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It was a wild and volatile ride for most ASX shares over the first quarter of 2022. For the three months to 31 March, the All Ordinaries Index (ASX: XAO) managed a gain, but a very small one at 0.1%. But some ASX shares did better than others. It was a similar story with ASX uranium shares.

Global energy concerns have helped push ASX shares that extract or process uranium (or hope to do so) into the spotlight. So let’s check out how some of these companies went last quarter.

Arguably the ASX’s leading uranium share is Paladin Energy Ltd (ASX: PDN). This company has a market capitalisation of close to $2.5 billion as it stands today. It has also given its investors an eye-watering return of 110% over the past 12 months. But how did it do over the first quarter of 2022?

Well, Paladin started the year at a share price of 88 cents per share. By 31 March, Paladin had fallen to 79 cents a share. That’s a rather hefty drop of 10.23%.

Ok, so not a great start to the year for Paladin. Let’s keep going.

How did other ASX uranium shares go over the March quarter?

Boss Energy Ltd (ASX: BOE) is another prominent ASX uranium share. It has also had a topsy-turvy year thus far, although long-term shareholders can’t do too much complaining over this company’s 1,700%-plus return over the past 12 months.

We saw Boss Energy start 2022 at a price of $2.25 a share. By the time the March quarter finished up, Boss was asking $2.24 a share. That’s a modest fall of 1 cent per share or 0.44%.

Turning now to another ASX uranium share in Deep Yellow Limited (ASX: DYL). Deep Yellow has also had a very successful 12 months, although not quite in the same league as Boss Energy. Since this time last year, this company has given investors a gain of around 68%.

But in terms of the three months to 31 March, Deep Yellow began the quarter at 86 cents a share. By 31 March it had risen to $1.02 a share. That’s a healthy gain of 18.6%.

Our final ASX uranium share to examine today is Vimy Resources Ltd (ASX: VMY). Vimy kicked off 2022 going for 20 cents per share. But this development company finished up in March at 27 cents per share. That’s a very healthy gain of 35% for the quarter. That makes Vimy the best-performing ASX uranium share for the March quarter on this list.

The post How did ASX uranium shares perform last quarter? appeared first on The Motley Fool Australia.

More reading

• Here are the 3 most heavily traded ASX 200 shares on Monday
• These were the best performers on the ASX 200 last week
• Here are the top 10 ASX shares today
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Here’s why the Boss Energy share price is rocketing 8% on Friday

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

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At lunch on Tuesday, the S&P/ASX 200 Index (ASX: XJO) has followed the lead of US markets and is sinking. The benchmark index is currently down 0.65% to 7,436.3 points.

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

Pendal rejects Perpetual takeover bid

The Pendal Group Ltd (ASX: PDL) share price is falling on Tuesday after the fund manager rejected a takeover offer from rival Perpetual Limited (ASX: PPT). Pendal’s Board believes the offer undervalues the company. Softening the blow somewhat is news that Pendal intends to launch a $100 million on-market share buyback in May.

Iress cancels divestment plan

The Iress Ltd (ASX: IRE) share price has defied weakness in the tech sector and is pushing higher on Tuesday. This follows news that the financial technology company has decided against divesting its UK Mortgages business. Management believes the recent weakness in tech valuations means it will create more value retaining the business. The company also reaffirmed its underlying net profit after tax growth guidance of 25% to 37% in FY 2022.

Mineral Resources shares rise

The Mineral Resources Limited (ASX: MIN) share price is rising today despite weakness in the lithium sector. This appears to have been driven by a broker note out of Goldman Sachs. This morning the broker upgraded the mining and mining services company’s shares to a buy rating and lifted its price target by 42% to $70.80. It made the move on “6 major changes to our MIN volume/growth assumptions (in addition to upgrades to both our lithium and iron ore price forecasts).”

Best and worst ASX 200 performers

The best performer on the ASX 200 on Tuesday has been the Uniti Group Ltd (ASX: UWL) share price with a gain of almost 3% on no news. Going the other way, the worst performer has been the Novonix Ltd (ASX: NVX) share price with a 7% decline. This follows weakness in the lithium and battery materials sectors.

