Tag: Motley Fool

  • BHP (ASX:BHP) share price lifts amid news $7.5b project will proceed

    mining worker making excited fists and looking excited

    The BHP Group Ltd (ASX: BHP) share price is climbing higher today as the company moves one step closer towards making its Jansen potash mine a reality.

    At the time of writing, shares in the diversified resource miner are up 1.58% to $52.08. The BHP share price is now 39% above where it was a year ago.

    Port facilities agreement for new mine

    Reports in The Australian reveal BHP is likely set to proceed with its Jansen potash development in Saskatchewan Canada. This follows news the mining giant has secured a conditional port services deal with Westshore Terminals.

    According to earlier news, the agreement remains conditional on BHP advancing to its first phase for Jansen. It is estimated that these initial phases could cost up to $5.7 billion.

    If the project goes ahead Westshore will be responsible for handling the potash for BHP up to the year 2051, subject to extension.

    Interestingly, the Jansen potash project will be the company’s first new resource in more than a decade. BHP has been investigating the prospects of potash since 2006. Back then the BHP share price was bouncing between $22 to $28 a share.

    In a presentation last month, the company discussed the compelling case for the resource. A combination of population growth, a shift to plant-based diets, and a need for increased crop yields are all attractive catalysts for potash, according to BHP.

    Additionally, its recent quarterly results showed the company on track for a ‘go or no-go’ decision in the next two months for Jansen stage 1. Nearly US$3 billion has already been sunk into the project to get it to this point.

    BHP share price snapshot

    The BHP share price has been enjoying the prolonged iron ore boom. Over the past year, the company has added 39% to its value — now commanding a market capitalisation of $238.5 billion.

    More recently, a nickel supply agreement with Tesla Inc (NASDAQ: TSLA) has pushed shares in the mining company even higher.

    The post BHP (ASX:BHP) share price lifts amid news $7.5b project will proceed appeared first on The Motley Fool Australia.

    Should you invest $1,000 in BHP Group right now?

    Before you consider BHP Group, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and BHP Group wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

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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. 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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  • Here’s why the Argosy Minerals (ASX:AGY) share price is soaring today

    asx share price growth represented by cartoon man flexing biceps in front of charged battery

    The Argosy Minerals Ltd (ASX: AGY) share price is soaring today, up 6% in early afternoon trade, having earlier posted gains of more than 8%.

    Below, we take a look at the latest announcement from the Perth-based lithium miner that looks to be driving investor interest.

    What update did Argosy provide?

    Argosy Minerals’ share price is leaping higher after the company reported additional progress with its clean lithium processing technology at its Rincon Lithium Project in Argentina.

    The company is focused on producing environmentally friendly battery quality lithium carbonate via its proprietary chemical process technology.

    It said that low energy use is one of the key factors which sets its process apart from competing lithium carbonate producers.

    Argosy estimates energy use at approximately 1MW for 2,000 tonnes per annum (TPA) operation levels and around 5–6MW for 10,000tpa in its planned expansion phase of operation.

    Energy will be provided by a nearby gas pipeline. Argosy is also looking into sourcing power from a solar power plant, which is currently under construction.

    Water consumption is also lower than industry standards with its chemical process technology recycling some 90% of the brine fed through its process plant.

    Argosy estimates the flow rate of raw water consumption at around 6–8m3/h for its 2,000tpa operation and at roughly 40m3/h for its 10,000tpa expansion operations.

    Commenting on the progress, Argosy’s managing director Jerko Zuvela said:

    We have a successfully proven, proprietary and environmentally friendly clean lithium technology to produce battery quality lithium carbonate with low impurities, meeting ESG requirements with a low carbon footprint of low fresh water and energy usage, sustainably producing at a scale no other junior lithium company is currently able to achieve, and currently in construction phase for the 2,000tpa operation, with development plans for an additional 10,000tpa production expansion.

    Argosy Minerals share price snapshot

    Over the past 12 months, the Argosy Minerals share price has surged 145%, far outpacing the 25% gains posted by the All Ordinaries Index (ASX: XAO).

