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The Bitcoin (CRYPTO: BTC) price has, so far, managed to shrug off news that Elon Musk’s Tesla Motors (NASDAQ: TSLA) has sold some 75% of its holdings of the world’s top crypto.

The digital token is up 1% over the past 24 hours, currently trading for US$23,273 (AU$33,849).

Why did Tesla sell most of its Bitcoin holdings?

The global electric vehicle company released its second quarter report (Q2 2022) yesterday (overnight Aussie time).

In that report, Tesla listed a number of factors that had negatively impacted its year-on-year operating income. Among those, the company named “Bitcoin impairment”.

While apparently having lost money on its crypto venture to date, the sale did add US$936 million to the company’s books.

“As of the end of Q2, we have converted approximately 75% of our Bitcoin purchases into fiat currency. Conversions in Q2 added $936M of cash to our balance sheet,” Tesla stated.

Tesla invested US$1.5 billion into the crypto asset in early February 2021. The Bitcoin price rocketed on the news of Elon Musk’s support of the token, reaching new record highs at the time of just over US$44,000.

With the Bitcoin price skyrocketing in the early months of 2021, Tesla turned around and sold roughly 10% of its holdings in short order, reporting $272 million in proceeds from those sales in its April 2021 quarterly update.

Is this the end of Elon Musk’s love affair with cryptos?

It’s unlikely that Elon Musk will turn his back on cryptos.

According to the world’s richest man, Tesla’s sale shouldn’t be viewed as “some verdict on Bitcoin”.

Rather the electric vehicle company was looking to bolster its cash holdings amid the lingering impacts of the global pandemic.

Josh Olszewicz, head of research at Valkyrie Investments, said Tesla likely sold its Bitcoin holdings for an average price of approximately US$30,000. That leaves the company holding around US$218 million of the crypto at current prices.

According to Olszewicz (quoted by Bloomberg):

Strongly bearish market conditions since the beginning of the year as well as the need for cash on the balance sheet likely contributed to this decision. From a treasury management perspective, downside volatility may have been too unattractive to ignore in the near term.

The post Tesla sells 75% of Bitcoin holdings. Here’s why Elon Musk is unloading appeared first on The Motley Fool Australia.

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More reading

• Tesla share price powers up on 42% revenue jump
• Why is the Core Lithium share price surging 7%?
• Here’s why the Bitcoin and Dogecoin prices are rocketing
• These are the stocks making hay from the Bitcoin price upturn
• Why Tesla stock popped today

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin and Tesla. The Motley Fool Australia has positions in and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Liontown Resources Limited (ASX: LTR) share price has returned from a brief trading pause and is shooting higher.

In afternoon trade, the lithium miner’s shares are up almost 7% to $1.19.

Why is the Liontown share price racing higher?

Investors have been bidding the Liontown share price higher after the company achieved another important milestone.

According to the release, the company has appointed Lycopodium Limited (ASX: LYL) to complete the engineering, procurement, construction management (EPCM) and commissioning services for the Kathleen Valley Lithium Project in Western Australia.

The EPCM contract is valued at approximately $35 million based on the agreed scope. Pleasingly, despite recent cost inflation, it is on terms consistent with the assumptions in the company’s definitive feasibility study. It also includes fixed and reimbursable portions to ensure greater cost certainty for project engineering.

Lycopodium is a familiar face at Liontown. The release notes that it has been involved with the project since 2018 and has substantial global mineral processing and project delivery experience which it will leverage to provide Liontown with an integrated engineering, construction and commissioning solution for delivery of the project.

‘Another significant milestone’

Liontown’s managing director and CEO, Tony Ottaviano, notes that this is another important milestone for the company. He said:

Awarding the EPCM Contract is another significant milestone for Liontown and the development of Kathleen Valley. We are delighted to have appointed a company of Lycopodium’s stature and capability, building on their long-standing involvement with the Kathleen Valley Project in overseeing testwork, piloting and design since 2018.

We believe Lycopodium is an ideal engineering and construction partner, with substantial experience in mineral processing plant design and construction expertise, making it ideally placed to deliver the Project.

The post Liontown share price jumps 7% on ‘significant milestone’ appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX shares today
• Down 40% in 2022: Is the Liontown share price a bargain buy?
• Here are the top 10 ASX shares today
• What’s the outlook for the Liontown Resources share price in FY23?
• Why are these ASX 200 lithium shares tumbling today?

