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On Wednesday, we looked at three ASX shares that brokers have given buy ratings to this week. Unfortunately, not all shares are in favour with brokers right now.

Three ASX shares that have just been given sell ratings by brokers are listed below. Here’s why they are bearish on them:

Fortescue Metals Group Limited (ASX: FMG)

According to a note out of Credit Suisse, its analysts have retained their underperform rating and $14.00 price target on this mining giant’s shares. Although Fortescue delivered a half year result in line with its expectations, it can’t find a way to justify its current valuation. Especially given its belief that robust demand for Fortescue’s low grade iron ore will be short lived. The Fortescue share price is trading at $20.70 on Thursday.

Pro Medicus Limited (ASX: PME)

A note out of Goldman Sachs reveals that its analysts have retained their sell rating and slashed their price target on this health imaging technology company’s shares to $44.80. Its analysts believe there is a risk that Pro Medicus’ growth could taper beyond FY 2022. If this happens, it feels the market will be unable to justify the sky high multiples that its shares trade on. The Pro Medicus share price has fallen heavily today and now trades at $45.64.

Seek Limited (ASX: SEK)

Another note out of Goldman Sachs reveals that its analysts have retained their sell rating but lifted their price target on this job listings company’s shares to $29.10. While Seek posted a half year result that was well ahead of the broker’s estimates and upgraded its guidance, it isn’t enough for a more positive rating. Goldman has concerns about how volume, depth, and pricing interplay through FY 2023 as the labour market starts to normalise. The Seek share price is now trading below this price target at $28.92.

The post Top brokers name 3 ASX shares to sell today appeared first on The Motley Fool Australia.

More reading

• Broker warns that Fortescue (ASX:FMG) share price could fall 30%
• Is BHP (ASX:BHP) the best ASX dividend share?
• Why BHP, Fortescue, Netwealth, and Santos shares are falling
• Why has the Fortescue (ASX:FMG) dividend tumbled 40%?
• Pro Medicus (ASX:PME) share price surges 8% on historic results

Motley Fool contributor James Mickleboro owns SEEK Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Pro Medicus Ltd. The Motley Fool Australia owns and has recommended Pro Medicus Ltd. The Motley Fool Australia has recommended SEEK 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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It’s a good day for the S&P/ASX 200 Index (ASX: XJO) and these heavyweights are making the most of it.

Right now, the ASX 200 is up 0.55%, boosting back towards a recovery from its disastrous January performance.

But not all of the index’s constituents have suffered in 2022. In fact, these three shares are trading at their highest price in at least 12 months.

These ASX 200 giants are hitting new 12-month highs

Woodside Petroleum Limited (ASX: WPL)

The Woodside Petroleum share price surged 4.9% earlier today to trade at its new 52-week high of $27.95.

Its gains come after the oil producer reported its after-tax profits increased 262% over the first half of financial year 2022 to reach around US$1.6 billion.

In turn, the company’s interim dividend was boosted 255% higher than that of the previous first half, coming to US$1.05.

Woodside’s profits soared alongside its realised oil price, which came in at US$60.30 last half.

Computershare Limited (ASX: CPU)

There’s no such clear reason behind Computershare’s gains today.

The ASX 200 technology company’s shares gained 1.55% earlier today to reach a new 52-week high of $23.49.

Right now, the Computershare share price is 15% higher than it was at the start of 2022 despite January’s ASX tech sell-off.

Vicinity Centres (ASX: VCX)

Finally, the Vicinity Centres share price also hit a new 52-week high of $1.93 today, gaining 3.4% in the process.

While there’s been no word from the retail-focused real estate investment trust (REIT) today, it did release its half-year results yesterday to the market’s delight.

Its net profit after tax (NPAT) for the period came to $650 million – more than $1 billion higher than that of the prior comparable period.

That’s despite Vicinity CEO and managing director Grant Kelley saying the period was “challenging” for the REIT as COVID-19‘s Omicron variant impacted its retail partners.

The ASX 200 REIT’s share price gained 11% after releasing its earnings on Wednesday.

The post 3 ASX 200 shares hitting 52-week highs today appeared first on The Motley Fool Australia.

More reading

• ASX 200 energy shares to become ‘cash machines’: broker
• Why Challenger, CSL, NRW, and Woodside shares are pushing higher
• ASX 200 (ASX:XJO) midday update: Telstra, Wesfarmers, and Woodside report
• Woodside (ASX:WPL) share price hits 52-week high after tripling full year earnings
• 5 things to watch on the ASX 200 on Thursday

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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S&P/ASX 200 Index (ASX: XJO) energy shares have been off to a strong start in the new year.

