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The WiseTech Global Ltd (ASX: WTC) share price has suffered at the hand of a tech-led selloff. Now down 22% since the beginning of the year, could the logistics software company present a buying opportunity?

In early morning trade, shares in WiseTech are feeling the pinch again, trading 2.8% lower to $45.41. The WiseTech share price is now 24.8% below its 52-week high of $60.40.

What does WiseTech do again?

WiseTech aspires to be the operating system for global logistics. Keeping track of all the variables within a supply chain can be complex. However, WiseTech’s cloud-based software solutions — such as CargoWise — bring all of the information into one location.

The technology helps logistics providers be more productive by giving them a broad toolset when it comes to the logistics industry. This includes features for handling customers, warehouse management, geocompliance, transport, etc.

Since its inception in 1994, WiseTech has grown to servicing 24 of the top 25 global freight forwarders on the planet. Likewise, the company’s software is used by 41 of the top 50 global third-party logistics providers.

Is the WiseTech share price in the buy zone?

A slump in the WiseTech share price could be attributed to a broader retreat in sentiment across tech shares. In fact, the S&P/ASX All Technology Index (ASX: XTX) is still down 17% year-to-date.

Staggering rates of inflation have seen investors begin to shift more into value shares. Last night, the United States Federal Reserve recorded its hottest inflation reading in 40 years, hitting 7.5%.

However, Bruce Williams of Elston Asset Management believes the value proposition offered by WiseTech is a good opportunity.

In an interview with Livewire, portfolio manager Williams said:

WiseTech is growing very, very strongly. They’ve got a lot of the sector as clients and it’s a five-year integration program or up to five years. They continually build revenue, not only from new client wins but from existing clients as well.

Fellow Fool, Tony Yoo, recently covered another expert’s take on WiseTech and its share price. Jun Bei Liu of Tribeca noted the company’s shares as a ‘great buying opportunity’ following the recent pullback, adding:

The last result was just incredibly strong and we think they still have a bright future

Lastly, WiseTech is expected to report its first half results on Wednesday 23 February.

The post ‘Bright future’: Is the Wisetech (ASX:WTC) share price on the way back up? appeared first on The Motley Fool Australia.

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• Tech train wreck: WiseTech (ASX:WTC) share price tumbles 8%

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended WiseTech Global. The Motley Fool Australia owns and has recommended WiseTech Global. 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 Magellan Financial Group Ltd (ASX: MFG) share price is on course to end the week with a day in the red.

In early trade, the embattled fund manager’s shares were down 6% to $17.95. They have since recovered a touch but remain down 2.5% to $18.58 at the time of writing.

This means the Magellan share price is now down 62% since this time last year.

Why is the Magellan share price falling?

Investors have been selling down the Magellan share price today after it provided an out-of-cycle funds under management update.

According to the release, at the close of the US market on 9 February, Magellan’s funds under management stood at approximately $87.1 billion. This represents funds under management declines of 6.85% from $93.5 billion at the end of January and 8.8% from $95.5 billion at the end of December.

The release explains that Magellan has experienced net outflows (excluding cash distributions paid) of approximately $5.5 billion since 1 January. This comprises net institutional outflows of $5.0 billion and net retail outflows of $0.5 billion.

These funds under management and net outflows are unaudited and comprise amounts that have been or are being redeemed of $3.6 billion and amounts for which Magellan has received notification of intention to redeem of $1.9 billion.

The latter could well increase as the month rolls on. Particularly given how a number of influential investment ratings agencies have put its funds under review and Zenith Investment Partners has reportedly cut the ratings on five of Magellan’s global funds to just “recommended” from “highly recommended.”

The AFR reports that Zenith Investment Partners has called Hamish Douglass’ indefinite leave a “material loss” for the fund manager.

It quotes Zenith saying: “Given our high regard for Mr Douglass, we consider his leave of absence to be a material loss for Magellan’s global equities suite and overall business.”

All eyes will be on Magellan’s next funds under management update at the start of March.

The post Magellan (ASX:MFG) share price slides 6% as FUM bloodbath continues appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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Australia can play a “pivotal role” in the hydrogen export market, a handbook released by Australia and New Zealand Banking Group Ltd (ASX: ANZ) reveals. In what could spell good news for ASX hydrogen shares, the report says, “Australia is remarkably well-positioned to benefit from the growth of hydrogen industries and markets”.

Last year proved to be a good one for ASX hydrogen shares, with five companies gaining more than 100% in 2021.