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

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At lunch on Thursday, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small decline. The benchmark index is currently down 0.1% to 6,754.1 points.

Here’s what is happening on the ASX 200 today:

ANZ shares edge lower

The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price is edging lower on Thursday. This follows the completion of the institutional component of the banking giant’s capital raising. ANZ raised gross proceeds of approximately $1.7 billion at a 12.7% discount of $18.90 per new share. These funds are being used for the acquisition of the banking operations of Suncorp Group Ltd (ASX: SUN).

Link accepts takeover offer

The Link Administration Holdings Ltd (ASX: LNK) share price is zooming higher after Dye & Durham agreed to increase its takeover offer again. Dye & Durham has lifted its offer from $4.57 per share to $4.81 per share and Link is recommending shareholders vote in favour of the proposal. Shareholders will also be entitled to a 13 cents per share consideration from the potential sale of Link’s BCM business.

Zip share price higher on Q4 update

The Zip Co Ltd (ASX: ZIP) share price is pushing higher today. Investors have been buying the buy now pay later (BNPL) provider’s shares after responding positively to its quarterly update. Zip reported group quarterly revenue growth of 27% to $160.1 million from its 12 million customers. The company also revealed that it is closing down its Singapore, Zip Business, and Pocketbook businesses. It is also looking at options for other Rest of the World businesses, including the UK.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday has been the Telix Pharmaceuticals Ltd (ASX: TLX) share price with a gain of over 15%. This follows the release of a strong quarterly update. Going the other way, the worst performer has been the Imugene Limited (ASX: IMU) share price with a 5% decline on no news.

The post ASX 200 midday update: ANZ’s capital raising, Link jumps, Zip’s Q4 update appeared first on The Motley Fool Australia.

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More reading

• Telix share price soars 11% following ‘first commercial quarter’
• Link share price jumps 10% on takeover deal
• ANZ share price edges lower after capital raising
• The Imugene share price has rocketed 77% in a month. What’s going on?
• Zip share price up 5% following Q4 update

Motley Fool contributor James Mickleboro has positions in TELIXPHARM DEF SET. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Link Administration Holdings Ltd and ZIPCOLTD FPO. 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 Scott Phillips.

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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.

Netflix (NASDAQ: NFLX) investors were able to exhale after the streaming service announced its second-quarter results on Tuesday afternoon. The stock initially moved higher, after the market was encouraged to see Netflix lose less than half of the subscribers that the platform thought it would shed sequentially during the period.

There is certainly some long overdue relief to Netflix losing only 970,000 net subscribers between the end of March and the conclusion of June. Back in April, Netflix was bracing investors for two million net defections. However, there is more to this relative success story — and subscriber guidance — than meets the eye. Let’s take a closer look.

Stranger danger things

It didn’t take long for bears to point out the soft spots in the financial update. If Netflix held up better than expected on the subscriber front, why did reported revenue fall short of the company’s own guidance?

If sequential subscriber growth is returning in the current quarter after back-to-back periods of sequential declines, why is Netflix’s outlook for the third quarter less than what Wall Street pros are modeling?

Things aren’t as bad as the naysayers’ questions suggest. Let’s start with the “miss” for the second quarter. Netflix was targeting 9.7% in year-over-year revenue growth. The top line only rose 8.6% on a reported basis, but that’s not the whole story.

This is a global juggernaut, as more than half of its revenue is now being generated overseas. With the dollar surging against most global currencies, there will be a lot, literally, lost in the translation. Netflix points out that there was a $339 million negative foreign currency impact on the top line in the second quarter. Back that out and revenue would’ve risen a better-than-expected 13% on a constant currency basis. 

Guidance for the current quarter is less than where analysts are perched, but that also is a matter of foreign exchange swings that are beyond the scope of Netflix’s springtime prognostication skills.

The third quarter seems uninspiring beyond the return to net additions for the first time in 2022, but it’s not as bleak as the headline numbers may suggest.

Netflix is eyeing 221.67 million streaming paid memberships worldwide by the end of September. This is a million more than the current count, but it’s still just shy of the 221.84 million accounts it had on its books when the year began. 

