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All eyes will be on the Westpac Banking Corp (ASX: WBC) share price next month when it releases its first quarter update.

Ahead of the release, let’s take a look at what the market is expecting from the banking giant.

What is expected from Westpac in the first quarter?

According to a note out of Bell Potter, its analysts are not expecting an overly strong result from Australia’s largest bank next month.

Its analysts are forecasting cash earnings of $1.82 billion, down 7.6% from the $1.97 billion recorded in the prior corresponding period.

Bell Potter commented: “Cash earnings in 1Q22 should be around $1.82bn mainly due to lower operating expenses. We believe mortgages should continue to grow at system (deposits will instead grow at greater than system – a plus in a way) but NIM will be even lower. As NIM is already 180bp excluding T&M for the month of September 2021 or around 10bp or 190bp after inclusion, we estimate a further loss of 4bp to 186bp in 1H22 mainly due to loan repricing (with the bulk taking place in 1Q22).”

The broker also gave its opinion on Westpac’s bold cost reduction target. Its analysts remain sceptical on the bank’s chances of cutting its cost base down to $8 billion in the coming years.

Bell Potter said: “We still think $8.0bn in cost target by FY24 will be difficult to achieve and have allowed instead for a figure that is closer to $10.0bn.”

“The revised operating expense savings are as follows: FY22 +1%; FY23 +4%, FY24 +10%; and FY25 +9%. While these will lead to higher EPS increases of up to 9% and ROE increase of nearly 1%, we still have to allow for the risk that WBC would not achieve its cost target by FY24,” it added.

Is the Westpac share price in the buy zone?

Despite the recent weakness in the Westpac share price, Bell Potter doesn’t see enough value to recommend it as a buy.

This morning the broker retained its hold rating with a $23.00 price target.

The post What to expect from Westpac (ASX:WBC) during earnings season appeared first on The Motley Fool Australia.

More reading

• Is the NAB (ASX:NAB) share price an undervalued smart buy for dividends?
• Analysts name 3 ASX 200 shares that could generate strong returns
• Neck and neck: Macquarie (ASX:MQG) bumps Westpac to become third-largest Aussie bank
• Is Westpac (ASX:WBC) going to be the best big 4 bank for dividends in 2022?
• 2 buy-rated ASX 200 dividend shares with big 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 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.

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Key points

• The Allkem share price has performed very strongly over the past year
• Lithium prices are soaring, helping revenue, profit and cashflow
• Analysts are predicting that Allkem has a number of good years ahead of it

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The Allkem Ltd (ASX: AKE) share price has been an exceptionally strong performer. But can the lithium miner keep charging higher?

Over the last month it has risen 24%. In six months it has surged 64%. The last year has registered a 120% rise of the share price.

What’s causing this big jump of the Allkem share price?

The business is seeing a strong performance from its Mt Cattlin. The 2021 calendar year annual production was 230,065 dry metric tonnes (dmt) of spodumene concentrate, beating the previous guidance of 220,000 dmt.

In the last quarter, it generated US$60.7 million of revenue by shipping in the quarter. An additional shipment of 23 kt was scheduled for dispatch in January 2022.

Group revenue for the three months to 31 December 2021 was approximately US$107 million and the group gross operating cash margin was approximately US$70 million.

Lithium prices have soared over the past year. Allkem notes that positive lithium product pricing momentum continues with indicative pricing for the second half of FY22 for spodumene shipments already at US$2,500 per tonne.

At Olaroz, 3,644 tonnes of lithium carbonate were produced, of which 51% was battery grade. Sales amounted to 3,293 tonnes at an average price of US$12,491 per tonne.

Development projects continue

Allkem is making progress on its pre-commissioning works at the Naraha Plant, within COVID restrictions.

Environmental permits for the stage one of Sal de Vida have now been received and pond construction commenced in January 2022. First production from stage one is now expected to occur by the second half of 2023.

