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The Brickworks Limited (ASX: BKW) share price may be a good one to consider. There are some compelling reason to like the business.

What is Brickworks?

Brickworks is a S&P/ASX 200 Index (ASX: XJO) company. It has a few different segments to it.

The part that captures most of the attention is the building products division in Australia. It is the largest brick manufacturer in Australia. But it’s also known for other products as well. There are various businesses including: Austral Bricks, Austral Masonry, Austral Precast, Bristle Roofing, Southern Cross Cement, Bowral Bricks, Daniel Robertson, Nubrik, Terracade, Pronto Panel, GB Masonrym Urban Stone and Capital Battens.

After making some acquisitions, it also has a large presence in the north east of the US. The businesses it operates there includes Glen Gery, Sioux City Brick, Lawrenceville Brick and Cushwa Brick.

It also has other assets, but those will be covered as one of the potentially compelling points below:

Reliable and growing assets

There are two asset groups that underpin the Brickworks share price.

Brickworks owns just over a quarter of the recently-enlarged Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). The investment house provides Brickworks with increasing dividends and diversification.

Soul Patts is invested in a number of sectors including telecommunications, building products (being Brickworks), mining and energy, financials, health and property.

The investment conglomerate is looking at a number of areas to invest in including health and ageing, the energy transition, agriculture, financial services and education.

Brickworks also owns half of a property trust along with Goodman Group (ASX: GMG). After including borrowings, Brickworks’ half of the net asset value of the trust was $911 million at 31 July 2021.

Brickworks sells surplus land into the trust at market value, whilst Goodman funds the infrastructure works, to create serviced land ready for development. Once a lease pre-commitment is secured, the serviced land can then be used as security, with debt funding to cover the cost of constructing the facilities. The completion of pre-committed developments over the next two years will result in an increase of around 60% in rent and leased asset value from the current level.

The new developments are increasingly sophisticated, with things like robotics, automation and multi-storey warehousing.

Good value

On 7 October 2021, Brickworks said that its current inferred asset backing was around $32 per share. That included the Soul Patts shareholding value of $3.41 billion, $911 million for the property trust, $1.03 billion of building product assets and $519 million of net debt.

The company also noted that the building products asset value includes land, both operational and surplus, with the market value “significantly higher” than the book value.

The share prices of Brickworks and Soul Patts are changing all the time. However, the current Brickworks share price is at a discount of around 25% from that value that was stated a week ago.

Long-term dividend record

Brickworks says that it’s proud of its long history of dividend growth and the stability that this provides to its shareholders.

It has maintained or increased its normal dividend every year for the last 45 years. That means no cuts for over four decades.

In FY21, it grew its total dividend by 2 cents per share to 61 cents per share.

At the current Brickworks share price, the trailing grossed-up dividend yield is 3.65%.

The post 3 reasons why the Brickworks (ASX:BKW) share price could be a buy appeared first on The Motley Fool Australia.

More reading

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• Why did the Woodside (ASX:WPL) share price slide today?
• Why ASX 200 tech shares have outperformed today
• Here are the top 10 ASX shares today
• Rio Tinto (ASX:RIO) share price climbs amid news of latest green push

Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Brickworks. The Motley Fool Australia owns shares of and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Rio Tinto Limited (ASX: RIO) share price will be one to watch on Friday.

This follows the release of the mining giant’s third quarter update this morning.

Rio Tinto share price on watch after downgrading guidance

The Rio Tinto share price could come under pressure today after it downgraded its full year guidance following a difficult quarter.

In respect to its performance, below is a summary of what happened during the third quarter:

• Pilbara iron ore shipments of 83.4Mt, up 2% year on year (YoY) and 9% quarter on quarter (QoQ)
• Bauxite production down 3% YoY but up 2% QoQ to 14kt
• Aluminium production of 774kt, which is down 3% YoY and 5% QoQ
• Mined copper came in at 125.2kt, down 3% YoY but up 8% QoQ
• Titanium dioxide slag down 29% YoY and 30% QoQ to 209kt

Guidance downgraded

In light of the above, the company has downgraded its guidance for a number of key commodities.

