Tag: Motley Fool

Arcadium Lithium CDI Def (ASX: LTM) shares have dropped by 16.6% since the new ASX lithium stock began trading on 22 December.

Arcadium is the new company formed from the merger of Allkem and US lithium giant Livent Corp. The merger was formally completed on 4 January.

The Arcadium Lithium share price is currently $8.44, up 1.93% for the day so far.

Upon completion of the deal, Arcadium CEO Paul Graves said Arcadium has “the resources, scale and expertise to meet the growing needs of our rapidly changing industry”.

He added:

We are a leader in every major lithium extraction process – from hard rock mining to conventional pond and DLE-based brine processing – and vertically integrated, from resource to chemical manufacturing, in strategic locations around the world.

This will open doors to new opportunities and strengthen our ability to deliver value to our customers, investors, employees and communities.

But what about this 17% drop in Arcadium Lithium shares over the past month?

Is this anything to worry about?

How Arcadium Lithium shares compare to the rest

Let’s compare the performance of Arcadium Lithium shares to other ASX lithium stocks since 22 December.

Since that day:

• Sayona Mining Ltd (ASX: SYA) shares are down 25%
• Core Lithium Ltd (ASX: CXO) shares are down 21.2%
• Liontown Resources Ltd (ASX: LTR) shares are down 21.4%
• IGO Ltd (ASX: IGO) shares are down 19.2%
• Lake Resources N.L. (ASX: LKE) shares are down 19.2%
• Mineral Resources Ltd (ASX: MIN) shares are down 13.4%
• Pilbara Minerals Ltd (ASX: PLS) shares are down 8.9%

As you can see, all of these ASX lithium stocks have fallen significantly over this particular time frame.

Some companies have unique factors weighing down their share prices, such as Core Lithium’s recent decision to suspend mining operations at Finniss to conserve cash while continuing to process stockpiles.

But the one thing they all have in common is exposure to continuously weak lithium commodity prices.

As an example, the lithium carbonate price has fallen by more than 80% over the past 12 months. The reason for this is simply falling demand amid rising supply.

On 22 December, the lithium carbonate price was US$13,746. Today, the price is US$13,415.

This represents a further deterioration in the commodity price, down 2.4%.

In light of this, it’s not surprising that the market is pessimistic about ASX lithium shares for the moment.

By the way, we recently wrote about whether lithium prices have finally bottomed.

Are Arcadium Lithium shares a good buy right now?

My Fool colleague in the US, Nicholas Rossolillo, provides his own point of view in an article published yesterday explaining why he’s buying more Arcadium shares.

The post Why are Arcadium Lithium shares down 17% since trading commenced? appeared first on The Motley Fool Australia.

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More reading

• Why Arcadium Lithium, BHP, Core Lithium, and Magellan shares are falling today
• Have lithium prices finally bottomed?
• Here are the top 10 ASX 200 shares today
• Why Arcadium Lithium, Brainchip, Megaport, and Northern Star shares are dropping
• What’s the outlook for Allkem shares in 2024?

Motley Fool contributor Bronwyn Allen has positions in Core Lithium. 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 Scott Phillips.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record another decline. The benchmark index is currently down 0.6% to 7,350.8 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are rising:

EML Payments Ltd (ASX: EML)

The EML Payments share price is up over 21% to 90.5 cents. This follows news that the payments company is shutting down its troubled PFS Card Services Ireland Limited (PCSIL) business. Management advised that it will now be closed to new business and wound down in a professional and orderly manner. A liquidator has been provisionally appointed by the High Court of Ireland to begin the wind-down.

Mount Gibson Iron Ltd (ASX: MGX)

The Mount Gibson Iron share price is up 4% to 53.5 cents. Investors have been buying the iron ore miner’s shares following the release of its quarterly update. Mount Gibson revealed that quarterly ore sales revenue came in at $228 million for the quarter. This took its sales revenue for the first half of FY 2024 to $436 million. In addition, cashflow of $123 million was generated for the December quarter.

