Tag: Motley Fool

The Kingsgate Consolidated Limited (ASX: KCN) share price is looking to finish Friday’s session deep in the red.

This comes after the company provided an update regarding its ongoing discussions with the Thai government.

At the time of writing, the gold miner’s shares are down 11.11% to $1.48 apiece. In comparison, the All Ordinaries (ASX: XAO) is down 0.73% to 7,540.4 points.

Let’s take a look at what the company announced to the ASX today.

Kingsgate progresses on Chatree, delays TAFTA

According to its release, Kingsgate is progressing with the Thai government on restarting the Chatree Gold Mine.

Located around 280 kilometres north of Bangkok, Chatree was historically a large-scale, low-grade, open-pit gold mine. However, in May 2016, the Thai government announced that the mine would close following accusations that villagers were poisoned by toxic waste. This led to all operations ceasing by the end of 2016, and Chatree was placed on ‘care and maintenance’ thereafter.

Further to the release, Kingsgate has mutually agreed to hold the issuance of the Thailand-Australia Free Trade Agreement (TAFTA) award.

The news of yet another delay has left investors frustrated, giving cause to sell off Kingsgate shares.

The date has been pushed back until 31 December 2022, which provides an opportunity for Kingsgate to get its affairs in order. Originally, the TAFTA award by the arbitral tribunal was scheduled for 31 October 2021, and then again 31 January 2022.

Kingsgate is working to optimise the restart process for Chatree, which could possibly include the initial refurbishment of plant number two. This would allow access to the current low-grade stockpile of 6.6 million tonnes of ore for processing. It is estimated that there are 73,000 ounces of gold and 780,000 ounces of silver.

Management comment

Kingsgate executive chair, Ross Smyth-Kirk commented:

It’s pleasing that we can engage in a mutual dialogue with the Thai Government about restarting Chatree, and at the same time deal with the TAFTA framework in a sensible and constructive manner. There is no downside to Kingsgate for the TAFTA award to be held for a further period, and I want to make it abundantly clear that this in no way impacts the restart of the Chatree Gold Mine.

About the Kingsgate share price

Over the past 12 months, Kingsgate shares have accelerated by more than 60%, but year to date they are down 23%.

The company presides a market capitalisation of about $328.66 million with approximately 221.32 million shares on its books.

The post This just sent the Kingsgate (ASX:KCN) share price tumbling 11% appeared first on The Motley Fool Australia.

More reading

• Here are the 3 most heavily traded ASX 200 shares this Friday
• Brokers name 3 ASX shares to buy today
• This ASX 200 share is a top buy after recent falls: broker
• Could opening WA borders expose ASX 200 mining shares to production risks?
• Should you buy Fortescue (ASX:FMG) shares before the mining giant reports next week?

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.

from The Motley Fool Australia https://ift.tt/Fc5tnRf

It has been another busy week for Australia’s top brokers. This has led to the release of a large number of broker notes.

Three broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

IDP Education Ltd (ASX: IEL)

According to a note out of Macquarie, its analysts have retained their outperform rating and lifted their price target on this language testing and student placement company’s shares to $35.00. This follows the release of a better than expected first half update. Looking ahead, Macquarie expects IDP to benefit from the reopening of borders and its growing footprint in the key India market. The IDP share price is trading at $28.78 this afternoon.

Megaport Ltd (ASX: MP1)

A note out of Citi reveals that its analysts have retained their buy rating and lifted their price target on this network as a service provider’s shares to $20.20. Citi was pleased with Megaport’s half year results. It also highlights that with Megaport’s investments now behind it, growth and margins look set to pick up. In addition, Citi sees potential upside to its medium-term forecasts from higher than expected take-up of MVE as the partner channel kicks in. The Megaport share price is fetching $13.80 today.

Mirvac Group (ASX: MGR)

Another note out of Citi reveals that its analysts have upgraded this property company’s shares to a buy rating with an improved price target of $3.13. Citi notes that Mirvac delivered a half year result in line with its expectations. And while it suspects the market may be disappointed that the company didn’t upgrade its guidance, it sees plenty of value in its shares to upgrade them to a buy rating. The Mirvac share price is trading at $2.50 on Friday afternoon.

