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Shares in Evolution Mining Ltd (ASX: EVN) are up slightly following news of a gold discovery at the Cue Project joint venture area in central Western Australia. At the time of writing, the Evolution share price is trading at $4.54 – 0.33% higher than its closing price yesterday.

Shares in Evolution’s joint venture partner, Musgrave Minerals Ltd (ASX: MGV), are also lifting today. Currently, the Musgrave share price is 4.29% higher than its previous close. Its shares are trading for 36.5 cents apiece.

Let’s take a closer look at today’s news from the gold miner.

Joint venture refresher

Evolution entered into the joint venture and earn-in agreement at the Lake Austin area of Musgrave’s Cue Project in 2019.

Under the terms, Evolution will spend $18 million on the site over the 5 years following the agreement in exchange for a 75% stake in the tenement. So far, Evolution has spent $4.6 million.

Today’s news

In its release, Evolution advised diamond drilling at the joint venture area had uncovered a new high-grade gold zone.

The zone is over a 400-metre strike and is open to the north, south, and at depth.

Following the results, Evolution has committed to spend another $5 million on exploration activities at the site over the next 12 months.  

Assay results from the 4 drill holes that intercepted the discovery include:

• 11.5 metres at 3.2 grams of gold per tonne from 245 metres, including 3 metres at 10.6 grams of gold per tonne from 247.5 metres
•  11 metres at 3.6 grams of gold per tonne from 272 metres, including 5 metres at 5.5 grams of gold per tonne from 276 metres
• 5 metres at 2.7 grams of gold per tonne from 169 metres
• 0.4 metres at 23.5 grams of gold per tonne from 144.7 metres

Musgrave stated the differentiated dolerite unit hosting the discovery was like that of other significant discoveries at the Cue Project.

Over the next 12 months, the companies will conduct another 7,000 metres of diamond drilling to find more targets. The next stage of drilling will kick off next month.

Evolution share price snapshot

Shares in Evolution are having a poor year on the ASX, having fallen 14% year to date.

The Evolution share price has also dropped 20% since this time last year.

The company has a market capitalisation of around $7.7 billion, with approximately 1.7 billion shares outstanding.

Musgrave share price snapshot

The Musgrave share price isn’t performing much better than that of its joint venture partner.

Currently, the Musgrave share price is 7% lower than it was at the start of 2021. It has also fallen 25% since this time last year.

The company has a market capitalisation of around $186 million, with approximately 533 million shares outstanding.

The post The Evolution (ASX:EVN) share price lifts after gold discovery appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 Sayona Mining Ltd (ASX: SYA) share price has returned from its trading halt with a bang on Wednesday.

In morning trade, the lithium explorer’s shares are up a massive 27% to 9.4 cents.

Why is the Sayona Mining share price rocketing higher?

The catalyst for the rise in the Sayona Mining share price today has been an update on its joint bid with Piedmont Lithium Inc (ASX: PLL) to acquire Quebec-based North American Lithium (NAL).

According to the release, the Superior Court of Quebec has granted an approval and vesting order in relation to the acquisition by its Sayona Quebec business. This means the parties can now push ahead with the acquisition valued at a total of C$196.2 million.

Sayona’s Mining’s Managing Director, Brett Lynch, believes this is a key milestone for the company, its partner Piedmont Lithium, and also the city of Quebec.

He said: “This is a pivotal point for not only ourselves and our bid partner Piedmont Lithium, but also Québec and its future as a leading player in the clean energy industry of the 21st century. We look forward to executing our turnaround plan in integrating NAL with our flagship Authier Lithium Project to transform the operation and create a world‐scale Abitbi lithium hub, advancing our plans for downstream processing in Quebec.”

What now?

The release explains that the transaction is expected to close during the third quarter of 2021, subject to the satisfaction of certain conditions. These conditions include Sayona Mining obtaining any necessary approvals under the ASX Listing Rules relating to its share purchase plan and other necessary regulatory approvals, as well as other customary closing conditions.

Upon completion, Sayona Quebec intends to refurbish NAL’s facilities. This includes technical improvements as well as the upgrading of certain equipment. After which, it will integrated the operation with the nearby Authier project to transform it and create a world‐scale Abitibi lithium hub.

Today’s gain means the Sayona Mining share price is now up a remarkable 750% in 2021.

The post Why the Sayona Mining (ASX:SYA) share price is up 27% today and 750% in 2021 appeared first on The Motley Fool Australia.