The key one is its Pilbara iron ore shipments guidance which is now expected to be in the range of 320 to 325Mt. This compares to its previous guidance of 325 to 340Mt. This follows modest delays to the completion of the new greenfield mine at Gudai-Darri and the Robe Valley brownfield mine replacement project due to the tight labour market in Western Australia.

Elsewhere, its guidance for Bauxite production has been trimmed to 54 to 55Mt (from 56 to 59Mt) and its Mined Copper production guidance has been reduced to 500kt (from 500 to 550kt).

Management commentary

Rio Tinto’s Chief Executive, Jakob Stausholm, commented: “The third quarter has demonstrated the resilience of our people in dealing with ongoing COVID-19 challenges. It has been another difficult quarter operationally and despite improving versus the prior quarter, we recognise the opportunity to raise our performance. We have consequently modestly adjusted our guidance.”

“We are progressing against our four pillars and striving to make Rio Tinto even stronger, notably to become the best operator. This will ensure we continue to deliver attractive returns to shareholders, invest in sustaining and growing our portfolio, and make a broader contribution to society, particularly in relation to the drive to net-zero carbon emissions,” he added.

The Rio Tinto share price is down 13% in 2021.

The post Rio Tinto (ASX:RIO) share price on watch after Q3 update & guidance downgrade appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Friday
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• Why this top broker says the Rio Tinto (ASX:RIO) share price is a buy despite weak iron-ore outlook
• ASX 200 (ASX:XJO) midday update: Westpac’s $1.3bn earnings hit, Ansell sinks

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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AGL Energy Limited (ASX: AGL) shares closed down 0.5% yesterday, having recouped intraday losses of 1.5%.

The S&P/ASX 200 Index (ASX: XJO), meanwhile, ended in the green, up 0.5%.

AGL, and Australia’s other energy companies including Origin Energy Ltd (ASX: ORG), are in the spotlight as the nation looks to cut its carbon emissions, potentially to net zero by 2050.

Below we take a look at some key takeaways from Capgemini’s 23rd edition of the World Energy Markets Observatory.

Clean, reliable and affordable

Among the core measures stressed in the report is the need for Australia, and the world, to keep a lid on energy prices “while accelerating the global transition to clean energy”.

And if you thought that the global pause many of us took to mitigate the impacts of the pandemic put a big dent in CO2 emissions, think again.

According to Capgemini:

Consumption and emissions decreases stemming from the COVID-19 pandemic did not lead to a sustained emissions decrease compatible with the 1.5°C global warming objective for 2100.

In a dire warning, the report notes, “If current trends continue, the world may experience a temperature increase of 1.5 °C as early as 2025–2030.”

And while renewable costs have been falling, Capgemini expects costs will level out in “coming years” as capital costs and, importantly, critical green energy metal prices rise.

Overall, the transition away from fossil fuel based energy sources to renewables isn’t going to come cheap.

To reach net-zero emissions in line with the Paris climate agreements, Capgemini estimates investments in low carbon technologies will have to ramp up 5 to 10 times every year between now and 2040.

As for AGL shares?

The report notes that the number 1 priority is, “Utilities transformation roadmaps must be reconsidered in a post-COVID world” for the energy transition to carbon neutrality.

Philippe Vié, Vice-President energy and utilities sector at Capgemini said:

In this year’s World Energy Markets Observatory, we see the need to maintain energy affordability while accelerating energy transition efforts. Emerging technologies and new use cases across the energy value chain, including green hydrogen, CCUS, storage, and e-mobility, will play a critical role in helping the world achieve a net zero future.

Australia’s big 3 energy producers

The big 3 energy producers down under, the report notes, are AGL, Origin and EnergyAustralia.

It says that together these 3 companies hold 64% of the small electricity and 83% of the small gas market.

And Australia has some way to go before reaching the lofty goals set in the Paris Accord.

In 2020, according to Capgemini, renewable energy was responsible for 24% of Australia’s total electricity generation.

AGL’s sustainability stance

The ASX 200 energy giant, addressing its responsibilities to move towards a low carbon future, notes:

At AGL, sustainability means thinking about our long-term responsibilities towards our customers, our people, our investors and to our community, and to the environment in which we all work and live.