The post Brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

More reading

• Top brokers say there are still ASX 200 growth shares with massive upside in 2022
• Why are these ASX 200 tech shares tumbling more than 6% on Friday?
• Here are 3 highly-rated ASX growth shares
• Here are the top 10 ASX shares today
• Why AMP, AVZ, Megaport, and NAB shares are pushing higher

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 Idp Education Pty Ltd and MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/z03m9YC

The battered Downer EDI Limited (ASX: DOW) share price could find some reprieve after Morgan Stanley reiterated its buy call on the ASX 200 share.

The engineering group shed around 4% of its value over the past two days after it posted a disappointing half year result.

The group’s interim earnings and revenue slid backwards and missed Morgan Stanley’s expectations.

Is this underperforming ASX 200 share a buying opportunity?

But that wasn’t enough to put the broker off as it believes the Downer share price has the potential to outperform from here.

There are a few reasons behind Morgan Stanley’s faith in the S&P/ASX 200 Index (ASX: XJO) share. Firstly, a number of one-off factors, such as issues caused by COVID-19, appear to have contributed to the earnings miss. These shouldn’t be a drag going forward.

Some areas of growth despite COVID headwind

The broker was also reassured after Downer’s Transport division delivered earnings growth of 16% in 1HFY22 compared to the same period last year despite bad weather. If not for this, management was confident that growth would have been significantly higher.

The performance of Downer’s Hospitality division was another sore point for shareholders as it recorded a $12 million loss. But at least management indicated that the loss will be minor in the current half. The turnaround is due to Downer’s successful exit of the problematic MCG contract.

Potentially better second half for the ASX 200 share

Investors can also find comfort in the fact that Downer usually delivers a stronger second half set of numbers.

Morgan Stanley pointed out that the gap between the first and second half may be even bigger this year due to Omicron.

In any case, the share price of this ASX 200 share is trading on an undemanding valuation and the group has a strong balance sheet.

How much is the Downer share price worth?

“It is focused on government-backed sectors that have a solid outlook,” said Morgan Stanley.

“Earnings stability remains an important attribute and something the company needs to demonstrate to justify higher multiples.”

It’s easy to overlook these strong points following the poor first half outcome. There’s also no guarantee that the COVID headwinds will abate in the current half. The lack of management guidance won’t help with confidence either.

Nonetheless, Morgan Stanley kept its overweight recommendation on the shares. But it lowered its 12 month price target on the Downer share price by $0.20 to $6.70 a share.

The post This ASX 200 share is a top buy after recent falls: broker appeared first on The Motley Fool Australia.

More reading

• Revenue, EBITA slide in 1HFY22 as Downer (ASX:DOW) share price plunges 7%
• 2 ASX shares to buy for dirt cheap right now: expert

Motley Fool contributor Brendon Lau 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.

from The Motley Fool Australia https://ift.tt/KYRBhDA

After two years of strict border controls to stop the spread of COVID-19 in Western Australia, the virus has found its way to the Pilbara region. But what might this mean for ASX 200 mining shares?

Australia initially took a cautious approach when the virus first reared its head in March 2020, closing its international borders. This led to the state and territories also shutting down travel within the country.

Fast forward to today, most of Australia has re-opened for tourism and business, except WA.

While WA Premier Mark McGowan made executive decisions to safeguard the public, he has also sought to protect the iron ore industry. But now COVID-19 has emerged in the remote mining region of Pilbara.

Last month, ASX 200 mining giant BHP Group Ltd (ASX: BHP) was forced to take measures after five of its staff contracted the disease. The workers self-isolated in their accommodation along with close contacts, Their quarantine was meant to be for 14 days. However, earlier this week the WA government shortened the isolation period to seven days and they were released.

