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A message from our CIO, Scott Phillips: “G’day Fools. If you’re like us, you’re dismayed by the events taking place in Ukraine. It is an unnecessary humanitarian tragedy. Times like these remind us that money is important, but other things are far more valuable. And yet the financial markets remain open, shares are trading, and our readers and members are looking to us for guidance. So, we’ll do our best to continue to serve you, while also hoping for a swift and peaceful end to war in Ukraine.” 

________________

The benchmark S&P/ASX 200 Index (ASX: XJO) has started the week poorly and, at the time of writing, is tracking 1.29% lower at 7,019.3 points.

With the geopolitical tension in Europe, equity investors in Australia have no doubt been questioning what moves they can take to ensure their portfolios are protected during the turbulence.

However, one expert advises avoiding any knee-jerk reactions in response to the conflict.

Avoid making sudden portfolio decisions

Speaking to the Australian Financial Review, portfolio manager of SG Hiscock’s High Conviction Fund Hamish Tadgell said that conflict like that seen in Europe might have far-reaching impacts on equity markets.

“Geopolitical events tend to result in sharp sell-offs but can also rebound quite quickly if economic growth is largely unaffected,” Tadgell said.

As a result, simply reacting to the news whilst following short-term market movements is bound to cause trouble for even the most experienced investor, he adds.

Plus, in the past, global stock markets tend to make a snap-back quickly after taking a hit when there is news of conflict or similar. He warns those who sell may overlook the company and sector fundamentals. This is a naysay for long-term investors.

“This suggests being too reactionary and making sudden portfolio moves may, in hindsight, not necessarily be the right thing to do,” Tadgell said.

As they say, never chop a tree down in the wintertime – you might need the shade during the summer.

What can be done?

Nevertheless, that doesn’t mean one shouldn’t be focused on making winning positions for the long-term based on the current secular trends, the portfolio manager notes.

“That said, we were already very overweight in energy and have had a reasonable commodity exposure given our view around inflation, investment required to decarbonise and increasing trade protectionism, and have some gold insurance,” he said.

This kind of thinking is important given the current macro-climate, Tadgell notes, because the question remains as to what the Russia-Ukraine crisis might mean for global economic growth.

“The other consideration is how will Russia respond?” he added.

“While it has little incentive to curtail major commodities like oil and gas, the disruption of industrial metals like nickel or palladium could cause problems for international supply chains, and add to inflation risks.”

Regardless, Australian benchmark indices have taken a hit this year as global macro-economic pressures mount in the form of inflation, supply chain headwinds, raw materials shortages and, of course, the conflict in Europe. Commodity baskets and the Australian dollar have been the exception, as shown on the charts below.

Whilst the S&P/ASX 200 Index (ASX: XJO) has fallen more than 5% since trading recommenced on January 4, and the iShares MSCI World Index Fund (NYSE: URTH) has fallen even more, most major commodity groups are within a full super-cycle. The March 2022 futures contract on Newcastle coal (NCFH2022), for instance, has gained more than 162% since December last year.

The post Adjusting your ASX share portfolio in response to the Ukraine crisis might not be beneficial: expert appeared first on The Motley Fool Australia.

More reading

• Has Zip (ASX:Z1P) got this key metric wrong in the Sezzle takeover?
• The oil price just hit a 13-year high, and these ASX 200 shares are surging
• ASX 200 (ASX:XJO) midday update: AGL rejects new takeover offer, Appen makes strategic investment
• Here’s why ASX shares are set for a shakeup this month
• Payday? Here’s why the CSL share price is sliding this morning…

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 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.

Whether you realize it or not, change is commonplace on Wall Street. It might seem like a given that today’s largest companies by market cap will retain their position in the future, but history has shown that innovation and execution shake up the world’s biggest companies with frequency over time.

Back in 1999, Nokia, General Electric and Intel were among the largest publicly-traded companies. Today, Microsoft is the only remaining member of the 10 largest publicly-traded companies in 1999.

Apple is the king… for now

At the moment, tech stock Apple (NASDAQ: AAPL) sits at the top of the pecking order with a market cap of $2.71 trillion.

In many respects, it deserves to be No. 1. Apple produces the most popular smartphone sold in the United States, and saw its sales and profits surge to record levels after introducing 5G capability to its iPhone. The company’s customer base is also extremely loyal, as evidenced by the lines that wrap around its stores anytime a new or updated product makes its debut.