We’re focused on delivering affordable, reliable, lower-carbon and innovative energy solutions for all of our customers, including those experiencing financial hardship…

We are also committed to taking a conscientious approach to the environment by actively working to reduce greenhouse gas emissions and manage our environmental footprint.

How have AGL shares been performing?

AGL shares have struggled since hitting all-time highs in May 2017.

Over the past 12 months, shares are down 55%, compared to a gain of 19% posted by the ASX 200.

The past month has been kinder to AGL shareholders, with the share price up 3% while the ASX 200 fell 1%.

The post Own AGL shares? Here are the World Energy Markets Observatory’s future priorities appeared first on The Motley Fool Australia.

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

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Looking for a growth share or two to buy this month? Three that could be worth considering are listed below.

All three have been tipped to grow strongly over the 2020s. Here’s what you need to know about them:

Appen Ltd (ASX: APX)

The first growth share to look at is Appen. It is a leading developer of high-quality, human annotated datasets for machine learning (ML) and artificial intelligence (AI). Appen was growing at a rapid rate until the pandemic put a dampener on demand from some of its biggest customers. While this is disappointing, management appears confident that demand will rebound post-pandemic. Especially given how the AI and ML markets are expected to continue their explosive growth for many years to come.

Earlier this week, the team at Citi retained their buy rating and lofty $17.00 price target on the company’s shares.

IDP Education Ltd (ASX: IEL)

Another ASX growth share to look at is IDP Education. It is a provider of international student placement services and English language testing services. As with Appen, IDP Education was hit hard by the pandemic. However, its performance has been improving greatly since the peak of the crisis and analysts expect the company to come out the other side of the pandemic in a much stronger position. IDP Education has also just boosted its offering with a key acquisition in the lucrative India market.

Morgan Stanley is very positive on the company’s prospects. Earlier this week, the broker retained its overweight rating and lifted its price target to $40.20.

Kogan.com Ltd (ASX: KGN)

A final growth share to look at is Kogan. It is one of Australia’s leading ecommerce companies and appears exceptionally well-positioned to benefit from the structural shift to online shopping. And while inventory issues are weighing on its near term performance, the company’s long term outlook remains very positive. Particularly given its strong market position, acquisitions, its growing private label offering, and the shift to online.

It is for these reasons that Credit Suisse remains positive on the company. Its analysts currently have an outperform rating and $14.06 price target on its shares.

The post Analysts name 3 excellent ASX growth shares to buy 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. owns shares of and has recommended Appen Ltd, Idp Education Pty Ltd, and Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Appen Ltd and Kogan.com 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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Before a slight rally on Thursday, the S&P/ASX 200 Index (ASX: XJO) had sunk 4.7% from its 13 August peak.

So will this correction turn into a bear market, or is it just a stumble before shares rocket up again?

According to AMP Capital chief economist Dr Shane Oliver, it’s too early to declare that the pullback has finished.

“Some of the worries around US fiscal policy and politics, China, global supply constraints and central banks likely have further to run and could see the correction go further,” he wrote on an AMP Ltd (ASX: AMP) blog.

Many worries for share markets at the moment

Both the ASX 200 and overseas markets are facing multiple sources of anxiety.

The US government would have run out of money this week, but an 11th-hour deal delayed this fate until at least December.

“But this just means the issue will come up again in a few months — along with the need to avoid a government shutdown where funding was also extended into December,” said Oliver.

“Republicans still don’t plan to vote for it as that will be seen as signing up to Democrat spending.”

There is also concern about the Democrats’ social spending package and US Federal Reserve chair Jerome Powell’s renomination.

On the other side of the world, real estate developer Evergrande had a stay of execution but clouds still hover over its fate.

“Evergrande is yet to be resolved and other developers are having problems,” Oliver said.

“The broader slowdown in Chinese growth reflects the earlier removal of stimulus and coronavirus restrictions in August, which have since been relaxed.”

Oliver thought Beijing would not allow a major slowdown of the economy, as that would risk “social unrest”.