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• Here’s why the Sayona (ASX:SYA) share price is plummeting 9%
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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 Piedmont Lithium Inc. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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

As an investor, it’s hard not to focus on the incredible revenue generated by COVID-19 vaccine makers like BioNTech (NASDAQ: BNTX). They have taken a new technology and turned it into one of the best selling drugs of all time. This year could be just the beginning.

After years of scientific research, the age of genetic medicine might have finally arrived. That’s great news for BioNTech shareholders. They could see decades of gains ahead. Ironically, the vaccine could now be the biggest threat to those gains in the short term. It’s turning out that the vaccine might just work too well.

1. Comirnaty: The COVID-19 Vaccine

Any discussion of BioNTech has to begin with the COVID-19 vaccine it developed with partner Pfizer (NYSE: PFE). As of May 6, more than 450 million doses of the drug had been provided across 91 countries. Combining all COVID vaccine producers, the U.S. is administering about 875,000 doses each day. That number is more than 45 million globally.

The partners already have orders for 1.8 billion doses this year and expect the total capacity for production to reach 3 billion by the end of 2021 (and even more in 2022). Based on the firm orders as of May, BioNTech management was expecting revenue of 12.4 billion euros. Extrapolating that number to the full allotment of doses would bring in more than $20 billion in sales. It’s amazing for a product that didn’t exist a year ago. However, for the company’s $27 billion market cap to hold up over time, it will likely have to bring other drugs to market. On that, it’s making progress.

2. A head start in a new era of medicine

With the success of its mRNA-based vaccine, BioNTech and Moderna (NASDAQ: MRNA) have established themselves as early leaders in a revolutionary new biotechnology. For its part, BioNTech has 14 drug candidates in 15 clinical trials. It was originally founded to beat cancer, and the company has several oncology programs going into phase 2 trials this year.

Its skin cancer treatment — with partner Regeneron — dosed its first phase 2 patient in mid-June. Its head and neck cancer treatment, combined with Merck‘s Keytruda, should dose its first phase 2 patient in the coming weeks. Phase 2 for BioNTech’s individualized colon cancer treatment will start later this year. In that treatment, a patient’s specific tumor mutations — or neoantigens — are used to develop a targeted therapy. The number of programs the company is pursuing speaks to the ambition it has for the future of mRNA.

3. Leadership has serious skin in the game

Amid the flurry of executive stock sales in 2020, when shares of companies benefiting from the pandemic skyrocketed, one man stood firm. Ugur Sahin, co-founder and CEO of BioNTech, never sold a single share. It fits his personality. He reportedly doesn’t own a car, bikes to work, and continues to live in a modest apartment. 

Filings show Sahin controls 17% of the company worth approximately $9.4 billion. Although there is nothing onerous with their actions, the leaders at Pfizer and Moderna pocketed a combined hundreds of millions of dollars in sales through 2020. A CEO who sells stock isn’t necessarily a reason to be concerned. But a CEO with most of his personal wealth aligned with shareholders is definitely a good sign.

The vaccines might be too good

Until now, most had been operating under the assumption that COVID protection would mean getting a booster shot each year  — like the flu. But the SARS-CoV-2 virus doesn’t mutate as fast as your typical influenza bug. And it is looking like our bodies defenses, through inoculation of having had the illness, might be long-lasting.

A just-published peer-reviewed study indicated the protection offered by the mRNA vaccines could last for years, making the need for booster shots unnecessary. That doesn’t apply to the Johnson & Johnson jab. The lack of enduring protection from that drug will create some incremental demand for both BioNTech and Moderna’s shot. The study didn’t account for the delta variant. It’s possible that could complicate the study’s conclusion.

The news makes it even more imperative that BioNTech comes up with a second act soon. Sahin has said it could launch multiple products in the next five years. It certainly has the ingredients: a full pipeline, the proven scientific acumen, and dedicated leadership. But much of the current valuation may be counting on vaccine demand persisting for a few years. If that falls off, it could be a bumpy ride for shareholders while they wait for an encore. 

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

The post 3 reasons to buy BioNTech, and 1 reason to sell appeared first on The Motley Fool Australia.

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Jason Hawthorne owns shares of BioNTech SE. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Johnson & Johnson and Moderna Inc. 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.

