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The COP26 Summit on climate change action has been a source of enlightenment for many investors around the world, lifting the veil on how the world intends to tackle the contentious issue.

Whilst many nations have secured their “phasing down” of coal use from the summit, a report from the Investor Group on Climate Change (IGCC) has slammed the boards of several ASX-listed companies for their lack of climate action.

The IGCC is a collaboration of Australian and New Zealand institutional investors focused on the impact of climate change on investments.

Board’s of 15 companies such as Qantas Airways Limited (ASX: QAN), Woodside Petroleum Limited (ASX: WPL) and South 32 Ltd (ASX: S32) are said to “lack the skills and experience to lead the corporate transition to net zero emissions by 2050, and it is unclear how they are addressing this gap”, according to the IGCC.

The report, titled “‘A Changing Climate: what investors expect from company directors on climate” studies 15 of Australia’s most carbon intensive companies. It sets out investor expectations regarding climate change risk.

Whilst not price-sensitive, shares in South32 took a hit today and edged lower to finish 1.4% in the red amid the release of IGCC’s analysis.

Here are the details.

What does the IGCC report mean for South32?

The report comes as investors are becoming more and more aware of the role companies are set to play in the climate risk transition.

Even the big guns are joining the cause. A recent push sees some of the world’s top asset managers sign up to the “net zero asset managers initiative” that now has over 220 signatories and $57 trillion in assets under management.

Suffice to say, there is a huge wave of steam gathering behind climate change initiatives from the finance world.

It, therefore, comes as no surprise that several shareholder meetings have advocated board members be removed this year due to their failure in acknowledging climate change risks.

For instance, the IGCC refers to ExxonMobil which “lost two board seats due to growing concern by investors over the risk of failing to adjust its business strategy to address global efforts to combat climate change”.

Not only that, the IGCC submits that these 15 companies don’t see climate change as a material risk, instead viewing it as “a separate risk issue and not integrated into the overall company strategy”.

The group doesn’t name the company in isolation, but calls on companies such as South32 to “ensure investment confidence” by adopting a range of measures that would see its board “reflect the climate change challenges ahead”.

These include ensuring board representatives have expertise in:

• Skills in disruption and transition
• Ability to challenge existing business models
• Knowledge of climate change
• Change management skills

It also advocates for the company and its colleagues to integrate climate change fully into company strategy, including capital allocation decisions and risk management.

The IGCC also reckons remuneration should be reflective of the company’s climate change targets, and for companies to put their money with their mouth is when issuing public statements.

With regards to its analysis, IGCC’s director of corporate engagement Laura Hillis stated:

We are at a tipping point for the transition to net zero emissions in Australia as evidenced by recent announcements from the federal government. While promisingly, many of the companies assessed for this report have set net zero targets, it is unclear based on the findings of this report how prepared the boards of these companies are to lead the transition to net zero.

Hillis continued:

Boards that fail to recognise the risk of climate change and their role in driving the company transition to a low carbon business, will leave the company and investors exposed to unacceptable financial, strategic and market risks. Not to mention they will miss out on the opportunities on the decarbonisation pathway, including jobs for regional communities

Investors are sure to keep a close eye on this space as pressure mounts on ASX-listed entities to recognise the risks outlined by the COP26 summit and align with the principles set out there.

South32 share price snapshot

The South32 share price has soared over 58% in the past 12 months, after rallying as much as 42% this year to date.

These returns are ahead of the benchmark S&P/ASX 200 index (ASX: XJO)’s gain of around 17% in that time.

The post South 32 (ASX:S32) share price sinks amid increased climate risk scrutiny appeared first on The Motley Fool Australia.

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The author Zach Bristow has no positions 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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If investors have got money to invest, then there could be some compelling ASX share ideas to consider for the long-term.

Businesses that are displaying growth, or have plans for growth, could be worth considering.

Here are two ASX shares to think about:

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This is a leading exchange-traded fund (ETF) that is offered by VanEck.