So what’s the outlook for hydrogen? Let’s take a look.

Clean energy opportunity

Hydrogen as a fuel source will be “key” to reducing carbon emissions in the economy, a foreword to the ANZ Hydrogen Handbook stated.

In comments signed off by ANZ chief executive Shayne Elliot, group executive Mark Whelan and managing director Christina Tonkin, the report said:

The rapid emergence of hydrogen as a low-emissions fuel source offers another pathway to achieving net-zero carbon. With its distinctive properties as an energy carrier, we believe hydrogen will be key.

With abundant wind and solar energy resources, Australia is well positioned to play a pivotal role in developing a hydrogen export market to key customers in Asia, in particular those in Japan, Singapore and South Korea. Our customers are clearly pursuing the commercial production of hydrogen to varying degree.

ASX hydrogen shares

Earlier this week, Goldman Sachs said the hydrogen market could be worth more than US$1 trillion ($1.4 trillion) by 2050 — and predicted Australia to play a major role in it.

A notable ASX hydrogen share that could benefit is Fortescue Metals Group Limited (ASX: FMG) and its green energy subsidiary, Fortescue Future Industries (FFI).

The company last year announced plans to build a hydrogen-equipment manufacturing facility in Queensland. The Global Green Energy Manufacturing Centre, in Gladstone, will produce up to 2 gigawatts of electrolysers each year. Electrolysers split hydrogen from water and, if run on renewable electricity, are entirely carbon neutral.

Fortescue chair Andrew Forrest this week took aim at the Morrison government’s assertion that coal and gas-generated hydrogen can be billed as ‘clean’.

The Fortescue Metals Group share price closed yesterday at $22.28, up 3.97%. It is now up 16% this year to date.

With investors keen to jump on the green energy bandwagon, 2021 saw huge increases for some ASX hydrogen shares. The biggest gainer was Province Resources Ltd (ASX: PRL), which saw its share price skyrocket 1,300% last year.

Other ASX hydrogen shares that recorded big gains in 2021 include Sparc Technologies Ltd (ASX: SPN), Pure Hydrogen Corporation CDI (ASX: PH2), Environmental Clean Technologies Ltd (ASX: ECT), and QEM Ltd (ASX: QEM).

Three key openings

There are three major openings for Australia when it comes to clean hydrogen, ANZ executive director John Hirjee suggests.

The first is energy export. Hirjee commented Japan and South Korea need cleaner energy to meet their reduction targets. He believes clean hydrogen is ideal.

In a research paper forming part of the handbook titled ‘Hydrogen — is it a lot of hot air?’, Hirjee said:

This is a significant opportunity for Australia, given the potential for ample renewable energy and convertible fossil fuel reserves. However, the export industry is likely to take some years to develop to full-scale commercialisation.

The domestic economy is also a major opportunity for Australia, given hydrogen can power our cars, Hirjee stated. Finally, he believes green hydrogen production can help build energy system resilience.

While firmed renewable energy is the least capital intensive form of producing clean hydrogen, green H2 production can respond rapidly to variations in electricity production and contribute to frequency control in the electricity grid.

However, the commercialisation of hydrogen is not without it challenges. the report says. Electrolysis, the method used to produce hydrogen, is expensive. Once produced, hydrogen is difficult and costly to store and transport, due to the gas being highly flammable and volatile.

So what’s the outlook for ASX hydrogen shares?

By 2050, hydrogen could power 400 million cars, 20 million trucks and 5 million buses, Hydrogen Council forecasts cited in the report predicted.

Hydrogen is experiencing “unprecedented momentum” and is vital for a clean and secure energy future, the report noted.

ANZ believes Australia is “uniquely positioned” to become a leader in clean hydrogen. In a research paper forming part of the report, author Jessica Paterson summarised:

The proximity of Australia to the Asia Pacific region provides a key advantage for supplying Asian markets with H2, as other potential competitors could be disadvantaged by additional transport costs.

Furthermore, Australia can capitalise on its proven track record in energy exports such as LNG, especially to comparatively resource-constrained countries.

The post Are ASX hydrogen shares in a ‘hot air’ bubble? appeared first on The Motley Fool Australia.

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• 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
• Sparc Technologies (ASX:SPN) share price rallies 7% on green hydrogen news
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• Can Australia win the $1.4 trillion global hydrogen race?

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.

Making electric vehicles mainstream, selling them for a profit, and becoming the richest man in the world in the process — Tesla (NASDAQ: TSLA) CEO Elon Musk has done it all. And by generating profits for two straight years, Tesla has proved its naysayers wrong. The company’s stock has risen some 1,400% over the past three years.

