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The Woodside Energy Group Ltd (ASX: WDS) share price is rising today amid higher oil prices.

Woodside shares are currently swapping hands at $32.395, a 3.5% gain. For perspective, the S&P/ASX 200 Energy Index (ASX: XEJ) is also up 2.87% today.

So why are Woodside shares having such a good day?

Oil prices leap 5%

Oil prices jumped more than 5% in US markets on Monday, Reuters reported. Brent crude oil leapt 5% to $106.27 a barrel, while US West Texas Intermediate (WTI) crude oil futures gained 5.1% to $102.60 per barrel.

The oil price rose on dollar weakness and amid speculation the US Federal Reserve could raise interest rates by 75 basis points, rather than 100 points.

In comments, cited by the publication, energy consultancy Ritterbusch and Associates LLC president Jim Ritterbusch said:

Today’s strong advance resulted largely from a sizable and broad-based weakening in the U.S. dollar that has been providing a key driver behind daily oil price swings during the past several weeks.

Woodside is a major oil producer. Fellow ASX oil shares Santos Ltd (ASX: STO) and Beach Energy Ltd (ASX: BPT) are also up 2.72% and 3.79% respectively at the time of writing.

Today’s oil price rise could also have been impacted by news Saudi Arabia cannot promise to boost its oil supply. In an ANZ research note, economist Steven Gregorius said:

Crude oil rallied after Saudi Arabia declined to make any promises about future output increases. Saudi ministers insisted any decision would be dictated by market conditions, following US President Joe Biden’s visit.

Woodside share price snapshot

The Woodside share price has gained 45% in the past year, jumping nearly 48% this year to date.

For comparison, the S&P/ASX 200 Energy Index (ASX: XEJ) is up 28% in the past year and 29% year to date.

Woodside has a market capitalisation of about $61.5 billion based on the current share price.

The post Why is the Woodside share price leaping today? appeared first on The Motley Fool Australia.

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More reading

• Why is the Woodside share price having such a strong start to the week?
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• Why Galileo Mining, Platinum, Sezzle, and Woodside shares are dropping

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 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.

What happened

The entire cryptocurrency market is rallying today, with more defensive and higher-beta tokens trading higher almost in lockstep. For meme tokens Shiba Inu (CRYPTO: SHIB) and Dogecoin (CRYPTO: DOGE), 24-hour price increases of 15% and 6.5% as of 12:45 p.m. ET, respectively, reflect increasingly bullish sentiment in the crypto sector. As a gauge for retail investor interest, these tokens are often looked to as directional indicators of where the market may be headed. 

Shiba Inu’s surge appears to be related to a recent community vote to reduce mining rewards with the network’s upcoming Layer 2 blockchain, Shibarium. Similarly, Dogecoin is seeing interest surge ahead of its Dogecoin Core 1.14.6 release, which is intended to harden node and network security while also incorporating fixes and adjusting rewards on the network.

Solana (CRYPTO: SOL), while not a meme coin in its own right, does have one meme token on its blockchain investors are watching. Solana-based Samoyedcoin is also up approximately 7% over the past 24 hours, at the time of writing, as investors look for high-leverage options to gain exposure to this crypto rally today. 

So what

Amid the fallout from other high-yielding projects, and those offering rewards many now view as unsustainable, the moves Shiba Inu and Dogecoin have made to reduce rewards and focus on network stability certainly make sense.

The saying “if it’s too good to be true, it probably is” has taken on a whole new meaning in the crypto world. At the end of the day, rewards come from somewhere, and whether it’s inflation from minting new tokens, or Ponzi-like structures that only work when prices go up, crypto investors certainly have reason to worry about projects over-offering rewards.

Now what

Meme tokens remain among the most volatile and high-risk assets investors can consider for their portfolios. While there’s certainly more developer activity being seen with the likes of Shiba Inu, Dogecoin, and other projects, the ultimate valuation investors can place on the real-world utility generated from these projects likely remains negligible. Accordingly, aside from bullish investor sentiment, there really aren’t many fundamental drivers that can take these tokens higher over the long term.