While the broader ASX 200 is down 3.5% in 2022, the S&P/ASX 200 Energy Index (ASX: XEJ) has gained 8.9%.

That energy index is comprised of big name ASX 200 energy shares like Santos Ltd (ASX: STO), up 7.2% so far this year.

Then there’s competing ASX 200 energy share Woodside Petroleum Limited (ASX: WPL), which has gained 22.5% since the opening bell on 4 January.

And the Beach Energy Ltd (ASX: BPT) share price has leapt 13.1% higher in that same time, giving it a current market cap of $3.3 billion.

ASX 200 energy shares to become ‘cash machines’

Earlier today Woodside released its full year results. And they didn’t disappoint.

Among the highlights, the ASX 200 energy share reported a 262% increase in underlying net profit after tax (NPAT) to US$1.62 billion. The company also paid a fully franked final dividend of US$1.05 per share, up 255% year on year.

Shaw and Partners called the results a “watershed moment” for the Aussie energy sector, with expectations that fossil fuels will be part of the energy mix for a long time yet as the world transitions to renewable sources.

According to Shaw and Partners (quoted by The Australian):

Over the past several years, the chorus of investors demanding returns from the sector has grown louder. The US Shale sector has responded, the Super Major have responded, howver the Australian listed companies have been caught in no man’s land.

Woodside’s CY21 today is the first time I can remember since CY14 that an Australain Oil & Gas company has so comprehensively beaten consensus estimates and at the same time provided a return to shareholders.

The broker said that companies in the sector, like ASX 200 energy shares, “are going to become cash machines, in the same way cigarette companies did post advertising restrictions in the 1970s”.

Shaw and Partners expects this won’t be the last time Woodside reports a double-digit yield and beats earnings expectation.

US and European energy shares also undergoing ‘tectonic shift’

The same tide that’s lifting ASX 200 energy shares is at work across the globe, as energy prices continue to surge.

Travis Stice, CEO of US shale driller Diamondback Energy said (quoted by Bloomberg), “Eighteen months ago, we were in a global apocalypse for the energy sector, and now you’re talking about out-sized returns. We should all pause and recognize the tectonic shift.”

Shell CEO Ben van Beurden added, “We are struggling as an industry to keep up with supply. Partly, that is because of the fact that during the lean years, we’ve all been very disciplined in cash preservation and in our investment decisions.”

With the tectonic shift still underway and the energy industry struggling to meet demand, ASX 200 energy shares look set for some healthy tailwinds.

The post ASX 200 energy shares to become ‘cash machines’: broker appeared first on The Motley Fool Australia.

More reading

• 3 ASX 200 shares hitting 52-week highs today
• Why Challenger, CSL, NRW, and Woodside shares are pushing higher
• ASX 200 (ASX:XJO) midday update: Telstra, Wesfarmers, and Woodside report
• Woodside (ASX:WPL) share price hits 52-week high after tripling full year earnings
• 5 things to watch on the ASX 200 on Thursday

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 S&P/ASX 200 Index (ASX: XJO) has faded from its intraday highs but remains in positive territory. In afternoon trade, the benchmark index is up 0.15% to 7,295.8 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are dropping:

Block Inc (ASX: SQ2)

The Block share price is down 5% to $151.00. This follows a similarly sharp decline for the payments company’s US-listed shares overnight. Investors continue to sell down fintech and buy now pay later shares. This appears to be on valuation concerns amid the prospect of interest rate increases coming sooner than anticipated.

Domain Holdings Australia Ltd (ASX: DHG)

The Domain share price is down 7% to $4.33. Investors have been selling this property listings company’s shares following the release of its half year results. This is despite Domain delivering a 27.9% increase in revenue to $175.3 million and a 34.2% jump in net profit to $26.1 million. However, an increase to its full year costs expectations could be weighing on its shares.

Telstra Corporation Ltd (ASX: TLS)

The Telstra share price is down 4% to $3.90. This is despite the telco giant delivering underlying earnings growth during the first half. Telstra posted a 4.4% decline in revenue to $10.5 billion but a 5.1% increase in underlying EBITDA to $3.5 billion. These earnings came in ahead of what analysts at Goldman Sachs were expecting. Some investors appear to have been expecting even better.