The post ASX 200 midday update: Pendal rejects takeover offer, Mineral Resources rises on broker upgrade appeared first on The Motley Fool Australia.

More reading

• Pendal share price falls amid Perpetual takeover rejection: What now?
• Why is the Iress share price pushing higher today?
• Leading broker upgrades Mineral Resources shares to buy rating amid lithium exposure
• 5 things to watch on the ASX 200 on Tuesday
• How did ASX lithium shares perform 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 recommended Uniti Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Coles Group Ltd (ASX: COL) share price is in the red on Tuesday.

The slip comes amid news that 2 legal actions brought against the supermarket might be rolled into a giant suit regarding employee underpayments.

At the time of writing, the Coles share price is $18.42, 0.11% lower than its previous close.

For context, the S&P/ASX 200 Index(ASX: XJO) is currently down 0.43%, while the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) – the supermarket’s home sector – has slipped 0.55%.

Let’s take a closer look at what Coles could be battling in the Federal Court next year.

Could this be weighing on Coles’ stock today?

The Coles share price is slipping lower on Tuesday amid news it could be involved in a mammoth Federal Court case.

The supermarket is facing legal action from the Fair Work Ombudsmen. The regulator is claiming it underpaid employees between 2017 and 2020. The legal suit involves the underpayment of 8,767 employees.

The ombudsmen commenced legal action against the supermarket last year. At the time, the underpayments were said to come with a price tag of $115.2 million.

Coles is also facing a class action on the matter.

Meanwhile, Coles’ peer, Woolworths Group Ltd (ASX: WOW), is facing costs of at least $571 million after it underpaid 19,000 staff members from 2015 to 2019. It’s also facing a regulatory case and a class action on the issue.

Now, Federal Court judge Nye Perram says the supermarket giants’ 4 respective legal actions could be merged into 1 hearing. That’s because substantial matters in both suits are similar – though, not identical.

They will both address tier 1 issues – those that question the interpretation of the General Retail Industry Award, the Fair Work Act, and employment contracts.

They will also cover tier 2 issues ­– questions of law mixed with questions of facts, such as exact positions of salaried employees.

“The issues in all four proceedings substantially overlap in relation to tiers 1 and 2,” Justice Perram wrote in his decision. He continued:

This suggests that they should be heard together in some fashion in relation to those issues. 

I do not think enough is presently known to determine just how they should be heard. This will not become clear for some time.

Justice Parram fixed all 4 cases for a 7 week hearing, starting in June 2023.

Coles share price snapshot

The Coles share price has been outperforming the ASX 200 in 2022 so far.

The supermarket’s stock has gained 2.7% year to date. Meanwhile, the ASX 200 has slipped 1.9%.

Coles’ shares have also risen 16.5% over the last 12 months compared to the index’s 6.7% gain.

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

More reading

• Top ASX dividend shares to buy in April 2022
• ASX market beater? Here’s how Coles shares performed during March
• Coles share price falls amid reports Wesfarmers is selling down its stake: Time to buy?
• 5 things to watch on the ASX 200 on Wednesday
• Humans don’t change: Expert names 2 ASX shares that exploit our urges

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended COLESGROUP DEF SET. 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 Krakatoa Resources Ltd (ASX: KTA) share price is heading for the sky today, up 94.9% to 12 cents at the time of writing.

Shares in the ASX resource minnow were placed in a trading halt on Friday before market open “pending the announcement of material exploration results from its 100% owned Mt Clere REE Project”.

REE, if you’re not familiar, stands for rare earth elements. These are comprised of a group of 17 metals. Many REEs are critical components in gadgets like your smartphone, alongside high-tech military hardware, modern vehicles, and much more.

Below we look at the exploration results, released this morning, that are sending the Krakatoa share price soaring.

What exploration results were announced?

The Krakatoa Resources share price is rocketing after the ASX resource explorer reported it’s discovered “widespread clay hosted ionic type REE in the regolith” at its Mt Clere project in Western Australia.

The initial batch of drill results, taken at the Tower prospect, indicate high levels of regolith-hosted REEs. According to the release, these include significant enrichment in the magnetic elements, concentrated in the clay saprolite profiles.