The big question now is whether the stock is still a buy. Again, the investors are sharply divided. Let’s take a closer look at the stock to see whether it’s Tesla bulls or bears who are likely right about the stock.

The growth of electric vehicles

Had there been any doubts earlier, the growth in electric vehicles (EVs) in the past couple of years made it clear that the future of transportation is electric. Electric car sales, including plug-ins, more than doubled in 2021 to 6.6 million units. That was nearly 9% of the global car sales for the year. At 3.4 million units, the EV sales in China alone accounted for more than half of the global sales. Around 2.3 million EVs were sold in the Europe and over half a million in the U.S. 

Tesla sold the most EVs globally in 2021, with 936,000. The company operates in all three major markets for EVs, with 352,000 cars sold in the U.S., 321,000 in China, and 170,000 in Europe last year. Presence in all the major markets not only diversifies Tesla’s revenue, but also allows it to grow faster. Volkswagen followed Tesla, selling 763,000 electric vehicles in 2021.

The demand for EVs right now exceeds the supply. This could well be the case over the next few years until the companies ramp up their EV production. That bodes well for Tesla, which is not only selling the most EVs right now but can continue doing so, considering its focus on expansion. Tesla’s factories in Texas and Berlin are at the equipment test stage, and the company expects to start vehicle deliveries from both factories soon.

Furthermore, the company is doing exceptionally well on the margins front. Tesla reported an operating margin of 14.7% for the fourth quarter.

TSLA Operating Margin (Quarterly) data by YCharts

The EV maker generated industry-leading margins in the third quarter as well.

Tesla stock trades at a premium

Tesla’s leadership position in EVs gets reflected in the premium valuation of its stock. Tesla stock trades at a significantly higher price-to-earnings (P/E) ratio compared to legacy automakers.

TSLA PE Ratio data by YCharts

What’s more, Tesla stock is trading at a significant premium compared to even the top technology stocks.

TSLA PE Ratio (Forward 1y) data by YCharts

Tesla’s P/E to growth (PEG) ratio, which divides its P/E ratio by its expected earnings growth, is less than 1. All other things remaining equal, a lower PEG ratio is better for a stock, and a ratio below 1 indicates that a stock likely isn’t overvalued. Tesla’s lower PEG ratio reflects its high earnings growth.

Tesla faces stiff competition

Tesla had a huge edge over its competition so far. When it started selling EVs, no other manufacturer was doing so seriously. But that isn’t the case anymore. With so many new EV companies as well as traditional car companies pouring billions of dollars into electrification, Tesla faces some stiff competition. Volkswagen intends to make half of its sales electric by 2030. Ford aims to make 40% to 50% of its sales electric by 2030. Then there are new EV companies, such as Lucid and Rivian, trying to capture a share of the EV pie.

In China, apart from global automakers, Tesla also faces competition from domestic EV companies such as BYD, Nio, and XPeng.

Is the EV pioneer’s stock a buy?

Tesla stock’s premium valuation is in large part due to its higher revenue growth and higher margins compared to other automakers. However, with rising competition, the higher growth and margins may not last very long.

Yet, Tesla can enjoy the high growth and margins at least for the next couple of years, till its competitors catch up. That would be enough to further solidify Tesla’s position in the EV market. This growth potential already gets reflected in the stock’s valuation.

However, beyond that, Tesla needs to show that it can sustain the high growth at such high margins. Otherwise, the company will have to look at profitability-enhancing sources — maybe full self-driving, robo-taxis, or car insurance based on drivers’ risk profiles generated using informatics — to justify its valuation.

So, Tesla could be an EV company, with its current offerings, which does not indicate much upside potential for its stock. Or it can continue disrupting the EV space to create still higher value for its shareholders. The latter case is unproven yet, and it is important to note that buying Tesla stock believing that the company will be successful in autonomous driving, or other such endeavor, entails risk. Of course, Tesla can succeed there too, but if you are risk averse, you may not want to jump in right now. 

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

The post Is Tesla stock a buy? appeared first on The Motley Fool Australia.

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Rekha Khandelwal has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends BYD, NIO Inc., Tesla, and Volkswagen AG. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

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The Wesfarmers Ltd (ASX: WES) share price is falling on Friday despite being given some good news.

At the time of writing, the conglomerate’s shares are down 1.5% to $52.56.