Apple’s push into subscription services should be a winning proposition as well. This transition, which is being led by CEO Tim Cook, can help soften the revenue lumpiness associated with Apple’s product replacement cycles, as well as lift margins over time.

The company is also a cash cow. Over the trailing 12-month period, Apple generated more than $112 billion in operating cash flow. With such robust cash generation, Cook has overseen a substantial capital return program via share buybacks and dividend growth.

These could be the world’s largest stocks by 2035

But history is pretty clear that change is normal among the largest publicly-traded companies. By the time 2035 rolls around, the following three companies might all be worth more than mighty Apple.

The no-brainer choice: Amazon

Although Microsoft would appear to be the most logical company to surpass Apple in market value by 2035, I’d wager that e-commerce giant Amazon (NASDAQ: AMZN) is the better bet to be the largest publicly-traded company in the world in 14 years’ time.

As many of you probably know, Amazon’s popularity stems from its dominant online marketplace. This past August, eMarketer estimated that Amazon would bring in 41.4% of all online retail spending in the US in 2021. That was nearly six times the share of Walmart, which is the No. 2 in US online retail sales.

Keep in mind that retail operating margins tend to be razor thin. Amazon accounts for this by pushing its Prime subscriptions, which were just raised $20 to $139 annually. The fees collected from the company’s 200 million global Prime members provides a healthy buffer that allows Amazon to undercut its competition on price.

But as I’ve pointed out previously, it’s not Amazon’s popularity in e-commerce that would be expected to fuel its push higher. What’s far more important is that the company’s higher-margin operating segments haven’t shown any signs of slowing. In particular, Amazon Web Services (AWS) accounts for almost a third of global cloud infrastructure spending. Last year, AWS brought in nearly three-quarters of Amazon’s operating income despite accounting for around 13% of net sales. 

As long as Amazon’s high-margin segments, such as AWS, subscriptions, and advertising, don’t considerably slow down, Amazon could be worth more than Apple by 2035.

If everything went just right: Nvidia

Another company with all the tools and intangibles necessary to be worth more than Apple in 14 years, but which’ll require a lot of things to go right for that to happen, is graphics and networking stock Nvidia (NASDAQ: NVDA).

Right now, virtually everything is going right for Nvidia, and it would need to stay that way for more than a decade if it’s going to become one of the world’s most valuable companies. For fiscal 2022, the company’s bread-and-butter gaming segment saw sales jump 61% on the heels of growing demand, innovation, and strong pricing power. 

Meanwhile, data center sales increased 58%, compared to fiscal 2021. In the wake of the pandemic, businesses are moving their data into the cloud at a faster pace than ever before. This has vastly improved the growth trajectory for Nvidia’s data center solutions, with this higher-margin segment likely to leap gaming in annual revenue in the not-too-distant future.

But the real wildcard here is the company’s professional visualization segment, which accounted for $2.11 billion of its $26.9 billion in total sales last year. This $2.11 billion in sales represents a cool 100% increase from the previous year. This segment is viewed as Nvidia’s springboard into the metaverse — i.e. the next iteration of the internet that’ll allow users to interact within 3D virtual environments. Though estimates vary, most analysts believe the metaverse has multitrillion-dollar potential. Providing tools that allow users to interact in virtual spaces, supplying solutions to support data centers, and being a leader in graphics cards, gives Nvidia a pole position in the development of the metaverse.

If the metaverse matures quicker than anticipated, Nvidia could very well leapfrog Apple.

The longshot: Airbnb

Now, if you want a true longshot that could come from much further down the market cap list to surpass Apple in 14 years’ time, look no further than stay-and-hosting platform Airbnb (NASDAQ: ABNB).

For the time being, Airbnb’s marketplace has in the neighborhood of four million hosts. But this should be viewed as just the tip of the iceberg. There are more than 30 times that many households in the US, and somewhere around one billion homes worldwide. Once owners realize how simple it is to generate cash flow from their home(s) by listing them on Airbnb, we should see a significant increase in marketplace listings. For what it’s worth, bookings more than quintupled in the three years leading up to the pandemic.