The James Bay feasibility study and maiden ore reserve has been released, confirming an economically viable, hard rock lithium operation utilising renewable hydropower.

Expansion works at Olaroz have reached 68% completion and first production is expected to commence in the second half of 2022.

The company summarised that it has an “enviable pipeline of expansion and development projects” which it intends to detail in a presentation in March.

Is the Allkem share price a buy?

The company notes that strong demand for lithium chemicals and spodumene concentrate continues. China is producing record amounts of lithium-ion battery materials and batteries.

Electric vehicle sales in 2021 were estimated at around 6.2 million units, approximately double compared to the prior year. Approximately 2 million electric vehicles were sold in the last quarter of 2021, representing a 13% increase quarter on year. Chinese electric vehicle sales in the last quarter of 2021 was a record of around 1.3 million units, equalling total sales in 2020.

Electric vehicle sales are expected to increase substantially in 2022, with continuing growth for lithium in China. Supply continues to fall short of demand.

There are plenty of buy ratings on lithium producers by brokers at the moment, including Macquarie. This broker is expecting that continuing ramping up of electric vehicle sales will help lithium prices for years, whilst Allkem grows its production.

Macquarie’s price target on the Allkem share price is $13.60, which suggests a potential rise of 17% over the next year.

The post Is the Allkem (ASX:AKE) share price going to keep charging higher? appeared first on The Motley Fool Australia.

More reading

• Why Allkem, BrainChip, Data#3, and JB Hi-Fi shares are charging higher
• Why ASX lithium shares could send heads spinning this earnings season
• Why is the Allkem (ASX:AKE) share price rising again today?
• 2 ASX lithium shares analysts rate as buys
• 2 ASX growth shares Macquarie rates as buys

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

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Key points

• The HUB24 share price has reacted underwhelmingly to the company’s second quarter update
• Total funds under administration reach $68.3 billion on record net inflows
• Acquisition of Class Ltd is progressing with shareholders to vote at the end of the month

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The HUB24 Ltd (ASX: HUB) share price is feeling flat today after the company released its second-quarter FY22 update this morning. However, trading volume is currently above average, suggesting heightened activity in the company’s shares this morning.

At the time of writing, the wealth management technology company’s shares are going for $26.97, up 0.45%.

HUB24 share price rallies on solid quarterly update

• Record second quarter platform net inflows of $3.6 billion
• Total funds under administration (FUA) at the end of December reaches $68.3 billion
• Total FUA increases 118% compared to prior corresponding period
• 28 new distribution agreements signed during the quarter
• Integration of Xplore Wealth is on track
• Scheme booklet distributed for the company’s proposed acquisition of Class Ltd (ASX: CL1)

What happened in the second quarter for HUB24?

Underpinning a solid quarter for HUB24, the company achieved record second-quarter platform net inflows of $3.6 billion. This represented a 127% increase on the prior corresponding period — though it is worth noting it includes flows from the Xplore acquisition.

In terms of total FUA, HUB24 now boasts $68.3 billion of total FUA at the end of the December quarter. This is comprised of $50 billion in Platform FUA, which grew by 128% year on year. In addition, the Portfolio, Administration and Reporting Services (PARS) segment also grew by 97% — making up the other $18.3 billion of FUA.

Impressively, today’s result marks the fourth consecutive quarter of record net inflows for the company. A byproduct of this tremendous growth is HUB24’s increasing market share. According to the announcement, market share has increased to 4.6%, up from 4.3%. This achievement bodes well for the HUB24 share price.

On another note, the company’s Xplore integration is going to plan. HUB24 expects the transition of Super FUA from Xplore to HUB24 to be completed during the fourth quarter of FY22.

Meanwhile, the next prominent event occurring for HUB24 will be its shareholder vote on the acquisition of Class Ltd. The vote is proposed to be held on 31 January 2022, with the board unanimously recommending shareholders vote in favour of the deal.

How have HUB24 shares performed recently?