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

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The Uniti Group Ltd (ASX:UWL) share price has been a major performer this year, surging around 88% year-to-date and 131% in the past 12 months

The Adelaide company, which focuses on the construction of communications infrastructure such as fibre, wireless towers and ground leases, is also intertwined with Australia’s National Broadband Network (NBN) rollout.

Let’s have a look at what Uniti Group has been up to recently.

ASX 200 inclusion

Only 2 years after listing, Uniti was added to the ASX 200 in early June. Uniti shares have climbed 3% following this rebalancing of the S&P/ASX 200 Index (ASX: XJO).

Since its inclusion, the 20-day average trading volume in Uniti shares has increased to more than 4 million shares changing hands daily.

Uniti has outpaced the ASX 200’s 12-month return, climbing 131% versus the index’s 23% during the same period.

NBN Co and broadband pricing

On June 7 2021, NBN Co released its views on future wholesale broadband pricing in a proposal to amend long-term NBN pricing options.

In the paper, NBN Co demonstrated it has considered indexing broadband prices “above the level of inflation” if low usage hurts the company’s revenue.

Uniti operates one of Australia’s largest open access broadband networks, and the company’s share price has climbed northwards by 7% following the paper’s release, jumping from $3.07 to $3.29 at pre-market today.

What do analysts say?

Analysts from firm JP Morgan Chase & Co assigned a buy rating on Uniti Group shares on 18 June, citing the above proposal and the impact of potential NBN pricing amendments to the company:

“In our analysis of NBN’s proposed pricing constructs, we estimate wholesale prices will increase by a minimum of 13% by mid-2023.”

“We view Uniti as a beneficiary of the wholesale price increases as it utilizes NBN’s pricing card for its own wholesale network.”

Analysts pointed to Uniti’s “leverage to the Australian domestic housing market and the company’s near certain growth from upcoming contracted construction.”

The analysts assigned a price target of $3.45 per share in an updated report to investors on 23 June.

At the current share price of $3.29, this implies an upside potential of more than 4%.

Uniti Group share price snapshot

Uniti Group shares have gained 86.65% during the previous 6 months. They’ve posted almost 10% in the previous month.

This has outpaced the ASX 200’s 8.88% return over the same 6-month period.

At the time of writing, Uniti Group Ltd has a market capitalisation of $2.27 billion and a price-to-earnings ratio (P/E) of 78.1.

The post The Uniti Group (ASX:UWL) share price has rocketed 130% in 1 year 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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Authorities are investigating insider trading allegations against Nuix Ltd (ASX: NXL)’s just-resigned chief financial officer Stephen Doyle and his family.

The Australian Securities and Investments Commission (ASIC) on Tuesday took legal action to prevent Doyle’s brother, Ross, from leaving the country to return to his residence in Switzerland.

The court papers show the brothers are accused of trading Nuix shares with knowledge of inside information over January and February this year, as The Sydney Morning Herald first reported.

Their father Ronald Doyle is also a subject of the investigation.

“We are genuinely disturbed by the allegations concerning Mr Doyle and will fully assist ASIC in getting to the bottom of that matter,” said Nuix chair Jeffrey Bleich.

The Motley Fool has contacted ASIC for comment.

The allegations against the Doyles

Nuix listed on the ASX in December with an initial public offer (IPO) price of $5.31. The hype about its growth prospects sent the share price rocketing up immediately, to a high of $11.86 in January.

As chief financial officer, Stephen Doyle would have allegedly known about the downgrade to the company’s financial performance that was to be revealed to the public in February.

But Stephen is accused of tipping off his brother in January, according to the court affidavit.

ASIC accuses Ross Doyle of then selling 1.8 million Nuix shares that were held by a Singapore company named Black Hat. Ross also sold 200,000 shares held under his own name.

When the company announced the downgrade in February, the Nuix share price plummeted 32%.

The corporate regulator alleges that both the brothers have a financial interest in Black Hat, and the insider trading would have saved them in excess of $5.7 million in losses.

Persons convicted of insider trading of shares face up to 15 years’ jail.

Nuix’s unhappy start as ASX-listed company

Nuix shares closed Tuesday at $2.54, which is more than 70% down on the year.

The pressures of financial downgrades and ASIC investigations forced the departure of Stephen Doyle and chief executive Rod Vawdrey just 2 weeks ago.

Just last week, Nuix’s Sydney office was raided by the Australian Federal Police, as was Stephen Doyle’s inner-city apartment.