Nuix Ltd (ASX: NXL)

The Nuix share price is up 3% to $1.65. This is despite there being no news out of the investigative analytics and intelligence software provider. Though, it is worth noting that Nuix’s shares were sold off last week. Some investors may believe they were oversold and have been snapping them up today.

RAIZ Invest Ltd (ASX: RZI)

The Raiz share price is up 4% to 38 cents. This follows the release of the investment platform provider’s quarterly update. Raiz reported a 6% quarter on quarter increase in revenue to $5.47 million. Management also reiterated that it is on the path to positive EBITDA.

The post Why EML, Mount Gibson, Nuix, and Raiz shares are rising today appeared first on The Motley Fool Australia.

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More reading

• Why is the EML share price rocketing 27% on Wednesday?
• Why Chalice Mining, Nuix, Pilbara Minerals, and Sayona Mining shares are falling
• Why A2B, Alumina, Healius, and Nuix shares are dropping today
• Why is this ASX All Ord share plunging 20% on Friday?

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 positions in and has recommended EML Payments. 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 Scott Phillips.

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Westpac Banking Corp (ASX: WBC) shares not only offer the potential for capital gains, but the S&P/ASX 200 Index (ASX: XJO) bank stock is also well known for its reliable fully franked dividend payments.

So far in 2023, Westpac shares haven’t been able to shake off the broader market pressure. This sees the big four bank’s stock down 0.3% year to date, trading for $22.93 apiece.

Though that’s a good bit better than the 3.5% loss notched by the ASX 200 so far in 2024.

But that’s the market for you. Over the shorter term, there’ll always be some down swings along with the up swings.

So, let’s take a step back to two years ago to get a better gauge of what this ASX 200 bank stock has delivered for longer-term shareholders.

How much would these Westpac shares have returned by today?

On 28 January 2022, Westpac shares closed the day trading for $20.63 apiece.

That means your $10,000 investment could have bought you 484 shares with enough change left over for a fast-food meal.

Today, as mentioned above, those same shares are worth $22.93.

If you opted to sell your 484 shares today, they’d be worth $11,098. Or a handy $1,098 gain on your $10,000 investment.

But let’s not forget those dividends!

If you’d bought $10,000 worth of Westpac stock on 28 January 2022, you’d have received the past four fully franked dividends totalling $2.67 a share. The most recent dividend of 72 cents a share would have landed in your bank account just in time for Christmas, on 19 December.

Adding those dividends back in, the accumulated value of your Westpac shares would now be $25.60 apiece, plus the potential tax benefits from those franking credits.

This brings the total value of your 484 shares to $12,394.

That’s a tidy 23.9% gain. Or a profit of $2,394 on your initial $10,000 investment two years ago.

The post If you’d bought $10,000 of Westpac shares in January 2022, here’s what you’d have now! appeared first on The Motley Fool Australia.

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More reading

• What will my ASX 200 bank stocks be worth in 5 years?
• 3 things ASX investors should watch this week
• Here’s how much I’d need to invest in Westpac shares for $3,000 a year in passive income
• The Westpac share price heavily underperformed the ASX 200 in 2023
• Why are the big four ASX 200 bank shares under pressure today?

Motley Fool contributor Bernd Struben 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 Scott Phillips.

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It’s looking like another dark day for the S&P/ASX 200 Index (ASX: XJO) and ASX 200 shares. At the time of writing, the ASX 200 Index has slipped by 0.61%, leaving it at under 7,350 points.

But not all ASX 200 shares are having a bad day this Thursday. In fact, some have even just hit new 52-week highs. Let’s discuss.

3 ASX 200 shares that have hit new 52 week highs today

Helia Group Ltd (ASX: HLI)

ASX 200 financial stock Helia is first up. Yesterday, Helia shares closed at $4.45 each. But the lenders’ mortgage insurance provider is currently up a rosy 1.01% at $4.50 a share, which happens to be Helia’s new 52-week high.