Wesfarmers Ltd (ASX: WES)

The Wesfarmers share price is down over 7% to $50.89 following the release of a disappointing half year result. The conglomerate reported broadly flat revenue but a 14.2% decline in net profit after tax to $1.2 billion. This was driven largely by the loss of ~34,000 store trading days due to COVID related closures. Investors may also have concerns with management’s plan to support customers in a more inflationary environment, rather than pass costs on.

The post Why Block, Domain, Telstra, and Wesfarmers shares are dropping appeared first on The Motley Fool Australia.

More reading

• Wesfarmers (ASX:WES) share price plunges 6% as Omicron takes its toll
• Telstra (ASX:TLS) share price slides 3% despite ‘strong mobile beat’
• ASX 200 (ASX:XJO) midday update: Telstra, Wesfarmers, and Woodside report
• Wesfarmers (ASX:WES) share price on watch after ‘most disrupted period’ since COVID onset
• Hold the phone! Telstra (ASX:TLS) delivers solid underlying growth and declares 8cps dividend

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 Block, Inc. The Motley Fool Australia owns and has recommended Telstra Corporation Limited and Wesfarmers 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 Lark Distilling Co Ltd (ASX: LRK) share price is climbing back from a 21% nosedive yesterday after the company announced the shock departure of its CEO.

At the time of writing, the Lark share price has rebounded 6.94% to $3.85.

Need to be brought up to speed? Here’s what is happening…

Why has the Lark CEO quit?

In a rather sudden announcement, Lark CEO Geoff Bainbridge has handed in his resignation in order to attend to a “personal matter” made known to the Board the day before.

It turns out that the personal matter involves a case of extortion. The Australian newspaper reported yesterday that it had obtained a video in which Bainbridge appears to be engaging in drug use.

Lawyers representing Bainbridge were quoted by the paper saying he is “the subject of a continuing, sophisticated and recently intensified extortion attempt by persons overseas using manipulated unverified images”. 

Further, the lawyers said: “The attempted extortion of Mr Banbridge commenced years before he had any involvement in Lark Distillery…”

In the meantime, non-executive director Laura McBain has taken the reins as interim managing director.

And seeing as Lark had been hunting for a CEO successor since December as part of its long term planning, the process has been kicked into overdrive.

Lark share price snapshot

The Lark share price opened yesterday at $4.10 and dropped as low as $3.48 throughout the day. By market close, Lark shares were sitting at $3.60 each — a decrease of just under 21%.

Today, Lark began trading at $3.99 but dropped back to $3.84 around lunchtime trade.

Over the last 12 months, the Lark share price has increased by 127%. In March last year, the shares were trading at a 52-week low of $1.63.

The shares hit a 52-week high of $5.61 in October, not long after the distiller completed the first stage of a capital raising, collecting $45.5 million from newly issued shares.

The company has a market capitalisation of $271 million.

The post Lark (ASX:LRK) share price rebounds 7% following sell-off appeared first on The Motley Fool Australia.

More reading

• Here’s why the Lark (ASX:LRK) share price is nosediving 21% today

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The Newcrest Mining Ltd (ASX: NCM) share price is holding up despite the company reporting a fall in revenue, profit, and production.

Newcrest shares are currently swapping hands for $23.80 apiece, a 1.26% gain. In comparison, the S&P/ASX 200 Index (ASX: XJO) is up 0.66%.

Let’s take a look at what the gold miner reported today.

Newcrest share price gains on financial results

Highlights of the company’s half-year (H1 FY22) results include:

• Statutory profit of US$298 million (A$414 million), down 46% on previous corresponding period (PCP) of H1 FY21
• Revenue of US$1,715 million, a 21% fall on PCP
• Earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $740 million, a 35% drop on PCP
• Gold production down 20% on PCP
• Copper production down 27% on PCP
• All-in sustaining cost of US$1,194 per ounce, up 23%
• All-in sustaining cost margin of US$502 per ounce, down 40%

What else happened in the half?

Newcrest declared a fully franked interim dividend of 7.5 US cents (10.4 AU cents), to be paid on Thursday, 31 March 2022.

The company reported major growth in its mineral resources and ore reserves, including a 10% rise in gold ore reserves to 54 million ounces.

The underlying profit was lower due to a planned upgrade of the Cadia SAG mill motor, which was completed in November. Production was also lower at the Lihir gold mine due to an expected fall in the grade of the ore.

The results reflected falling gold and copper sales due to less production at the mine, the company said. This wasn’t helped by a lower realised gold price, higher freight costs, and a strengthening Australian dollar against the US dollar impacting operating costs. Supply issues and rising demand also put pressure on the operating costs.