Major ASX 200 mining shares such as Rio Tinto are already facing a tight labour market in the state. An increase in cases across WA — it recorded 37 new cases yesterday, its biggest number so far — means those challenges are unlikely to ease anytime soon.

How important is the iron ore industry?

Iron ore mining is a lucrative industry for the state, and the government will be keen to protect it. Iron ore miners based in WA brought in $155 billion to the state over the 2020-21 financial year. These included mining giants BHP, Rio Tinto Limited (ASX: RIO), and Fortescue Metals Group Limited (ASX: FMG), along with the other smaller players.

WA views the iron ore industry as critical in regards to filling up its coffers. Last financial year, the state took home $9.8 billion in royalty payments, which reflected a 26% increase year-on-year.

Given the size of the revenue source, Premier McGowan has mandated all mineworkers be triple vaccinated. Additionally, mining companies have enforced a rapid antigen test for anyone arriving on site.

What could a COVID-19 breakout mean for ASX 200 mining shares?

Mining companies have been pushing for the WA border to reopen to allow more workers into the state border. However, any border re-opening without stringent rules could potentially jeopardise a company’s workforce, adding to the labour squeeze.

This could affect ASX 200 mining shares. Bell Potter Securities’ Giuliano Sala Tenna said (quoted by the ABC).

Labour costs will rise and they won’t be able to get jobs done. There will be lots of dislocations within the projects, so we’re concerned that we’re going to see some weak quarterlies, which could see some knee-jerk reactions to some of the share prices [for] those miners.

When COVID-19 spread through another major iron ore producer, Brazil, it brought the industry to its knees.

However, Pilbara Ports Authority CEO Roger Johnston is more optimistic. He said (quoted by the ABC):

“We are uniquely lucky in Western Australia. We’re not dealing with one miner with one big mine, and then you shut it down. We have multiples of miners, many of them are very large and most of them have a suite of mines. When you spread your risk like that you’ve not vested everything in one mine.

I wouldn’t believe that you’re going to see, if there was an impact, mines shut down for months and months at a time as you’ve seen in Brazil.

While the existing labour shortage is an issue for ASX 200 mining shares in WA, a widespread outbreak of COVID-19 could exacerbate the problem. This could have an impact on production levels which in turn would mean less revenue for the state.

Multiple shutdowns across the Pilbara regions are something Western Australia is doing everything it can to avoid.

The post Could opening WA borders expose ASX 200 mining shares to production risks? appeared first on The Motley Fool Australia.

More reading

• Should you buy Fortescue (ASX:FMG) shares before the mining giant reports next week?
• Why IAG, Rio Tinto, Unibail, and Westpac shares are pushing higher
• Are ASX hydrogen shares in a ‘hot air’ bubble?
• Here’s what Rio Tinto (ASX:RIO) boss says is ‘causing some challenges’ right now
• Here are the 3 most heavily traded ASX 200 shares on Thursday

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.

from The Motley Fool Australia https://ift.tt/tJwuaE6

Shares in iron ore giant Fortescue Metals Group Limited (ASX: FMG) are up in afternoon trade, trading up 1.96% at $22.94.

As the price of iron ore begins to curl upwards from 52-week lows in November last year, iron ore players like Fortescue are back in fashion once more in 2022.

After taking a beating last year, both iron ore and the Fortescue share price had reached a low point before rekindling the flame to trade back at levels not seen since 1H 2021.

In the last month, the price of iron ore has gained 22% as market pundits are now pricing in an uptick in demand once global construction picks back up at the normal pace.

This bodes in well for Fortescue, given it is a price taker whose share price fluctuates with volatility in the iron ore markets. This relationship is shown in the chart below.

With this rally, analysts at JP Morgan have since chimed in on the investment debate, offering their outlook on Fortescue shares in 2022. Let’s take a closer look.

What’s in store for Fortescue this earnings season?

JP Morgan analysts are constructive on Fortescue’s upcoming earnings results and forecast profits to land slightly ahead of consensus.