To add to those worries, gas prices have risen 6-fold this year in Europe and there are electrical blackouts in China.

But the biggest issue is supply and inflation

Above all, though, Oliver reckons there is one problem that could have a much more direct and longer-lasting impact on ASX 200 shares.

“Supply constraints and inflation — this is the biggest issue because a permanent increase to significantly higher inflation will mean lower price-to-earnings multiples/higher required yields for assets.”

He added that while a huge increase in the supply of money globally does pose an inflation risk, the current dilemma is more attributable to temporary distortions caused by COVID-19.

“In the pre-COVID world, the global supply system was a very finely tuned and highly efficient machine.

“Coronavirus threw it off with outbreaks (people can’t go to work) and their response (e.g. enhanced unemployment benefits encouraging people not to work) causing disruptions to production, and demand swinging to goods from services all of which is showing up in today’s problems.”

The prospect of inflation is triggering central banks around the world to become more hawkish. New Zealand last week already pushed up its official cash rate.

So is this the start of a bear market for the ASX 200?

Oliver predicts grey clouds to stick around in the short term.

“The risk is that the correction has further to run,” he said.

But as for whether the correction will turn into a significant bear market, Oliver pointed to a recession as the historical catalyst for such a downturn.

The good news is that he doesn’t see the long list of worries as severe enough to trigger a US, global or Australian recession.

“Ultimately, we see the issues being largely resolved in a way that does not severely threaten global growth,” Oliver said.

“So with global monetary policy likely to remain relatively easy for some time, we continue to see the broader trend in global and Australian shares remaining up, once the correction runs its course.”

The post Will this ASX 200 correction turn into a major bear market? appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Friday
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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. 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 fund manager Wilson Asset Management (WAM) has told investors about two compelling ASX shares that it has in its portfolio.

WAM operates several listed investment companies (LICs). Some, like WAM Leaders Ltd (ASX: WLE), focus on larger companies.

There’s also one called WAM Capital Limited (ASX: WAM) which targets “the most compelling undervalued growth opportunities in the Australian market.”

The WAM Capital portfolio has delivered an investment return of 16.7% per annum since inception in August 1999, before fees, expenses and taxes. This gross return outperformed the S&P/ASX All Ordinaries Accumulation Index return of 8.7% per annum over the same timeframe.

These are the two ASX shares that WAM Capital outlined in its most recent monthly update:

Tuas Ltd (ASX: TUA)

Tuas was created after the merger between TPG Telecom and Vodafone Hutchison Australia last year.

In its first financial year, Tuas revealed that it tripled its subscriptions to reach a total of 392,000 paid active subscriptions on 31 July 2021. It reached a market share of 4.5%.

The subscription growth underpinned “strong” revenue growth for the ASX share, increasing by SG$30 million since October 2020 to SG$34.3 million while also enabling the company to achieve breakeven earnings ahead of market expectations. TPG Singapore, the operational business of the group, achieved a positive earnings before interest, tax, depreciation and amortisation (EBITDA) of S$0.9 million for the 12 months to 31 July 2021.

WAM says that Tuas is set to continue growing as it “tracks positively” in FY22. The fund manager believes the market is yet to fully appreciate the incremental operating leverage as further subscribers are added to the largely fixed cost base.

Maas Group Holdings Ltd (ASX: MGH)

WAM described MAAS Group as a leading independent and vertically integrated construction materials, equipment and services provider with a property development arm.

The fund manager pointed out that in September the ASX share announced it had signed an agreement for the acquisition of Earth Commodities hardrock quarry operation in Gladstone, enabling the company to realise synergies with its Central Queensland construction materials business and increase its growth opportunities in the year ahead.

WAM noted the strategically located quarry assets, significant unutilised capacity and a substantial pipeline of infrastructure spend expected over the next three to five years. It’s that combination of things that makes the fund manager believe the organic growth outlook for the business is compelling and expects this to be further increased by bolt-on acquisitions. The investment team believe there is potential for corporate action within the property arm.

The post Wilson Asset Management (WAM) thinks these 2 top ASX shares are a buy 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. 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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Looking for dividend shares to add to your income portfolio? Then the three listed below could be top options.