That might change, but for now, investors may want to view these tokens as ultrasensitive gauges of investor sentiment. In today’s session, that means some nice near-term rallies in these tokens. However, if the selling pressure isn’t over, investors may want to prepare for more downside risk in the medium term with these dog-inspired tokens. 

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

The post Shiba Inu, Dogecoin, Solana surge higher: Where are meme coins headed from here? appeared first on The Motley Fool Australia.

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More reading

• Is “Solana Summer” (Finally) upon us?
• What’s going on with the Dogecoin price?
• What one tech guru thinks of the current crypto market
• Why Bitcoin, Ethereum, and Dogecoin are down today
• These 3 cryptos are feeling the Elon Musk effect today

Chris MacDonald has positions in Solana. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Solana. The Motley Fool Australia owns and has recommended Solana. 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 BHP Group Ltd (ASX: BHP) share price is pushing higher on Tuesday.

In morning trade, the mining giant’s shares were up 2.5% to $37.93.

The BHP share price has since pulled back but remains up 0.7% to $37.22 at the time of writing.

Why is the BHP share price rising?

The BHP share price is rising on Tuesday after investors responded positively to the mining giant’s fourth quarter update.

For the three months ended 30 June, BHP reported an 8% increase in iron ore production to 64.2Mt and a 25% quarter on quarter increase in copper production to 461.8kt.

This brought the Big Australian’s full year production to 253.2Mt and 1,573.5kt, respectively, for iron ore and copper, which was in line with guidance. It also allowed BHP to deliver record full year sales volumes from its iron ore business in Western Australia.

According to a note out of Macquarie, its analysts were pleased with BHP’s performance during the June quarter. The broker highlights that the mining giant’s iron ore production was in line with its expectations, whereas copper and energy coal production were ahead of them.

What about revenue and earnings?

No details were provided in respect to revenue or earnings expectations for FY 2022.

However, BHP did provide investors with a summary of the average prices it received for its major commodities during the year. They were as follows:

• Copper price up 9% to US$4.16 per pound
• Iron ore price down 13% to US$113.10 per tonne
• Metallurgical coal price up 225% to US$347.1 per tonne
• Thermal coal price up 271% to US$216.78 per tonne
• Nickel price up 43% to US$23,275 per tonne

What is expected from BHP’s full year results?

The team at Macquarie is currently expecting BHP to report revenue of US$65.93 billion and EBITDA of US$39.96 billion in FY 2022. This represents a year on year increase of 8.4% and 6.9%, respectively.

Macquarie is expecting this to underpin a fully franked US$2.93 per share full year dividend. Based on the current BHP share price and exchange rates, this will mean a massive 11.5% yield for investors.

Pleasingly, the broker expects another big yield next year. It is currently forecasting a 4 US cents increase to BHP’s dividend in FY 2023 to US$2.97 per share.

The post BHP share price climbs amid record year for iron ore appeared first on The Motley Fool Australia.

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More reading

• BHP share price on watch after ‘strong fourth quarter’
• 5 things to watch on the ASX 200 on Tuesday
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why BHP, Jumbo, Pendal, and Rio Tinto shares are sinking today
• These ASX 200 mining shares are getting buried. What’s happening?

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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The Magellan Financial Group Ltd (ASX: MFG) share price is in the red in early trading on Tuesday following a company announcement.

At the time of writing, the fund manager’s shares are down 0.9% to $12.05 apiece.

In comparison, the S&P/ASX 200 Index (ASX: XJO) is also edging lower by 0.35% to 6,663 points.

What did Magellan announce?

In a statement to the ASX, Magellan advised that David George will join the board of the company. George was previously announced as Magellan’s CEO and managing director.

George’s addition to the board, as well as the board of Magellan Asset Management (the main operating subsidiary), will take effect today.

This comes as Magellan co-founder Hamish Douglass will resume working with the business in a new consultancy role.

In that function, Douglass will be tasked with providing valuable investment insights, including geopolitical and macroeconomic views, to Magellan.