On a positive note, a higher realised copper price and less income tax expense partially offset these concerns. Overall, operating costs were lower due to lower sale volumes, a decreasing gold price, and other volume-linked costs.

Additionally, the company highlighted it is creating a brighter future via its safe and responsible mining. There has not been a fatality at the mine for six years.

Management commentary

Investors are pushing the Newcrest share price higher on the back of the results. This positive sentiment was echoed by CEO Sandeep Biswas, who said:

We have taken a big step forward in our profitable growth agenda during the first half of FY22. The depth and quality of our global organic growth portfolio was demonstrated through the announcement of the findings of the Cadia PC1-2, Red Chris Block Cave, Havieron Stage 1, and Lihir Phase 14A Pre-Feasibility Studies.

The outlook for the commodities that we mine is strong, and we have additional opportunities to further enhance our gold and copper production profile. Our team continues to pursue the potential for further open pit and underground opportunities to extend the life of Telfer, the development of Wafi-Golpu and potentially Namosi, all of which represent upside opportunity to our current base case projections.

What’s next for Newcrest?

Newcrest is on track to deliver its FY22 production guidance on the back of it completing major maintenance in September and the Cadia SAG mill motor upgrade.

The miner expects performance at the Lihir mine will improve in the second half of the financial year due to higher-grade ore.

Its all-in sustaining cost guidance also remains unchanged. However, the costs of managing COVID-19 are expected to be around $50-$60 million, up from the $35-$45 million estimated at the start of the financial year. This is due to government restrictions on travel, staff absences, logistic challenges, and isolation.

Newcrest believes the outlook for the commodities it mines is strong. The company will continue to improve its gold and copper production profile.

Commenting on the future outlook, Biswas added:

Following a solid start to the financial year, Newcrest is well placed to deliver a strong second half, to continue to pursue profitable growth, and to progress our Forging an Even Stronger Newcrest plan.

Newcrest share price summary

The Newcrest share price has fallen 3% in the past year, while it is up 3% in the past week.

For perspective, the benchmark ASX 200 has returned around 6.5% over the past year.

Newcrest has a market capitalisation of roughly $19.2 billion based on today’s share price.

The post Newcrest (ASX:NCM) share price lifts despite 46% profit drop appeared first on The Motley Fool Australia.

More reading

• Record exploration: Are ASX 200 shares gearing up for the next mining boom?
• Why Bendigo and Adelaide Bank, Crown, JB Hi-Fi, and Newcrest are pushing higher
• Is Newcrest Mining (ASX:NCM) set to start a share buyback in 2022?
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 on Friday

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 NRW Holdings Limited (ASX: NWH) share price is soaring after the company released its half-year results for the FY22 period before the market open.

At the time of writing, the diversified service provider’s shares are fetching $1.98 apiece, up 14.9%.

Let’s take a closer look at NRW’s performance in the first half.

NRW share price advances following growth across key metrics

The NRW share price is well into the green on the back of the company’s robust results for the six months ending 31 December 2021. Here are some of the key highlights:

• Revenue of $1,160 million, down 0.7% on the prior corresponding period (pcp) (H1 FY21 $1,168 million)
• Earnings before interest and tax (EBIT) of $74.6 million, up 26.4% (H1 FY21 $59 million)
• Profit before income tax of $64.2 million, up 59.3% (H1 FY21 $40.3 million)
• Cash balance of $195.9 million, up 33.7% on the prior period ($146.5 million)
• Fully franked interim dividend of 5.5 cents per share, up 37.5% (H1 FY21 4 cents per share).

What happened in H1 FY22 for NRW?

Investors are bidding up the NRW share price today as the company announced upgraded earnings for the FY22 period.

NRW is comprised of three divisions, which are civil, mining, and minerals, energy and technologies (MET).

In the civil business, revenue was lower than the pcp as major Pilbara-based projects were completed in FY21.

NRW noted that the high activity level in FY21 meant they had to hire more staff at unprecedented levels. Projects cost more because staff availability was severely impacted by COVID-19 measures including border closures. 

Lower activity in the first half of FY22 meant not as many staff were needed, which in turn has contributed to improved margins.

Across to the mining segment, activity levels increased by around 10% excluding the impact of lower revenue (and depreciation) on the Boggabri project.

Revenue increased to $611.3 million from $585.4 million in H1 FY21.

Lastly, revenue in the minerals, energy and technologies business increased to $359.2 million compared to $118.3 million in H1 FY21. This was mostly due to the inclusion of Primero, which was acquired by NRW in February 2021.