Here’s why analysts rate these dividend shares highly:

Adairs Ltd (ASX: ADH)

The first dividend share to look at is Adairs. It is a leading homewares and furniture retailer with both a physical presence and growing online presence. The latter includes through both its core brand and its online only Mocka brand.

According to a note out of UBS, its analysts have a buy rating and $5.40 price target on its shares. It is also forecasting a fully franked dividend of 19.6 cents per share in FY 2022. Based on the current Adairs share price of $3.89, this will mean a yield of 5%.

National Australia Bank Ltd (ASX: NAB)

Another dividend share to look at is NAB. This banking giant could be a top option for income investors due to its strong rebound from the pandemic, the Citi acquisition, and its cost management initiatives.

Goldman Sachs is very positive on NAB. It currently has a conviction buy rating and $30.62 price target on the bank’s shares. In addition, the broker is forecasting a fully franked $1.40 per share dividend in FY 2022. Based on the current NAB share price of $28.58, this will mean a yield of 4.9%.

Telstra Corporation Ltd (ASX: TLS)

A final dividend share to look at is this telco giant. It could be a quality option due to its very positive outlook which is being underpinned by its recently announced T25 strategy. This has management targeting solid and sustainable growth in the coming years.

The team at Morgans are fans of Telstra. They recently put an add rating and $4.44 price target on its shares. The broker also continues to forecast a 16 cents per share in FY 2022. Based on the current Telstra share price of $3.84, this will mean a yield of 4.1%.

The post 3 buy-rated ASX dividend shares for income investors appeared first on The Motley Fool Australia.

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• What happened for the Telstra (ASX:TLS) share price in the FY22 first quarter?
• Own NAB (ASX:NAB) shares? What to expect from its FY21 results

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 shares of and has recommended ADAIRS FPO. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO and Telstra Corporation 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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On Thursday the S&P/ASX 200 Index (ASX: XJO) was back on form and pushed higher. The benchmark index climbed 0.5% to 7,311.7 points.

Will the market be able to build on this on Friday? Here are five things to watch:

ASX 200 expected to rise again

The Australian share market looks set to end the week on a positive note. According to the latest SPI futures, the ASX 200 is expected to open the day 45 points or 0.6% higher. This follows a very strong night of trade on Wall Street, which late on sees the Dow Jones up 1.4%, the S&P 500 1.6% higher, and the Nasdaq up 1.65%.

Rio Tinto quarterly update

All eyes will be on the Rio Tinto Limited (ASX: RIO) share price today when it releases its third quarter update. Investors will no doubt be keen to see if the mining giant is on course to achieve its full year guidance. This includes iron ore shipments of 325 to 340Mt, aluminium production of 3.1 to 3.3Mt, and copper production of 210 to 250kt.

Oil prices rise

Energy producers including Santos Ltd (ASX: STO) and Woodside Petroleum Limited (ASX: WPL) could have a strong finish to the week after oil prices pushed higher. According to Bloomberg, the WTI crude oil price is up 1.15% to US$81.36 a barrel and the Brent crude oil price is up 1.15% to US$84.13 a barrel. A stronger draw on US fuel inventories boosted prices.

Dividends

The Harvey Norman Holdings Limited (ASX: HVN) share price is trading ex-dividend for its fully franked 15 cents per share final dividend this morning and could trade lower. Elsewhere, shareholders of Eagers Automotive Ltd (ASX: APE) and HUB24 Ltd (ASX: HUB) can look forward to being paid their latest dividends later today.

Gold price rises

Gold miners Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) will be on watch after the gold price edged higher. According to CNBC, the spot gold price is up 0.2% to US$1,798.9 an ounce. This was driven by softening bond yields.

The post 5 things to watch on the ASX 200 on Friday appeared first on The Motley Fool Australia.

More reading

• Why did the Woodside (ASX:WPL) share price slide today?
• Why ASX 200 tech shares have outperformed today
• Why the HUB24 (ASX:HUB) share price jumped 11% to a record high today
• Here are the top 10 ASX shares today
• Rio Tinto (ASX:RIO) share price climbs amid news of latest green push

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 shares of and has recommended Hub24 Ltd. The Motley Fool Australia owns shares of and has recommended Harvey Norman Holdings Ltd. 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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The small end of the Australian share market is home to a number of companies with the potential to grow materially in the future.

