The S&P/ASX 200 Index (ASX: XJO) hasn’t exactly given us a flying start to the trading week this Monday. At the time of writing, the ASX 200 is down by 0.38% so far today to 7,292 points.

So rather than dwell on that number, let’s instead check out which ASX 200 shares are trading with the heaviest volume so far today, according to investing.com.

The 3 heaviest traded ASX 200 shares on Monday

Whitehaven Coal Ltd (ASX: WHC)

Our first ASX 200 share to check out today is the coal miner Whitehaven. Whitehaven has so far today seen a hefty 15.49 million of its shares bought and sold. There are no developments of an official nature out of the company so far today.

However, the Whitehaven share price has seen a big move today that is probably responsible for this high volume. Whitehaven is currently up a very healthy 5.88% to $3.42 a share at the time of writing.

Beach Energy Ltd (ASX: BPT)

Beach is another ASX 200 share that’s flying around the markets today. This Monday has seen a sizeable 19.14 million Beach shares swap hands so far.

Another ASX resources share, Beach shares also seem to be trading at an elevated volume due to a share price movement. Beach shares are currently up a robust 2.08% today to $1.475 a share. Earlier in the day, the oil driller climbed as high as $1.50. This seems to be the reason behind this high trade volume.

Star Entertainment Group Ltd (ASX: SGR)

Our final ASX 200 share today is a rare guest appearance on this list. But boy, is it here for a good reason! This gaming company and casino operator has seen a whopping 40.96 million of its shares change hands so far this Monday. We don’t have to look too far to see what’s happening here. As my Fool colleague Brooke comprehensively covered earlier today, the Star share price has spent most of this Monday in freefall.

Star shares are down a devastating 22.2% to $3.33 a share at the time of writing. This seems to be in response to several media outlets launching allegations against the company. These reports allege Star has allowed “suspected money laundering, organised crime, fraud, and foreign interference in its casinos”. This sizeable drop in Star’s share price is almost certainly the reason so many shares are trading today.

The post Here are the 3 heaviest traded ASX 200 shares on Monday appeared first on The Motley Fool Australia.

More reading

• Why Afterpay, Platinum, Star, & Strike Energy shares are sinking
• Which ASX 300 shares are making headlines on Monday?
• ASX 200 energy shares rise amid market sell-off
• Why is the Star Entertainment (ASX:SGR) share price plunging 19%?
• ASX 200 (ASX:XJO) midday update: Star shares crash, tech shares tumble

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 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 Nova Minerals Ltd (ASX: NVA) share price is off to a flying start this week and is trading 50% higher at 16.5 cents.

Nova Minerals shares are on the move after the company announced a key update regarding its flagship Estelle Gold Project.

Here’s what we know from what Nova released.

Nova Minerals share price spikes on ‘bonanza’ gold results

Nova announced it had intersected a broad zone of high-grade “bonanza” gold grades when drilling at the Estelle site’s RPM North mineralised prospect.

Drilling is now complete at this section with a further three holes pending. According to Nova, the goal is to “delineate a maiden resource by late 2021” and then advance through the project’s pipeline.

This marks the end of the maiden drill program at RPM North, and a follow-up work program is now being planned for the next round of drilling.

Aside from this, the work program also intends to extend the gold zone’s footprint for the RPM South prospect as early as possible in 2022.

Furthermore, the RPM prospect is “now confirmed to be the second significant project development area at Estelle, and will be a key component” in the path to production at its Estelle site.

The results build on previous drill results Nova announced last month regarding its RPM North prospect. The company now has assay results pending for over 10,000m of drilling from both its RPM prospect and additional Korbel Main site.

Nova also advised that all rigs have moved back to the Korbel Main site, to maximise infill and drill data for upcoming mineral resource updates.

In a separate point, Nova also exclaimed that a “Snow Lake Resources update (is) due shortly”.

What did management say?