The post Former Nuix (ASX:NXL) executive accused of insider trading appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo owns shares of Nuix Pty Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Nuix Pty Ltd. The Motley Fool Australia has recommended Nuix Pty 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 Pro Medicus Limited (ASX: PME) share price has been one of the best performers on the ASX this year. And today it could be even better as it edges towards a record high.

So far, the health imaging technology company’s shares are up almost 70% year-to-date and 120% in the past 12 months.

We take a closer look at what could push Pro Medicus shares to an all-time high this morning.

Pro Medicus share price on the move

Investors remain confident in the Pro Medicus share price as the company continues to impress the market.

During mid-May, Pro Medicus signed an 8-year contract to licence its Visage 7 Enterprise imaging platform to The University of Vermont Health Network Inc. This $14 million deal further cemented the company’s growth opportunities across the healthcare market in North America and other regions.

Pro Medicus stated it’s won seven contracts in a row, building on its client base and revenue streams.

In addition, the company also recently partnered with healthcare giant Mayo Clinic in a multi-year research agreement announced earlier this month. The framework is aimed at developing and commercialising artificial intelligence, leveraging Pro Medicus’ Visage AI Accelerator platform.

The company believes the use of artificial intelligence will play an important role in the healthcare sector in the future. Its latest research collaboration is an integral part of the company’s AI strategy in meeting clinical goals with better patient outcomes.

Broker consensus

Over the past week, two brokers rated Pro Medicus shares with similar price points.

The first, Bell Porter, lifted its 12-month price target by 14% to $49.00. The investment firm views Pro Medicus in a positive light but put it on a hold rating due to its current valuation.

Australian investment house Morgans followed suit, raising its price by 20% to $49.69. However, it downgraded its rating from hold to reduce. This could be because the current Pro Medicus share price is almost 20% higher than its recommendation.

Based on valuation metrics, the company commands a market capitalisation of roughly $6 billion, with more than 104 million shares outstanding.

The post Pro Medicus (ASX:PME) share price eyes all-time high appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Pro Medicus Ltd. The Motley Fool Australia owns shares of and has recommended Pro Medicus 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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

Netflix (NASDAQ: NFLX) disappointed investors when it reported fewer than 4 million net subscriber additions for the first quarter and forecast a measly 1 million net adds for the second quarter. The hangover from 2020’s streaming bonanza hit Netflix, and it hit hard.

But after a couple of quarters of recuperation, Netflix is set to bounce back to its normal self again, potentially adding 10 million to 15 million subscribers in the back half of the year, similar to normal times. Credit Suisse analyst Douglas Mitchelson thinks subscriber growth will normalize by the fourth quarter, based on information from a proprietary survey. Here’s why Netflix’s second half should look much better than the first half.

Three challenges in the first half of the year

Netflix wasn’t just coming off a once-in-a-lifetime event that pulled forward millions of subscribers for the streaming service — it also faced several challenges in the first half of the year, hindering subscriber growth.

First, it raised the price of its subscription in several big markets, including the United States. While Netflix still has plenty of pricing power, some subscribers have balked at its last few price increases. While this price hike appears to have been more easily digested among Netflix’s subscriber base, it was still a likely cause for some subscriber churn. And with Netflix’s ballooning subscriber base, a small increase in churn translates into a lot of subscriber losses.

Second, Netflix had a relatively weak content slate in the first half of the year. Management acknowledged this at the start of the year, noting that some of its big tentpole series — Stranger Things, The Witcher, Money Heist, Sex Education — won’t premiere until the latter part of the year.

Finally, Netflix is facing the headwind of economies reopening and warming weather, which will temporarily reduce gross additions as consumers look to make up for lost time with out-of-home activities.

Getting back to normal

While Netflix may have suffered because of its price hike earlier this year, subscriber churn should normalize going forward. What’s more, Netflix has previously indicated it sees strong rates of resubscribing from customers who churn. That may present an opportunity to improve gross additions later in the year.

Churn is an increasingly important factor for all streaming services as they compete for viewers. That said, Netflix has done a good job of keeping its churn low while others have seen more cancellations. That’s supported by Credit Suisse’s survey showing Netflix subscribers will look to the service before any other they subscribe to when looking for content to watch. In other words, Netflix is a priority for most Netflix subscribers. Furthermore, just 8% of survey respondents raised any concerns about the value of Netflix for the price.

The weak content slate in the first half will give way to an abnormally strong content slate in the back half of the year. Original series are one of the big reasons consumers sign up for a new streaming service, and that’s still true with Netflix.