It has an annual management cost of 0.49%, which is more expensive than some of the biggest ETFs out there, but cheaper than plenty of fund managers.

VanEck Morningstar Wide Moat ETF represents a portfolio of shares that are judged to be quality US companies that Morningstar analysts believe possess sustainable competitive advantages. This is also called a ‘wide economic moat’.

The durability of economic profits is far more important to Morningstar than the size. There must also be “clear evidence” that the company has at least one of five moat sources: intangible assets, cost advantages, switching costs, network effects or efficient scale.

For a business to be rated as having a wide economic moat, it must (with near certainty) be able to generate excess normalised returns in a decade from now, and more likely or not be positive in 20 years from now.

The shares in this ASX share’s portfolio comes from a range of industries. However, there are four with a weighting of more than 10%: IT (26.2%), healthcare (19.1%), industrials (13.6%) and consumer staples (11.7%).

At the latest daily disclosure, these are the biggest of the 50 positions: Salesforce, Microsoft, Cheniere Energy, Wells Fargo, Tyler Technologies, Compass Minerals, Blackbaud and Alphabet.

Past performance is not a guarantee of future results, but over the past three years the ASX share’s net performance has been an average return per annum of 19.3%.

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is a healthcare technology business that provides a number of software offerings relating to care and administration for patients undergoing breast screening.

The business is growing at a rapid pace in percentage terms. In the second quarter of its FY22, it experienced record quarterly cash receipts from customers of NZ$7.1 million, which was up approximately 52%. It received NZ$6.9 million of subscription-based receipts, up 63%.

Annual recurring revenue (ARR) reached US$20.4 million, up more than US$1.2 million from the end of the FY22 first quarter.

It has reached a market share coverage of 34% of US women being screened, up from around 33% in the prior quarter. This gives it more power in the US market.

Average revenue per user (ARPU) over Volpara’s installed based was US$1.46 in the second quarter, up from US$1.42 in the first quarter. Average ARPU in the first quarter was US$1.55, it was US$2.04 in the second quarter.

The ASX share is targeting growth in its ARPU through a number of initiatives including upselling to existing customers and offering a higher focus on patient risk.

Its software as a service (SaaS) retention remains high and it recently closed its largest contract to date that will deliver US$2.15 million in revenue over five years, representing US$430,000 in ARR.

The company is also positioning for lung cancer screening. Management believe the commercial opportunity in lung screening is at least equal to breast screening, with over US$400 million ARR in the US alone. Volpara has partnered with AI leaders like Riverain, MeVis and RevealDX to build a lung platform and enter the screening market as programs are set up globally.

The post Have money to invest? Here are 2 ASX shares that could be potential buys appeared first on The Motley Fool Australia.

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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. owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia has recommended VanEck Vectors Morningstar Wide Moat ETF. 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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When it comes to the S&P/ASX 200 Index (ASX: XJO), it goes without saying that some shares are more beloved than others. Much is often made of the special attachment ASX investors have to the big four bank shares for example. Or else, long-time ASX stalwarts like BHP Group Ltd (ASX: BHP) or Woolworths Group Ltd (ASX: WOW). But we can’t exactly say that about the Webjet Limited (ASX: WEB) share price.

Why? Well, Webjet shares have been frequenting the list of the most shorted ASX shares for a while now. My Fool colleague James takes a look at the most shorted ASX shares every week. And every week so far this November, Webjet has made the list of the 10 most shorted shares on the sharemarket. Throw in the last week of October, and we seem to have a company which investors are singling out as a lucrative short-selling target.

Why does this matter? Well, short selling is the practice of ‘borrowing’ another investors shares with the promise of returning them at a set date in the future. The shortseller then sells the shares upon receiving them, hoping to buy back those same shares at a later point for a cheaper price and return them to their owner. Thus, a successful ‘short’ relies upon a company’s share price falling over the period the investor has chosen to short the share.