The HUB24 share price has had a rocky start to 2022, falling 4.6%. The S&P/ASX 200 Index (ASX: XJO) is down 1.3% over the same time period.

While it is difficult to pin down exactly what the cause of the recent valuation weakness is, potentially HUB24 has been caught in the broader tech selldown.

However, the company continues to trade on a relatively rich price-to-earnings (P/E) ratio of 183 times.

The post HUB24 (ASX:HUB) share price gains attention on record platform net inflows appeared first on The Motley Fool Australia.

More reading

• These 2 ASX fintech shares are delivering rapid growth. Are they buys?

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 Hub24 Ltd. The Motley Fool Australia owns and has recommended Class Limited. The Motley Fool Australia has recommended Hub24 Ltd. 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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Key Points

• BrainChip share price rockets to record high of $2.34 in morning trade
• United States patent secured for its neuromorphic processor
• 8th patent awarded by United States Patents and Trademarks Office

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The BrainChip Holdings Ltd (ASX: BRN) share price is yet again breaking new records today. This comes after the company made a positive announcement regarding its neuromorphic artificial intelligence chips.

At the time of writing, the artificial intelligence (AI) technology company’s shares are up 18.82% to $2.21. This means that its shares have now risen an incredible 200% in the past month alone.

BrainChip secures new US patent

In its release, BrainChip advised that it has been granted a patent to add to its growing portfolio. Approved by the United States Patents and Trademarks Office, the latest addition will seek to further protect BrainChip’s intellectual property.

BrainChip stated that the newest patent follows its footsteps in previously securing corresponding United States patents.

The new patent is titled, ‘Event-based Classification of Features in a Reconfigurable and Temporally Coded Convolutional Spiking Neural Network’.

The key features on the patent protect the company’s neuromorphic processor. The function revolves around performing complex tasks on a digital input data, thus allowing AI to process images.

Developing such a tool enables a wide range of existing AI applications used in the industry to be ported to Akida.

The potential capability in bringing AI to the edge has led the BrainChip share price to astronomical highs. Clearly, investors have priced a lot of things to come from the global technology company.

BrainChip chief technology officer and founder, Peter van der Made commented:

This latest patent is one of 8 patents we’ve secured since 2008 to protect our intellectual property rights to ensure we maintain our global competitive advantage in the field of neuromorphic artificial intelligence.

As the world’s first and only commercial producer of neuromorphic artificial intelligence chips (Akida1000), we must maintain our lead over our competitors by ensuring our unique and revolutionary technology is protected and secure.

BrainChip share price snapshot

Over the last 12 months, BrainChip shares have gained 3000%. The company’s share price reached an all-time high of $2.34 today before some profit-taking occurred.

On valuation grounds, BrainChip has a market capitalisation of around $3.19 billion, with approximately 1.71 billion shares on its registry.

The post BrainChip (ASX:BRN) share price leaps to all-time high. Here’s why appeared first on The Motley Fool Australia.

More reading

• BrainChip (ASX:BRN) share price up 20% and hits $3bn market capitalisation
• Why Allkem, BrainChip, Data#3, and JB Hi-Fi shares are charging higher
• The BrainChip (ASX:BRN) share price has rocketed 100% in a month. Is this AI tech company worth its valuation?
• Why AnteoTech, BrainChip, City Chic, and ResMed shares are charging higher
• Why the BrainChip (ASX:BRN) share price is rocketing 21% to a new record high

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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Key points

• Lake is almost doubling the production base case for its Kachi Lithium Project to 50,000 tonnes per annum
• Previous production base case was 25,500 tonnes per annum
• Increasing demand was a driver of the decision

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The Lake Resources N.L. (ASX: LKE) share price has been a positive performer on Wednesday despite the market weakness.

In morning trade, the lithium developer’s shares are up 5% to $1.00.

Why is the Lake Resources share price rising today?