Buoyant iron ore markets and the company’s pivot into new ventures are attractive points in the iron ore giant’s case, JP Morgan says. It recently updated its FY22/23 estimates and prescribed a 46% and 35% upgrade to earnings respectively.

“We look for 1H22 NPAT of $2.77 billion (consensus $2.70 billion) and expect a dividend of 86 cents per share (70% payout)– in line with consensus”, the broker noted in its release to clients.

Analysts at the firm also note that Fortescue offers investors exposure to long life mining operations, “with attractive margins and expansion optionality over the long term”.

Even with these factors, JP Morgan retains its neutral rating on the stock, citing several risks that need to be considered.

“The market continues to look for material details on hydrogen plans, along with progress on Iron Bridge” it said, a view it held fairly consistently last year.

“Our December 2022 price target is set in line with our valuation, rounded off to the nearest dollar” the broker noted, reinforcing its neutral stance on Fortescue shares.

The broker is also forecasting iron ore prices to increase across all major spot and futures contracts this quarter, implying a 47%–61% jump and then a 19%–22% spike the subsequent quarter.

Aside from that, its analysts are tipping Fortescue to trade on a 5.8% dividend yield in FY23 and 5.6% in FY24, slightly behind some competitors.

It also estimates the company to deliver a half year adjusted EBITDA of $4.8 billion, whereas the consensus of analyst estimates has Fortescue generating $2.07 billion in net profit.

“Our FMG valuation rises 4% on the new price deck with our FY22/23 earnings up 46%/35%, respectively” the broker concluded.

Fortescue reports earnings on 16th February. Investors can tune in then.

A bit more on Fortescue shares

Fortescue shares have pared gains in the past 12 months and have lost 3% in that time.

This year to date the picture is completely different, however. Since trading started on January 4, shares have spiked more than 19% and are now up over 11% for the month. This is ahead of the benchmark index.

The post Should you buy Fortescue (ASX:FMG) shares before the mining giant reports next week? appeared first on The Motley Fool Australia.

More reading

• Could opening WA borders expose ASX 200 mining shares to production risks?
• Are ASX hydrogen shares in a ‘hot air’ bubble?
• CBA’s stunning profit, Fortescue investing $10b in renewables. Scott Phillips on Nine’s Late News
• Fortescue (ASX:FMG) Future Industries is planning a HUGE solar and wind farm
• How far off is BHP (ASX:BHP) from producing ‘green steel’?

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.

from The Motley Fool Australia https://ift.tt/pZ47NPr

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a disappointing note. At the time of writing, the benchmark index is down 0.7% to 7,239.8 points.

Four ASX shares that are avoiding the market weakness today are listed below. Here’s why they are pushing higher:

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price is up over 4% to $4.74. Investors have been buying this insurance giant’s shares following the release of its half year results. For the six months ended 31 December, IAG delivered a cash profit of $176 million. While this was short of what the market was expecting, investors appear to be willing to overlook this due to management upgrading its FY 2022 gross written premium (GWP) guidance. It now expects GWP growth in the mid single-digits compared to low single digits.

Rio Tinto Limited (ASX: RIO)

The Rio Tinto share price is up 3% to $122.50. Investors have been buying Rio Tinto and other iron ore miners after the steel making ingredient continued its ascent. According to CommSec, the spot iron ore price has risen by a sizeable US$7.00 or 4.8% to US$153.75 a tonne.

Unibail-Rodamco-Westfield (ASX: URW)

The Unibail-Rodamco-Westfield share price is up 7.5% to $5.66. Investors have been buying this shopping centre operator’s shares after its announced the sale of a 45% stake in Westfield Carré Sénart and the creation of a joint venture with Societe Generale Assurances and BNP Paribas Cardif.

Westpac Banking Corp (ASX: WBC)

The Westpac share price is up 1% to $22.83. Investors may be buying the banking giant’s shares due to the prospect of rising interest rates. A stronger than expected inflation reading in the US has led to speculation the US Federal Reserve could act sooner. Rising rates would be a boost to the bank’s margins.