There’s not much in the way of news out from the company today that explains this new high. Saying that, Helia shares have been an exceptional investment in recent times, with the company up a whopping 62.9% over the past 12 months.

CSR Ltd (ASX: CSR)

ASX 200 construction materials manufacturer CSR is next up today. CSR shares tapped out at $6.69 apiece yesterday afternoon. But the company overcame a sluggish start this morning to push even higher.

At present, CSR is sitting at $6.70 a share but reached as high as $6.72 earlier today, the company’s new 52-week high.

There’s been no fresh news out of CSR either that might explain this new high. However, the company has been on a tear over the past month, ever since we discussed some insider buying from management actually. CSR shares are now up a rosy 30.3% over the past 21 months.

Netwealth Group Ltd (ASX: NWL)

Finally, let’s check out ASX 200 fund management company Netwealth. Netwealth shares finished up yesterday’s trading at $16.52 each. But the company has vaulted higher today, currently up a robust 1.03% at $16.69. Earlier this morning, Netwealth climbed up to $16.73 a share, which is the new 52-week high.

All has been quiet on the Netwealth news front as well. However, that hasn’t stopped the Netwealth share price from climbing more than 30% since October. The company is now up 19.9% over the past 12 months.

The post These ASX 200 shares just hit new 52-week highs appeared first on The Motley Fool Australia.

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More reading

• Why these two headwinds are dragging down the ASX 200 today
• ASX 200 shares: A once-a-decade opportunity to get rich?
• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Bitcoin price predicted to hit $100k this year! I’m buying ASX 200 shares instead

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. has positions in and has recommended Netwealth Group. The Motley Fool Australia has positions in and has recommended Netwealth Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) is under selling pressure on Wednesday.

In early afternoon trade, Australia’s benchmark index is down 0.7%.

But today’s fall has very little to do with any specific issues among ASX 200 companies.

Rather the Aussie market is facing some broader macroeconomic headwinds from two fronts.

Here’s what’s going on.

ASX 200 hit from two fronts

The first macro headwind that’s giving Aussie investors the jitters and sending the ASX 200 lower is blowing out of China.

This comes as analysts forecast weaker growth ahead in 2024 for the world’s number two economy and Australia’s top export market.

China’s economy grew by 5.2% in 2023, meeting expectations. But growth is widely forecast to fall below 5% in 2024 as the nation continues to struggle with high debts and a floundering real estate market. China’s shrinking population, while potentially a good thing over the longer term, is also pressuring the growth outlook for the economy.

With China’s crude steel output figures for December down 15% year on year and the lowest level in seven years, iron ore prices may also keep coming down. Overnight the industrial metal slipped 2.7% to US$125.80 per tonne.

Commenting on the shaky outlook for China’s economy that looks to be pressuring the ASX 200 today, Capital Economics head of China economics Julian Evans-Pritchard said (quoted by The Australian Financial Review), “The recovery clearly remains shaky. And while we still anticipate some near-term boost from policy easing, this is unlikely to prevent a renewed slowdown later this year.”

Which brings us to…

Global interest rates

Hopes of a March interest rate cut from the US Federal Reserve continue to recede. And as we’ve seen over the past year, the ASX 200 has proven quite susceptible to expectations on US interest rates.

Traders further reduced bets of a March rate cut from the world’s most influential central bank after Federal Reserve governor Christopher Waller signalled that the Fed was unlikely to rush into the easing cycle.

Yesterday (overnight Aussie time), Waller said, “When the time is right to begin lowering rates, I believe it can and should be lowered methodically and carefully.”

But he spooked investors, and likely added to selling action on the ASX 200 today, by adding, “With economic activity and labour markets in good shape and inflation coming down gradually to 2%, I see no reason to move as quickly or cut as rapidly as in the past.”