Investors have been bidding the Lake Resources share price higher this morning following the release of an update on its Kachi Lithium Project in Argentina.

According to the release, following recent drilling activities, the company confirms that the production base case for Kachi will be increased to 50,000 tonnes per annum lithium carbonate equivalent (LCE) in the Definitive Feasibility Study (DFS) and the final investment decision (FID). This is almost double its previous base case of 25,500 tonnes.

Management advised that there were four reasons for the increase. One of these was the increasing demand by prospective offtake partners for a secure supply chain of environmentally friendly high purity lithium carbonate.

In addition, the company notes indicative support to fund the project by Export Credit Agencies and the international bank panel. The UK and Canada Export Credit Agencies have already indicated a willingness to provide debt finance for around 70% of the project’s capital requirements.

Another driver of the decision was the supportive investment policies of the Argentine Government, which has announced a process to lower export taxes as part of the Strategic Plan for Mining Development.

Finally, the confidence of technology partner Lilac Solutions that its modular direct lithium extraction technology is scalable and cost effective also supported the decision.

Lake Resources’ Managing Director, Steve Promnitz, commented: “Given the increasing demand and the significant lithium supply gap, Lake is focused on delivering high purity lithium carbonate at scale with meaningful ESG benefits. Lake has received indicative financial support for an increase in the size of the Kachi project from the Export Credit Agencies (ECA’s) of the UK and Canada and the numerous international ECA-supported banks. Also, Lake’s technology partner, Lilac Solutions, is focused on advancing the Kachi Project at this larger scale.”

The post Here’s why the Lake Resources (ASX:LKE) share price is charging 5% higher today appeared first on The Motley Fool Australia.

More reading

• Why this ASX lithium share could be heading 37% higher
• Bell Potter names 2 ASX mining shares to buy in 2022
• The ASX share market coverage that captivated readers in 2021

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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Key points

• Softening growth during the second quarter weighing on its shares
• Megaport shares also caught up in tech selloff
• Management positive on the future

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The Megaport Ltd (ASX: MP1) share price is under pressure on Wednesday morning.

At the time of writing, the leading elastic interconnection services provider’s shares are down 12% to $16.10.

Why is the Megaport share price falling?

Investors have been selling down the Megaport share price today amid broad weakness in the tech sector and the release of an underwhelming second quarter update.

According to the release, Megaport reported a quarter on quarter increase of just $0.6 million or 7% in its monthly recurring revenue (MRR) to $9.2 million. This led to an 8% increase in second quarter revenue to $26.6 million.

Driving this was a 5% increase in customer numbers to 2,455, a 5% lift in total ports to 8,523, and a modest 2% rise in average revenue per port to $1.074. This was supported by the launch of the PartnerVantage portal, which allows indirect partners to resell Megaport services.

While no details were provided on Megaport’s earnings during the period, it did reveal that its cash balance stood at $105 million at 31 December. This is down from $114 million since the end of September.

Judging by the Megaport share price performance today, its growth during the quarter doesn’t appear to have been enough for the market. Particularly given the sky high multiples its shares trade on.

Management commentary

Megaport’s Chief Executive Officer, Vincent English, commented, “In the second quarter, we continued to stay very focused on executing to achieve our targets and aligning the business for greater channel growth. In addition to delivering the strongest second quarter for new customers and Ports, the team also delivered key new partnerships in the indirect channel and technology alliance space. Additionally, we launched VantageHub, a one-stop platform for indirect channel partners to manage their Megaport business.”

Mr English remains positive on the future. He said: “We are well positioned to capture indirect channel opportunities coming into the second half of the financial year and beyond. Integration of InnovoEdge following the acquisition last August is well underway and we expect to showcase the capability for additional orchestration and automation for greater end-to-end control of network and IT resources in the next quarter.”

The post Why the Megaport (ASX:MP1) share price is crashing 12% today appeared first on The Motley Fool Australia.