The post Why IAG, Rio Tinto, Unibail, and Westpac shares are pushing higher appeared first on The Motley Fool Australia.

More reading

• Merci! Here’s what’s driving the Unibail (ASX:URW) share price 7% higher today
• Here’s why the IAG (ASX:IAG) share price is charging 4% higher today
• ASX 200 (ASX:XJO) midday update: IAG upgrades guidance, Magellan sinks again
• Here’s what Rio Tinto (ASX:RIO) boss says is ‘causing some challenges’ right now
• 2 buy-rated ASX dividend shares with 4%+ yields

Motley Fool contributor James Mickleboro owns Westpac Banking Corporation. 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 Insurance Australia Group Limited. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/Mt3ADUr

It’s been a tough start to the year for S&P/ASX 200 Index (ASX: XJO) stocks. Fortunately, brokers have tipped plenty of ASX 200 growth shares to keep an eye on over the rest of this year.

Among them are some old favourites and others that might come as a surprise.

Let’s take a look at which shares experts are predicting will perform well in 2022.

3 ASX 200 growth shares brokers expect to rocket in 2022

Domino’s Pizza Enterprises Ltd. (ASX: DMP)  

The Domino’s Pizza share price is one that has caught brokers’ attention this year.

As The Motley Fool Australia recently reported, Goldman Sachs has a price target of $136.20 on the stock. That signals a 30% upside on its current share price of $104.26.

The broker is expecting strong growth from the company’s soon-to-be-released earnings for the first half of financial year 2022.

Meanwhile, UBS has slapped it with a smaller price target – expecting it to get to $120 – and a ‘buy’ rating. That represents a 15% upside.

IDP Education Ltd (ASX: IEL)

Another ASX 200 share worth watching, according to brokers, is IDP Education.

The company helps international students’ study in English speaking countries. It also owns the International English Language Testing System.

According to reporting by my Foolish colleague James Mickleboro, the company could be set for strong growth this year as international students return to their studies.

UBS currently has a $35.90 price target and a ‘buy’ rating on IDP Education’s shares, representing a 24% upside on its current share price of $28.94.

Goodman Group (ASX: GMG)

Finally, real estate investment trust (REIT) Goodman Group has brokers excited in 2022.

The REIT focuses on industrial real estate such as logistics and industrial facilities, warehouses, and business parks.

As The Motley Fool Australia recently reported, Citi has slapped the Goodman Group’s stock with a $27.50 price target – 20% higher than its current share price of $22.75.

The post Top brokers say there are still ASX 200 growth shares with massive upside in 2022 appeared first on The Motley Fool Australia.

More reading

• Here are 3 highly-rated ASX growth shares
• 3 buy-rated ASX growth shares to make you smile
• 3 buy-rated ASX 200 shares with plenty of upside potential
• IDP Education (ASX:IEL) share price tumbles after record result falls short of expectations
• How are ASX Real Estate Investment Trusts (REITs) performing 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. owns and has recommended Idp Education Pty Ltd. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/MRnWoC1

The S&P/ASX 200 Index (ASX: XJO) is, unfortunately, having a pretty depressing end to the week so far this Friday. At the time of writing, the ASX 200 is down by 0.71% after falling a little further earlier in the trading day. But the Zip Co Ltd (ASX: Z1P) share price is putting that move to shame.

Zip shares are currently down a nasty 6.2% at just $2.88 each That’s a lot closer to the company’s 52-week low of $2.78 than its 52-week high of $14.53 a share. Today’s move puts this buy now, pay later (BNPL) company’s 2022 performance at a sobering -33.5%.

So what might be behind Zip’s share price malaise this Friday?

Well, it’s possible Zip shares have just been caught up in the selloff that has gripped the ASX tech shares sector. We’ve already covered Appen Ltd‘s (ASX: APX) nasty fall earlier today. So perhaps Zip is just experiencing a similar fate.

But there is some other relevant news out today that might be affecting investor’s appetites for Zip shares too.