Also of note, Airbnb’s fastest-growing segment is long-term stays, which are defined as stays of at least 28 days. The pandemic completely disrupted physical workplaces and made a sizable percentage of the labor force realize they could work from anywhere, so long as they had an internet connection. With workers not tied down to any one location, the rise of the mobile worker could become a major profit driver for Airbnb.

Furthermore, the company is relying on more than just marketplace bookings to drive top-and-bottom-line growth. Airbnb wants its piece of what’s estimated to be an $8 trillion travel industry. Introducing Experiences, which allows local experts to take travelers on adventures, is one way Airbnb is attempting to capture a larger percentage of travel spending. But it’s likely just the beginning. Airbnb could extend branches to the transportation or restaurant industries to control a larger percentage of what travelers are spending.

If Airbnb’s rapid growth trajectory picks up where it left off prior to the pandemic, Apple could well be in its sights by 2035.

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

The post 3 stocks that could be worth more than Apple by 2035 appeared first on The Motley Fool Australia.

More reading

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Sean Williams owns Amazon. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Airbnb, Inc., Amazon, Apple, Intel, Microsoft, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2023 $57.50 calls on Intel, long March 2023 $120 calls on Apple, short January 2023 $57.50 puts on Intel, and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Amazon, Apple, and Nvidia. 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a heavy decline. At the time of writing, the benchmark index is down 1.3% to 7,019.6 points.

Four ASX shares that aren’t letting that hold them back are listed below. Here’s why they are racing higher:

Argosy Minerals Limited (ASX: AGY)

The Argosy Minerals share price is up 4.5% to 33.5 cents. Investors have been buying this lithium developer’s shares amid news that it has completed the brine systems work at the Rincon Lithium Project. All in all, this puts the company on track to achieve its first production of lithium carbonate in the middle of the year.

De Grey Mining Limited (ASX: DEG)

The De Grey Mining share price has jumped almost 14% to $1.32. This has been driven by a strong rise in the gold price overnight and news that the gold explorer’s shares will be added to the illustrious ASX 200 index at the next quarterly rebalance on 22 March.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven Coal share price is up 3.5% to $4.13. Investors have been buying this miner’s shares again on Monday in response to another strong rise in the thermal coal price. According to CommSec, the thermal coal price rose 13.2% on Friday to US$418.75 a tonne. Traders have been bidding up coal prices on the belief that Europe will switch to it to avoid Russian natural gas.

Woodside Petroleum Limited (ASX: WPL)

The Woodside share price has jumped 9% to $34.34. Investors have been bidding this energy producer’s shares higher again following another strong rise in oil prices. Prices reached a 13-year high of US$130 a barrel briefly amid speculation that Russian oil could soon be banned. This has heightened fears of supply issues.

The post Why Argosy Minerals, De Grey, Whitehaven, and Woodside shares are racing higher appeared first on The Motley Fool Australia.

More reading

• Why the Ukraine crisis is shining the spotlight on ASX coal shares
• ‘Significant milestone achieved’: Argosy (ASX:AGY) share price accelerates on Rincon update
• The oil price just hit a 13-year high, and these ASX 200 shares are surging
• ASX 200 (ASX:XJO) midday update: AGL rejects new takeover offer, Appen makes strategic investment
• Why the De Grey Mining (ASX:DEG) share price is shooting 12% higher 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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The Santos Ltd (ASX: STO) share price has been on a wild ride through 2022 so far.

Despite the peaks and troughs, it’s gained 23% year to date. That has been helped along by the 14% gain it’s racked up over the last seven days.

At the time of writing, the Santos share price is $8.19.

But do the gains mean it’s now passed the buy zone? One expert doesn’t think so.

Here’s why Firetrail Investments deputy managing director and portfolio manager Blake Henricks thinks now is the time to buy Santos shares.

After gaining 22% in 2022, is the Santos share price still a buy?

2022 has been a crazy year for many ASX shares, with uncertainty around inflation and geopolitics rife.

As Henricks told Livewire last week, almost every S&P/ASX 200 Index (ASX: XJO) stock has, at some point, been heralded as protection against inflation – which is “borderline ridiculous”, according to the expert.

However, there is one sector he believes could hold the answer to inflation. That is the ASX energy sector.