Commenting on the initial results, Krakatoa’s CEO Mark Major said:

These results have now confirmed that widespread clay hosted, ready soluble REEs exist at significant concentrations within the thick saprolite regolith of the Mt Clere project…

Demand for these magnetic and critical REEs are expected to increase over the next ten years, as the world embarks on the electric revolution. We are now in a strong position to capitalise on this potential as we have only covered a six square kilometre area, mineralisation is open, thick and close to surface.

Investors could also be bidding up the Krakatoa Resources share price today on the potential of other juicy REE targets within its property.

“Significantly, we have multiple other high priority targets within the extensive 2,300 square kilometre property,” Major said.

The company is still awaiting results for 18 more drill holes at its Tower Prospects. It intends to fast track a comprehensive infill and extensional drill program at Tower Prospect, along with reconnaissance drilling of other “highly prospective areas”.

Krakatoa Resources share price snapshot

With today’s intraday gains factored in, the Krakatoa Resources share price is up 130% in 2022. That compares to a year-to-date loss of 2% posted by the All Ordinaries Index (ASX: XAO).

The post Krakatoa Resources share price explodes 95% on major discovery appeared first on The Motley Fool Australia.

More reading

• Here’s why the Latin Resources share price is on ice today
• Why Shiba Inu is plummeting today
• The Zip share price is a buy with 180% upside: broker
• What’s with the Firefinch share price today?
• Fortescue share price jumps as Shell exec ‘not convinced’ on Twiggy’s green hydrogen plans

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

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The Latin Resources Ltd (ASX: LRS) share price won’t be going anywhere on Tuesday.

This comes as the company requested that its shares be placed in a trading halt.

As such, the lithium explorer’s shares are frozen at 18.5 cents apiece.

Why is the Latin Resources share price halted?

Prior to the market opening, management requested that the Latin Resources share price be halted while it prepares an announcement.

According to the release, the company is planning to make an announcement in relation to a capital raising.

It’s worth noting that Latin Resources shares have powered ahead to astonishing levels. In a month, its shares are up 340%. It appears that the company is looking to take advantage of the share price acceleration to fund its lithium projects.

Latin Resources has requested that the trading halt remain in place until Thursday 14 April or following the release of the announcement, whichever comes first.

More on Latin Resources and lithium

Australian-based mineral exploration company, Latin Resources has projects in both Australia and South America.

In Australia, Latin Resources operates the Cloud Nine Halloysite-Kaolin deposit located 300 kilometres east of Perth in Western Australia.

On the other hand, the company is developing two lithium projects situated in Brazil and the other in Argentina.

Almost all everyday technology such as mobile phones, laptops, cameras, toys, and clocks are widely used from lithium.

However, one of the biggest markets for the battery making ingredient is electric vehicles. The reason for this is the huge difference in battery sizes. As an example, a Tesla car is fuelled by up to 90 kWh of lithium-ion compared to 5-6 kWh for an iPhone 11 that would last an entire year.

Lithium is mainly sourced from either spodumene or brine. Australia is home to the majority of the hard rock (spodumene) mines, while brine production is concentrated mainly in South America, particularly Chile and Argentina.

In contrast, it’s about 3-5 years for spodumene mines to go into production, whereas brine can take up to 7 years.

With the lithium revolution continuing to keep pace, Latin Resources is looking to get in on the action.

About the Latin Resources share price

Over the past 12 months, Latin Resources shares have surged by 260% following strong investor hype in the lithium space.

Although, when looking since the start of the year, its shares have recorded a wild uptrend, gaining more than 530%.

Based on valuation grounds, Latin Resources has a market capitalisation of roughly $305.1 million, with approximately 1.65 billion shares outstanding.

The post Here’s why the Latin Resources share price is on ice today appeared first on The Motley Fool Australia.

More reading

• Latin Resources share price surges 11% on ‘very positive’ lithium news
• Why did this ASX lithium share soar 18% today?
• Why Eagers Automotive, Firefinch, Latin Resources, and Piedmont Lithium are rising today
• Latin Resources (ASX:LRS) share price shoots 28% higher on potential ‘major new lithium discovery’

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 Bruce Jackson.

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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

Shiba Inu (CRYPTO: SHIB) is sinking in today’s trading. The cryptocurrency’s token price was down roughly 6.9% over the previous 24-hour period at 11:30 a.m. ET Monday.