Over the six months to 31 December, the NRW share price rose by 20.4%.

What did NRW management say?

NRW managing director and CEO, Jules Pemberton, touched on the result, saying:

The results reflect what we said we would do. Activity levels are as we expected despite a series of challenges related to the COVID-19 pandemic. Earnings have recovered and delivered to the high end of guidance. We have also made progress in resolving claims and that is reflected in significantly improved cashflows in the half.

What’s the outlook for NRW for the remainder of FY22?

NRW advised that pandemic restrictions have continued for longer than previously anticipated. This has led to some challenges around recruiting staff for specific trades on future projects.

Nonetheless, the business is seeking to capture growth opportunities across the resources, infrastructure and renewables sectors.

The pipeline of opportunities currently stands at $19.5 billion. The order book has increased to $4 billion compared to $3.4 billion in June 2021. This is likely to continue growing following the completion of contract extension negotiations with Coronado Coal.

Revenue guidance for the full year remains between $2.4 billion to $2.5 billion. NRW noted that it has secured work in hand for the remaining six months of FY22 that supports the revenue forecast at the low end of the range.

In addition, earnings guidance (EBITA) for the full year has been updated to a range of $150 million to $155 million, reflecting the strong first-half results.

The post NRW (ASX:NWH) share price leaps 14% on ‘high end’ earnings and upgraded guidance appeared first on The Motley Fool Australia.

More reading

• Why Challenger, CSL, NRW, and Woodside shares are pushing higher
• ASX 200 (ASX:XJO) midday update: Telstra, Wesfarmers, and Woodside report

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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record another solid gain. At the time of writing, the benchmark index is up 0.6% to 7,330.9 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are pushing higher:

Challenger Ltd (ASX: CGF)

The Challenger share price is up 6.5% to $6.73. Investors have been buying the annuities company’s shares following the release of its half year results. Challenger reported a 21% increase in normalised net profit before tax to $238 million. This means the company is on track to achieve its FY 2022 normalised net profit before tax guidance of between $430 million and $480 million.

CSL Limited (ASX: CSL)

The CSL share price is up 4% to $274.49. This follows a positive response from brokers to the biotherapeutics company’s half year results. For example, both Morgan Stanley and Ord Minnett upgraded the company’s shares to overweight and accumulate ratings, respectively.

NRW Holdings Limited (ASX: NWH)

The NRW share price has jumped 14% to $1.97. This follows the release of the mining contractor’s half year results. For the six months ended 31 December, NRW delivered a 26% increase in operating earnings to $74.6 million. This represents the high end of its guidance range. In light of this strong form, management has narrowed its full year guidance towards the top end of its previous range.

Woodside Petroleum Limited (ASX: WPL)

The Woodside share price is up almost 5% to $27.87. This follows the release of the energy producer’s full year results, which revealed the more than tripling of its profits in FY 2021. Thanks to a modest increase in sales volumes and a surge in realised prices per barrel, Woodside reported a 93% increase in operating revenue to US$6,962 million and a 262% jump in underlying net profit after tax to US$1,620 million.

The post Why Challenger, CSL, NRW, and Woodside shares are pushing higher appeared first on The Motley Fool Australia.

More reading

• NRW (ASX:NWH) share price leaps 14% on ‘high end’ earnings and upgraded guidance
• The ‘tide is beginning to turn’: CSL (ASX:CSL) share price tipped to rise
• ASX 200 (ASX:XJO) midday update: Telstra, Wesfarmers, and Woodside report
• Woodside (ASX:WPL) share price hits 52-week high after tripling full year earnings
• 5 things to watch on the ASX 200 on Thursday

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 CSL Ltd. The Motley Fool Australia has recommended Challenger 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 Global Lithium Resources Ltd (ASX: GL1) share price is surging after the company released news of its Manna Lithium Project.

The project’s maiden inferred JORC mineral resource estimate has nearly doubled the company’s overall lithium mineral resource base.

At the time of writing, the Global Lithium share price is $1.51, 14.77% higher than its previous close.

However, earlier today Global Lithium shares soared to $1.56 – representing an 18% gain.

Let’s take a closer look at the news that’s sending the lithium explorer’s shares rocketing.

Global Lithium stock surges as resources nearly double

Global Lithium acquired 80% of the Manna Lithium Project in December for $33 million. Now, the Manna Project ­has received its maiden resource estimate.