Wesfarmers share price lower despite acquisition update

The Wesfarmers share price is in the red this morning despite revealing that it has received confirmation from the Australian Competition and Consumer Commission (ACCC) that it will not oppose its proposed acquisition of Australian Pharmaceutical Industries Limited (ASX: API).

Wesfarmers notes that ACCC clearance was a condition precedent for the transaction. This brings the transaction a step closer to successfully completing around the end of the first quarter of the 2022 calendar year.

What did the ACCC say?

The ACCC advised that its review primarily focused on the markets for the retail sale of over-the-counter pharmaceutical and beauty and personal care products.

Positively for Wesfarmers, the regulator didn’t see any issues with the transaction due to competition from the likes of Coles Group Ltd (ASX: COL) and Woolworths Group Ltd (ASX: WOW).

ACCC Commissioner Stephen Ridgeway explained: “Our investigation showed that there are many large and well-established retailers, including Chemist Warehouse, Woolworths and Coles, that will compete strongly with Wesfarmers after the acquisition in both the market for over-the-counter pharmaceutical products and the market for beauty & personal care products.”

“We consider that API’s competitors will continue to compete strongly with Wesfarmers after the acquisition,” he added.

The ACCC also considered the impact that owning the Priceline Sister Club and 50% of Flybuys could have on competition. This includes whether the acquisition would reduce competition by incentivising and locking customers into shopping at Wesfarmers-aligned pharmacies and providing it with access to increased customer data.

Mr Ridgeway said: “Wesfarmers acquiring the Priceline Sister Club loyalty scheme will not have a lock-in effect on consumers in any market. We also consider the benefits obtained from the additional customer transaction data do not appear to be so strong as to result in a substantial lessening of competition from the acquisition. Customers generally do not only join one loyalty scheme, and major competitors to Wesfarmers after the acquisition will have, or could start, their own customer loyalty schemes.”

The post Wesfarmers (ASX:WES) share price lower despite API takeover update appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended COLESGROUP DEF SET 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 Paladin Energy Ltd (ASX: PDN) share price has been trickling downwards recently.

Based on its current price of 78 cents, Paladin shares have dropped by 15.76% in a month. Within that time, the Aussie miner has given a number of updates on its uranium operations to shareholders.

Want to know what’s going on? Let’s dive in…

Here’s the latest on the Paladin share price

Last Friday, Paladin was one of the three most highly traded ASX 200 shares. The day before that, the company released its latest investor presentation.

In it, the company reported a cash position of US$38 million (as of 31 December 2021) with no corporate debt. The miner says this will allow it to extend its marketing potential.

Paladin was most concerned with updating investors on its West African uranium project — the Langer Heinrich Mine (LHM) in Namibia.

Plans are now in place to recommence operations at LHM — “a globally significant, long-life operation” — after pressing pause in 2018 due to low uranium prices.

There is no set date as yet for recommencing. The miner is looking for self-funded options to commence early works this year.

Comment from management

According to Paladin, uranium already accounts for 20% of electricity generation in the US and 25% in the European Union.

With demand growing for the “reliable baseload power source”, Paladin is passionately aiming to maximise the value of its 75% stake in LHM, and to process and export its explorations.

It has already signed an offtake agreement with CNNC Overseas Uranium Holdings Limited (a subsidiary of China National Nuclear Corporation) for 25% of its future production, and is looking for more customers.

Commenting on its December quarterly activities, Paladin CEO Ian Purdy said:

The Restart Plan Update is the conclusion of an extensive work stream that has reinforced our confidence in Langer Heinrich as a low-risk, robust, long-life operation.

We continue to engage with global nuclear energy utilities to secure long term contracts to underpin the restart of Langer Heinrich and ensure the project, when restarted, will deliver significant economic benefit to all of our stakeholders.

The improving structural outlook for uranium markets and the transition towards the decarbonisation of global electricity generation provides the platform for an exciting period ahead for Paladin and I look forward to updating you on our progress.

Paladin share price snapshot

The Paladin share price grew from 24 cents to 88 cents in 2021. That 266% increase made it one of the best performing ASX uranium shares of 2021.

The company has a market capitalisation of $1.98 billion and 2.68 billion shares on issue.

The post Why has the Paladin Energy (ASX:PDN) share price tumbled 15% in a month? appeared first on The Motley Fool Australia.

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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.

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Rio Tinto Limited (ASX: RIO) shares have been benefiting from a resurgent iron ore price.

The industrial metal is currently trading at US$152 per tonne, having dropped to lows of some US$87 per tonne in mid-November.