Two that investors might want to get better acquainted with are listed below. Here’s why they are highly rated:

Booktopia Group Ltd (ASX: BKG)

The first small cap ASX share to watch is rapidly growing online book retailer, Booktopia.

Thanks to the shift to online shopping and its new automated distribution centre, Booktopia was a very strong performer in FY 2021. It reported a 35% lift in revenue to $223.9 million and a 125% jump in underlying EBITDA to $13.6 million.

Also growing strongly was its active customers. At the end of the period, the company had a total of 1.8 million active customers. This was an increase of 19% year on year.

Pleasingly, FY 2022 has started positively and the company’s revenue was tracking ahead of the prior corresponding period at the end of August. A further update on its performance is likely to be released later this month.

In the meantime, the team at Morgans is very positive on Booktopia’s outlook. Its analysts currently have an add rating and $3.72 price target on its shares.

Universal Store Holdings Limited (ASX: UNI)

Another small cap ASX share to look at is this fashion retailer. Universal Store aims to deliver an ever-changing and carefully curated selection of on-trend products for younger consumers.

This strategy has been working very well, leading to strong sales and profit growth in FY 2021. Universal Store reported a 36.1% increase in sales to $210.8 million and an 87.7% jump in underlying net profit after tax to $30.4 million.

This went down well with the team at Macquarie. In response, the broker put an outperform rating and $8.90 price target on its shares.

The post 2 exciting small cap ASX shares analysts rate highly appeared first on The Motley Fool Australia.

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• 2 exciting small cap ASX shares to watch
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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 recommended Booktopia Group Limited. 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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It was a mighty day for the WiseTech Global Ltd (ASX: WTC) share price today. Shares in the cloud-based logistics software company finished Thursday’s session as the third best performing share in the S&P/ASX 200 Index (ASX: XJO).

At the end of the day, the Wisetech share price climbed 7.17% to $53.51, putting it 6.6% away from its 52-week high. As a result, the company holds a market capitalisation of $17.39 billion.

Interestingly, the upwards move in value today comes without any announcement from WiseTech. In which case, let’s take a look at what else might have helped.

Rising tide lifts all boats

Rather than company-specific news helping the WiseTech share price today, the move appears more widespread.

For instance, the S&P/ASX All Technology Index (ASX: XTX) gained 3.11%, which would be partially thanks to WiseTech. However, other notable contributions came from Megaport Ltd (ASX: MP1), Xero Limited (ASX: XRO), and Afterpay Ltd (ASX: APT). This trend on Aussie markets followed the lead of US markets overnight, where the tech-heavy Nasdaq Composite index gained 0.7%.

Additionally, the push higher in tech shares comes as some market commentators warn of an impending period of stagflation. As the saying goes, a rising tide lifts all boats, and rising tech shares have carried the WiseTech share price with it today.

In simple terms, stagflation involves a mix of high inflation and slowing economic growth. During such periods investors tend to flee to ‘high performing’ shares — which might include some of the more profitable, high margin tech businesses.

As demonstrated in its FY21 result, WiseTech might meet that criteria to some investors. For reference, the company delivered a net profit after tax of $105.8 million, doubling its earnings from FY20.

At the same time, with supply chains being in such turmoil, software that optimises this industry might have the ability to retain customers with price increases to negate inflation.

WiseTech share price in review

The WiseTech Global share price has delivered sensational returns to shareholders compared to the benchmark index. For example, the logistics software company has experienced a 95.7% rise in its share price in the past year. Meanwhile, the S&P/ASX 200 Index has climbed 17.7%.

At present, Wisetech trades on a price-to-earnings (P/E) ratio of 112 times.

The post WiseTech (ASX:WTC) share price surges 8% on Thursday appeared first on The Motley Fool Australia.

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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 shares of and has recommended WiseTech Global. The Motley Fool Australia owns shares of and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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