The new subscriber goal is just 3.8% higher than where Netflix was at that point last year. It’s a historical low, but this naturally includes the back-to-back quarters of net defections the platform experienced through the first half of this year.

The 4.8% year-over-year increase in revenue that it’s targeting for the third quarter is short of the 8% that analysts were modeling, but — again — the strong dollar blurs the passport picture here. On a constant currency basis, Netflix expects its revenue to rise 12% for the current quarter.

The exchange rate blizzard blows through the income statement, as its forecast of a 29% decline in operating profit would be just a 3% dip. Operating margin would be at 20% instead of the implied 16% in its outlook. 

In short, it’s not as bad as it seems. It’s also important to frame things in the right light. I’ve seen a couple of boobirds online point out the audacity of Netflix stock rising despite the company shrinking its audience by nearly a million subscribers.

The obvious counter is that Netflix was expecting to lose more than twice as many paid memberships, but there’s a better argument. Netflix stock was at $348.61 three months ago, minutes before the company announced it would lose two million net subs for the upcoming quarter. Netflix poking its head above $200 on Wednesday isn’t a victory lap. 

Netflix has a long way to go, and the good news is that it’s far from complacent right now. The launch of an ad-supported tier should help it retain cost-conscious subscribers.

Starting to crack down on password sharing — through Latin America, initially — could backfire, but if it works, there could be a new higher-priced tier for multi-household families or splits that translate into membership growth.

Netflix is still the king of the hill when it comes to streaming service stocks, and this week’s mixed report is actually better than it seems on most fronts. 

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

The post Netflix still has a long way to go appeared first on The Motley Fool Australia.

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More reading

• Why did the Netflix share price lift despite losing 970,000 subscribers?
• The end of ‘Stranger Things’ might actually be a boost for Netflix
• Betting against Netflix now could be a big mistake
• Should you invest in stocks right now? These 2 charts say yes
• Better bear market buy: Netflix vs Amazon

Motley Fool contributor ick Munarriz has positions in Netflix. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Netflix. The Motley Fool Australia has recommended Netflix. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

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The Domino’s Pizza Enterprises Ltd (ASX: DMP) share price is 3% higher in morning trading today. It’s currently fetching $74.85 per share and is up 17.2% over the past month.

The increasingly global fast food business has been growing in size for many years. But the Domino’s share price has more than halved in the past year. It’s down around 55% since mid-September 2021.

One of the benefits of a lower share price is that it boosts the prospective dividend yield for new investors. Not only that, Domino’s has some grand plans for company growth, which in turn could raise profits and dividends for shareholders.

Domino’s has long been seen as an ASX growth share, but could it become an ASX dividend share, too?

A decade of growth in Domino’s dividends

Domino’s can point to a decade of growth in its dividend over the past 10 years.

Most recently, the company decided to maintain its interim dividend for FY22 at the same level as FY21. This followed a 5.3% fall in underlying net profit after tax (NPAT) to $91.3 million in the first half of FY22.

Based on the past 12 months of dividends, Domino’s has a grossed-up dividend yield of about 3% at the current share price.

If the company grows its earnings over the long term, I think the dividend can rise as well.

Looking at CMC Markets’ estimate for the Domino’s dividend in FY24, it suggests long-term growth.

CMC has projected a potential grossed-up dividend yield of 3.7% in FY24 due to higher earnings by then.

Why the earnings of Domino’s could rise

The food business is employing a few key tactics to help it grow its earnings into the future.

Growing into new international markets has been a big boost for the scale of the business over the years. Domino’s recently added its tenth market, Taiwan, which brought 156 stores to the overall network.

The company has two longer-term goals. Over the next three to five years, it wants to grow its new store openings by 9% to 12% per annum and increase same-store sales by between 3% to 6%.

To put some numbers on it, the Asia Pacific region currently has 1,959 stores. Domino’s wants to grow this to 3,600 (a collective increase for the region of 83.8%). In Europe, it has 1,368 stores and wants to grow this to 3,050 (up 123%).

Domino’s believes that the growth of digital and delivery will help the company achieve the growth it’s looking for. The company notes that delivery is the fastest growing part of the fast food market.

The company thinks that increased scale will help in a number of ways. This includes growing advertising funds and reducing the cost of delivery. It says that shorter run times mean more profitable deliveries.