The surging price have helped propel Rio Tinto shares to a 19% gain this calendar year, even as the S&P/ASX 200 Index (ASX: XJO) has slipped 4%.

Of course to mine that iron ore you need skilled people in the field. And that, says Rio Tinto Iron Ore CEO Simon Trott, is “causing some challenges”.

What’s all this about a labour shortage?

Unemployment levels are falling across Australia.

But after 2 years of border closures to the rest of the nation and with COVID-19 now leaking into the state, the big miners like Rio Tinto are facing a particularly tight labour market in Western Australia.

And with 37 new local cases reported yesterday, by far the most in WA since the pandemic spread down under, those labour challenges aren’t likely to go away anytime soon.

In an effort to keep its own work force safe and free from week-long periods of isolation, Rio Tinto tests its workers before they fly out to the mine sites.

According to Trott (quoted by ABC News):

We have to be ready. We’re going to have to respond to the circumstances that we face each time, and we can’t stand here and predict exactly what will happen in the future. Certainly, we’re seeing greater cases in the community.

Rio Tinto tests some 12,000 of its workers at Perth Airport each week. Last month 2 of those workers tested positive before flying to the Pilbara.

While those workers were screened out before arriving on the mine site, Trott doesn’t expect this to last indefinitely:

A really big part is about making sure that we plan for having cases on site. As we’ve seen in other states in Australia, and across the world, we can’t imagine that we will be immune from it.

As ABC News reported, Rio Tinto is expanding its rapid antigen tests beyond just those working at the mine sites.

“We have, in the last week, stood-up screening for employees at our Perth office as well, where employees will be tested on their first day at work each week,” Trott said.

As for the labour crunch hitting miners in WA?

According to Trott:

Clearly that does have an impact in terms of our day-to-day operations and the activities that we do, and we need to work our way through that. It is certainly causing some challenges at the moment.

How could this impact Rio Tinto shares?

Higher labour costs and project disruptions could see some investors hitting the sell button when the quarterly activity reports come out.

Bell Potter Securities’ Giuliano Sala Tenna said:

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.

The post Here’s what Rio Tinto (ASX:RIO) boss says is ‘causing some challenges’ right now appeared first on The Motley Fool Australia.

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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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If you’re looking for exposure to the lithium sector, then you may want to check out the two ASX shares listed below.

These lithium shares have been named as buys with huge upside potential from current levels. Here’s what you need to know:

Allkem Ltd (ASX: AKE)

The team at Morgans believe this lithium miner is the best option in the space right now. Its analysts recently put an add rating and $13.25 price target on the company’s shares. This compares favourably to the current Allkem share price of $9.90.

The broker commented: “Our preferred stock for lithium exposure, Allkem. AKE announced a 68% qoq increase in revenue at Olaroz and a 7% CY21 beat of production guidance at Mt Cattlin with large increases in realised prices at both projects. AKE expects USD20k/t for lithium carbonate sales in 2HFY22 at Olaroz. Production growth continues with Naraha commissioning, progress on Sal de Vida and FID expected on James Bay in 2QCY22. Construction is expected to commence the following quarter.”

Vulcan Energy Resources Ltd (ASX: VUL)

This lithium developer could be the best value lithium share if the team at Germany-based Alster Research are on the money with their recommendation. The broker currently has a buy rating and $25.00 price target on the company’s shares. This is more than double the latest Vulcan share price of $9.70.

It commented: “At this point, Vulcan has marketed its initial production volumes for the first 5-6 years. We expect the upcoming definitive feasibility study (DFS) to create some leeway. In the near term, we expect the admission to FSE as a catalyst for the stock, as future capital increases will be accessible to a broader audience. Thus, liquidity and interest will most likely increase. We confirm our PT of AUD 25.00, equivalent to EUR 15.81, and reiterate our BUY recommendation.”

The post 2 ASX lithium shares with huge upside potential in 2022 appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro owns Allkem 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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

What happened

Easy come, easy go. After two straight days of mind-boggling gains, shares of tiny, relatively unknown — at least up until this week — Australian electrical equipment stock Tritium DCFC Limited (NASDAQ: DCFC) are succumbing to gravity this morning.

By market close, the maker of charging stations for electric vehicles saw its stock slide 15.1%.

So what

Let’s recap, shall we? On Tuesday, Tritium stock soared on an announcement that it is building a new factory in Tennessee. One day later, Tritium stock was off to the races once again, this time because President Biden stood on a stage and praised the company (and its new Tennessee factory) by name.