More reading

• 2 beaten down ASX tech shares tipped as buys
• ASX 200 (ASX:XJO): Woolworths withdraws API proposal, tech shares rebound
• Why has the Megaport (ASX:MP1) share price tumbled 14% in a month?
• 2 exciting ASX 200 tech shares to buy

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 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.

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Key points

• The CSL share price has slumped 13% since the Omicron variant emerged
• The dip was likely mostly driven by its acquisition of Vifor Pharma and subsequent capital raise
• Previously, the biotechnology company’s stock has weathered the pandemic reasonably well

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While the COVID-19 pandemic wreaked havoc on many ASX stocks, the CSL Limited (ASX: CSL) share price has traded relatively flat throughout the period.

Of course, sentiment for the company was likely boosted by its manufacturing of the AstraZeneca (NYSE: AZN) COVID-19 vaccine. Though, it was hindered by the impact the pandemic has had on plasma collections.

Despite a rocky performance, the CSL share price gained around 2% over the course of 2020 and was boosted another 2% last year.

For context, the S&P/ASX 200 Index (ASX: XJO) fell 3% in 2020 and gained 13% in 2021.

At the time of writing, the CSL share price is $272.19, a fall of 0.56% in early trading.

Let’s take a look at how the biotechnology giant’s stock has been performing since the Omicron variant emerged.

How has the CSL share price traded since Omicron emerged?

The discovery of COVID-19’s Omicron variant was first announced to the world on 25 November.

Then, South Africa’s National Institute for Communicable Diseases announced it had identified a then-unnamed variant responsible for just 22 infections in the nation.

Of course, the variant soon reached Australia and the rest is history. But there’s hope we might be out of the woods sooner rather than later.

Federal health minister Greg Hunt said on Sunday, the current Omicron outbreak may be peaking in New South Wales and the ACT and the rest of the country will likely follow suit in coming weeks.

Since news of the Omicron variant’s emergence, the CSL share price has tumbled 13%. Though, it hasn’t simply been the new virus strain weighing it down.

It announced a massive US$12 billion takeover after close on 14 December. The biotechnology giant will be purchasing Vifor Pharma, a Swiss pharmaceutical company specialising in the treatment of iron deficiency.

Unfortunately, the market didn’t react favourably to the news. It sent the CSL share price tumbling 8% after the company exited a trading halt put in place as it underwent a $6.3 billion capital raise.

While the stock mostly recovered over following sessions, it has slumped another 6% year to date.

The post How is the CSL (ASX: CSL) share price performing in the age of Omicron? appeared first on The Motley Fool Australia.

More reading

• Leading fund manager says these blue-chip ASX shares are buys right now
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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 CSL Ltd. 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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Recent weeks have been confusing for investors of financial and technology ASX shares.

As COVID-19 Omicron put a spanner in our plans to reach post-pandemic life, the S&P/ASX 200 Financials (ASX: XFJ) has dropped 2.8% and the S&P/ASX All Technology Index (ASX: XTX) has calamitously plunged more than 14% since mid-November. 

But no 2 businesses are the same, so such sector-wide declines can sometimes mean individual ASX shares might be selling at a bargain.

“Many good companies are oversold,” said market commentator Peter Switzer on his Switzer TV Investing show.

The Switzer team recently analysed broker predictions for various ASX fintech shares.

This allowed them to pick out 2 ASX shares in the payment tech area that professional investors think have massive upside potential:

‘Good things come to those who wait’ 

Tyro Payments Ltd (ASX: TYR) shareholders have torn their hair out seeing the stock plunge 37% since the start of November.

The fintech shares fell 15% in one day at one stage.

They would feel like 2022 is starting the same way as 2021, when they had to watch the company scramble to service customers with “bricked” payment terminals.

But Switzer’s research showed analysts are confident that Tyro can turn it around from here.

On average, the brokers saw a remarkable 63% upside in the stock price. Morgan Stanley was the most confident, betting that Tyro shares would soar 86%.