The energy transition has recently been embodied by energy shortages in Europe and news that Origin Energy Ltd (ASX: ORG) will bring forward the closure of the Eraring coal-fired power station, said Henricks.

Now, oil prices are hitting their highest point in 13 years and gas prices are surging, spurred by Russia’s invasion of Ukraine.

“Everywhere I look, energy’s being disrupted,” Henricks said. “And then you look at something like a Santos.”

On why he thinks Santos is a buy, Henricks said:

That is an area, it’s inflation-protected, huge cash flows. And if it doesn’t rerate, we won’t really care because we’ll be getting dividends, huge buybacks.

Henricks also told Livewire the Santos share price surpassed $9 in early 2020. At that time, the expert said the oil price was around US$60 per barrel.

“Today, the oil price is over US$100 dollars a barrel, and Santos is around $7.”

Of course, both the Santos share price and the price of oil have gained on the figures quoted by Henricks last week.

The Santos share price is now 16% higher while the price of West Texas Intermediate futures is 24% higher, currently trading at US$124.25 per barrel, according to data from CNBC.

The post Up 14% in a week. Here’s why this expert says Santos (ASX:STO) shares are undervalued appeared first on The Motley Fool Australia.

More reading

• The oil price just hit a 13-year high, and these ASX 200 shares are surging
• Here’s why ASX shares are set for a shakeup this month
• 5 things to watch on the ASX 200 on Monday
• Here’s why the Santos (ASX:STO) share price is struggling today
• 3 ASX shares to cash in from the energy crisis: expert

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 Bruce Jackson.

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The Zip Co Ltd (ASX: Z1P) share price has taken another tumble on Monday.

During morning trade, the buy now pay later (BNPL) provider’s shares dropped almost 6% to $1.62.

When the Zip share price hit that level, it was down approximately 62% since the start of the year.

Is this a buying opportunity?

While there have clearly been far more sellers than buyers recently, it is worth noting that a couple of notable people have been doing their bit to support the buy side over the last couple of trading sessions.

According to a release this morning, Zip’s co-founders have taken advantage of recent weakness in the Zip share price to top up their already sizeable holdings.

The announcement reveals that co-founders Larry Diamond and Peter Gray purchased approximately $1.5 million of Zip shares between 4 March and 7 March. While it is unclear whether this is in total or if they have each bought $1.5 million worth of shares, what is clear is that that both remain positive on the company’s future.

The company commented: “While market factors and external conditions have impacted the fintech and broader technology sector in recent months, the co-founders continue to believe that the market opportunity to deliver transparent, fair, and innovative financial products remains significant. The founders remain committed to the successful execution of Zip’s strategy and in delivering long-term value creation for all shareholders.”

In addition, the release highlights that a number of other non-executive directors, including chair Diane Smith-Gander, also purchased Zip shares at the end of last week.

Is the Zip share price in the buy zone?

Opinion remains largely divided on the future direction of the Zip share price.

The team at Morgans, for example, has an add rating and $3.94 price target on its shares, which implies more than 100% upside.

Whereas the team at UBS slapped a sell rating and lowly $1.00 price target on its shares last week.

The post Bargain hunting: Zip (ASX:Z1P) co-founders snap up $1.5 million of shares appeared first on The Motley Fool Australia.

More reading

• Has Zip (ASX:Z1P) got this key metric wrong in the Sezzle takeover?
• ASX 200 (ASX:XJO) midday update: AGL rejects new takeover offer, Appen makes strategic investment
• These are the 10 most shorted ASX shares
• What on earth happened to the Zip (ASX:Z1P) share price last week?!
• 5 ASX shares making big news this week

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. 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 Block Inc (ASX: SQ2) share price is under pressure, with the tech sector taking the hardest blow in investor sentiment today.

Investors remain wary of the lingering uncertainty as conflict rages on across Ukraine. Consequently, focus has shifted to risk-off assets and constricted commodities. Meanwhile, the S&P/ASX 200 Info Tech Index (ASX: XIJ) is failing to attract buyers, falling 5.57% so far today.

At the time of writing, Block shares are down 11.02% to $136.09, on pace with some of the worst performers on the market for its size.

What is going on with the Block share price?

There are a couple of factors that could be weighing down the Block share price on Monday, though the most obvious is a widespread disinterest in tech shares.