The cryptocurrency space is getting hit with a wave of bearish momentum as investor appetite for risk appears to be wavering, and SHIB is no exception. Its token price is now down roughly 11.8% over the last week of trading. 

So what

There don’t appear to be any major new developments driving sell-offs for Shiba Inu and the the crypto market at large today, but risk-off sentiment has generally been shaping trading lately. With hawkish Federal Reserve police, high inflation, Russia’s invasion of Ukraine, and other factors, investors are weighing a bevy of bearish catalysts and opting to liquidate positions in cryptocurrencies and stocks.

Now what

Shiba Inu now has a market capitalization of roughly $12.75 billion, and it ranks as the 15th-largest cryptocurrency by valuation. 

In recent months, SHIB has traded largely in line with the broader cryptocurrency market, and it looks as if market momentum will continue to be the main pricing driver in the near term. While the team behind Shiba Inu is rolling out expanded compatibility features and a metaverse themed around the token’s meme mascot, the extent to which these initiatives will create bullish catalysts for the token is hard to predict. 

If the broader crypto space sees another major bullish swing, it’s reasonable to think that Shiba Inu’s token could enjoy a substantial rally. However, investors should understand that forecasting crypto cycles is difficult, and the potential for big returns is counterbalanced by high risk. 

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

The post Why Shiba Inu is plummeting today appeared first on The Motley Fool Australia.

More reading

• Why Bitcoin, Ethereum, Dogecoin, and Shiba Inu are down today
• Shiba Inu’s ride higher accelerates as the token surges 18%
• Is Shiba Inu ready for a bull run?

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

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

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One broker thinks the Zip Co Ltd (ASX: Z1P) share price can deliver an enormous amount of growth.

The buy now, pay later business has seen a lot of difficulty over the last year. In 2022 alone, it has fallen by 69%. Over the last 12 months, the Zip share price has dropped by 84%.

But the broker Ord Minnett has a price target on the company that implies a significant upside.

Optimism for the Zip share price

The broker has a price target of $4 on Zip shares. That implies a potential upside of more than 180% over the next 12 months.

One of the positives for the broker is the planned acquisition of Zip’s BNPL competitor Sezzle Inc (ASX: SZL).

According to the merger presentation, if the two combined, Zip would have 13.3 million global customers and 8.8 million US customers. It would also have 128,800 global merchants, with 60,500 of those being in the US.

When announcing the acquisition, Zip said that the proposed transaction is expected to be accretive to revenue per share and accretive to earnings before tax, depreciation and amortisation (EBTDA) in FY24, including the full impact of potential synergies.

Zip suggested that EBTDA could benefit from up to approximately A$130 million EBTDA in FY24, of which $60 million to $80 million would be cost synergies.

Zip expects to be EBTDA and cash flow positive during FY24, including the full impact of potential synergies.

The company also conducted a capital raising to support sustainable growth. It raised $148.7 million in an institutional placement.

Ord Minnett thinks that the business now has enough money to see it through to being cash flow positive with EBTDA.

Is the core business still growing?

The Zip share price has fallen despite the company continuing to report growth.

Since the beginning of March, Zip shares have fallen 37%. But in the February reporting season, it reported plenty of growth.

Its FY22 first-half revenue rose 89% to $302.2 million, transaction volume grew 93% to $4.5 billion, and customer numbers rose 74% to 9.9 million. The revenue margin was 6.7%.

Its Australian division delivered the 14^th consecutive quarter of positive cash flow.

However, during the period, the cash transaction margin declined to 2.1% (from 3.7% in HY21), reflecting rising bad debt costs reflective of current credit headwinds as well as increasing weighting towards the rest of the world.

To combat the lower margin, Zip said it’s addressing its risk decisioning policies and its collections and recoveries processes to immediately address the credit performance.

In the medium-term, Zip said that it’s expecting to deliver a cash transaction margin of between 2.5% to 3%.

The post The Zip share price is a buy with 180% upside: broker appeared first on The Motley Fool Australia.