As such, a short is essentially a bet that a company’s share price will fall. By extension, this means that investors appear to be not too bullish on Webjet’s short-to-medium term prospects. That’s given this company has topped the top 10 most shorted ASX shares for several weeks in a row now.

Why are Webjet shares still topping the shortseller’s Christmas list?

So why might investors be betting the Webjet share price has more downside in front of it than upside? Well, the company is scheduled to deliver its results for the first half of its FY2022 on 25 November, next Thursday. The travel industry is showing some green shoots and full-scale international flights are scheduled to resume in the next few months. Even so, the travel industry is still a long way from where it was in the pre-COVID world. And we also have the impacts of the most recent bout of lockdowns to consider, especially in Sydney and Melbourne.

Perhaps the short sellers are looking at the Webjet share price as well. Even though Webjet has taken a hit today, Webjet shares are still up an impressive 21.2% year to date in 2021 so far. They are also up 22.4% over the past 12 months. By contrast, the ASX 200 has only managed 11.6% and 15.05% respectively over the same periods. Perhaps shorts are betting that these gains have come too quickly.

Whatever the reason why so many investors are short selling this company, time will only tell if their bearish bets will pay off.

At the current Webjet share price of $6.21, this ASX travel company has a market capitalisation of $2.4 billion.

The post Why are Webjet (ASX:WEB) shares still being shorted in November? appeared first on The Motley Fool Australia.

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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 no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet 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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2021 has been a bad year for the A2 Milk Company Ltd (ASX: A2M) share price so far.

Its first close of the year saw it sitting at $11.65. As of today’s close, the A2 Milk share price is $6.26. That represents a 46.26% fall.

The former market darling has only released price-sensitive news to the ASX 4 times since the start of this year.

Unfortunately for A2 Milk investors, each time the company has updated the market, its share price has fallen by more than 10%.

Let’s take a look at what’s been driving the milk and formula producer and supplier’s share price downwards this year.

And a quick note: all dollar figures are converted from New Zealand dollars at today’s exchange rate of AUD$1 to NZD$1.04.

A2 Milk share price struggles through 2021

The first major hit to the A2 Milk share price in 2021 came on 25 February when the company released its results for the first half of financial year 2021.

Over the 6 months ended 31 December 2020, A2 Milk recorded $650.3 million of revenue. That represented a drop of 16% on that of the first half of the previous financial year.

On the same day, A2 Milk also downgraded its forecasted revenue for financial year 2021 to around $1.34 billion.

Perhaps unsurprisingly, A2 Milk’s stock tumbled 13.9%.

The next time the company released price-sensitive news to the ASX was on 10 May.

Then, it downgraded its guidance again after its daigou and cross-border e-commerce markets failed to recover as planned. Its new guidance for financial year 2021 was for revenue of between roughly $1.15 billion and $1.2 billion.

When A2 Milk dropped its guidance, its share price fell 13.1%.

That guidance came to fruition on 26 August when the company announced its revenue for financial year 2021 was, indeed, around $1.16 billion – representing a 30% decline on that of the previous financial year.

A2 Milk’s stock dropped another 11.8% that day.

And the final fall came nearly 3 weeks ago when A2 Milk announced its recovery plan but hesitated to promise it would get back to its previous profit levels.

As readers have likely guessed, the company’s share price plummeted 11.9% on the back of the update.

All eyes will likely be on A2 Milk when it reports its results for the first half of financial year 2022 to see if its new plan puts it on the road to recovery.

The post The A2 Milk (ASX:A2M) share price has fallen 46% so far in 2021. Here’s why appeared first on The Motley Fool Australia.

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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. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. 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 Elders Ltd (ASX: ELD) share price closed Monday down 0.74%, after initially jumping 2.8% higher following this morning’s opening bell.