Speaking on the announcement, Nova Minerals CEO, Christopher Gerteisen said:

This marks a major milestone for Nova Minerals. RPM is now confirmed to be the second significant project development area at Estelle and will be a key component of our ongoing resource development work on our path towards production at the Estelle Gold Project. This is what unlocking a district looks like, and we will continue to do so with Korbel and RPM representing only 2 of 15 known prospects with the wider Estelle Gold Project claims. In addition to these, there are numerous unnamed colour anomalies across our 324km2 claim block.

Nova Minerals share price snapshot

The Nova Minerals share price has had a difficult year to date, having posted a return of just 3% since the beginning of the year.

Despite this, it has climbed over 68% into the green in the past year of trade, after rallying 14% in the last month.

This result outpaces the S&P/ASX 200 Index (ASX: XJO)’s gain of around 20% in the past year.

The post Nova Minerals (ASX:NVA) share price rockets 52% on gold update appeared first on The Motley Fool Australia.

More reading

• Nova Minerals (ASX:NVA) share price tanks 18% on cap raise news

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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a decline. At the time of writing, the benchmark index is down 0.4% to 7,288.3 points.

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

Ampol Ltd (ASX: ALD)

The Ampol share price is up 3% to $30.02. Investors have been buying the fuel retailer’s shares after it announced that it has entered into a binding scheme implementation agreement to acquire Z Energy Ltd (ASX: ZEL). According to the release, the two parties have agreed on a price of NZ$3.78 cash per share. This represents an enterprise value of NZ$2.8 billion. Management expects the deal to create a “Trans-Tasman fuel champion.”

Fortescue Metals Group Limited (ASX: FMG)

The Fortescue share price is up almost 5% to $14.93. There appear to have been a couple of catalysts for this rise. One was a solid night for iron ore prices on Friday and the other is a broker note out of Ord Minnett. The latter has seen the broker downgrade its iron ore price forecasts but retain its buy rating, albeit with a slightly trimmed price target of $25.00.

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price is up 3.5% to $5.37. This insurance giant’s shares are charging higher after the Federal Court found in favour of insurers on a significant number of policy wording questions in the second business interruption test case. And while the court found in favour of policyholders on other questions, IAG revealed that it is reviewing the judgment to determine whether to appeal any aspect of it.

Perenti Global Ltd (ASX: PRN)

The Perenti share price is up 4% to 99 cents. The catalyst for this appears to have been a broker note out of Macquarie this morning. According to the note, the broker has retained its outperform rating and lifted its price target on Perenti’s shares to $1.10. The broker was pleased to see the company reaffirm its FY 2022 guidance at its annual general meeting.

The post Why Ampol, Fortescue, IAG, & Perenti shares are charging higher appeared first on The Motley Fool Australia.

More reading

• Why the Fortescue (ASX:FMG) share price is up 4% today
• Ampol (ASX:ALD) share price zooms higher on NZ$2.8bn Z Energy acquisition
• Is Fortescue Future Industries listed on the ASX?
• Why are ASX hydrogen shares in the spotlight on Monday?
• ASX 200 (ASX:XJO) midday update: Star shares crash, tech shares tumble

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns 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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The Liontown Resources Limited (ASX: LTR) share price is surging higher today amid the market’s excitement for its spin-off’s Initial Public Offering (IPO).

The spin-off will be named Minerals 260 and will trade under the ticker MI6 from 10am Tuesday morning.

Minerals 260 holds the Moora Project and the Koojan Joint Venture Project, both located in Western Australia. It also owns the Dingo Rocks tenement and has tenement applications at Yalwest.

At the time of writing, the Liontown share price is $1.47, 3.51% higher than its previous close.

Let’s take a closer look at Minerals 260’s upcoming ASX debut.

Liontown share price up ahead of Minerals 260’s IPO

The Liontown share price is gaining amid anticipation of its spin-off’s float.

The company announced news of Minerals 260’s heavily oversubscribed $30 million IPO last week.

Under Minerals 260’s prospectus, shares in the company were offered for 50 cents apiece.

Liontown also offered 160 million Minerals 260 shares as part of a pro-rata offer to its own shareholders. As a result, each Liontown shareholder received 1 Minerals 260 share for every 11.94 Liontown shares they held as of 28 September.