    Year-to-date, Argosy Minerals’ share price is up more than 65%.

    The post Here’s why the Argosy Minerals (ASX:AGY) share price is soaring today appeared first on The Motley Fool Australia.

    Should you invest $1,000 in Argosy Minerals right now?

    Before you consider Argosy Minerals, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Argosy Minerals wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

    More reading

    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 Digital Wine (ASX:DW8) share price sinks 6% on quarterly report

    An older woman wearing a wonky party hat looks unpleasantly at a glass of wine in her hand.

    The Digital Wine Ventures Ltd (ASX: DW8) share price is starting the week off in the red. This comes after the wine-focused technology investment company announced a trading update for the fourth quarter of FY2021.

    Digital Wine shares sank 6.1% to an intraday low of 7.6 cents at the opening of trade. Apart from a late morning rally they have stayed down and, at the time of writing, are trading hands for 7.7 cents a share.

    How did Digital Wine perform in Q4 FY21?

    Investors appear to be heading for the hills, selling Digital Wine shares despite the company reporting impressive numbers.

    For the three months ending 30 June 2021, Digital Wine achieved $1.02 million in revenue from its WineDepot platform. This reflects a 33% increase on the prior quarter, and a mammoth 274% jump on the previous corresponding period (Q4 FY20). The outstanding result came on the back of strong orders received, along with a number of new suppliers.

    WineDepot shipped a total of 75,377 cases throughout the fourth quarter, resulting in a 22% lift on Q3 FY21 (61,939 cases). That’s also a significant increase compared to this time last year, when the business shipped 13,840 cases in Q4 FY20.

    The average number of cases shipped per order stood at 2.33, however this will likely surge over the coming months. As WineDepot Market grows, trade buyers typically place larger orders than consumers, leading the volume of orders processed.

    During Q4 FY21, the company acquired 68 new suppliers, bringing the total number of suppliers using WineDepot’s platform to 375.

    In addition, Digital Wine touched on some previous achievements that occurred during the quarter. This included securing a liquor licence to launch a wine club called Insider Trading. This is an invitation-only membership program that allows access to private tastings, dinners, master classes and other events.

    Furthermore, Digital Wine’s WineDepot went live in Melbourne and Sydney, offering a direct-to-trade marketplace for consumers. The company notably partnered with Zip Co Ltd (ASX: Z1P) for a buy now, pay later credit solution, and Amazon (NASDAQ: AMZN) for its logistics network.

    Management commentary

    Digital Wine CEO Dean Taylor highlighted the company’s strong performance, saying:

    There’s been a noticeable lift in our key metrics over the last 3 months as existing and new suppliers embrace new functionality offered via our platform, such as MARKET & DIRECT. The combination of the new revenue streams generated by these products together with very strong customer growth, generated organically and via strategic acquisitions, provides the basis for a very exciting year ahead in respect of revenue growth.

    Digital Wine share price snapshot

    In the past 12 months, Digital Wine shares have outpaced the broader All Ordinaries Index (ASX: XAO) to post a 92.5% gain. So far in 2021, the company’s share price is up 79%.

    Based on today’s price, Digital Wine presides a market capitalisation of roughly $128 million, with 1.6 billion shares on issue.

    The post The Digital Wine (ASX:DW8) share price sinks 6% on quarterly report appeared first on The Motley Fool Australia.

    Should you invest $1,000 in Digital Wine Ventures right now?

    Before you consider Digital Wine Ventures, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Digital Wine Ventures wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

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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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  • Why the CSL (ASX:CSL) share price is up 5% in a week

    woman in lab coat conducting testing representing biotech

    The CSL Limited (ASX: CSL) share price has rallied strongly in the second half of this month, up 7.40% since 15 July to $295.55.

    Broad buying across ASX 200 healthcare shares

    The CSL share price isn’t alone in its recent resurgence.

    The S&P/ASX Health Care (INDEXASX: XHJ) index has also rallied 6% since 15 July.