Elders’ shares slipped despite reporting a significant lift in sales and profits for the full 2021 financial year (FY21). Meanwhile, the S&P/ASX 200 Index (ASX: XJO) finished the day 0.36% higher.

Below we look at those FY21 results, for the 12 months to 30 September 2021, released by the Aussie agribusiness giant this morning.

Elders share price slips despite FY21 profit boost

In this morning’s ASX release, Elders reported its FY21 results:

• Sales revenue of $2.548 billion, a 22% year-on-year increase
• Statutory profit after tax of $149.8 million, up 22%, or $26.9 million, from FY20
• Underlying earnings before interest and taxes (EBIT) of $166.5 million, a 38% increase from FY20’s $120.6 million
• Total dividends of 42 cents per share, 20% franked. That’s a 91% increase from the previous year, when dividends were fully franked.

What happened during the reporting period for Elders?

The company reported improved financial performance across all its product areas and locations, aside from its Feed and Processing business. That segment came under pressure from higher feeder cattle prices.

The 2021 financial year saw Elders implement the first year of its third Eight Point Plan. That plan saw the company target 5%–10% growth in EBIT and EPS (earnings per share) through the agricultural cycles. Further, Elders was targeting a return on capital (ROC) of at least 15%.

The business exceeded all of those metrics. EBIT and EPS increased by 38% in FY21, while ROC grew by 22.5%.

Elders attributed its growth strategy, which targets 50% of growth from acquisitions, for the strong results.

What did management say?

Commenting on the results, Elders CEO Mark Allison said:

We have made tremendous progress on our current Eight Point Plan and are well positioned to continue our growth into FY22. We have built our business to perform well in challenging years and to outperform in better years.

With our focus on safety, sustainability, innovation and financial discipline, we have laid the groundwork for sustained growth in FY22 and beyond. Significant opportunities remain to gain market share by serving new and existing customers in new and existing geographies with our multiple product and service portfolios. There is also significant value to be extracted from further improvements in our existing business as we continue to implement our third Eight Point Plan.

What’s next for the Elders share price?

Looking ahead, the company has forecast favourable seasonal conditions and high demand for agricultural commodities in the first half of FY22. This could provide some tailwinds for the Elders share price.

It reported actively managing global supply chain disruptions through “forward orders and risk diversification” across its suppliers.

Elders expects the summer crop to drive strong demand for agricultural chemicals, fertiliser and seed. This gives a positive outlook for its Rural Products segment.

The post Elders (ASX:ELD) share price slips despite 22% profit leap 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 recommended Elders 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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Today, the S&P/ASX 200 Index (ASX: XJO) made its first day of the new week a positive one. At the end of the session, the benchmark index finished 0.36% higher at 7,470.1 points.

While the market was mostly green today, a few lagging sectors held the Aussie index back. Materials, energy, and financials all took a step backward on Monday. Meanwhile, optimism among consumer discretionary, healthcare, and tech more than made up for the losses.

As always, the question is: which shares delivered the biggest returns to investors on the ASX today? Here are the ten stocks that rose to the occasion:

Top 10 ASX shares countdown today

Looking at the top 200 listed companies, Zimplats Holdings Ltd (ASX: ZIM) was the biggest gainer today. Shares in the platinum group metals miner leaped 9.15% despite there being no announcements from the company. Find out more about Zimplats Holdings here.

The next biggest gaining ASX share today was Resmed Inc (ASX: RMD). Shares in the medical device manufacturer rose 4.93% also without any new announcements from the company today. Uncover the latest Resmed details here.