On Mineral 260’s fast approaching float, Liontown’s managing director Tony Ottaviano commented:

It’s tremendous to see the successful conclusion of the Minerals 260 demerger and the launch of an exciting new, well-funded exploration company on the ASX… I look forward to monitoring the progress that Minerals 260 makes, while Liontown continues to advance towards its objective of becoming a world-class battery materials producer.

Minerals 260’s projects include the Moora Project which houses gold, platinum group elements, nickel, and copper. The company also has an option to earn a 51% stake in the Koojan Joint Venture Project.

The newly formed company will be led by Liontown’s former technical director David Richards.

All eyes will be on the Minerals 260 share price, and that of Liontown, when the ASX opens tomorrow morning.

The post Liontown (ASX:LTR) share price lifts ahead of Minerals 260’s IPO appeared first on The Motley Fool Australia.

More reading

• How did ASX lithium shares perform in the FY22 first quarter?
• Top brokers name 3 ASX shares to buy next week
• These were the best performing ASX lithium shares in September
• Which ASX shares are the top movers in the ASX 300 today?
• Why is the Liontown (ASX:LTR) share price sinking 6% today?

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 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 300 Index (ASX: XKO) is starting the week off in negative territory, following a mixed performance for October.

During late afternoon trade, the ASX 300 is down 0.51% to 7,285.4 points. Currently, the index is around 4.5% off its all-time high of 7,625 points reached on 13 August.

Let’s take a look at which ASX companies are the biggest movers today.

Yancoal Australia Ltd (ASX: YAL)

The Yancoal share price is soaring 8.01% to $3.91, despite no market-sensitive news out of the company today.

The spot price of coal has taken a breather but hasn’t affected the energy producer’s shares from rising.

China and India made news last week after running low on coal supplies which led to power blackouts across Asia. And if that wasn’t enough, Lebanon is facing a power crisis of its own, with the country plunged in darkness. 

It appears investors are anticipating coal prices to potentially surge in the near-term future.

Z Energy Ltd (ASX: ZEL)

The Z Energy share price is storming higher with a 5.90% gain to $3.41.

The energy company has received a takeover offer from fuel retailer, Ampol Ltd (ASX: ALD) for NZ$2.8 billion.

In the binding scheme implementation agreement, Z Energy shareholders will get NZ$3.78 cash per share. However, this could increase if the deal isn’t completed by 31 March 2022.

Only time will tell how long the transaction takes to be finalised.

Coronado Global Resources Inc (ASX: CRN)

Another strong mover for the start of the week is the Coronado share price, up 5.59% to a 52-week high of $1.605.

The coal miner hasn’t reported any price-sensitive news since its half-year results in mid-August. Although, investors appear buoyant on the company’s prospects, sending its shares higher.

And which ASX 300 companies are heading the other way?

The Star Entertainment Group Ltd (ASX: SGR)

The biggest loser today is the Star Entertainment share price, down a mammoth 20.68% to $3.395.

The company responded to concerning allegations regarding serious misconduct at its casinos. This includes suspected money laundering, organised crime, fraud, and foreign interference.

No doubt, this has worried investors, dumping its shares heavily as a result.

SkyCity Entertainment Group Ltd (ASX: SKC)

Also being weighed down by investors is the SkyCity share price, down 4.91% to $3.005.

The gaming and entertainment business also is suffering from Star Entertainment’s alleged wrongdoing.

Furthermore, SkyCity chair and director, Mr Rob Campbell has decided to retire from the company to focus on other commitments. It is expected his departure will come into effect sometime in early 2022.

SkyCity is currently undertaking a process to replace Mr Campbell.

The post Which ASX 300 shares are making headlines on Monday? appeared first on The Motley Fool Australia.

More reading

• Ampol (ASX:ALD) share price zooms higher on NZ$2.8bn Z Energy acquisition
• Why is the Star Entertainment (ASX:SGR) share price plunging 19%?
• ASX 200 (ASX:XJO) midday update: Star shares crash, tech shares tumble
• Z Energy (ASX:ZEL) share price leaps 6% on Ampol takeover news
• Ampol (ASX:AMP) share price on watch after Z Energy takeover agreement

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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Few ASX-listed companies are as highly contentious as Flight Centre Travel Group Ltd (ASX: FLT) and its share price. The Australian travel agency is consistently ranking in the top 10 most shorted shares on the ASX, despite shares rallying 39% in value this year.