What it means for investors

Mitchelson says any disappointment in Netflix’s results in the second or third quarters “would prove a clearing event” before the fourth-quarter results look more like 2019 and 2020. And disappointing subscriber growth usually comes with a pullback in Netflix’s stock price.

Expectations are already extremely low for Netflix’s second quarter. Management forecast just 1 million net additions, which would be the fewest net additions it’s seen in any quarter for eight years. And that was before it had much of any international presence.

Much of the focus will be on management’s expectations for the third quarter. If management provides numbers that are weaker than the Street was looking for, it could result in a good buying opportunity for long-term investors. Netflix reports its second-quarter results July 20.

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

The post Netflix subscriber growth will pick up in the second half appeared first on The Motley Fool Australia.

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Adam Levy owns shares of Netflix. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Netflix. The Motley Fool Australia has recommended Netflix. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

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Inflation and interest rates have completely dominated ASX share market discussions the past few months.

Is post-COVID inflation just a fad or will it stick around? Will central banks lose their nerve and raise interest rates earlier than they’ve flagged?

This uncertainty is causing some anxiety.

But Montgomery Investment Management chief investment officer Roger Montgomery reckons he’s picked out 3 small-cap ASX shares that will win regardless of macroeconomic conditions.

That is, these companies will enjoy growth because of structural reasons — their business models and the way they’re placed in their sectors makes them unique and valued.

Here are Montgomery’s picks:

Megaport Ltd (ASX: MP1)

Megaport allows computer networks to connect to cloud service providers.

According to Montgomery, the company currently facilitates access for 2,100 customers to reach 740 data centres globally.

Megaport shares closed Tuesday 1.22% higher at $18.20. They’ve gained almost 28% this year so far.

Montgomery reckons the next “catalyst” for a price spike will be the July quarterly update.

“We believe MP1 has a large growth opportunity in front of it, including from new products, an example being the recently launched Megaport Virtual Edge, which is being sold by the salesforce of Cisco Systems Inc (NASDAQ: CSCO),”  

“We expect the company to enjoy the tailwinds of rapid growth in cloud computing, which is a lowly penetrated market, offering multi-years of opportunity runway ahead.”

Alliance Aviation Services Ltd (ASX: AQZ)

Montgomery had already identified Alliance Aviation’s enviable market position back in April, but again reiterated the attractiveness of this ASX share.

Both the big players, Qantas Airways Limited (ASX: QAN) and Virgin Australia, wet lease planes from Alliance.

“Wet leases are agreements between 2 airlines, where the lessor agrees to provide an aircraft, crew, maintenance and insurance to the lessee in return for payment on the number of hours the aircraft is operated, irrespective of how many passengers are on the plane or the price they paid for their seat,” said Montgomery. 

“Wet leases offer the lessee everything needed to begin flights on an almost immediate basis.”

The company cleverly took advantage of the depressed aviation market last year, buying up 30 Embraer E190 planes for just $197 million.

“These prices are cents on the dollar of the original capital cost of the assets,” Montgomery said.

“This is AQZ’s key competitive advantage, great operational on-time performance from the lowest capital cost aircraft in the market.”

Alliance shares closed slightly lower on Tuesday at $4.34. That’s 13.02% up from the start of the year.

“We believe it is worth in excess of $5.00 per share.”

Aeris Resources Ltd (ASX: AIS)

Copper is a theme that Montgomery thinks has a lot of merit currently.

“There has been a long-identified dearth of global copper discoveries and projects coming online, with mined grades continuing to fall as the easiest to find and cheapest to mine copper gets accessed and depleted,” he said.

“Future supply growth for copper looks challenged, whilst the future demand — driven by incremental needs from decarbonising economies — looks strong.”

Among the local copper producers, his pick is Aeris Resources.

The company recently raised $50 million to fund more drilling, and extend the working life of its Queensland Cracow Gold Mine and NSW Tritton Copper Project.

“The exciting story is this influx of capital has funded increased drilling activity at targets close to existing infrastructure,” said Montgomery.

“High copper grades have been found near [the] surface, which could mean higher copper production, longer mine life, and cheaper extraction costs and potentially higher margins in a commodity that looks structurally attractive.”

Aeris shares closed flat for the day on Tuesday at 18.5 cents. The stocks are up a whopping 85% this year.

“We have been an investor in AIS from 3 cents per share and assuming continued strong drilling results, we think 30 cents is not out of the realm of possibility.”