He is expected to commence the position on 1 October 2022.

Magellan chair Hamish McLennan said:

We welcome David to the Board of Magellan in his role as CEO and Managing Director of the Company. His investment management experience brings deep expertise and a fresh perspective to the Board.

Magellan’s new CEO David George added:

I am excited to join Magellan as CEO. This is an important period for Magellan to demonstrate value to clients and shareholders, and I am confident we will deliver the strategy and strong investment performance to support this.

I look forward to working with the Magellan Board as we restore growth to the business.

It appears the broader market may be dragging down the Magellan share price today after overnight losses were recorded on Wall Street.

About the Magellan share price

Tough trading conditions mixed with wider market volatility have led the Magellan share price to sink 43% in 2022.

The company’s shares are also down 77% over the past 12 months.

The Magellan share price reached a multi-year low of $11.38 last Friday – a level not seen since August 2014.

Magellan commands a market capitalisation of around $2.22 billion.

The post ‘Important period’: Here’s why the Magellan share price is shedding today appeared first on The Motley Fool Australia.

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More reading

• Is the Magellan share price on course for a recovery in FY23?
• Here are the top 10 ASX shares today
• Why Collins Foods, GQG, Magellan, and SkyCity shares are dropping
• Here’s why the Magellan share price is sinking 6% today
• 5 ASX dividend shares with the highest yields in FY22

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

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The Megaport Ltd (ASX: MP1) share price has struggled year to date, but could this earnings season be a turning point?

The technology company’s share price has slid 66% since the beginning of the year. In early trade on Tuesday, the Megaport share price is down 7.4% to $6.26.

Let’s check the outlook for the Megaport share price.

What could be ahead for Megaport?

Megaport is among multiple shares Goldman Sachs equity strategist Matthew Ross believes are cycling “very strong revenue comparisons” this earnings season, according to a report in The Australian.

Other companies he named included NextDC Ltd (ASX: NXT), City Chic Collective Ltd (ASX: CCX), Reliance Worldwide Corp Ltd (ASX: RWC), Carsales.com Ltd (ASX: CAR), and Altium Ltd (ASX: ALU).

Ross expects these companies to report strong revenue in the second half of the financial year despite margin pressures, according to the publication.

Commenting on the outlook for the earnings season at a broader level, Ross said:

Coming out of the pandemic many firms have seen margins expand given the combination of strong demand and short supply, but as disposable income comes under more pressure and supply returns, we expect margins will start to normalise.

Megaport is due to release its quarterly report prior to market open on Wednesday.

Meanwhile, Firetrail analysts are optimistic about the outlook for Megaport and have added the company’s shares to their fund. A recent change to the Megaport’s sales model could add “significant value”, according to the analysts.

In a memo, the Firetrail team said:

The fund has added capital to the Megaport position on the back of the share price weakness and our conviction in the medium-term outlook for the company.

Megaport share price

The Megaport share price has fallen more than 60% in the past year. However, in the past month, it has jumped 21%.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has lost 9% in the past year.

Megaport has a market capitalisation of just under $1 billion based on the current share price.

The post What’s in store for the Megaport share price this earnings season? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX shares we just bought that everyone’s underestimating: fund
• ASX 200 midday update: ANZ to buy Suncorp Bank for $5bn, Whitehaven Coal’s update
• Brokers name 3 ASX shares to buy today
• Broker names 2 ASX tech shares to buy in July
• Why Block, Megaport, Navigator Global, and Whitehaven Coal shares are rising

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 Altium, MEGAPORT FPO, and Reliance Worldwide Corporation Limited. The Motley Fool Australia has recommended MEGAPORT FPO, Reliance Worldwide Corporation Limited, and carsales.com 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 QBE Insurance Group Ltd (ASX: QBE) share price is seeking direction in early trade.

Shares in the S&P/ASX 200 Index (ASX: XJO) insurer closed yesterday at $11.68 and are currently trading for $1.73, down 0.3% after earlier posting small gains.

This comes as investors digest the latest news on the company’s remediation plans.