Today’s top 10 biggest gains were made in these ASX shares:

ASX-listed company	Share price	Price change
Zimplats Holdings Ltd (ASX: ZIM)	$25.40	9.15%
Resmed Inc (ASX: RMD)	$36.62	4.93%
Liontown Resources Ltd (ASX: LTR)	$1.645	4.78%
NextDC Ltd (ASX: NXT)	$12.195	4.32%
Incitec Pivot Ltd (ASX: IPL)	$3.25	4.17%
Nickel Mines Ltd (ASX: NIC)	$1.105	3.76%
Pro Medicus Ltd (ASX: PME)	$61.03	3.67%
Mineral Resources Ltd (ASX: MIN)	$41.29	3.64%
Megaport Ltd (ASX: MP1)	$21.48	3.52%
Genesis Energy Ltd (ASX: GNE)	$3.02	3.07%

Our top 10 ASX shares today countdown is a recurring end-of-day summary to ensure you know which companies were making big moves on the day. Check-in at Fool.com.au after the market has closed during weekdays to see which stocks make the countdown.

The post Here are the top 10 ASX shares today appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler owns shares of Pro Medicus Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended MEGAPORT FPO and Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia has recommended MEGAPORT FPO and ResMed Inc. 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 Argosy Minerals Limited (ASX: AGY) share price may be down today but this hasn’t dented its recent upward trajectory. The lithium miner has been busy progressing construction works at its Rincon lithium project, located in Salta Province, Argentina.

At the time of writing, Argosy shares are down 2.42% to 32.2 cents apiece. Despite the backtrack, the company’s shares have shot up 50% over the past month.

What’s the latest with Argosy?

Investors have been bidding the Argosy share price higher as the company edges closer to bringing the Rincon project online.

Last week, Argosy advised the plant and equipment requisition and procurement works are on track as planned.

Early-lead items such as 150kVA generators, industrial pumps, chillers/coolers, agitators, and motors were sourced from local manufacturers. Furthermore, longer-lead items that include process tanks, reactors, and industrial boilers were being engineering and built locally in Argentina.

Other items, such as the evaporator/dryer, is being manufactured in Germany and filters are coming from Asia. The mill, which has been already built and delivered, came from the United States.

The company is targeting for the construction phase to be completed sometime in April 2022. Plant commissioning works, along with test works and ramp-up, is set to follow immediately after.

Argosy managing director Jerko Zuvela commented:

The Company’s Puna operations team is continuing their timely development progress, with plant and equipment procurement on schedule and budget for the 2,000tpa lithium carbonate production operation at our Rincon Lithium Project.

We look forward to a significant near-term growth phase from the increasing development activity at Rincon as we get closer to completing construction works and transform Argosy into a battery quality lithium carbonate producer and cashflow generator, and then to further progress the 10,000tpa project development expansion.

Argosy share price summary

In the last 12 months, the Argosy share price has gained a mammoth 508%, with year-to-date up more than 303%.

The company’s shares rose strongly at the start of the calendar year before profit-taking took hold. More recently, Argosy shares have zipped upwards to reach a multi-year high of 36.5 cents last week.

On valuation grounds, Argosy has a market capitalisation of roughly $404 million, with 1.25 billion shares on issue.

The post Why the Argosy (ASX:AGY) share price is up 50% in a month appeared first on The Motley Fool Australia.

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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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The S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a gain. In afternoon trade, the benchmark index is up 0.3% to 7,465 points.

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

BrainChip Holdings Ltd (ASX: BRN)

The BrainChip share price is down 10% to 54.5 cents. Investors have been selling this artificial intelligence technology company’s shares after it announced the appointment of its new CEO. According to the release, the company has appointed Sean Hehir as its new CEO, with effect from 29 November 2021. The market may have been hoping for a more experienced CEO or one with a background in artificial intelligence.

HT&E Ltd (ASX: HT1)

The HT&E share price is down 6.5% to $1.79. This follows the release of a trading update at the outdoor advertising and media company’s annual general meeting. That update revealed that the company’s growth has continued in the second half. However, it appears as though some investors were expecting stronger growth.