Commenting on the outlook for rate cuts, Krishna Guha, vice chairman of Evercore ISI said (quoted by the AFR), “What we think some in the markets have been missing – or not putting enough weight on – is the central banks’ shared fear of starting too soon and having to stop or reverse course.”

And it’s not just the US that could see rates stay higher for longer.

With inflation ticking higher in the United Kingdom for the first time in 10 months, it’s unlikely the Bank of England will be cutting rates in the near term either.

According to Ed Monk, associate director at Fidelity International:

The rise in inflation today suggests that the market has got ahead of itself in expecting early rate reductions. Today’s reading is a setback. The last portion of above-target inflation may prove the most difficult to shift.

But higher rates for longer doesn’t mean there aren’t plenty of good investment opportunities on the ASX 200. And with the benchmark down 3.7% year to date, some of these big companies are likely selling for a bargain.

The post Why these two headwinds are dragging down the ASX 200 today appeared first on The Motley Fool Australia.

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• ASX 200 shares: A once-a-decade opportunity to get rich?
• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Bitcoin price predicted to hit $100k this year! I’m buying ASX 200 shares instead
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Bernd Struben 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 Scott Phillips.

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It has been a tough 12 months for the ResMed Inc. (ASX: RMD) share price.

Despite recovering strongly since hitting a 52-week low of $21.14 in September, the sleep treatment company’s shares are still down 20% on an annual basis.

This has been driven by concerns over the impact of GLP-1 drugs like Ozempic on its addressable market.

But with many analysts saying that these drugs are not a threat, should investors be snapping up ResMed’s shares before the release of its second quarter update next week?

Is the ResMed share price good value?

The team at Citi has been looking at the company ahead of its results release.

According to the note, the broker is expecting double-digit revenue growth for the second quarter. This is expected to be driven by solid performances across devices, masks, and software.

As a result, it sees a lot of value in its shares and has put a buy rating and $29.00 price target on them.

Based on the current ResMed share price of $26.00, this implies potential upside of 11.5% for investors over the next 12 months.

Over at Goldman Sachs, its analysts agree and are recommending the company as a buy.

The broker is even more positive, though, with its buy rating and $32.00 price target. This suggests a return of 23% for investors from current levels.

Its analysts are not concerned by the threat of GLP-1 drugs and believe investors should be snapping up its shares while they are cheap. The broker said:

[W]e believe the perceived downside risk from GLP-1/GIPs has been over-capitalised at RMD’s current valuation. Overall, we reduce our TP -3% (with our earnings upgrades offset by mark to market multiples today), and continue to see asymmetric upside risk from current levels and reiterate our Buy rating.

The post Is the ResMed share price in the buy zone ahead of next week’s update? appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy today
• These 3 ASX 200 shares could rise 20% to 40%
• Are ResMed shares still undervalued in 2024?
• Here are the top 10 ASX 200 shares today
• 2 of the best Australian shares I plan to hold forever

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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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.

Semiconductor designer Nvidia (NASDAQ: NVDA) has made many millionaires in recent years. Its stock has more than tripled in the last year alone. Among stocks with a market cap of at least $50 billion today, Nvidia has outperformed absolutely everybody over the past three, five, and 10 years. It’s hard to beat this wealth-building machine these days. 

So what’s next? Let’s say I scrape together a robust $20,000 Nvidia position today — can I expect to make a million dollars on that investment?

The short answer is yes, but it’ll take a while and the lofty target result isn’t guaranteed.

Nvidia in the rearview mirror

Looking back, Nvidia’s stock chart from the past eight years is nothing short of extraordinary. Starting from a respectable $23 billion market cap in 2016, the company’s strategy has shifted along with the market opportunity.

Nvidia’s expertise in high-performance graphics cards for gaming and professional graphics turned into a crypto bonanza when enthusiasts found the same cards to be excellent for mining Ethereum (CRYPTO: ETH) tokens. Just as Ethereum switched to a different technology with no need for miners, OpenAI came along with its ChatGPT tool, unveiling a new dawn in generative artificial intelligence (AI). Based on the same high-end graphics platforms as the gaming and crypto surges, Nvidia’s AI accelerator processors powered the back-end creation of ChatGPT’s AI engine.