In recent months, a powerful combination of inflation worries, Ukraine-Russia tensions, and market volatility has resulted in investor appetite for risk waning.

As shown in the chart below, gold miners such as Newcrest Mining Ltd (ASX: NCM) have outperformed compared to the likes of Block. This is telling of how market participants are feeling at the moment.

Given the uncertainty, many people are feeling less confident in those companies that are reliant on a continuation in strong growth to validate their high multiples.

Additionally, the Block share price could be getting trampled due to its removal from the S&P/ASX 20 Index. This was announced after the market had closed on Friday, leaving investors to react to the information today.

Rough run on the block

Since joining the ASX, the Block share price has not been a breadwinner for its shareholders. During this time, the company’s shares have fallen 23%.

It hasn’t exactly been an ideal time for the broader Aussie market either. However, the ASX 200 has experienced a less severe fall, slipping 4.4% over the same time frame.

The post Why is the Block (ASX:SQ2) share price sinking 11% on Monday? appeared first on The Motley Fool Australia.

More reading

• Here’s why ASX shares are set for a shakeup this month
• Why did the Block (ASX:SQ2) share price sink 9% today?
• ASX tech shares take a hammering on Friday
• ASX 200 (ASX:XJO) midday update: Block, Zip tumble, QBE’s asset sale
• Top brokers name 3 ASX shares to buy today

Motley Fool contributor Mitchell Lawler owns Block, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Block, Inc. The Motley Fool Australia owns and has recommended Block, Inc. 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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A message from our CIO, Scott Phillips: “G’day Fools. If you’re like us, you’re dismayed by the events taking place in Ukraine. It is an unnecessary humanitarian tragedy. Times like these remind us that money is important, but other things are far more valuable. And yet the financial markets remain open, shares are trading, and our readers and members are looking to us for guidance. So, we’ll do our best to continue to serve you, while also hoping for a swift and peaceful end to war in Ukraine.”

—

ASX coal shares are flying high on investors’ radars as the price of fossil fuels is rocketing.

In today’s action alone, the S&P/ASX 200 Energy Index (ASX: XEJ) is up 4.8% while the broader S&P/ASX 200 Index (ASX: XJO) is down 0.8%.

And some of the top ASX 200 coal shares are leading the charge higher for the Energy Index.

The Whitehaven Coal Ltd (ASX: WHC) share price, for example, is up 4.5%, while New Hope Corporation Limited (ASX: NHC) shares have gained 5.6% today.

Meanwhile, rival ASX 200 coal share, Yancoal Australia Ltd (ASX: YAL), has enjoyed a 6.6% boost to its share price in intraday trading.

What’s boosting ASX coal shares today?

While many factors determine a coal company’s share price (management, balance sheet, quality of assets, etc.), the price of the coal they dig from the ground is a major factor.

And coal prices have climbed rapidly recently alongside oil and gas, offering strong tailwinds to ASX coal shares.

Energy prices were already trending higher late last year as the world’s pandemic reopening picked up pace. This saw a sharp increase in the demand for energy for both travel and manufacturing outpacing any additional supply growth coming online.

But fossil fuel prices have really taken off in the last month as Russia first massed troops on Ukraine’s border and then launched an all-out assault.

Now Western nations are getting serious about imposing sanctions on Russian oil, gas and coal exports.

That’s critical here because Russia is the second largest oil exporter and third largest coal exporter in the world. The prospect of removing that much supply, or even a significant slice of it, has sent crude oil prices to 13-year highs today and coal surging to another all-time high of some US$420 per tonne.

Aussie coal to the rescue?

Somewhat ironically for an industry that’s taken so much flack for the ‘dirty energy’ it provides, nations the world over are turning to Australia to potentially help fill any void left by a ban on Russian coal.

As The Australian reports, despite Poland relying on Russia for 90% of its coal needs, “the country’s government has led the European charge to impose sanctions“.

Poland is among the countries that may be getting a lifeline in the form of additional shipments supplied by ASX coal shares. “Industry sources say officials also sought information on whether coal supplies could be made available to customers in South Korea and Japan.”

According to Resources Minister Keith Pitt (quoted by The Australian) the Aussie government is “facilitating access to Australian thermal coal producers to interested parties as they seek alternative supplies from Russia. Australian producers have indicated they are willing to help our friends and allies if they can.”