    The broad buying across the healthcare space has witnessed ASX 200 healthcare heavyweights Sonic Healthcare Limited (ASX: SHL) and ResMed Inc. (ASX: RMD) surge to new record highs.

    Encouragingly, Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) and Cochlear Limited (ASX: COH) have also moved up strongly since mid-July, up 8.65% and 3.7% respectively.

    What’s next for the CSL share price?

    The CSL share price could be a winner once the delta variant of COVID-19 subsides according to Peter Switzer.

    His outlook was previously covered by The Motley Fool, highlighting why CSL could be a good long-term opportunity.

    According to Switzer, “The company’s biggest profit-maker is collecting plasma in the US, and the virus concerns scared off a lot of its donors who get paid to give blood. As normalcy comes back, demand for blood will rise, and that will be good for CSL’s bottom line.”

    The CSL share price is still flat this year

    The CSL share price is up about 3.5% year-to-date, underperforming the broader S&P/ASX 200 Index (ASX: XJO).

    CSL’s underwhelming performance is consistent with its international biotech peers such as Grifols.

    Grifols is a Spanish multinational biotech company with a focus on producing blood plasma-based products.

    Its shares have tumbled 13.66% year-to-date, but its quarterly results on 4 May reveal some positive commentary regarding plasma collections.

    In the United States, plasma donations are gradually recovering. Of note was the trend observed in January, February and April in the wake of the country’s vaccination rollouts and the easing of COVID-19 restrictions, while taking into account the mitigating effect of stimulus incentives issued in March and December.

    The post Why the CSL (ASX:CSL) share price is up 5% in a week appeared first on The Motley Fool Australia.

    Should you invest $1,000 in CSL right now?

    Before you consider CSL, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and CSL wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

    More reading

    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. owns shares of and has recommended CSL Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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  • Why the Mandrake Resources (ASX:MAN) share price is tumbling 14% today

    share price dropping

    The Mandrake Resources Ltd (ASX: MAN) share price is falling hard in early afternoon trade, down 14%.

    Below, we take a look at the ASX resource explorers latest drill results.

    What update did Mandrake report?

    The Mandrake Resources share price is tumbling after announcing it had completed diamond drill hole MNEWDD003 at its Newleyine PGE-nickel-copper prospect in Western Australia.

    The company reported that the massive sulphides observed at the drill hole are coincident with the strong down-hole electromagnetic (DHEM) conductor.

    Mandrake Resources has conducted 3 diamond drill holes to date to test 3 “discrete, late-time electromagnetic (EM) bedrock anomalies”. Its geophysical interpretation suggests the anomalies may be the response of massive sulphides “consistent with Julimar-style PGE-Ni-Cu mineralisation”

    The Mandrake Resources share price may be under pressure today, however, as it reported it will need to conduct further drill testing of the area.

    Commenting on the results, Mandrake Resources managing director, James Allchurch said:

    The appearance of further massive sulphides in Mandrake’s third hole is encouraging and highlights the potential of the Newleyine intrusive to host economic mineralisation. Another compelling off-hole conductor has been identified by down-hole EM at MNEWDD002 and we are yet to test our third and final original conductor at plate C.

    Allchurch said pending assay results will give the company a better grasp on the platinum group elements (PGE) and base metal concentrations in the 3 holes already drilled. Those results will help it plot out the next round of drilling.

    Mandrake Resources share price snapshot

    Over the past 12 months, the Mandrake Resources share price has surged 110%, compared to a gain of 25% on the All Ordinaries Index (ASX: XAO).

    Year-to-date the Mandrake Resources share price has gone the other direction, down 19% with today’s intraday losses factored in. Shares hit all-time highs less than 2 months ago, trading at 23.5 cents on 31 May.

    The post Why the Mandrake Resources (ASX:MAN) share price is tumbling 14% today appeared first on The Motley Fool Australia.

    Should you invest $1,000 in Mandrake Resources right now?