It has been inferred to contain 9.9 million tonnes at 1.14% lithium oxide and 49 tantalum pentoxide parts per million.

That brings the company’s overall lithium estimates across both the Manna Project and its 100% owned Marble Bar Project to 18.4 million tonnes.

Global Lithium exploration manager Bryan Bourke said the company’s new mineral resource position is “a huge achievement for a company that only listed on the ASX in May last year.”

“We will carry out significant exploration programs at both sites in 2022 in parallel with a surging global lithium market that we plan to supply in the coming years,” Bourke continued.

Global Lithium is working to get approvals and plan logistics for a drilling program at the Manna Project.

Global Lithium share price snapshot

As Bourke noted, the company debuted on the ASX in 2021. Global Lithium launched with a share offer of 20 cents apiece during its initial public offering (IPO).

That leaves shareholders who got on board with the company prior to its listing boasting a 657% gain on their investment.

Additionally, since the start of 2021, the company’s share price has gained 32%.

The post Global Lithium (ASX:GL1) share price rockets 18% on ‘huge achievement’ appeared first on The Motley Fool Australia.

More reading

• How has the Global Lithium (ASX:GL1) share price managed to surge 58% in 2022?

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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Could the Magellan Financial Group Ltd (ASX: MFG) share price be a buy? It’s due to hand in the FY22 half-year result this week, so it’s going to be under the spotlight after all of the disruptions over the last few months.

The company may have some surprises. But we already know some of the things that the ASX share is going to say.

Magellan loses significant funds under management (FUM)

An important part of profit generation for funds management businesses is the amount of FUM it has. It may be obvious to say, but usually higher FUM means higher revenue and profit. Lower FUM can therefore translate into lower profitability.

At 30 November 2021, Magellan had total FUM of $116.4 billion.

On 20 December 2021, Magellan announced that it had lost the St James’ Place investment mandate, representing 12% of annual revenue.

At 31 December 2021, the FUM had dropped to $95.5 billion.

The FUM had fallen to $93.5 billion at 31 January 2022.

Unusually, Magellan then released a mid-month FUM update. At 9 February 2022, FUM had dropped again to approximately $87.1 billion. This was a combination of market movements, cash distributions paid, net outflows and notifications since 1 January 2022. It has experienced net outflows of around $5.5 billion since 1 January 2022, including net institutional outflows of $5 billion.

Billions are flowing out of Magellan at the moment, which is hurting the Magellan share price.

Underperformance may be a key reason that investors are pulling out. As an example, over the year to 31 January 2022, the Magellan Global Fund has underperformed its benchmark by 10%. It’s also showing underperformance over the last three, five and seven years.

Hamish Douglass steps down

Hamish Douglass was well-known as being the investment leader of Magellan.

But Mr Douglass has now taken a medical leave of absence to prioritise his health after intense pressure and focus on both his professional and personal life. The Magellan share price fell after the announcement of this news.

Mr Chris Mackay, Magellan’s co-founder, inaugural chair and chief investment officer between 2006 to 2012, will oversee the portfolio management of Magellan’s global equity retail funds and global equity institutional mandates.

Magellan noted that Mr Mackay is a highly experienced and respected global equity portfolio manager, with a “very strong” long-term record of managing global equities. He has been the portfolio manager of MFF Capital Investments Ltd (ASX: MFF) since 2013.

The funds management business also announced that Ms Nikki Thomas has rejoined the business as a co-portfolio manager. She originally joined Magellan in January 2008 and was involved in the global equity strategy since its inception in July 2007 to December 2017.

Is the Magellan share price a buy?

Despite the 60% drop of the Magellan share price over the last six months, analysts still don’t think it represents good value.

For example, UBS rates Magellan as a sell, with a price target of just $17 with potential for further FUM declines and the possible need to reduce fees to stop FUM flowing out.

Morgan Stanley also thinks Magellan is a sell, with a price target of $17.20.

Credit Suisse is ‘neutral’ on the business, but the price target is $16.50. Retail FUM outflow is expected to pick up around the end of the financial year as financial advisors look at what’s happened.

The post Is the Magellan (ASX:MFG) share price a smart contrarian buy? appeared first on The Motley Fool Australia.

More reading

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• Down 60% in a year, has the Magellan (ASX:MFG) share price reached the bottom? Brokers weigh in
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• Top brokers name 3 ASX shares to sell next week
• Why AGL, Magellan, Xero, and Zip shares are sinking

Motley Fool contributor Tristan Harrison owns MFF Capital Investments Limited and Magellan Financial Group. 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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