Tyro shares fell another 1.53% on Tuesday to close at $2.58.

“Sometime this year these stocks will benefit from a rotation back into the tech and payment sector,” said Switzer.

“But you’ll have to have patience… Good things come to those who wait.”

Fighting Irish 

Similarly, EML Payments Ltd (ASX: EML) shares have had a shocking 12 months but analysts firmly back a 2022 revival.

The EML stock price has lost more than 43% since last May.

The company had been fighting regulatory issues in Ireland, which seems to have stabilised now.

Brokers on average are seeing a 29.1% upside to the EML share price.

UBS is the most bullish, salivating at a 41% price target for the payments technology provider.

Thematically both EML and Tyro could benefit from continued post-pandemic economic revival.

The post 2 ASX fintech shares that could rocket this year appeared first on The Motley Fool Australia.

More reading

• Why is EML payments (ASX:EML) share price having a rollercoaster start to the year?
• Here’s why the EML (ASX:EML) share price could be a big opportunity
• Why is the Tyro (ASX:TYR) share price tumbling today?
• 2021 was a year to forget for the EML (ASX:EML) share price. Here’s why
• 2 ASX growth shares rated as buys in January 2022

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended EML Payments and Tyro Payments. The Motley Fool Australia owns and has recommended EML Payments. The Motley Fool Australia has recommended Tyro Payments. 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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Key points

• Supply issues are impacting the retail sector as COVID-19 forces workers into isolation
• Federal Treasurer Josh Frydenberg has flagged cutting isolation requirements to five days
• Consumer confidence fell in the second week of January

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ASX retail shares are on watch today amid talk of potential cuts to COVID-19 isolation requirements to five days.

The S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) dropped 0.25% yesterday to finish at 3,398.50 points. Meanwhile, the S&P/ASX 200 Consumer Staples Index (ASX: XSJ) fell 0.17% to 12,670.00 points.

Let’s take a look at what may impact retail shares today.

Isolation cuts

Supermarkets and retail outlets have been facing supply issues due to worker shortages amid the COVID-19 outbreak in Australia.

Some of the retail shares on the ASX include Coles Group Ltd (ASX: COL), Woolworths Group Ltd (ASX: WOW), Wesfarmers Ltd (ASX: WES), and Harvey Norman Holdings Limited (ASX: HVN).

Other big-name retailers include Adairs Ltd (ASX: ADH), JB Hi-Fi Limited (ASX: JBH), Kogan.com Ltd (ASX: KGN), City Chic Collective Ltd (ASX: CCX) and Australian Pharmaceutical Industries Ltd (ASX: API).

The Australian Financial Review reported COVID-19 isolation requirements could be cut to five days to help solve the worker supply issue. Federal Treasurer Josh Frydenberg said during a speech in Melbourne:

I do note that a number of other countries around the world have actually reduced the isolation requirements, even for those who have tested positive from seven or 10 days, down to five days.

It’s never set and forget. The government will do everything possible to help support the Australian community on both the health and the economic front.

The news comes as consumer confidence has dropped to its lowest level since October. A survey from ANZ-Roy Morgan, released on Tuesday, shows confidence dropped 8.1 points in the second week of January to 97.9.

ANZ Economics head David Plank said:

Consumer confidence dropped 7.6% last week as Omicron case numbers surged. Consumer confidence readings are usually positive during the month of January and the level of 97.9 is the weakest January result since 1992, when the Australian economy was experiencing sharply rising unemployment. 

The post ASX retail shares on watch amid potential cuts to COVID-19 isolation requirements appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX shares today
• Here are the 3 most heavily traded ASX 200 shares this Tuesday
• ASX 200 (ASX:XJO) midday update: Rio Tinto’s Q4 update, JB Hi-Fi rockets, Kogan sinks
• This is how much the average Aussie needs to feel ‘rich’

The author has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended ADAIRS FPO and Kogan.com ltd. The Motley Fool Australia owns and has recommended ADAIRS FPO, COLESGROUP DEF SET, Harvey Norman Holdings Ltd., Kogan.com ltd, 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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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.