    Before you consider Mandrake Resources, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Mandrake Resources wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

    More reading

    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 City Chic (ASX:CCX) share price has jumped 6% today. Here’s why

    A happy woman carrying colourful bags descends and escalator after a successful shopping spree

    The City Chic Collective Ltd (ASX: CCX) share price has jumped more than 6% into the green this morning.

    Today’s gain comes as the company updated the market on a recent acquisition and its FY21 trading update.

    Let’s explore what City Chic announced in a bit more detail.

    Quick recap on City Chic

    City Chic, formerly Specialty Fashion Group, is a women’s fashion retailer. It’s main focus is on the plus-sized women’s clothing market.

    The company has an online and in-store presence in more than 200 locations dotted across Australia, New Zealand, America and the United Kingdom.

    City Chic currently has a market capitalisation of $1.3 billion.

    Navabi acquisition

    City Chic announced that on 23 June it had completed a “share purchase agreement to acquire 100% of the shares” in JPC United GmbH for $9.6 million.

    JPC United is the sole operator of online marketplace Navabi, which sells “third-party women’s plus size brands, as well as its own exclusive brands”.

    Navabi recorded sales revenue of $16.6 million with 5.8 million website visits in 2020. Before the pandemic hit, it recorded annual traffic in excess of 10 million visits.

    City Chic will finance the transaction from its “existing cash balance”, which came in at $71.5 million at the end of June.

    The company also acquired all asset and liabilities on Navabi’s balance sheet, including $3.3 million in cash “net of tax liabilities”.

    According to City Chic, the acquisition provided “a platform to expand further in Europe”, thereby launching into its “fourth key geography”.

    FY21 result and trading update

    In today’s release, City Chic reported FY21 unaudited sales of of $258 million, a 33% year on year increase.

    It also reported underlying earnings before interest, tax, depreciation and amortisation (EBITDA) expectations in the range of $42 – $42.5 million, calling for 58–60% growth from one year prior.

    Regarding its trading update, the company stated:

    Trading in FY22 has exceeded budget, with strong US and UK performance outweighing the impact of temporary store closures due to lockdowns in Australia.

    At the time of writing, the City Chic share price is up 6.47%, trading at $5.76 after reaching an intraday high of $5.80. .

    For context, the S&P/ASX 200 Index (ASX: XJO) has posted a return of 0.1% this morning.

    Foolish takeaway

    The City Chic share price has lifted 40% this year to date, extending the previous 12 month’s return of 78%.

    This has outpaced the broad index’s return of ~22% over the previous year.

    Investors can expect City Chic’s fully audited FY21 results to be released on 26 August.

    The post The City Chic (ASX:CCX) share price has jumped 6% today. Here’s why appeared first on The Motley Fool Australia.

    Should you invest $1,000 in City Chic right now?

    Before you consider City Chic, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and City Chic wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

    More reading

    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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  • Blackstone (ASX:BSX) share price charges 11% higher on update

    Man in overalls at mine cheering

    The Blackstone Minerals Ltd (ASX: BSX) share price stormed more than 11% higher in today’s session.

    Shares in the nickel mining company surged ahead after the company released an update, with the price reaching an intraday high of 50.5 cents.

    At the time of writing, shares in Blackstone are trading 3.3% higher at 47 cents.

    Let’s take a look at what Blackstone announced.

    Blackstone share price soars on feasibility study

    Earlier today, Blackstone announced the completion of its pre-feasibility study (PFS) for its Ta Khoa Refinery Project (TKR) in northern Vietnam.

    Blackstone highlighted that the PFS demonstrated the project will require low capital intensity to produce Class I nickel at scale.

    The company noted that the project will have a refinery capacity of up to 400ktpa of nickel concentrate and a 10-year life-of-operations. As a result, Blackstone will be able to produce battery-grade nickel for the lithium-ion battery industry.

    According to Blackstone’s PFS, the life-of-operations revenue for TKR is estimated at US$14 billion. In addition, the project is estimated to produce an operating cash flow of US$4.5 billion.

    Blackstone noted that an upfront project capital of US$491 million would be paid back in 1.5 years from first production.