Today, the company’s shares are flying into the new week slightly lower than last. At the time of writing, the Flight Centre share price is swapping hands for $22.29, down 2.88%.

Meanwhile, the great debate rages over whether the embattled travel share is worth its value. There are two schools of thought from analysts — yes and no. So, let’s break down each of those.

Looking lofty

It might be hard to fathom but Flight Centre is back to its pre-pandemic valuation. This is due to the number of outstanding shares nearly doubling since the beginning of the COVID-19 onslaught. In short, this means the market capitalisation is back above $4.4 billion despite the share price being approximately half of what it was in September 2019.

While the market valuation has recovered, the company’s earnings certainly haven’t. This has attracted the interest of short-sellers with the belief the Flight Centre share price is overinflated on reopening hopes.

According to the AFR, participants who are bearish on the travel agent expect the resumption of travel will actually depress the company’s working capital. This is due to the large backlog of travel credits accumulated by customers from cancelled travel plans.

In addition, one analyst is wary of the changing travel landscape. Australia’s iconic airline Qantas Airways Limited (ASX: QAN) has made the move to reduce commissions paid to travel agents. Although Flight Centre insists this is not a concern, bears think otherwise.

Last week’s 10 most shorted ASX shares placed Flight Centre in pole position. According to the data from ASIC, the company posted a short interest of 11%.

Bullish thesis for Flight Centre share price

On the other hand, there are investors who maintain the belief that shares in the travel agent could hold more upside.

Director at Carter Bar Securities Peter Drew paints a portrait of optimism for the Flight Centre share price. Looking at the company’s 2024 projections, Drew anticipates $12 billion of total transaction value (TTV) from the corporate unit alone.

Furthermore, Drew believes this could result in approximately $220 million of profit for 2024. He argues that if this is given the same price-to-earnings (P/E) ratio multiple as Corporate Travel Management Ltd (ASX: CTD), the company would be then be valued at $4.4 billion. Importantly, this disregards any contribution from the leisure unit of the business — offering potential further upside to the Flight Centre share price.

The post Is the Flight Centre (ASX: FLT) share price overvalued? appeared first on The Motley Fool Australia.

More reading

• Why did the Flight Centre (ASX:FLT) share price have such a great month in September?
• Top broker upgrades the Super Retail (ASX:SUL) share price to buy
• Why A2 Milk, CBA, Flight Centre, & Magellan’s shares are sinking
• Which ASX shares are leading the way in the ASX 300 today?
• These are the 10 most shorted ASX shares

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. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia has recommended Flight Centre Travel 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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The A2 Milk Company Ltd (ASX: A2M) share price is out of form again on Monday.

In afternoon trade, the embattled infant formula company’s shares are down 2% to $5.91.

This means A2 Milk’s shares are now down over 49% since the start of the year.

Has the A2 Milk share price found a bottom yet?

Unfortunately for shareholders, one leading broker doesn’t appear to believe the A2 Milk share price has found its bottom just yet.

A note out of Credit Suisse from last week reveals that its analysts have retained their underperform rating and $5.50 price target on the company’s shares.

Based on the current A2 Milk share price, this implies potential downside of 7% over the next 12 months.

What did the broker say?

According to the note, the broker highlights that infant formula prices stabilised in China in September.

It also notes that marketing activity is increasing and chat groups have been formed with daigou shoppers ahead of the major Singles Day retail sales event next month.

However, this isn’t enough for the broker to change its rating. It has previously voiced its concerns over China’s slowing birth rate and A2 Milk’s loss of market share in stage 1 infant formula. Credit Suisse fears that the latter could act as a drag on its Stage 2 and Stage 3 product sales as this cohort ages.

Is anyone positive?

One broker that remains positive on the A2 Milk share price is Citi. It recently put a buy rating and $7.20 price target on the company’s shares.