It believes that a reduction of delivery costs by a third is possible in every market.

What’s happened to the Domino’s share price in 2022?

The Domino’s share price is down nearly 40% in the year to date.

A falling share price automatically lifts the dividend yield, as long as the company can maintain the same level of payments to shareholders.

Foolish takeaway

According to CMC, the Domino’s share price is valued at 27 times FY24 estimated earnings.

While not as cheap as it was in June, I think this represents an attractive entry point for long-term investors.

FY24 and beyond look like good years for dividend growth.

The post Why I think Domino’s can deliver as an ASX dividend share appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy next week
• What I’d do with 3 ASX shares that have plunged this year: expert
• Here are the top 10 ASX shares today
• Why Costa, Domino’s, EML, and Novonix shares are dropping
• Domino’s share price drops 5% on bearish broker note

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Telix Pharmaceuticals Ltd (ASX: TLX) share price is pushing higher in trade today.

At the time of writing, the share is trading more than 11% in the green at $6.21 apiece.

Investors are bidding up the Telix share price following the release of its quarterly cash flow statement and activities report for the quarter ended 30 June 2022.

Telix reports 10x revenue increase in Q4

• Total revenue of $22.5 million from global sales of Illuccix in its first commercial quarter, 10x increase on previous quarter
• Cash balance of $122 million
• Cash inflows of $5.4 million, up from around $2 million in the previous quarter
• $17.4 million invested in R&D, manufacturing and clinical development activities
• Telix reports it has 5.5 quarters of cash based on net cash used in operations in the June 2022 quarter

What else happened for Telix last quarter?

It was the commercial launch of Illuccix in the US. Telix distributed the product to 140 pharmacies across pharmacy networks in America.

Illuccix (aka TLX591–CDx) is Telix’s prostate imaging product. The company notes that Illuccix commercial sales revenue from the US between 14 April and 30 June 2022 was USD$13.6 million (AUD$19.3 million).

Telix also completed enrolment for its ZIRCON Phase III kidney cancer imaging trial. It now has 300 patients dosed, per the release.

It also signed an in-licence agreement with Lilly to develop the antibody Olaratumab “as a diagnostic and therapeutic radiopharmaceutical agent”.

New Group CFO, Darren Smith, was also appointed into his role, to take effect on 1 August 2022.

Management commentary

Speaking on the results, Telix Managing Director and Group CEO, Dr Christian Behrenbruch said:

The U.S. commercial launch of Illuccix is off to a strong start. This result reflects the efficacy of our differentiated business model in a large and growing market. We’ve delivered doses across the entire country, demonstrating the value of our nationwide pharmacy distribution partnerships and with industryleading on-time delivery.

We are meeting the needs of our customers and patients through reliable service delivery, flexible scheduling and wide accessibility to PSMA-PET imaging. With reimbursement effective 1 July, we expect to see Illuccix revenues grow considerably.

Telix share price snapshot

In the past 12 months, the Telix share price has clipped a 19% gain. A bulk of this was seen in the past month of trade, with shares up 50% in that time.

The post Telix share price soars 11% following ‘first commercial quarter’ appeared first on The Motley Fool Australia.

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More reading

• How did ASX biotech shares perform in FY22?
• Bell Potter names 2 of the best ASX healthcare shares to buy in FY23

Motley Fool contributor 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 Scott Phillips.

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The Tesla Inc (NASDAQ: TSLA) share price is rising today on the back of the electric vehicle giant’s quarterly results.

Tesla shares are climbing 1.45% in after-hours trade on the Nasdaq Composite (NASDAQ: .IXIC) to $753.30 at the time of writing. On Wednesday in the United States, Tesla shares climbed 0.8% to $742.50.

Let’s take a look at what Tesla reported to the market.

Tesla reports quarterly results

Highlights of the Tesla Q2 2022 results include:

• Total revenue of $16.93 billion, up 42% year on year, down 10% on the previous quarter
• Net GAAP income of $2.26 billion, up 98% year on year, down 32% on the previous quarter
• Total gross profit of $4.2 billion, up 47% year on year but down 22% on the previous quarter
• Adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $5.023 billion
• 14.6% operating margin
• Cash of $18.9 billion
• Adjusted earnings per share (EPS) of $2.27

What else did Tesla report?