Platinum Asset Management Ltd (ASX: PTM)

The Platinum share price is down 2% to $2.91. This could have been driven by a broker note out of UBS last week. That note revealed that UBS has commenced coverage on the fund manager with a sell rating and lowly $2.25 price target.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven Coal share price is down 1.5% to $2.44. Investors have been selling this coal miner’s shares after a climate deal was reached at COP26. That agreement will see the world phase down coal use. Though, one slight positive for Whitehaven is that the wording of the agreement was changed late on from phase “out”.

The post Why BrainChip, HT&E, Platinum, and Whitehaven Coal are dropping 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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Shares in insurance giant Insurance Australia Group Ltd (ASX: IAG) continue their horrendous run and now trade 0.45% in the red on Monday.

Make no mistake, IAG shares are swimming in a sea of red. They are 13% down in the past month, 18% in the red over the previous 3-months and down 6% this year to date.

It seems whenever one looks, there is a sharp downturn in the IAG share price. As such, top brokers are keeping a close eye on this share’s activity.

No one can predict the future, especially in the financial markets. Whilst many have tried, equally as many have failed at doing so.

Nonetheless, analyst estimates are one of the many drops in an investors bucket when forming an investment decision.

And with several brokers covering IAG shares, it is useful to gather the consensus of their opinion, in order to gauge the market’s sentiment on this floundering insurance giant.

Without further ado, here are what the experts are saying about the outlook for IAG investors.

Can the IAG share price fall even more?

The team at Swiss investment bank UBS reckon this could be the case. It doesn’t see a clear vision of growth for IAG shareholders.

Due to IAG’s recent perils activity, which has plagued its share price over the past few months, UBS reckons there is a downside risk to the company’s earnings. This, especially given “limited sideways insurance cover remaining” if the perils activity is drawn out.

Not only that, UBS is cautious on the spate of regulatory scandals IAG is tied up in, which could bode poorly to its share price, the broker says.

Morgan Stanley expects further downgrades like this, especially as driving activity has almost returned to pre-lockdown levels on NSW and Victorian roads.

This, it reckons, means that there is little protection over IAG’s earnings from what it calls ‘catastrophe risk’. IAG’s shifting business into “short-tail lines..[also] tend to be more catastrophe risk prone” according to the broker.

Not only that, but Morgan Stanley also is cautious on the regulatory proceedings against IAG, and notes there is little shield on IAG’s earnings from this risk either.

It had previously been noted that the regulators choice to launch action against IAG reduces capital flexibility and increases earnings uncertainty.

What other expert opinion is there?

Fellow brokers Macquarie Group Ltd (ASX: MQG), and Jarden agree with this sentiment, compounding the point with their own analysis.

Both Macquarie and Jarden recently lowered their price targets by 5.3% and 2.6% to $5.40 and $5.65 per share respectively.

However, Macquarie retained its outperform rating on the outlook of IAG shares even with its target revision.

Other recent earnings downgrades come out of Morgans and Credit Suisse. Both recently trimmed IAG price targets by 5% each.

Yet, despite the cut to valuations, both brokers are optimistic about the direction of IAG’s share price. Alongside Macquarie, each of the brokers is bullish on IAG shares.

The team at Credit Suisse maintained its outperform rating, even when cutting its target to $5.60. It states that IAG is likely to absorb the net peril costs plaguing its outlook in FY22. But it likes IAG at its current valuation.

Even still, the broker is cautious on IAG’s earnings outlook, stating it “may elect to manage higher insurance margins and increase reinsurance costs by adjusting its cover, but this could come at the expense of increased volatility”.

It remains constructive on the sector nonetheless, citing a favourable interest rate cycle and rational pricing in its reasoning.

Meanwhile, Morgans reckons that IAG looks cheap at these current levels, and encourages an add recommendation for prudent investors.

For those patient investors, it says, IAG could return to profitability from FY23, as insurance premiums are set to lift beyond FY22 for IAG.

Even though IAG recently revised its FY22 natural perils claims cost to $1.04 billion – up from an estimate of $765 million – Morgans notes that “it’s another 6-month period affected by weather for IAG, which is becoming a consistent theme for the general insurers”.