To an extent, this was a logical reaction: After all, President Biden’s trillion-dollar infrastructure bill, which passed late last year, contains some $7.5 billion worth of federal funding to support companies working to create a network of 500,000 electric vehicle charging stations in the U.S. And Tritium will almost certainly share in this loot, now that the president has put his imprimatur of approval upon it.

Now what

It’s logical, therefore, to assume that Tritium is now in line to receive millions (or even tens of millions) of federal revenue dollars on its top line. For a company that did barely $56 million in sales over the last 12 months, this is a big deal.

That being said, Tritium has not yet shown itself capable of turning any level of revenue into real profit on the bottom line. Subsidies from the government will certainly help with that — in fact, I’d go so far as to say it’s now more likely than not that Tritium will turn profitable over the next several years. But will it be profitable enough to justify the $2.1 billion market capitalization that the company has amassed over the past couple of days?

That remains to be seen — and until it is seen, investors are right to be cautious. 

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

The post Why Tritium shares dropped 15% today appeared first on The Motley Fool Australia.

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

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ASX buy now, pay later (BNPL) shares could be the focus of attention on Friday after the share price of BNPL giant Affirm Holdings Inc (NASDAQ: AFRM) plunged 21% amid an accidental tweet.

Astonishingly, Affirm was forced to release its earnings for the December quarter early after a human error saw it post some of its results to Twitter Inc (NYSE: TWTR).

The Affirm share price plunged to close at $58.68 – 21.42% lower than its previous close – during yesterday’s session in the United States (US).

That’s despite the stock trading up to 11% higher prior to the release of its quarterly results.

The international BNPL giant’s dip has likely put ASX BNPL shares on watch today. Let’s take a closer look.

Affirm share price tumbles on early release of quarterly earnings

ASX BNPL shares like Zip Co Ltd (ASX: Z1P), Sezzle Inc (ASX: SZL), and Block Inc CDI (ASX: SQ2) – now the home of Afterpay – will be watched closely when the market opens this morning after Affirms’ dramatic and disappointing quarterly results.

Affirm – with its market capitalisation of around US$16 billion – reported a US$159.7 million loss for the 3 months ended 31 December.

That meant its earnings per share (EPS) for the period equated to a US$0.57 cent loss.

According to my Foolish colleagues in the US, analysts had been predicting EPS would come to a US$0.34 cent loss.

It was also a far greater impact than the US$26.6 million loss it recorded in the same quarter of the previous year.

However, Affirm saw a 77% increase in revenue over the December quarter, reaching US$361 million. Its gross merchandise volume also grew 115% to US$4.5 billion.

Finally, the number of active customers using Affirm increased 150% on the prior comparable quarter and 29% quarter-on-quarter.

Affirm conceded to Twitter the previously tweeted results were a result of “human error”.

Due to human error, a small portion of Affirm’s fiscal Q2 results were inadvertently tweeted from Affirm’s official Twitter account earlier today. Affirm has since issued its complete fiscal Q2 results, which are available at https://t.co/kQLTu8O9Vv.

— Affirm (@Affirm) February 10, 2022

https://platform.twitter.com/widgets.js

What could be in store for ASX BNPL shares on Friday?

Plenty of eyes will be on the Zip share price on Friday morning, as well as those of Sezzle and Block.

Particularly as the Affirm share price’s slump helped drive the tech-heavy Nasdaq Index down 2.1% in Thursday’s session.

The index’s falls generally weigh on the S&P/ASX 200 Info Tech Index (ASX: XIJ) and the S&P/ASX All Technology Index (ASX: XTX).  

The share price of US-listed Block Inc (NYSE: SQ) also slumped overnight, ending 3.4% lower.

Meanwhile, shares in payment service providers Paypal Holdings Inc (NASDAQ: PYPL) and Visa Inc (NYSE: V), which each offer a BNPL service, ­fell 3% and 2% respectively.

The post ASX BNPL shares in focus after Affirm (NASDAQ:AFRM) share price tumbles 21% appeared first on The Motley Fool Australia.

More reading

• After a disastrous 2021, the Zip (ASX:Z1P) share price has tumbled another 30%. What’s going on?
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• The week ahead: Confidence, ASX earnings, tech in focus. Scott Phillips on Nine’s Late News
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• BNPL ASX shares in for a ‘tough time’: 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. owns and has recommended Block, Inc. and ZIPCOLTD FPO. The Motley Fool Australia has recommended PayPal Holdings. 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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