What remediation update was announced?

The QBE share price is in the green after the company reported on the results of its ongoing review of policy pricing promises dating back several years.

The appraisal is part of a wider industry review by the Australian Securities and Investments Commission (ASIC) and covers a number of different policy administration systems and products.

While the insurer said work is continuing, it’s reported the initial finding to ASIC and will continue to work with the regulatory body to make sure impacted customers are remediated “as quickly as possible”.

QBE said it will record a US$75 million (AU$110 million) pre-tax provision in the second half of the 2022 financial year (1H22) to cover the remediation along with interest and administration costs for the program. This amount will not be included in the management basis underwriting result.

Commenting on the review, QBE CEO, Andrew Horton, said:

We are disappointed by the findings of the review and apologise to those of our customers who have been impacted. We are working promptly to close out our process, and remediate impacted customers.

The ASX 200 insurer is due to deliver its 1H22 results on 11 August. The company said it will update the market with further details at that time.

QBE share price snapshot

The QBE share price has seen its share of ups and downs over the past 12 months, but overall has come out as a strong performer, up 11% since this time last year.

By comparison, the ASX 200 is down 8% over the full year.

At the current share price, QBE pays a trailing dividend yield of 2.6%, 10% franked.

The post Here’s what’s moving the QBE share price on Tuesday appeared first on The Motley Fool Australia.

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More reading

• 2 excellent ASX dividend shares rated as buys by experts
• Broker names 2 ASX 200 financials shares to buy

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 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 Mesoblast limited (ASX: MSB) share price is racing higher on Tuesday morning.

At the time of writing, the biotech company’s shares are up 14% to 97.5 cents.

Why is the Mesoblast share price racing higher?

Investors have been bidding the Mesoblast share price higher on Tuesday following the release of a positive update on the biotech company’s rexlemestrocel-L product candidate.

According to the release, rexlemestrocel-L delivered an improvement in left ventricular ejection fraction (LVEF) at 12 months after a single intervention in the 565-patient randomised controlled trial in New York Heart Association (NYHA) class II/III chronic heart failure (CHF) with reduced ejection fraction (HFrEF).

The release highlights that the improvement in LVEF was most pronounced in the setting of inflammation and preceded a long-term reduction in major adverse cardiovascular events (MACE) and associated recurrent hospitalisations for non-fatal heart attack or stroke.

In respect to the latter, the trial reported a 68% reduction in the rate of recurrent hospitalisations from non-fatal heart attacks or strokes compared with controls.

Management also notes that the effects on LVEF and MACE outcomes were even more pronounced in 301 HFrEF patients with high baseline levels of inflammation.

Another positive was that the results confirmed the observed reduction in major gastrointestinal bleeding events seen in an earlier 30-patient randomised study.

This is good news for Mesoblast, as the US FDA has previously indicated that a reduction in life-threatening mucosal bleeding events is an important clinical outcome in patients implanted with a left ventricular assist device.

What’s next?

Mesoblast intends to meet with US FDA under the regenerative medicine advanced therapy framework.

It will discuss the totality of the data, the evidence of a common mechanism of action across the broad HFrEF spectrum, and how the outcomes from each trial may support the regulatory approval pathway for rexlemestrocel-L.

The post Why is the Mesoblast share price jumping 14%? appeared first on The Motley Fool Australia.

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More reading

• How did ASX biotech shares perform in FY22?
• These are the 10 most shorted ASX shares
• Why Austal, Mesoblast, Regis Resources, and Zip shares are charging higher
• Why is the Mesoblast share price leaping 19% today?
• Why has the Mesoblast share price crashed 40% since April?

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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The Transurban Group (ASX: TCL) share price has gone through much volatility over the last two and a half years.

Despite inflation and interest rates roiling the market, Transurban shares are actually up in 2022. At the time of writing, since the beginning of 2022, the company’s share price has risen by 3.55%.

There may be a couple of key reasons for the improvement in investor sentiment about the toll road operator.

Let’s look at each of them briefly.