Now, lots of companies with AI-powered ambitions are buying hundreds or even thousands of extremely pricey accelerator chips and Nvidia is the first supplier that comes to mind at this point. It shows in Nvidia’s spectacular financial results and the stock chart that follows:

NVDA data by YCharts

The chart above shows the return of a $20,000 investment started on May 16, 2016, resulting in a $1.0 million value nearly 8 years later. That’s an average annual return of 67.4%.

The road ahead

At the end of that market-crushing chart, Nvidia is worth $1.4 trillion. The stock rose to this height the hard way, delivering top-notch products attuned to the right market opportunities at the right times. The end result is a legendary price gain with record-high investor returns. Sorting the total stock market’s 10-year gains, I don’t even need to limit the field with a large market-cap requirement to weed out short-lived meme stocks and other gadflies. Nvidia simply offered the strongest decade-long returns of any stock tracked by the screeners at my disposal.

But things are different now. It may be difficult to grow a $23 billion market cap 50-fold, but even tougher when you start with a $1.3 trillion stock-value footprint. Even if Nvidia continues to dominate the AI market, and that trend delivers on the most striking predictions for years to come, it’s unrealistic to assume an average annual return of 67% for another eight-year run.

By the end of that rainbow, Nvidia would be worth $67.6 trillion. That’s more than double the gross domestic product (GDP) of the United States, estimated at $26.9 billion in 2023. I’m sorry, but that’s going to take a while.

Balancing business growth and shareholder rewards

Nvidia’s past performance has set a high bar and it’s important to manage your expectations for the next phase of its AI business. The exceptional gains of recent years are not likely to continue for another 8-year span. That would require not only continued success in the booming AI sector for nearly a full decade, but also sustained hypergrowth in the market itself and unshaken investor confidence in Nvidia’s lofty valuation ratios. The stock trades at 72 times earnings and 30 times sales today. These overheated ratios should cool down over time, raising the needed financial support for that $67 trillion market cap in the process.

Of course, Nvidia could lower the bar with some accounting tricks. The company can return cash to shareholders by means of generous share buybacks and dividends.

Other companies have pursued this strategy before. For example, International Business Machines (NYSE: IBM) has seen its share price fall by 2% over the last 10 years while its market cap shrunk by 14%. At the same time, Big Blue bought back 12% of its issued shares and delivered robust dividend payouts. All in all, IBM investors pocketed a respectable total return of 50% over the same period.

Nvidia could attempt a larger-scale version of this, boosting the returns by sharing cash profits with the company’s investors. Of course, this cash-sharing idea takes away from the company’s freedom to invest in future growth-boosting business plans, so there’s a fine line between generosity and growth-blunting missteps.

And of course, anything is possible over a long enough time span. America’s GDP stopped at $1.5 trillion in 1973, comparable to Nvidia’s market value today. Suggesting that any single company could deserve a trillion-dollar market cap would have sounded ridiculous 50 years ago, but here we stand with 6 stocks in the trillion-dollar club. A few decades from now, that $67 trillion target might not look so silly anymore.

The real question is, will Nvidia still be around in 2064 or 2074, and will it dominate its chosen markets for that long? I don’t think so, but anything is possible.

A pragmatic approach to investing in Nvidia

So yes, Nvidia just might be able to grow that a $20,000 investment into a cool million, but it’s a long road to that ambitious target and many things can go wrong along the way. Remember, this stock delivered the richest shareholder returns of any company over the last decade, and even that stellar run barely exceeded the 50-fold gain it takes to meet that goal.