However, it has warned that there could be more bad news coming at its investor event later this month. This could include lower than expected margins.

The only potential benefit here is that that broker suspects that any weakness in A2 Milk’s shares could be greeted with a takeover offer.

Time will tell which broker makes the right call.

The post Why this broker thinks the A2 Milk (ASX:A2M) share price has further to fall appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to sell next week
• Top broker tips A2 Milk (ASX:A2M) share price to jump 30%
• Why A2 Milk, Magellan, Santos, & Whitehaven Coal shares are falling
• Why A2 Milk, CBA, Flight Centre, & Magellan’s shares are sinking
• Which ASX shares are leading the way in the ASX 300 today?

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 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 Metal Hawk Ltd (ASX: MHK) share price is off to the races, up 9% in afternoon trade, after earlier posting intraday gains of more than 15%.

That’s a noteworthy performance on any day, but especially so on one that’s seeing the All Ordinaries Index (ASX: XAO) sinking 0.4%.

Below, we take a look at the ASX resource explorer’s drilling update that looks to be driving investor interest.

What drilling update was reported?

Metal Hawk’s share price is rocketing after the company reported that it had started diamond drilling at its Berehaven Nickel Project in the West Australian goldfields, located in Western Australia.

Commenting on the progress, Metal Hawk’s managing director Will Belbin said:

Diamond drilling has started exactly one month after the discovery RC [reverse circulation] hole which intersected high grade massive nickel sulphides at Commodore.

Following last weeks’ successful capital raising, we now look forward to progressing this exciting discovery with an aggressive drilling program.

On 28 September, the explorer announced it had confirmed massive nickel sulphides grading 5.9% nickel at the Commodore prospect, within Berehaven. That announcement saw the Metal Hawk share price gain 6% at close, with much larger intraday gains posted.

When news of that prospect was first released to the market on 14 September, Metal Hawk’s shares closed the day up an eye-popping 265%.

On the day, Belbin foreshadowed, “We look forward to ramping up our nickel sulphide exploration at Berehaven and plans for diamond drilling are well underway.”

In today’s release, Metal Hawk said atop the diamond drilling, it plans to restart RC drilling at the Berehaven Nickel Project sometime this week.

Metal Hawk share price snapshot

Currently trading at 63 cents apiece, the Metal Hawk share price has been a standout performer in 2021, up 137% so far this year. By comparison the All Ords is up 9% year-to-date.

Over the past month, Metal Hawk has come under some pressure, with shares down 10%.

The post Why the Metal Hawk (ASX:MHK) share price is rocketing 9% today appeared first on The Motley Fool Australia.

More reading

• Metal Hawk (ASX:MHK) share price rockets 15% on capital raising update
• Metal Hawk (ASX:MHK) share price rockets 27% on high grade discovery
• Metal Hawk (ASX:MHK) share price jumps following investor update
• Metal Hawk (ASX:MHK) share price closes 265% higher on action-packed day
• Metal Hawk (ASX:MHK) share price explodes 256% on huge nickel discovery

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 Fortescue Metals Group Limited (ASX: FMG) share price has scored a turnaround on Monday, bouncing 3.65% higher to $14.77.

Iron ore holding above US$120 a tonne

It was a quiet week for iron ore markets last week following China’s week-long National Day holiday which ran between 1 and 7 October.

Iron ore prices rallied last Friday, 8 October with improved trading liquidity and recovering demand according to Fastmarkets.

Spot prices were up US$6.36 or 5.4% to US$123.38 a tonne.

Chinese iron ore futures which trade on the Dalian Commodity Exchanges also opened higher on Monday.

The most active futures contracts for January 2022 are up 2.87% to 768 yuan (US$119) a tonne.

What’s the outlook for China?

China’s focus on emissions and energy consumption has headlined the recent decline of iron ore prices. In addition, weak Chinese economic data and concerns surrounding its real estate market continue to weigh on iron ore markets.

BHP Group Ltd (ASX: BHP) CEO Mike Henry spoke at the Financial Times Mining Summit last week, providing an upbeat view about China’s growth and demand outlook.