    Blackstone management highlighted the PFS as an important milestone towards achieving the company’s vision to integrate lithium-ion battery supply chains and enable a green solution from mine to consumer.

    More on Blackstone

    Blackstone is a nickel mining company that has a 90% interest in its flagship TKR Project in Vietnam.

    Ahead of today’s news, Blackstone recently reported its first batch of precursor battery-grade nickel-cobalt-manganese. The results were generated using ore from its TKR Project and third-party feed.

    According to the company, analysis of the precursor material confirmed that it met specifications for the lithium-ion battery industry.

    Including today’s bullish price action, the Blackstone share price has soared more than 50% since the start of July.

    Overall, shares in the mining company are trading around 23% higher for the year to date.

    The post Blackstone (ASX:BSX) share price charges 11% higher on update appeared first on The Motley Fool Australia.

    Wondering where you should invest $1,000 right now?

    When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

    Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

    *Returns as of May 24th 2021

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    Motley Fool contributor Nikhil Gangaram 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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  • ASX 200 midday update: Lynas jumps, GPT withdraws guidance

    woman talking on the phone and giving financial advice whilst analysing the stock market on the computer with a pen

    At lunch on Monday, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a modest gain. The benchmark index is currently up 0.2% to 7,409.2 points.

    Here’s what is happening on the ASX 200 today:

    Lynas quarterly result

    The Lynas Rare Earths Ltd (ASX: LYC) share price is racing higher today following the release of its fourth quarter update. Lynas reported neodymium and praseodymium (NdPr) production of 1,393 tonnes, representing a 79.7% increase on the prior corresponding period. Combined with the almost doubling of its average realised price, this led to a significant increase in sales revenue to $185.9 million for the quarter. This compares to sales revenue of $38 million a year earlier.

    GPT withdraws guidance

    The GPT Group (ASX: GPT) share price is under pressure today after withdrawing its guidance for FY 2021. According to the release, the property company has withdrawn its Funds From Operations (FFO) and distribution guidance for 2021 due to uncertainty caused by COVID-19 lockdowns in Melbourne and Sydney.

    AMP update

    The AMP Ltd (ASX: AMP) share price is falling again today despite announcing changes to its advice business model. AMP revealed a new contemporary advice service model, marking a new era for financial advice at the company. AMP’s new model further prioritises its clients and will provide services to advisers which support the delivery of quality advice, improve practice efficiency, and help advisers grow their businesses.

    Best and worst ASX 200 performers

    The best performer on the ASX 200 on Monday has been the Lynas share price with an 8% gain. This follows the release of its quarterly update. The worst performer on the ASX 200 has been the Silver Lake Resources Limited (ASX: SLR) share price with a 5% decline. This gold miner’s shares have come under pressure since the recent release of its quarterly update and softer than expected FY 2022 guidance.

    The post ASX 200 midday update: Lynas jumps, GPT withdraws guidance appeared first on The Motley Fool Australia.

    Wondering where you should invest $1,000 right now?

    When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

    Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

    *Returns as of May 24th 2021

    More reading

    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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  • Is the A2 Milk (ASX:A2M) share price a buy right now?

    falling milk asx share price represented by frowning woman tasting sour milk

    The A2 Milk Company Ltd (ASX: A2M) share price is falling again after a strong run in recent weeks. Could it now be an opportunity?

    A2 Milk shares fell to almost $5 in the middle of May. But then the share price started going through a recovery. From that low, A2 Milk climbed around 40% to a high of $7.20 earlier this month. But it’s dropping again – down around 10% from the July high. It is 4% in the red today, at the time of writing.

    There is still volatility for A2 Milk, despite the significant decline over the last 12 months.

    But there are some brokers that don’t have a high opinion of A2 Milk’s share price prospects in the shorter-term despite the decline.

    For example, Citi rates A2 Milk as a sell with a price target of $6.05. That suggests that the ASX share is going to see more declines over the next 12 months, if the broker is right.