That being said, I’m not closing out my own Nvidia position anytime soon, though I might take advantage of its recent moonshot by diversifying some of the gains into other investment ideas. I’m still looking at a proven AI giant with a bright future, and its valuation has calmed down a bit in recent weeks. Buying Nvidia stock today makes perfect sense if you can stomach it trading at nosebleed-inducing prices. The next wave of processor orders for AI systems could make the last surge look forgettable by comparison.

So feel free to invest in Nvidia today. Just don’t expect the incredible returns of the last 8 years to continue for another multi-year span. To make me a happy Nvidia investor, all the company needs to do is deliver stock price gains comparable to or exceeding the stock market as a whole.

At an annual clip of 15%, a 50-fold return would materialize after 28 years. Patience is a virtue, dear reader. 

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

The post Could investing $20,000 in Nvidia stock make you a millionaire? appeared first on The Motley Fool Australia.

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More reading

• Why Nvidia stock skyrocketed 239% in 2023
• Is it too late to buy Nvidia stock?
• One artificial intelligence (AI) stock I’d buy over Nvidia for 2024

Anders Bylund has positions in Ethereum, International Business Machines, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Ethereum and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended International Business Machines. The Motley Fool Australia has recommended Nvidia. The Motley Fool Australia has recommended and has positions in Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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

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Liontown Resources Ltd (ASX: LTR) shares are crashing into the red again on Thursday.

In morning trade, the lithium developer’s shares are down 12% to $1.20.

Why are Liontown shares crashing?

There are a couple of reasons why Liontown shares are under pressure this morning.

The first is further weakness in the lithium industry, which has led to most ASX lithium shares falling today.

For example, Arcadium Lithium (ASX: LTM), Core Lithium Ltd (ASX: CXO), and Pilbara Minerals Ltd (ASX: PLS) shares are all down approximately 2.5% at the time of writing.

Albemarle selldown

Another reason why its shares are falling today are reports that its former suitor, Albemarle Corp (NYSE: ALB), has offloaded its stake in the lithium developer following its failed takeover bid.

As a reminder, Albemarle was seeking to acquire Liontown for $6.6 billion or $3.00 per share. However, with Gina Rinehart effectively purchasing a blocking stake, the lithium giant withdrew its offer in October.

The company explained:

Albemarle has advised Liontown that its decision to withdraw its proposal was due to the growing complexities associated with executing the transaction. Albemarle has confirmed to Liontown its favourable view of the flagship Kathleen Valley project and Liontown’s management.

Albemarle may have a favourable view of the project, but it isn’t sticking around to see its development as a major shareholder.

According to the AFR, Albemarle was looking to sell the stake for a price of $1.26 to $1.32 per share on Wednesday. The former represents a 7.4% discount where Liontown shares closed the session.

And while the company has not yet commented on the reports, it is worth noting that approximately 96.26 million Liontown shares were traded before the market open for $1.26 per share. It seems quite likely that this was Albemarle’s stake.

Liontown’s shares are now down 60% over the last four months.

The post Why are Liontown shares crashing 12% today? appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Copper and lithium: Broker says these ASX mining shares can double in value
• Which had the better year in 2023: Core Lithium, Liontown or Pilbara Minerals shares?
• These are the 10 most shorted ASX shares
• Up 25% in 2023, here’s what went right and what went wrong for the Liontown share price

Motley Fool contributor James Mickleboro owns Arcadium shares. 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 Scott Phillips.

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BHP Group Ltd (ASX: BHP) shares are on the move on Thursday morning.

At the time of writing, the mining giant’s shares are down 1.5% to $45.65.

This follows the release of the Big Australian’s second quarter update.

BHP shares falls on Q2 update

According to the release, iron ore production came in 4% higher quarter on quarter at 65.8Mt, bringing its half year production to 129Mt (down 2% half on half). This puts the company on track to achieve its unchanged FY 2024 guidance of 254Mt to 264.5Mt.

BHP shipped a total of 70.3Mt of iron ore from WAIO (100% basis) during the period. This was achieved with an average iron ore price of US$109.47 per wet metric tonne, which is up 12% since the first quarter.