Elon Musk’s Tesla produced 258,580 vehicles in quarter two, up 25% year on year but down from 15% in the previous quarter. Of these vehicles, 254,695 were delivered.

The company made “significant progress” in the second quarter. However, there were also challenges, including shutdowns, global supply chain disruptions, and labour shortages.

Shanghai was shut down for most of the quarter, limiting production. However, to end the quarter, Tesla achieved record monthly production in Shanghai.

In the US, the Fremont Factory produced record vehicle numbers in the second quarter.

New factories in Berlin-Brandenburg and Austin ramped up in the quarter. In one week, Tesla managed to produce more than 1,000 vehicles at the Berlin gigafactory.

Energy storage deployments fell 11% year on year, while solar distribution jumped 25% year on year.

Tesla converted 75% of its bitcoin purchases into fiat currency, adding $936 million to the cash balance sheet.

What’s ahead?

In what could spell good news for the Tesla share price, the company said recent upgrades in Shanghai will lift the production rate from this factory in the future.

In Europe, Tesla can see the production rate increasing through the year.

In the US, Tesla sees opportunity to boost production rates. For example, in Texas, the company can now produce vehicles with either structural batteries or legacy battery. Tesla added:

The next generation of 4680 battery cell machinery has been installed in Texas and is in the process of commissioning. Factory output in Texas continues to grow.

Overall, Tesla is planning to boost manufacturing as “quickly as possible”. The company is forecasting it can achieve a 50% increase in the average annual growth rate of vehicle deliveries.

Commenting on the overall outlook, Tesla said:

We have sufficient liquidity to fund our product roadmap, long-term capacity expansion plans and other expenses.

The pace of production ramps in Austin and Berlin-Brandenburg will be influenced by the successful introduction of many new product and manufacturing technologies in new locations and ongoing supply chain related challenges.

Tesla share price snapshot

The Tesla share price has jumped 13% in the past year, while it has fallen 38% year to date. However, in the past month, Tesla shares have climbed 4%.

For perspective, the Nasdaq Composite has lost 19% in a year and nearly 25% year to date.

The post Tesla share price powers up on 42% revenue jump appeared first on The Motley Fool Australia.

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More reading

• Why is the Core Lithium share price surging 7%?
• Why Tesla stock popped today
• What’s in store for the BetaShares NASDAQ 100 ETF in the next 12 months?
• GameStop finally announced its stock split. The MOASS still isn’t coming
• What Tesla’s production slowdown could mean for its stock

Motley Fool contributor Monica O’Shea has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Tesla. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Santos Ltd (ASX: STO) share price is in the red after the company released its latest quarterly earnings, detailing record first half production, revenue, and cash flow.

Shares in the ASX oil and gas share have fallen 0.24% to trade at $7.37 at the time of writing.

Santos share price dips despite record first half

Here are the key takeaways from Santos’ June quarter:

• Quarterly revenue of around US$1.88 billion – 74% higher than that of the prior comparative period
• First half revenue came to a record US$3.77 billion – 85% higher than the same period of 2021
• Produced 25.5 million barrels of oil equivalent (mmboe) in the quarter – a 2% drop on that of the March quarter
• First half free cash flow came to US$1.7 billion – a 199% increase

The company’s revenue for the June quarter was flat with the previous quarter’s as higher commodity prices offset lower sales.

Meanwhile, the company’s oil production slipped due to natural field decline at Bayu-Undan and planned maintenance outages at PNG LNG, Darwin LNG, and the Cooper Basin. Though, its production jumped 9% to 51.5 mmboe over the six months ended June.

Santos’ sales volume came to 27.5 mmboe last quarter – a 2% drop. It increased 4% over the first half, coming in at 55.7 mmboe.

Finally, Santos achieved sustaining annual merger synergies of US$95 million in the first six months of its marriage to Oil Search. It previously targeted maximum synergies of US$115 million.

What else happened in the quarter?

The Santos share price slipped 4% over the second quarter, outperforming the S&P/ASX 200 Index (ASX: XJO) by 8%.

The major news from the company in that time came in mid-April. Then, Santos announced a US$250 million on-market share buyback.

As of the end of June, US$174 million of the buyback had been completed.