But ramping up coal mining isn’t as simple as turning up the tap.

With most ASX coal shares already producing near their production peak, it will take some time before capacity can be significantly ramped up. Which could see the price of coal remain elevated.

How have these ASX coal shares been tracking?

All 3 of the ASX coal shares mentioned above have trounced the benchmark index of late.

Over the past month alone, the New Hope share price is up 24.5%, Whitehaven shares have leapt 46%  and the Yancoal share price has rocketed an eye-popping 71.5%.

To put that into context, the ASX 200 is down 1.4% over the past month.

The post Why the Ukraine crisis is shining the spotlight on ASX coal shares appeared first on The Motley Fool Australia.

More reading

• 3 reasons why Soul Pattinson (ASX:SOL) is a strong ASX dividend share idea
• These were the best performing ASX 200 shares last week
• 5 ASX shares making big news this week
• Here are the top 10 ASX shares today
• 2 ASX 200 shares cracking 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 Zip Co Ltd (ASX: Z1P) share price hasn’t been having a great time of it lately. Zip shares are today trading at $1.65 at the time of writing, down a nasty 4.07%. That’s after the buy now, pay later (BNPL) share hit yet another 52-week low this morning of $1.62.

2022 has certainly been a year to forget for Zip shares. Even though it’s only March, Zip is now down a painful 61.5% year to date as it stands today. Over the past 12 months, the company has lost more than 82% of its value.

But it’s not as if Zip hasn’t had anything to give investors recently. Last month, the company made waves when it announced that it would be merging with its fellow BNPL provider Sezzle Inc (ASX: SZL). If all goes to plan, Sezzle shareholders will receive 0.98 shares of Zip for every Sezzle share owned when the deal is done.

But investors seem to have taken a strong dislike to these merger plans. That’s going off of the fact that the Zip share price has descended more than 20% since the announcement was made public.

It’s not unclear why investors might not be too keen on this deal. But one analyst has an idea.

According to reporting in the Australian Financial Review (AFR), an analyst at broker Citi has taken umbrage with some of the assumptions that Zip is making with its merger deal.

Zip share price: Analysts struggle to find value in Sezzle merger

The report quotes a research note from analyst Siraj Ahmed, which claims that the 25% customer overlap between the two companies is higher than what Citi is estimating. Citi only reckons the two businesses have a 15% overlap. That would directly affect the revenue synergies that the two companies are factoring in with their deal. Here’s some of what Ahmed said on these concerns and more:

While we would assign a (relatively) high probability on the cost synergies being delivered, we see the Sezzle acquisition as an expensive customer acquisition strategy and remain concerned on whether revenue yield of 6%-7% is sustainable over the medium-term.

But Ahmed and Citi aren’t the only ones expressing concerns over some of these metrics. The report also claims that analysts at Macquarie Group Ltd (ASX: MQG) have similar concerns. Macquarie’s analysts concluded that “this appears to be a merger out of necessity rather than one to create long-term shareholder value”.

Hardly a vote of confidence from these brokers. Saying that, not all analysts have been as negative. My Fool colleague James had a look at some analyst views last week that were markedly more positive on the Zip-Sezzle marriage. But only time will tell what might play out in this space. For now, it seems investors have yet to be convinced it’s a good idea.

At the current Zip share price, this ASX 200 BNPL share has a market capitalisation of $1.11 billion.

The post Has Zip (ASX:Z1P) got this key metric wrong in the Sezzle takeover? appeared first on The Motley Fool Australia.

More reading

• The oil price just hit a 13-year high, and these ASX 200 shares are surging
• ASX 200 (ASX:XJO) midday update: AGL rejects new takeover offer, Appen makes strategic investment
• Here’s why ASX shares are set for a shakeup this month
• Payday? Here’s why the CSL share price is sliding this morning…
• These are the 10 most shorted ASX shares

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. owns and has recommended ZIPCOLTD FPO. 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 Bruce Jackson.

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Shares in Northern Star Resources Ltd (ASX: NST) are on the march today. The gold miner’s shares now trade 6.27% higher at $10.76.

The Northern Star share price is unfaltering on Monday despite the wave of macro-economic crosscurrents currently crashing into equity markets around the world.