Last night (our time), the US BNPL company Affirm Holdings Inc (NASDAQ: AFRM) reported its quarterly results for the December quarter. As my Fool colleague Brooke covered this morning, Affirm was forced to release the results early after the company mistakenly gave some of it away on Twitter.

Buy now, pay later? Investors are paying now, but not buying Zip shares…

Affirm reported a 77% increase in revenue over the quarter. But it also reported a net loss of US$159.7 million. Investors evidently weren’t too impressed. The Affirm share price promptly crashed 21.4% over last night’s US trading session.

So obviously some of this sentiment alone might have flown into the zip share price. Block Inc CDI (ASX: SQ2), the new owner of fellow BNPL provider Afterpay, has also lost a good chunk of change today.

But another warning came out of Affirmt that might have spooked investors even further.

According to reporting in the Australian Financial Review (AFR) today, Michael Linford, chief financial officer (CFO) at Affirm, warned investors that rising interest rates pose a massive risk to Affirm’s business. He said that a “1 per cent lift in rates ‘beyond current expectations’ would result in 20 basis point impact to revenue less transaction costs as a percentage of gross merchant value in FY2023”.

Investors in both the US and here in Australia are already arguably on edge over inflation and interest rate rises. So that was probably not what investors wanted to hear. Worryingly for Zip, it’s possible that the same factors could affect Zip’s own business in a similar fashion.

So that might be why ASX investors are punishing Zip shares today so far.

At the current Zip share price, this ASX BNPL share has a market capitalisation of $1.71 billion. 

The post Do Affirm’s warnings raise red flags for the Zip (ASX:Z1P) share price? appeared first on The Motley Fool Australia.

More reading

• Why are these ASX 200 tech shares tumbling more than 6% on Friday?
• ASX 200 (ASX:XJO) midday update: IAG upgrades guidance, Magellan sinks again
• ASX BNPL shares in focus after Affirm (NASDAQ:AFRM) share price tumbles 21%
• After a disastrous 2021, the Zip (ASX:Z1P) share price has tumbled another 30%. What’s going on?
• The Zip (ASX:Z1P) share price has 100% upside – broker

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 Block, Inc. and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/E5PSDzT

Many investors are taking a closer look at Bitcoin (CRYPTO: BTC) as it faces unchartered territory.

The potential of rising interest rates is a phenomenon that cryptocurrencies have not yet seen in their existence. Though, it is looking more likely after the United States consumer price index hit a staggering 7.5% year-over-year increase last night.

Today, the Reserve Bank of Australia (RBA) has acknowledged the surprisingly hit figure. RBA Governor Philip Lowe responded by recognising that a rate increase this year may now be ‘plausible’.

Despite this, recent research from JPMorgan suggests there could still be a pathway to new all-time highs for Bitcoin.

So, where could Bitcoin be heading from here?

Short term pain before a long term gain

In the past week, the price of Bitcoin has rallied nearly 17%, recuperating some of the ground lost between November and January. However, in a recent report from JPMorgan research analyst Nikolaos Panigirtzoglou, there could be more downside in the short term.

According to the report, Bitcoin should be fairly valued at around US$38,000. Interestingly, the analyst bases this on a comparison of volatility against gold.

Panigirtzoglou highlights that because Bitcoin is four times more volatile than the precious metal, its price target is US$38,000. Moreover, if the cryptocurrency was able to reach parity to gold on a volatility basis, then its fair value would be US$150,000.

As such, the analyst applied a long-term price target of US$150,000 on Bitcoin. Although, this would be reliant on it gaining more mainstream acceptance — an outcome that would presumably reduce volatility.

Is Bitcoin correlated with other investments?

Cryptocurrency advocates have long touted cryptocurrency — namely Bitcoin — as an uncorrelated asset class. Essentially, this means its performance is relatively untethered to other investments such as shares, real estate, etc.

More recently, the behaviour of the long-standing cryptocurrency has started to resemble that of tech shares. In the chart below, Bitcoin moved counter to the S&P/ASX All Technology Index (ASX: XTX) back in March 2021.