More reading

• These were the worst 3 ASX All Ordinaries shares to hold during the March quarter
• These are the 10 most shorted ASX shares
• 16 million new Zip shares just hit the ASX. Here’s the deal
• 16 million new Zip shares will hit the ASX on Monday. What does this mean?
• March was a lousy month for ASX BNPL shares. Here’s why

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended 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 Bruce Jackson.

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The Firefinch Ltd (ASX: FFX) share price is falling today despite a seemingly positive production update from the company.

Firefinch shares are currently trading at $1.035, a 3.27% fall.

For perspective, the S&P/ASX 200 Resources Index (ASX: XJR) is down 0.79% today. Additionally, the gold price has fallen 0.15% in a day, Trading Economics data reveals.

Let’s take a look at what this gold producer and lithium developer announced today.

Gold production update

Firefinch advised the company achieved production of 10,874 ounces of gold in the first quarter of 2022 at the Morila gold project in Mali, West Africa.

This was within the company’s guidance of 10,000 to 11,500 ounces of gold. However, this does not seem to have impressed investors, judging by the Firefinch share price.

The company’s guidance of 100,000 ounces of gold in 2022 remains unchanged. Forecast production for the rest of the year is:

• 17,000 to 20,000 ounces of gold in quarter 2
• 30,000 to 35,000 ounces of gold in quarter 3
• 36,000 to 40,000 ounces of gold in quarter 4

Commenting on the production, Firefinch managing director Dr Michael Anderson said:

After a year in the role as managing director, I am very pleased to report we have delivered on our plan of transitioning from tailings reprocessing to hard rock mining. Our Q1 2022 gold production of 10,874 ounces comfortably met guidance and pleasingly was delivered injury free.

We are on the brink of benefitting from the mining of the Morila Super Pit and N’Tiola, both of which have commenced ahead of schedule.

The higher production forecast in the second half of the year will be driven by production at the Morila super pit.

The company is now mining at the N’Tiola project six weeks earlier than planned. This is taking place together with Malian company EGTF Group.

Firefinch share price snapshot

The Firefinch share price is soaring 21% year to date while it has surged 338% in a year.

In the past month, the company’s shares have returned 32%, while they are down 16% in the past week.

In contrast, the S&P/ASX 200 Index (ASX: XJO) has returned about 7% in the past year.

Firefinch has a market capitalisation of about $748.6 million based on its current share price

The post What’s with the Firefinch share price today? appeared first on The Motley Fool Australia.

More reading

• Is a bubble forming for ASX green metals shares?
• 3 ASX All Ords commodities shares smashing new highs today
• Why Allkem, Argosy Minerals, Firefinch, and Tabcorp shares are charging higher
• Why is the Firefinch (ASX:FFX) share price charging higher again?
• 5 ASX lithium and green metals shares hitting new 52-week highs today

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

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The Fortescue Metals Group Limited (ASX: FMG) share price is rallying on Tuesday morning even after Shell PLC (LON: SHEL) cast doubts on the miner’s green hydrogen plans.

Shell’s head of hydrogen, Paul Bogers, believes that it will be more difficult than anticipated for Fortescue’s chairman Andrew Twiggy Forrest to deliver on his ambitious agenda, The Australian reported.

“We like the enthusiasm for the venture…. But I think the reality is it’s still some time away before we can build these really large-scale ammonia-based import-export plays,” said Bogers.

“We’re not convinced that that is the best way of shipping hydrogen over longer distances, because of how much energy you have to put in creating it.”

Fortescue’s green hydrogen plans under a capex cloud

Several of Fortescue’s major shareholders and analysts have already expressed concern about the costs involved to bring Twiggy’s green hydrogen dream to life. The iron ore miner is committing 10% of its net profit to its green energy business, Fortescue Future Industries.

An analysis by The Australian found that Fortescue will need around $195 billion to make good on Twiggy’s promises.

Fortescue’s share price unaffected by doubters

But investors don’t seem perturbed. The Fortescue share price jumped 1% to $21.41 in early trade. At the time of writing, it is 0.73% in the green at $21.345.

In comparison, the BHP Group Ltd (ASX: BHP) share price is down 0.48% at $51.43 while the Rio Tinto Limited (ASX: RIO) share price is 0.38% higher to $117.95 at the time of writing.

Mind you, Shell isn’t pouring cold water on green hydrogen. It’s only concerned about the speed that Twiggy wants to execute.

