 on Tuesday
• 3 ASX 200 shares that keep growing their dividends
• Chimeric Therapeutics (ASX:CHM) share price jumps 88% following its IPO

Motley Fool contributor Brendon Lau owns shares of Evolution Mining Limited and Newcrest Mining Limited. Connect with me on Twitter @brenlau.

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

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Shares in Rhythm Biosciences Ltd (ASX: RHY) are soaring higher during early afternoon trade. This comes after the company announced it has added two extra clinical trial sites for its ColoSTAT study.

Rhythm’s ColoSTAT is an experimental test-kit that is being trialled as a low-cost, easy-to-use blood test to detect colorectal cancer.

At the time of writing, the Rhythm share price is advancing 7.5% to $1.43 after reaching an-all time high of $1.47 around midday. In comparison, the All Ordinaries Index (ASX: XAO) is also moving higher, up 1.1% to 7,014 points.

Why is the Rhythm share price climbing?

Rhythm advised today that the Concord Repatriation General Hospital in Sydney’s inner west will participate in the ColoSTAT clinical trial. Run by principal investigator, Dr Emily He, the hospital is internationally recognised for colorectal surgery.

The building services a large portion of the Sydney inner city population, and has become a lead teaching hospital. Conducting more than 50 trials over the last 5 years, the gastroenterology department is understood to have the required skillset to run clinical trials.

The second addition is the Bendigo Cancer Centre inside the Bendigo Hospital, a modern facility equipped with a dedicated clinical trials research unit. The centre participates in both national and international studies associated with cancer trials.

Bendigo Hospital itself caters for a large swath of population towns, covering up to quarter of the size of Victoria. This includes major regional hubs like Mildura, Echuca, Swan Hill, Kyneton, and Castlemaine.

With the recent inclusions, Rhythm now has total number of 9 clinical trials sites testing its ColoSTAT device. The company revealed that both additional trial sites have recruited their first patients for the ColoSTAT study.

Comments from management

Rhythm CEO Glenn Gilbert, welcomed the new additions, saying:

The addition of Concord and the Bendigo Cancer Centre to the ColoSTAT clinical trial continues to build on our momentum toward delivering an important world-leading and mass-market simple blood test for the early detection of colorectal cancer.

Concord Hospital’s Dr He added:

With colorectal cancer now the leading cause of cancer related deaths for 30–35-year-olds in both male and females in Australia, the time is right for a simple and effective blood test for early detection that can be adopted by all ages of the population on a mass scale.

And Dr Sam Harris reiterated the important participation from the Bendigo Cancer Centre, saying:

As a leading regional cancer centre specialising in diagnosing and treating cancer patients, we see first-hand the social, physical and mental impacts that colorectal cancer can have on families, particularly when diagnosed late.

With such low participation rates under the current screening system, we are eager to be part of the development of a new simple blood test that has the potential to increase screening compliance and ultimately save lives.

About the Rhythm share price

The Rhythm share price has accelerated in the last 3 months, reflecting gains of more than 670% for shareholders.

Moving on an upwards trajectory, shares in the company have surged strongly since its 4.1 cent low in March. Today’s rise sees the Rhythm share price hit a new all-time record of $1.47.

More reading

• Why the Bod (ASX:BDA) share price is tracking 5% higher today
• ASX 200 Weekly Wrap: ASX drops despite promises of more US stimulus
• Rhythm Biosciences (ASX: RHY) share price soars 1300% in 6 months
• Why the OptiScan (ASX:OIL) share price is climbing higher
• What’s with the Legend Mining (ASX:LEG) share price 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.

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The Newcrest Mining Ltd (ASX: NCM) share price is having a fun day today. Newcrest shares are up 1.07% at the time of writing to $26.51 a share. But that doesn’t paper over the last few months. The Newcrest share price is down more than 17% over the past year, and almost 28% since early August.

On one hand, one might be able to explain this move by a commensurate fall in the price of gold. Price movements of a resources companies’ underlying commodity are normally what’s to blame for these kinds of moves.

And looking at the gold price, it has been in a downward spiral since August. That was when gold broke it’s all-time high and climbed over US$2,000 an ounce for the first time. Since then, gold has retreated somewhat and is currently buying roughly US$1,840 an ounce today (although the effect has been mollified here in Australia somewhat by our rising dollar).

The simple fact is that demand for ‘safe-haven’ assets like gold is falling. Yes, gold is still at levels considered historically high. But the market is likely anticipating a more stable political environment in the United States come 20 January, as well as a successful coronavirus vaccine rollout over the year ahead. As such, it’s easy to see why investors have taken the gold price off the boil.

Newcrest still underperforms

But Newcrest has seemed to underperform many other ASX gold miners too. So between 6 August and today, Newcrest shares are down approximately 27.9%. Over the same period, Northern Star Resources Ltd (ASX: NST) is down 19%, Saracen Mineral Holdings Limited (ASX: SAR) is down 16.47% and Perseus Mining Limited (ASX: PRU) has lost 24.5%.

To be fair, a couple of gold miners have done worse than Newcrest. Gold Road Resources Ltd (ASX: GOR) is one, Regis Resources Limited (ASX: RRL) is another.

But Newcrest, the ASX’s largest gold digger, has certainly been taking investors’ money a little more than the average gold miner.

So why are investors not too enamoured with Newcrest?