However, the pair began moving more synchronously in November last year.

Nonetheless, some crypto experts believe the correlation will be short-lived. Bitcoin strategist at Validus Power Corp, Greg Foss, reckons the similarity in performance will separate in the future.

Foss said:

Bitcoin eventually will be viewed as insurance and, therefore, will de-correlate from the rest of the assets.

The post Could Bitcoin (CRYPTO:BTC) be eyeing off a $150,000 future? appeared first on The Motley Fool Australia.

More reading

• Bitcoin price rally fizzles. Here’s what the experts are watching for next
• The best cryptocurrency exchanges for Australians
• $3.6 billion crypto heist thwarted, sending this obscure cryptocurrency skyrocketing
• This global financial giant is buying up Bitcoin. Could ASX banks be next?
• Why Bitcoin and Ethereum Were Up Big Today

Motley Fool contributor Mitchell Lawler owns Bitcoin. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Bitcoin. The Motley Fool Australia owns and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/yVjqOpz

The Unibail-Rodamco-Westfield CDI (ASX: URW) share price is jumping today on the back of a sale and joint venture announced after the market closed yesterday.

The real estate company — which owns and runs 85 shopping centres and more than 50 flagship sites in Europe and the United States — also released its full-year results for the 2021 financial year yesterday.

At the time of writing, the Unibail Rodamco share price is up 7.32% at $5.65.

So what does this joint venture mean for the company? And how has it fared over the last 12 months with the worldwide COVID-19 challenges?

Let’s dive straight in…

Unibail-Rodamco’s joint venture

The Unibail-Rodamco share price is gaining after the company announced it had agreed to sell a 45% stake in Westfield Carré Sénart in Paris.

It will also enter into a long-term joint venture and management contract with insurance companies Societe Generale Assurances and BNP Paribas Cardif to provide asset and property management services.

The centre has an implied sticker price of €1 billion with a transaction date expected in Q1 FY22. The sale will cut €280 million of debt from the company’s balance sheet.

Unibail-Rodamco-Westfield CEO Jean-Marie Tritant said:

We are pleased to announce the completion of this transaction and the creation of a long-term partnership with two leading French institutional investors.

The agreement is fully in line with our European disposal strategy to find the right joint venture partners for select assets, allowing us to release capital while continuing to leverage our established management capabilities.

FY21 full-year results

Additionally, the Unibail-Rodamco share price is likely being boosted by the company’s earnings for FY21, which it also released after the market closed on Thursday.

The real estate company saw decreased vacancies across the board, with “tenant sales approaching pre-COVID levels”. In fact, sales-based rents were up 30% against 2019.

As of 31 December 2021, the Unibail-Rodamco portfolio was valued at €54.5 billion — retail accounted for 86% of this, offices 6%, convention and exhibition venues 5%, and services 2%. It has also seen its asset values stabilise.

Further, it reported “above guidance” adjusted recurring earnings per share (EPS) of €6.91. Its 2022 adjusted earnings per stapled share (AREPS) are predicted to be between €8.20 and €8.40.

The company has also made a €2.2 billion debt reduction dent in its deleveraging plan and is pushing towards its goal of reducing its US financial exposure this year and the next.

Tritant said Unibail-Rodamco’s “operational performance over the past 12 months, achieved in the extremely difficult context of COVID-19, gives us great confidence for 2022”.

Unibail-Rodamco share price snapshot

Over the past 12 months, the Unibail-Rodamco share price has increased by 21%. It saw its highest price of $6.53 in June and its lowest of $4.25 in February.

Its shares are also up 18% this year to date.

The company has a market capitalisation of $1.01 billion and a price-to-earnings ratio (P/E) of 6.13.

The post Merci! Here’s what’s driving the Unibail (ASX:URW) share price 7% higher today appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: IAG upgrades guidance, Magellan sinks again

Motley Fool contributor Alice de Bruin 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.

from The Motley Fool Australia https://ift.tt/p8qB5Nx