There’s a potential event that Ethereum (CRYPTO: ETH) investors are looking forward to, and it’s called the flippening. This will take place the moment that Ethereum overtakes Bitcoin (CRYPTO: BTC) in terms of market capitalization. Ethereum, with a market cap of $373 billion as of Tuesday morning, would have to more than double to overtake Bitcoin at $786 billion. 

The gap has actually widened over the past month, as Ethereum’s 20% decline finds it falling behind Bitcoin despite the leading crypto’s 10% slide in the same time frame. Bitcoin isn’t the only rival that Ethereum investors should be watching. Bulls are spending so much time looking through the windshield at Bitcoin that they’re not paying attention to what’s happening in the rearview mirror. Smaller players led by Cardano (CRYPTO: ADA) and Solana (CRYPTO: SOL) are starting to catch up, and there’s no doubt that those crypto investors see an entirely different “flippening” scenario playing out. 

Objects in the mirror may be closer than they appear

January has historically been a great time to own Ethereum. The world’s second most valuable digital currency has appreciated by at least 35% in the first month of the year in all but one year since its debut in the summer of 2015: 

• January 2016: 148%
• January 2017: 35%
• January 2018: 48%
• January 2019: (20%)
• January 2020: 39%
• January 2021: 78%

It’s off to a rough start in 2022. Ethereum has fallen roughly 16% month to date, challenging the 20% January decline it experienced three years ago. Naturally a lot can happen in the next two weeks. Ethereum is a volatile beast, and historically it has favored the bulls. 

However, the bullish thesis for owning Ethereum in 2022 hangs largely on its upcoming migration to proof-of-stake protocols. It will be a dramatic transformation. Ethereum is the crypto world’s platform of choice with its bar-raising blockchain technology, powering smart contracts and other digital applications. There are more than 3,000 popular decentralized apps built on top of Ethereum. The knocks on Ethereum — that the crypto is too resource draining to mine and too slow and expensive to move around — will grow quieter when the Ethereum 2.0 transition is complete. 

There are two sticking points that could be holding Ethereum back, and the first is that the shift to proof of stake is taking a long time to happen. Originally slated to happen in 2019, the next major phase of Ethereum 2.0 has been pushed out to June of this year. No one will be surprised to see the goalpost moved again. There are also concerns that, even after the transformation is complete, it won’t make Ethereum faster or cheaper to use than Solana and Cardano are right now.

In the same past 30 days that we’ve seen Ethereum surrender 20% of its value, we’ve seen Cardano climb by 20%. As the crypto market in general retreated over the holiday weekend, Cardano was one of the rare climbing digital currencies. It even overtook Solana in terms of market cap late last week. Solana has had a challenging past month like Ethereum, but over the past year it has popped 35-fold compared with a 150% advance by Ethereum. 

This isn’t necessarily the time to dump Ethereum. It has a history of bouncing back after sharp corrections. However, if your crypto portfolio consists exclusively of Ethereum and/or Bitcoin it may be a good time to consider adding some other types of cryptocurrencies to your risk-tolerant portfolio. Cardano is trending with strong momentum right now, and Solana has some key speed, cost, and other efficiencies working in its favor. 

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

The post Is Ethereum losing steam in 2022? appeared first on The Motley Fool Australia.

More reading

• Bitcoin (CRYPTO:BTC) takes most popular crown, here are 3 cryptos hot on its heels
• Crypto is crashing: Should you invest now?
• Why Solana could be poised to rally
• Bitcoin, Ethereum, and Dogecoin surge higher as crypto markets recover
• Why Cardano is on the move higher today

Rick Munarriz owns Bitcoin, Ethereum, and Solana. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends Bitcoin and Ethereum. 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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