Keeping the dream alive

The billionaire businessman is also not put off by Shell’s comments. If anything, he said that Bogers’ remarks show action was needed now.

“It’s good to see Shell is acknowledging it’s going to happen, it’s now just a discussion on timing,” Twiggy said.

“We strongly encourage these massive fossil fuel companies to use their huge infrastructure, very talented people and massive renewable resources from our environment, as that is the only way to save our environment.

“They can create the energy the world needs, leaving their fossil fuel in the ground, because time will run out, long before oil does.”

Fortescue’s green hydrogen ambition

Twiggy wants to use renewable power, such as solar, to split hydrogen from water. Hydrogen can then be transported as ammonia.

Shell sees a future for green hydrogen, but it also wants to use other technologies such as carbon capture and storage.

Interestingly, Bogers acknowledged the role that Twiggy is playing as a green hydrogen evangelist. It is influential voices like his that will help bring change and accelerate the great energy transition, he said.

The post Fortescue share price jumps as Shell exec “not convinced” on Twiggy’s green hydrogen plans appeared first on The Motley Fool Australia.

More reading

• Up 20% in a month: Is the Fortescue share price a buy?
• ASX 200 midday update: Magellan jumps, tech shares tumble
• Fortescue share price lifts amid $2b cap raise
• Iron ore just passed US$160 per tonne. So why is the Fortescue share price slipping?
• What’s the outlook for the Fortescue (ASX:FMG) share price in April?

Motley Fool contributor Brendon Lau owns BHP Billiton Limited, Fortescue Metals Group Limited, and Rio Tinto Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Later this week, all eyes will be on Bank of Queensland Limited (ASX: BOQ) shares when the regional bank releases its half year results.

Ahead of the release on Thursday, let’s take a look at what the market is expecting from the bank.

What is the market expecting from Bank of Queensland?

According to a note out of Goldman Sachs, for the six months ended February 28, its analysts are expecting Bank of Queensland to report cash earnings of $222 million.

This will be a 16.5% decline from the $266 million reported for the prior corresponding period.

The broker expects this to be driven by bad and doubtful debts and tax expense increases, offsetting a 1.1% increase in revenue to $835 million.

Despite this reduction in cash earnings, Goldman is forecasting an increase in Bank of Queensland’s interim dividend. It has pencilled in a 22 cents per share fully franked dividend, up 29.4% from 17 cents per share a year earlier.

What else should you look out for?

Goldman is looking for Bank of Queensland to deliver on its target of positive jaws in FY 2022. This is where revenue grows quicker than costs, which supports margin expansion.

It commented: “BOQ is expecting at least 2% jaws (GSe 2.9%) in FY22, driven by above system volumes in conjunction with expenses to be c. 1% lower than FY21 (consistent with GSe).”

“We will be keen to see how BOQ is tracking on this front particularly on the expense side of things and note the following drivers highlighted by BOQ management: i) +3% FY22 underlying expense growth target comprised of 2% from amortization uplift, and 1% to support ongoing business growth, and ii) benefits from synergies should get BOQ’s FY22 expected expenses to slightly lower versus FY21. BOQ further noted FY23 will have a similar profile, while in FY24 BOQ could see an acceleration in the fall in its CTI,” the broker added.

Are Bank of Queensland shares in the buy zone?

Goldman is positive on the bank and sees a lot of value in Bank of Queensland shares. It currently has a buy rating and $9.84 price target on them.

Based on its current share price of $8.45, this implies potential upside of 16.6% over the next 12 months.

In addition, Goldman expects fully franked dividends per share of 45 cents in FY 2022 and 49 cents in FY 2023. This represents yields of 5.3% and 5.8%, respectively.

The post Own Bank of Queensland shares? Here’s what to watch when the company reports this week appeared first on The Motley Fool Australia.

More reading

• Here are the 5 best performing ASX 200 bank shares of the March quarter
• What’s the outlook for the Bank of Queensland share price in April?
• 5 things to watch on the ASX 200 on Thursday
• Why is the Bank of Queensland share price climbing today?
• Why is the Bank of Queensland (ASX:BOQ) share price slipping 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 Bruce Jackson.

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