As such, despite a small haircut to its target, it reckons IAG shares can reach $5.36 given the right environment.

What is the sentiment?

Interestingly, out of the 13 brokers covering IAG, 61.5% have a buy rating on its shares, whereas the remaining 38.5% have a hold.

Curiously, there are no sells on the ratings list provided by Bloomberg Intelligence.

The average price target from all brokers is $5.31, and the spread between the highest and lowest valuation is 85 cents of 18%.

At the time of writing, this implies an upside potential of around 20%. However, it is the market’s opinion that matters most.

And with each decrease in share price, IAG has to recover even more to reach this $5.31 consensus target.

Not to mention the raft of regulatory headwinds IAG is currently embroiled in, which several brokers acknowledge could be a negative for investors.

Alas, as it stands, the opinion appears to be tilted towards an upside target for the IAG share price.

The post Could the IAG (ASX:IAG) share price be heading even lower? appeared first on The Motley Fool Australia.

More reading

• Here’s why the IAG (ASX:IAG) share price is down 16% in a month
• The IAG (ASX:IAG) share price has gone backwards so far in 2021. Here’s why
• Why is the QBE (ASX:QBE) share price outperforming IAG lately?
• Is the IAG (ASX:IAG) share price cheap after hitting a 52-week low?
• These top brokers weigh in on the IAG (ASX:IAG) share price

The author Zach Bristow has no positions 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 shares of and has recommended Insurance Australia 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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Bank of Queensland Limited (ASX: BOQ) shares are struggling on the ASX today, despite no news having been released by the company.

At the time of writing, the Bank of Queensland share price is $8.49, 1.28% lower than its previous closing price.

For context, both the S&P/ASX 200 Index (ASX: XJO) and the All Ordinaries Index (ASX: XAO) are gaining today. They’re up 0.33% and 0.4% respectively.

Additionally, the S&P/ASX 200 Financials Index (ASX: XFJ) has tumbled, at one point this morning down 0.52%, making it today’s worst-performing sector.

Let’s look at what has turned out to be a bad Monday for the Bank of Queensland and its peers.

What’s up with the Bank of Queensland share price today?

The Bank of Queensland is underperforming most of the ASX financial shares today for no obvious reason.

In fact, the only bank stock doing worse than the Queensland-based bank is the National Australia Bank Ltd (ASX: NAB).

Though, the NAB share price has an excuse for its poor performance. It went ex-dividend today, sinking 1.77% as a result.

Other financial shares struggling today include Platinum Asset Management Ltd (ASX: PTM) and Janus Henderson Group CDI (ASX: JHG). They’ve seen their share prices fall 2% and 1.87%, respectively.

Meanwhile, Macquarie Group Ltd (ASX: MQG) is the best performing ASX bank share, having gained 0.97% at the time of writing.

The last time the market heard price-sensitive news from the Bank of Queensland was on 28 October. Then, the bank announced it had sold its stake in insurer St Andrew’s.

The sale’s proceeds came to $23 million. The bank expects to recognise an indicative post-tax statutory loss of $26 million from the transaction in its results for the first half of financial year 2022.

The Bank of Queensland share price has fallen 9% over the last month. It’s currently 13% higher than it was at the start of 2021.

The post The Bank of Queensland (ASX:BOQ) share price is having a lousy start to the week. Here’s why appeared first on The Motley Fool Australia.

More reading

• How does the Bank of Queensland (ASX:BOQ) dividend compare to its sector?
• The Bank of Queensland (ASX:BOQ) share price is now trading on a forecast 4.4% fully-franked dividend yield
• Why is the Bank of Queensland (ASX:BOQ) share price trading at 7-month lows?
• Here’s why the Bank of Queensland (ASX:BOQ) share price tumbled 5% in October
• Own Bank of Queensland (ASX:BOQ) shares? Here’s what you should know about its home loans

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and 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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