It’s probably a legacy from the woes that this company faced last year. Back in January, Newcrest warned that production might have to be curtailed due to drought. Subsequently,  the company had to undertake a series of planned shutdowns across its network of mines. That timing was unfortunate, considering it coincided with the run-up in the gold price.

It may just be a lack of spotlight too. The ASX gold mining sector has been dominated by news of a blockbuster merger of late.

Northern Star Resources and Saracen are set to merge soon after shareholders of both companies’ overwhelmingly voted in favour of the marriage. If this goes ahead, the newly merged company would be a top 10 global gold miner and second largest on the ASX after Newcrest. Perhaps Newcrest simply looks boring in comparison right now.

Regardless, Newcrest shareholders are probably hoping that the next 6 months will be better than the last 6.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Think you saw growth in 2020? Just wait for 2021: fundie
• ASX 200 Weekly Wrap: ASX drops despite promises of more US stimulus
• 5 things to watch on the ASX 200 on Monday
• Why the Northern Star and Saracen Mineral merger is getting closer

Motley Fool contributor Sebastian Bowen owns shares of Newcrest Mining Limited. 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 JB Hi-Fi Limited (ASX: JBH) share price has continued its positive run on Tuesday.

Earlier today the retail giant’s shares climbed to a new record high of $53.34.

When the JB Hi-Fi share price hit that level, it meant it was up 43% since this time last year.

Can the JB Hi-Fi share price continue to climb higher?

One leading broker that isn’t betting on the JB Hi-Fi share price going higher from here is Goldman Sachs.

According to a note out of the investment bank this morning, the broker has retained its neutral rating and lifted its price target on the retailer’s shares to $51.60.

This follows the release of its guidance for the first half of FY 2021 on Monday.

What did Goldman Sachs say?

Goldman notes that JB Hi-Fi’s first half performance was ahead of its expectations for both sales and earnings growth thanks to the stay at home trend.

And while it is forecasting a strong full year result in August and a better than previously expected result in FY 2022, it is still expecting its earnings to decline next year and then again in FY 2023 as the tailwinds it is experiencing ease.

Goldman said: “JBH has benefited from a strong spending trend in “stay at home” products, but also continues to execute strongly in store and online, remaining at the forefront of technology categories as they continue to deliver growth.”

“We anticipate conditions to remain elevated over 2H21 before normalising back to a more sustainable trend over FY22 and FY23. However, the underlying level of earnings have also been revised upwards in FY22 reflecting the slower decline in conditions than previously anticipated in our forecasts as the outlook for other spending alternatives (e.g. international travel) remain constrained,” it added.

Goldman Sachs is forecasting earnings per share of $4.18 in FY 2021, $3.02 in FY 2022, and then $2.90 in FY 2023. This compares to earnings per share of $2.81 last year.

This means its shares are trading at approximately 18x FY 2022 and FY 2023 earnings, which it feels makes them fully valued at the current level.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• 3 ASX 200 shares that keep growing their dividends
• ASX 200 drops 0.8%
• JB Hi-Fi (ASX:JBH) share price soaring on record sales
• Why Data#3, JB Hi-Fi, Ramsay, & Zip shares are charging higher

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.

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The National Australia Bank Ltd (ASX: NAB) share price is pushing higher on Tuesday.

In afternoon trade the banking giant’s shares are up 1.5% to $24.02.

Why is the NAB share price pushing higher?

Investors have been buying NAB’s shares on Tuesday after analysts at Goldman Sachs took another look at the banking sector and became more positive on its outlook.

According to the note, the broker is expecting housing loan growth to rise towards 5% in the second half of 2021 from the current level of ~3%.

Goldman explained: “Our forecast is for a growth rate of 3.1% through to Mar-21 (flat yoy vs. 2H20) after which we see a gradual rise to 4.9% in Sep-21 and then 5% by CY year end. These expectations are supported by: i) recent mortgage approvals having trended strongly in recent months; ii) the four RBA cash rate cuts since Jun-19; and iii) amortisation of the books remaining broadly unchanged despite expectations of it rising.”

Another positive is that its lead indicator is suggesting that the banks have reached an inflection point for loan impairment expense and this metric is now trending lower. It believes this supports its view that the credit cycle is gradually reverting to long-run levels.

And finally, the broker sees potential for net interest margin (NIM) upside in the short-term.

It commented: “Overall, our expectation is for a negative margin trajectory into FY21E as we currently forecast the majors’ NIM to contract by 5-9bp vs. FY20. However, with the recent deposit pricing trends in mind, we see potential for some upside risk in the shorter-term.”

What does this mean for investors?

After taking all this into account, the broker has reiterated its conviction buy rating on NAB’s shares and lifted the price target on them to $24.72.

Goldman explained: “NAB remains our preferred bank exposure based on: i) our view of better-than-peer revenue growth, supported by superior management of the volume/margin trade-off; ii) investment spend which appears further progressed vs. peers allowing for more selective distribution of resources (contributing to a broadly flat FY21 cost target (c.0-2%)); and iii) when combined, drives our forecast for NAB to deliver top of peer PPOP per share growth. relative NIM performance versus peers.”

And for those interested in dividends, Goldman Sachs estimates that its shares offer a 3.8% FY 2021 yield and a 5.1% FY 2022 yield.

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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 This top broker thinks the NAB (ASX:NAB) share price is a strong buy appeared first on The Motley Fool Australia.

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