“The big-picture outlook for commodities remains really healthy both in China and globally, where we are starting to see a bit of a pick-up in inflation, as well, which has been spoken about.”

“Resources companies like BHP are right at the front end of that, and we are benefiting from that through prices for pretty much all of our commodities at this point,” he said.

Looking over at China’s housing market, Henry said “On the one hand, we are seeing pressure on housing starts, which will then impact on near-term steel demand.  On the other hand, activity on work underway remains very strong, and we are starting to see the pull-through to housing completions, which of course is going to bode well for copper demand.  So it is not all a bad news story.”

“Our long-term outlook for China, with continuing strong growth there, has not really changed.  We acknowledge that there are some near-term disruptions occurring that have impacted things like iron ore pricing, but that will work its way through the system in due course,” said Henry.

Fortescue share price snapshot

The Fortescue share price is down an ugly 40% year-to-date and down 12% in the past 12-months.

Encouragingly, it seems to have found a floor around the $14 level, coinciding with the recent rebound in iron ore prices.

The post Why the Fortescue (ASX:FMG) share price is up 4% today appeared first on The Motley Fool Australia.

More reading

• Is Fortescue Future Industries listed on the ASX?
• Why are ASX hydrogen shares in the spotlight on Monday?
• Fortescue (ASX:FMG) share price gains amid Twiggy’s planned $1bn hydrogen investment
• Do these ASX dividend shares really have 20%+ yields?
• 2 ASX shares that could be worth researching this weekend

Motley Fool contributor Kerry Sun 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 Prospect Resources Ltd (ASX: PSC) share price is sliding into the red today and is now changing hands at 35.5 cents.

That’s a 10.13% drop from the open for the Australian lithium company despite it releasing two key updates today.

Let’s cover each update in a bit more detail.

What did Prospect Resources Announce?

The Prospect Resources share price is on the move today after the company advised its 87% owned Arcadia lithium project in Zimbabwe is now “confirmed as (a) world class deposit”.

It draws this conclusion from a staged optimised feasibility study (OFS) that confirmed the “strong technical and economic viability of Arcadia under a staged development pathway”.

These results indicate the potential of the Arcadia site to become a compelling long life and large scale open pit lithium mine, according to the company.

It also confirms the project is “among the best in the world for scale and cost of production when compared to existing operations”.

The update notes that one key contributor is the quality of lithium concentrate products at the site. They are described as high in grade and very low in impurities.

For reference, the price of lithium has come off an all-time high of 177,000 Chinese Yuan (A$37,440.54) per tonne since September, although is still up 254% since January 1.

The company says a so-called staged development pathway now indicates a lower required rate of return on the project to achieve profitability.

As such, the project’s economics are expected to be “further improved in (a) direct-to-2.4 Mtpa Optimised Feasibility Study (Direct OFS)” due for completion in Q4 2021.

The company says there is strong interest from several groups focused on the direct OFS’s outcomes.

Prospect is “now completing the work on the direct OFS pathway case before funding decisions are made” on its next steps.

The company also held an investor briefing and released an investor presentation regarding the staged OFS results alongside the headline announcement.

Investors have sold on the news, pushing the Prospect Resources share price lower today. It hit 33.5 cents just before midday.

What did management say?

Speaking on the announcement, Prospect Resources Managing Director Sam Hosack said:

The OFS details our clear differentiation with a range of potential product markets and customers versus traditional spodumene projects. Even at the smaller initial scale, the Lycopodium results demonstrate a highly competitive forecast [regarding] operating costs and margins, reflecting prices for technical petalite at a significant premium to traditional chemical grade spodumene concentrate pricing.

Prospect Resources share price snapshot

The Prospect Resources share price has soared this year to date and climbed 111% since January 1.

Despite sliding 17% this past week, it has also gained 89% in the last 12 months.

The post Why is the Prospect Resources (ASX:PSC) share price plunging 10% today? appeared first on The Motley Fool Australia.

More reading

• Why is the Prospect Resources (ASX:PSC) share price up 11% this month?

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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