    Shifting consumer choices in China suggest that A2 Milk may not see much benefit from a change in China’s child policy to allow three children. Chinese families are increasingly going for local brands, particularly in smaller cities where people are even more likely to choose a Chinese product.

    Credit Suisse is another broker that rates A2 Milk as a sell. But the price target is even lower, at just $5.50. The broker points out that the daigou sales are not contributing much to the overall picture now.

    A2 Milk’s latest update

    The last update from A2 Milk was in May.

    It said that the trading dynamics in the China infant nutrition market have been and continue to be challenging for the company as well as international formula peers.

    The FY21 third quarter was broadly in line with its plan, but A2 Milk said it was clear the actions taken to address challenges in the daigou and cross-border e-commerce channels will not result in sufficient improvement on the third quarter of FY21 in pricing, sales and inventory levels to meet previous guidance.

    After reviewing its inventory, management noted that challenges were being exacerbated by excess inventory and difficulties with visibility. So it decided to take more aggressive action to address excess inventory which will impact FY21 revenue and earnings before interest, tax, depreciation and amortisation (EBITDA) and potentially the first quarter of FY22. This inventory action will give Chinese mothers with the freshest infant milk formula and benefit the company’s customers, distributors and partners.

    A2 Milk is also increasing its marketing to drive customer demand.

    However, despite these short-term setbacks, management are confident in the long-term opportunity that the infant nutrition market in China represents, and the company is determined to build on the strong position it has built in the market over the last five years.

    In that May update, one area of growth was that its store count increased to 22,600. The 12-month rolling market value share in mother and baby stores (MBS) was stable at 2.4%

    But, the company recognises that the Chinese market and channel structure is changing rapidly and has therefore commenced a comprehensive process to review its growth strategy and executional plans to respond to this new environment.

    A2 Milk is also thinking about a potential share buyback to utilise its capital.

    The post Is the A2 Milk (ASX:A2M) share price a buy right now? appeared first on The Motley Fool Australia.

    Should you invest $1,000 in A2 Milk right now?

    Before you consider A2 Milk, you’ll want to hear this.

    Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and A2 Milk wasn’t one of them.

    The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

    *Returns as of May 24th 2021

    More reading

    Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended 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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  • Tinybeans (ASX:TNY) share price rises on Nasdaq update

    A graphic illustration with the words NASDAQ atop a US city and currency

    The Tinybeans Group Ltd (ASX: TNY) share price is rising on Monday morning.

    At the time of writing, the family-focused social media platform company’s shares are up 3% to $1.25.

    Why is the Tinybeans share price rising on Monday?

    The rise in the Tinybeans share price today has been driven by the release of an announcement relating to its plan to list on the Nasdaq index.

    According to the release, the company has appointed Grant Thornton Audit as its new auditor with immediate effect.

    It made the move in support of its planned listing on Nasdaq. This is because the Nasdaq requires a company to have an auditor that is registered with the Public Company Accounting Oversight Board in the United States.

    Why is Tinybeans listing on the Nasdaq?

    Tinybeans advised that its decision to list on a major U.S. exchange is aligned with its increasing operational and revenue shift to the United States, as well as its subscription growth strategy.

    But don’t panic, nothing will happen with your Tinybeans shares if you’re a shareholder. Tinybeans intends to maintain its primary listing on the ASX and expects to be dually listed on the ASX and Nasdaq.

    Tinybeans CEO, Eddie Geller, commented: “Tinybeans has had a strong presence in the United States ever since we established Tinybeans USA in New York in 2014. Today, nearly 100% of our revenue—and most of our brand partners and subscribers—are based in the U.S., helping to double our revenues for FY21. Grant Thornton is already engaged in the independent audit of our FY21 results. We look forward to releasing our full year results in late August.”

    The Tinybeans share price has been a strong performer over the last 12 months. Following today’s gain, its shares are now up over 41% since this time last year.

    The post Tinybeans (ASX:TNY) share price rises on Nasdaq update 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 Tinybeans Group Ltd. The Motley Fool Australia has recommended Tinybeans Group 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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