Additionally, the company’s Barossa project is 40% complete, on schedule, and on budget. Meanwhile, its Pikka Phase 1 project in Alaska has advanced front end engineer design (FEED) work and is ready for a final investment decision.

Looking to the greener end of the business, Santos’ Moomba carbon capture and storage (CCS) project is 18% complete, on schedule, and on budget. Progress is also being made on the Bayu-Undan CCS project.

What did management say?

Santos managing director and CEO Kevin Gallagher commented on the news driving the company’s share price today, saying:

Santos is positioned as a leading and reliable LNG supplier into Asia and we are well placed to take advantage of growing Asian demand for LNG, which is forecast to double by 2050.

Our new capital management framework announced in April combined with strong free cash flows position us well to provide returns to shareholders at the half-year results in August.

What’s next?

The Santos share price might be being weighed down by the company’s newly updated guidance.

It now expects to produce between 102 mmboe and 107 mmboe in 2022. That’s relatively in line with its previous production guidance of between 100 mmboe and 110 mmboe.

On top of that, Santos has lowered its production cost guidance to between US$7.90 and US$8.30 per barrel.

However, the company has also dropped its sales guidance. It now expects to sell between 110 mmboe and 116 mmboe this year. Previously, its top line guidance was 120 mmboe.

Santos share price snapshot

The Santos share price has outperformed the broader market so far this year.

It has gained around 11% year to date. It’s also currently nearly 12% higher than it was at this point last year.

Meanwhile, the ASX 200 has slipped 11% year to date and 7% over the last 12 months.

The post Record-breaking: Santos share price slips despite 85% jump in half-year revenue appeared first on The Motley Fool Australia.

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More reading

• ‘Not enough’: Could Europe’s gas woes bolster ASX 200 energy shares?
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• Why is the Santos share price on such a tear today?
• Why are ASX 200 energy shares having such a stellar Tuesday?

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 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 Scott Phillips.

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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.

Could a class action lawsuit filed against the creators and early investors in Solana (CRYPTO: SOL) impact your ability to invest in crypto?

Some commenters worry it might. A new lawsuit circulates around the question of whether cryptocurrency is a security. 

Alleging that the defendants were involved in illegal securities trading, the suit could be a harbinger of disruptive rulings revisiting whether crypto is a security and whether non-accredited investors can participate – or it could be a nothingburger.

Although this suit uses some of Solana’s problematic features to argue it is a security, many similar lawsuits have been filed against various crypto entities and businesses using similar lines of reasoning.

The gist of the complaint: Solana is a centralized security, and its creators misled the public in order to profit 

On 1 July, a class action lawsuit was filed against Solana Labs, the Solana Foundation, Solana Labs CEO Anatoly Yakovenko, the venture capital firm Multicoin Capital, and its CEO, Kyle Samani.

Filed by lead plaintiff Mark Young “on behalf of all investors who purchased Solana tokens,” the suit alleges that Solana Labs’ negotiations prior to their initial coin offering (ICO, the crypto world’s equivalent of an IPO) constitute multiple violations of the Securities Act. 

Deploying the Howey test (a court precedent for determining whether something is an investment contract), the suit alleges that SOL is an unregistered security. The suit claims the defendants used a series of negotiations to sell lots of SOL among themselves at rock-bottom prices, and then chose to sell relatively few SOL at much higher prices during the public ICO in order to maintain control over the platform before dumping SOL on gullible investors.  

The core questions in the lawsuit relate to both the specifics of Solana and to crypto investing in general – and that is what concerns some crypto commenters.

The complaint alleges that Solana creators used a series of private deals and their ICO to deliberately centralize and consolidate control of both the tokens and the network infrastructure. Many have criticized Solana for its centralization: Its network and governance structures make it possible for some stakeholders to have more power than others.

However, the broader legal argument suggests that purchasing almost any cryptocurrency with an expectation of profit would meet the threshold of a security — and that the average retail investor lacks the knowledge and skills to make an informed investment.

The lawsuit could have major implications for retail crypto investing

Any class action lawsuit hitting the developers of one of the top 10 cryptocurrencies will turn heads. But one thing about this case that has particularly concerned commenters is that it rests on the argument that Solana is a security.

This classification is more than pedantic hair-splitting: For decades, American courts have used the Howey test to evaluate whether a transaction is a security.  