COVID-19 recovery

When COVID-19 hit, the amount of traffic on Transurban’s toll roads took a huge hit. People were working and learning at home. During the first week of April 2020, the average daily traffic was down more than 50% year on year.

But since then, there has been a progressive traffic recovery, partly as government restrictions eased. In a recent Macquarie conference in May 2022, it was revealed traffic volumes in Sydney, Melbourne and Brisbane were up in the second week of Easter compared to the same period in 2019. By comparison, North American traffic was down, but only by a relatively small amount.

Transurban said that workday traffic trends across the Australian markets showed a return to CBDs. The business also said that private road transport usage has recovered closer to pre-COVID levels compared to public transport modes.

The toll road business believes that a permanent and total shift away from the workplace is “unlikely”. It listed a few reasons such as a survey of employees showing 87% of respondents expected to do most of their work back in the workplace and increased collaboration in workplaces.

Finally, Transurban noted a continuing preference for private transport over public transport.

Transurban is expecting near and long-term traffic growth.

Inflation

Transurban says that the “inflation benefit” can provide “near-term interest rate protection”.

The business has inflation-linked toll price increases. In other words, as inflation increases, so will the price of tolls. With inflation rising in the Australian economy, this can boost Transurban’s revenue, as long as drivers continue to use Transurban roads.

Is the Transurban share price a buy?

It’s an interesting investment question because of what’s going on in the wider economy.

Transurban itself points out that freight is pivotal to the Australian economy, with four billion tonnes of goods carried across Australia each year. There was 3.2% growth in road freight movement across Australia in 2021. Large vehicle traffic is up 7.5% compared to pre-COVID levels. This could be helpful for the Transurban share price over time.

Another factor that Transurban prides itself on is delivering distribution growth. It thinks this can continue with the inflation-linked toll escalations, anticipated traffic growth, and balance sheet capacity to pursue growth opportunities.

It is currently working on seven projects. In the near term, the pipeline is focused on ‘enhancement’ opportunities.

One of the biggest projects is the West Gate Tunnel Project (WGTP) in Melbourne which aims to create a “vital alternative” to the West Gate Bridge. WGTP will deliver around 70km of new traffic lanes, as well as more than 14km of new and upgraded walking and cycling paths. This is set to open in 2025 and is specifically designed to move heavy vehicle traffic away from local roads.

Macquarie analysts think Transurban is a buy, with a price target of $14.97, implying a possible rise of around 5%. While recognising interest rate and bond changes would typically hurt asset investment plays, the broker noted that Transurban does benefit from inflation. One advantage is that the company’s revenue can rise faster than interest rate rises. In fact, Transurban noted that a 1% increase in CPI is likely to increase revenue more than the impact of a 1% increase in interest rates in the near term.

Macquarie thinks the Transurban share price is valued at 23 times FY23’s estimated earnings with a forecast FY23 distribution yield of 4.4%.

The post Is the Transurban share price a buy ahead of earnings season? appeared first on The Motley Fool Australia.

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More reading

• Pricing power: 2 ASX shares that can fight stagflation
• Here’s why Transurban shares are this fund manager’s top holding
• 2 excellent ASX dividend shares that analysts rate as buys in July
• 2 ASX 200 shares with enough pricing power to battle inflation: Expert
• Why is the Transurban share price languishing today?

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 Macquarie Group 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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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 several electric vehicle stocks rose Monday morning as the broader market climbed higher.

Two reports indicated that the Federal Reserve may not hike its benchmark interest rate as sharply as had been previously anticipated. That sparked some optimism in the market. Meanwhile, two analysts offered positive comments about Tesla (NASDAQ: TSLA), which not only gave its stock a lift, but by association likely helped push Rivian Automotive (NASDAQ: RIVN) and Nio (NYSE: NIO) higher as well. 

As of 12:15 p.m. ET, Tesla was up by 3.5%, Rivian had gained 4.8%, and Nio was up by 4.5%.