The post 3 ASX shares that’ll grow regardless of inflation or economy: expert appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo owns shares of Qantas Airways Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. 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 Tuesday morning. This comes after the mining giant provided an update to its Richard Bay Minerals in South Africa.

At yesterday’s market close, Rio Tinto shares finished the day at $125.

What did Rio Tinto announce?

Investors may act on their concerns about the company’s latest announcement to the ASX.

According to this morning’s release, Rio Tinto advised that it has declared “force majeure” on customer contracts at the Richard Bay Minerals. The legal term, force majeure refers to an event or effect that can be neither anticipated nor controlled.

Rio Tinto stated that the security condition at its operations has unfortunately escalated as violence and destruction has raged. Last month, a senior manager at the site was murdered, and heavy equipment was set alight.

This has led the company to suspend all mining and smelting operations until the safety and security of the situation improves.

Rio Tinto chief executive Minerals, Sinead Kaufman touched on the current situation, saying:

The safety of our people is our top priority. We continue to offer our full support to the investigating authorities and I would like to acknowledge the ongoing support of the regional and national governments and South African Police Service as we work together to ensure that we can safely resume operations.

The Zulti South project, also in South Africa is still in limbo with operations in full suspension since 2019.

Rio Tinto share price summary

While the news is concerning, Rio Tinto shares have risen 27% over the course of the last 12 months. The company’s share price reached a 52-week high of $132.94 in mid-May before moving in circles.

Rio Tinto commands a market capitalisation of roughly $46.4 billion, making it the eleventh largest company on the ASX. The company has more than 371 million shares listed on its registry.

The post Why the Rio Tinto (ASX:RIO) share price will be in the spotlight today appeared first on The Motley Fool Australia.

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

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Investors with cash may want to consider some ASX shares that have longer-term growth potential.

The below two businesses have grown considerably over the last two years, but they may have more growth potential over the coming years:

Sonic Healthcare Ltd (ASX: SHL)

Sonic is a large, global business that’s involved in pathology, diagnostic imaging and radiology as well as general practice medicine and corporate medical services.

In the first half of FY21, it saw elevated revenue growth of 33% to $4.4 billion. Profit measures grew even faster. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 89% to $1.3 billion and net profit increased 166% to $678 million. This profit growth occurred thanks to the operating leverage of using existing facilities.

Whilst the global base business was flat, it was the millions of COVID-19 tests that drove revenue and earnings higher. Whilst COVID-19 immunity testing could see potential growth, there is another wave of COVID-19 as the Delta strain spreads across the world which is causing renewed testing volumes.

Sonic Healthcare also recently announced that it was acquiring Canberra Imaging Group (CIG). This will boost the ASX share’s imaging Australian revenue by approximately 10% and offer potential synergy benefits.

CIG has annual revenue of around $60 million and is the leading radiology practice in Canberra.

Settlement of the transaction is expected in the first quarter of FY22. It will be funded from cash and/or available debt and will immediately add to earnings per share (EPS).

Kogan.com Ltd (ASX: KGN)

Kogan has a number of retail offerings and services. Not only does it sell a wide array of products on its main website such as TVs, phones, computers, appliances, heating, cooling, furniture, office supplies and so on, it also has other services including mobile, internet, insurance, superannuation, energy and so on.

The e-commerce business also owns a couple of businesses it has acquired like furniture business Matt Blatt and New Zealand online retailer Mighty Ape.

Kogan’s share price has dropped around 34% since the start of the 2021 calendar year.

There has been demurrage costs impacting its profit and loss in FY21. The company recently explained that a key challenge caused by COVID-19 has been managing inventory levels to support its growth. It built up its inventory position in late 2020, causing high warehousing costs that are continuing.

The ASX share has been optimising its inventory to reflect the current market conditions by increasing promotional activity, which has led to near-term gross margin and higher near-term marketing costs. Kogan is expecting to return to normal inventory levels (relative to the size of the business) and marketing spending as the inventory is reduced.

Before these inventory problems, Kogan had been experiencing steadily increasing profit margins at different profit margin lines of the business.

In the company’s outlook update, Kogan said:

The longer term fundamentals for Kogan.com remain very attractive given the company’s position in the Australian and New Zealand online retail markets, and with online retail sales currently only accounting for a small percentage of total retail sales in Australia and New Zealand.

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

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd. The Motley Fool Australia has recommended Sonic Healthcare 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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