As investors fly to more quality, less volatile asset classes like gold amid the calamity, gold miners like Northern Star are set to benefit as demand for the yellow metal soars and prices follow.

Why are Northern Star shares roaring today?

The price of gold has shot up since 30 January from US$1,789 per troy ounce. Gold now trades at US$1,998 per troy ounce.

After trading sideways for the good part of a year around the US$1,800/oz mark, recent geopolitical tensions and a reset of global equity markets has seen investors revel in the rally gold has staged in the past 30 days.

It is now up more than 18% for the past 12 months, and 9% in the past month alone.

Northern Star’s share price closely tracks the price of gold (shown below). Northern Star shares are hypersensitive to movements in the precious metal – a common feature among ASX gold mining shares.

In fact, as gold has driven northwards during the past month, Northern Star shares have spiked 26%. That’s well ahead of both inflation and the benchmark indices in 2022.

The price of gold itself has charged north with authority in the past two months. This is a sign investors are seeking to hedge out both inflation and what is known as ‘systematic risk’, the risk of the economic ‘system’ turning down. Most commonly, this occurs during a recession.

As such, it has staged an impressive rally and now fetches its highest price on record since being de-pegged from the US dollar back in the 1970s.

With the conflict in Europe adding more weight to the selling pressure on traditional equity markets, the stage looks set for gold to continue its popularity as a safe-haven asset.

Given these strengths in the gold markets, the Northern Star share price has a number of sector-specific and macro-economic tailwinds behind it right now. Hence the 6% gain on Monday.

Northern Star share price snapshot

In the last 12 months the Northern Star share price has gained more than 13% and is soaring 14% this year to date.

Prior to the wave of government lockdown directives in 2021, Northern Star had peaked at an all-time high of $16.56 in November 2020.

The post Northern Star Resources (ASX:NST) share price sparkles as gold spikes 9% in a month appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• Northern Star (ASX:NST) share price is shining 17% brighter than a month ago
• Here’s why ASX gold shares are having another stellar day
• 5 things to watch on the ASX 200 on Wednesday
• Here’s why ASX gold shares just had their best month in 2 years

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 Bruce Jackson.

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The Argosy Minerals Limited (ASX: AGY) share price is racing higher following an update on its Rincon Lithium Project.

At the time of writing, the lithium miner’s shares are up 4.69% to 33.5 cents.

Let’s take a closer look and see what Argosy reported to the ASX market this morning.

Argosy progresses on Rincon development works

Investors are bidding up the Argosy share price following the company’s latest positive developments.

According to its release, Argosy advised it has completed the brine systems work at the Rincon Lithium Project.

Argosy currently holds a 77.5% interest in the Rincon Lithium Project, located in Salta Province, Argentina. The mine is situated within the “lithium triangle” – the world’s dominant source of lithium production.

The work conducted on the brine system includes the following:

• Expansion of the pumping station and construction of associated equipment
• Piping installation
• Plant settling ponds
• Establishing the brine production wells into the brine operations circuit

The remaining construction works to bring the project online are on budget and schedule.

Argosy is anticipating that first production of lithium carbonate will be achieved from mid-2022.

Once attained, management will focus on ramping up operations to mine 2,000 tonnes per annum of lithium carbonate later this year.

Argosy managing director Jerko Zuvela touched on the company’s 2022 goal, saying:

The Company’s Puna operations team have achieved another significant milestone, with the brine systems works now complete, as we head toward commencing the 2,000tpa lithium carbonate production operation at our Rincon Lithium Project.

We are committed to achieving our upcoming targets and becoming only the 2nd ASX- listed battery quality lithium carbonate producer and progressing toward the next stage 12,000tpa scale operations and beyond.

Argosy share price summary

In the last 12 months, the Argosy share price has returned 240% to shareholders, with year to date up 6%.

On valuation grounds, Argosy has a market capitalisation of roughly $446.41 million, with 1.31 billion shares on issue.

The post ‘Significant milestone achieved’: Argosy (ASX:AGY) share price accelerates on Rincon update appeared first on The Motley Fool Australia.

More reading

• Argosy (ASX:AGY) share price buzzes 8% higher on lithium project news
• Argosy (ASX:AGY) shares climb on ‘significant milestone’ at Rincon

Motley Fool contributor Aaron Teboneras owns Argosy Minerals Limited. 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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