BHP’s copper operations had a softer quarter following a very strong start to the year. Copper production was down 4% quarter on quarter to 437.4kt, but up 7% half on half to 894.4kt. This also leaves BHP well-positioned to achieve its unchanged guidance for FY 2024.

Metallurgical coal production was up 2% in the second quarter to 5.7Mt. However, for the half, it came in 17% lower at 11.3Mt. In light of this, management has lowered its FY 2024 guidance from 28Mt-31Mt to 23Mt-25Mt.

Finally, Energy coal production was up 7% for the quarter and 36% for the half, and Nickel production was down 3% in the second quarter but up 4% for the first half. BHP’s guidance for both remains unchanged, but with Energy coal now expected to be at the top end of its range.

How does this compare to expectations?

The market was expecting iron ore shipments of 72.5Mt from WAIO, which would have been a 1% increase quarter on quarter.

In addition, copper production was expected to be 454kt and met coal was forecast to come in at 6.9Mt.

As you can see above, this means that the miner has fallen a short of expectations with this update. This may explain why BHP’s shares are falling today.

Management commentary

BHP’s CEO, Mike Henry, was pleased with the quarter and half. He said:

Operationally, BHP has had a solid first half. WA Iron Ore production was up 5% quarter-on-quarter, while first half copper production rose 7% reflecting a record half at Spence and ongoing strong performance and additional tonnes at Copper South Australia. NSW Energy Coal had its best first half in five years, while BMA had a tough six months following significant planned maintenance and low starting inventories. At Nickel West, we are evaluating options to mitigate the impacts of the sharp fall in nickel prices.

We progressed our growth agenda during the quarter with ongoing construction of the Jansen mine in Canada and the sanction of Jansen Stage 2, which doubles our planned potash production capacity. In South Australia, we successfully integrated our Copper SA business and significant exploration drilling beneath Olympic Dam has identified attractive copper mineralisation above 1% grade along a 2 km strike, with areas above 2%.

The post BHP shares tumble after missing expectations in second quarter appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• ‘Deteriorating demand’: Should you be worried about your BHP shares in 2024?
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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 Scott Phillips.

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A couple of ASX All Ords shares are sinking deep into the red on Thursday following the release of updates.

Let’s dig deeper and find out what’s going on. Here are the shares in question:

Ampol Ltd (ASX: ALD)

The Ampol share price is down 2.5% to $35.11 today after fuel retailer provided guidance for the full year.

According to the release, the ASX All Ords share is expecting its unaudited Replacement Cost Operating Profit (RCOP) EBIT for the full year to be “slightly ahead” of the record results delivered in 2022, on a continuing basis.

While this looks positive on paper, the market was expecting a stronger result after its stellar third quarter performance, which saw its RCOP EBIT increase 65% on the prior corresponding period.

Management notes that growth in earnings from non-refining divisions offset a reduction in refinery earnings from the historically high levels in the prior year.

In addition, the company revealed that the Lytton Refiner Margin (LRM) averaged US$10.52 per barrel in the fourth quarter. This is down sharply from US$19.69 per barrel in the previous quarter. This reflects a rise in landed crude premiums and reduced product crack spreads compared to the third quarter.

APM Human Services International Ltd (ASX: APM)

The APM share price is also sinking today and is down 35% to 85 cents. Investors have been hitting the sell button today after the international human services provider released an update on its first half performance.

The ASX All Ords share expects to report revenue of $1.14 billion and underlying NPATA of $55 million for the six months ended 31 December. This compares to revenue of $853.7 million and underlying NPATA of $85.4 million a year earlier.

Management blamed this on tough labour market conditions and higher interest costs and taxes.

It expects things to improve in the second half, noting that “2H24 EBITDA and NPATA to be higher than 1H24 with a second half earnings skew consistent with prior periods.”

The post Guess which ASX All Ords shares are sinking after poor updates appeared first on The Motley Fool Australia.

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