Many lawsuits have claimed that various crypto entities operate as securities. However, U.S. law generally considers crypto to be a commodity, so it falls under the purview of the Commodities Futures Exchange Commission (CFTC).

There would be many implications if this classification changes, but one of the most direct potential consequences could be restrictions in which kinds of investors can purchase crypto or participate in ICOs. 

It’s important to know that only accredited investors – wealthy individuals with a specific license and high net worth – can purchase certain types of investments. The mere idea of accredited investors is anathema to many who see crypto as a way to even the financial playing field. 

Plus, many businesses in the crypto sector, such as Coinbase (NASDAQ: COIN), use a business model that relies on retail investors to provide revenue.  

Yet many of the lawsuits claiming that crypto is a security rest on the argument that creators defrauded unsophisticated investors.  

That’s why any legal proceeding that threatens to change this status quo could have ramifications that “ripple” beyond Solana. Ripple (CRYPTO: XRP) is already embroiled in a similar lawsuit with the SEC, and legal experts involved with that case are already warning that if Ripple loses, the case could transform the crypto sector.

But then again, maybe it won’t

The Solana suit is hardly breaking new legal ground: As of May 2022, there had been at least 200 lawsuits concerning cryptocurrency, many of which alleged that crypto creators defrauded investors by illegally selling securities.  

Though the initial complaint never specifies whether the plaintiff was an accredited investor, Young purchased more than $117,000 USD of Solana in August and September last year via altcoins such as Cardano and Ethereum.  While nobody wants to watch a $117,000 investment plummet in value, it is also probably more than most retail investors are able to invest in crypto.

The complaint’s emphasis on the defendants’ use of Twitter to promote Solana also suggests that the plaintiff, or others in the class of plaintiffs, might have influenced their investment decisions. 

No matter how this lawsuit turns out, this is a great occasion to remind yourself that all investments carry risk, crypto is highly volatile, and you should only invest in proportion to your risk tolerance.

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

The post Solana Foundation slapped with class action lawsuit alleging SOL is a security appeared first on The Motley Fool Australia.

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More reading

• Shiba Inu, Dogecoin, Solana surge higher: Where are meme coins headed from here?
• Is “Solana Summer” (Finally) upon us?

Fool contributor Miranda Tedholm owns Solana. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Coinbase Global, Inc., Ethereum, Solana, and Twitter. The Motley Fool Australia owns and has recommended Solana and Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

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The Link Administration Holdings Ltd (ASX: LNK) share price is having a strong day on Thursday.

In morning trade, the administration services company’s shares are up 10% to $4.36.

Why is the Link share price surging higher?

Investors have been scrambling to get hold of Link shares this morning after the company provided another update on its takeover saga.

But as you might have guessed from the Link share price reaction, this update is potentially a good one for shareholders.

According to the release, Dye & Durham has revised its base scheme consideration to $4.81 per share. While this is lower than the original base scheme consideration of $5.50 per share, it is higher than its recently revised offers of $4.30 per share and $4.57 per share.

In addition, Link shareholders remain entitled to receive net consideration of up to 13 cents per share from the sale of the Banking and Credit Management (BCM) business. This is if the business is sold and proceeds are received up to 12 months after the implementation of the revised scheme.

Dye & Durham has advised that it will shortly appoint financial advisers to sell Link BCM business and will commence this process immediately following implementation of the revised scheme.

Offer recommended

The Link board is unanimously recommending that shareholders vote in favour of the revised scheme in the absence of a superior proposal and subject to the independent expert concluding that it is fair, reasonable, and in the best interests of shareholders.

Subject to the same qualifications, each Link director intends to vote in favour of the revised scheme at the forthcoming scheme meeting.

Though, the deal will still require approval from the courts, regulators, and other customary conditions.

The post Link share price jumps 10% on takeover deal appeared first on The Motley Fool Australia.

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More reading

• Link share price higher amid takeover and guidance update
• Here are the top 10 ASX shares today
• Why Chalice Mining, Damstra, Link, and Pinnacle shares are storming higher
• Link share price jumps 7% on beefed up takeover bid
• Why Audio Pixels, Lake Resources, Link, and Magellan shares are dropping

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Link Administration Holdings Ltd. 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 Scott Phillips.

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