So what 

Over the weekend, a Wall Street Journal article and Goldman Sachs‘ chief economist both said that it’s likely that the Fed will deliver a 75-basis-point hike to the federal funds rate later this month, rather than the 100-basis-point hike that some economists have been expecting.  

While a 75-basis-point increase would still be significant, investors are currently looking for any positive news they can find. Those bits of news were likely what drove both the S&P 500  and the tech-heavy Nasdaq Composite higher Monday morning. 

With these indices making gains, it’s not surprising that Tesla, Rivian, and Nio are climbing. But they also got a lift because a Barclays analyst raised his price target for Tesla’s stock from $370 to $380 and Deutsche Bank analyst Emmanuel Rosner added the EV maker to the institution’s “short-term Catalyst Call Buy List.”

Tesla will report its latest quarterly financial results on July 20 and Rosner believes the automaker’s margins will be better than analysts’ consensus expectation. He also thinks that Tesla will be able to maintain its goal of increasing vehicle deliveries by 50% in 2022 as production ramps up in the second half of the year. 

With Tesla’s share price down significantly this year, Rosner said that there’s “a compelling opportunity to accumulate the stock” right now.

Tesla’s stock rose on all of this news, and Rivian and Nio likely got swept upward in the momentum. Additionally, Rivian investors may have been optimistic after Rosner kept his buy rating for that stock, though he lowered its price target from $69 to $46 — still about 45% higher than where it closed Friday.

Now what 

Investors will get a clearer picture of how Tesla is doing when the company reports its second-quarter earnings in just a couple of days, and they’ll see how Rivian and Nio are doing when they report their results, likely on Aug. 11. Until then, investors are latching onto the positive sentiment in the market and the fact that two analysts are bullish on Tesla right now.

But with the market still volatile and the U.S. continuing to grapple with high inflation and concerns about a slowing economy, long-term investors should anticipate more share price swings in the near term. 

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

The post Why Tesla stock popped today appeared first on The Motley Fool Australia.

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Chris Neiger 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 Goldman Sachs, Nio Inc., and 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.

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

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The Hub24 Ltd (ASX: HUB) share price is sinking on Tuesday morning.

At the time of writing, the investment platform provider’s shares are down 7% to $22.06.

Why is the Hub24 share price sinking?

Investors have been selling down the Hub24 share price following the release of the company’s fourth quarter update. Although that update revealed a record year of inflows, a sudden slowdown in the final three months appears to have spooked investors.

For the three months ended 30 June, Hub24 delivered platform net inflows of $2.5 billion. This was broadly flat on the prior corresponding period excluding large transitions.

Nevertheless, this couldn’t stop the company from reporting a 31.7% increase in annual platform net inflows to a record of $11.7 billion. And despite negative market movements of $3.5 billion, Hub24’s full year platform funds under administration (FUA) rose 19.9% in FY 2022 to $49.7 billion.

Together with its Portfolio, Administration and Reporting Services (PARS) FUA of $15.9 billion, Hub24 ended the period with total FUA of $65.6 billion.

While this was an increase of 11.8% year on year, it was a disappointing 4% reduction quarter on quarter.

What else happened?

The release notes that the latest Strategic Insights data shows that Hub24 has maintained second place for annual net inflows. Furthermore, at the end of March, its market share had increased to 5.1% from 3.9% a year earlier.

Management advised that a key driver of its growth has been its flexible approach to supporting advisers to create efficiencies in their business. This led to a strong pipeline of new opportunities across all customer segments including large licensee clients, brokers, boutique advice practices and self-licensed advisers. During the quarter, the total number of advisers using the platform grew 13.8% to 3,486.

Another positive was that the recently acquired Class business completed the year with its strongest June quarter since 2019. Management advised that Class Super, Class Portfolio and Class Trust products reported growth in total net accounts.

In addition, Class’ Nowinfinity offering performed well, finishing the quarter with document orders up 4% on the prior corresponding period. Momentum in the Class business is expected to continue into FY 2023.

The post Hub24 share price sinks 7% despite record year appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Hub24 Ltd. The Motley Fool Australia has positions in and has recommended Hub24 Ltd. 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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