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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is pushing ever so slightly higher. At the time of writing, the benchmark index is up 0.1% to 7,265.7 points.

Four ASX shares that have climbed more than most today are listed below. Here’s why they are charging higher:

ARB Corporation Limited (ASX: ARB)

The ARB share price is up 5.5% to $44.64. Investors have been buying the 4×4 parts company’s shares following the release of a bullish broker note out of Ord Minnett. According to the note, the broker believes that ARB will benefit from growth in new vehicle sales. In addition, it expects new store openings and demand for SUVs to be supportive of its growth.

Humm Group Ltd (ASX: HUM)

The Humm share price has risen 5% to $1.08. The catalyst for this appears to have been a broker note out of UBS this morning. Its analysts have retained their buy rating and $1.60 price target on the company’s shares. This follows the announcement of the release of its new buy now pay later product, TAPP.

Incitec Pivot Ltd (ASX: IPL)

The Incitec Pivot share price is up 2% to $2.39. This appears to have been driven by a broker note out of Macquarie this morning. The broker highlights that fertiliser prices remain positive and in some cases are strengthening. The broker has retained its outperform rating and $2.93 price target on its shares.

Pro Medicus Limited (ASX: PME)

The Pro Medicus share price is up 2.5% to $48.79. In response to the announcement of a collaboration with healthcare giant Mayo Clinic, Goldman Sachs retained its buy rating and $53.80 price target on the company’s shares. “We believe the strategy of partnering with the leading academics helps to maximise the value and competitive advantage of PME’s technology proposition,” the broker commented.

The post Why ARB, Humm, Incitec Pivot, & Pro Medicus shares are charging higher appeared first on The Motley Fool Australia.

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The CVC Limited (ASX: CVC) share price is down today. At the time of writing, shares in the investment company are trading for $1.95 – down 2.01%. By comparison, the S&P/ASX All Ordinaries Index (ASX: XAO) is 0.19% higher.

The company comes into focus after issuing a profit guidance and several business updates.

Let’s take a closer look at today’s announcement.

CVC share price edges lower

In a statement to the ASX, CVC Limited gave the following updates.

Profit guidance

CVC is forecasting a net profit after tax of $21–$23 million for the year ended 30 June 2021. In the prior corresponding period, the company made a $2.1 million loss. CVC stated that the forecasted profit includes a “significant proportion of unrealised gains, approximately 50%, arising from the revaluation of long-term investments held by CVC.”

In its half-year report, the company posted a net profit after tax of $15.7 million. Today’s announcement would mean profits for the second half of the financial year are down by approximately 50%.

Business updates

In today’s statement, CVC also highlighted its portfolio investment “is now significantly more weighted to property focused investments.”

It provided a number of property-related updates, including:

• A property in East Bentleigh, Victoria, which CVC has a 50% stake in, has been rezoned from industrial use to mixed residential, retail, and commercial use. The property has now been revalued upwards to $67.3 million – adding $13 million in pre-tax profit for FY21.
• A property in Donnybrook, Victoria, which CVC has a 49% interest in, is on the brink of being approved. Formal approval is now with the state minister for planning, and the area is expected to be rezoned.
• A property in Liverpool, NSW, which CVC owns a 66% stake in, has had planning approval from Liverpool City Council and is now in the hands of the NSW Department of Planning.
• A Bunnings Warehouse has been approved for development at a 60% owned property of CVCs in Caboolture, Queensland. Construction of shopping centre at the site should commence within FY22.

CVC share price snapshot

Over the past 12 months, the CVC share price has increased 39.3%. The company was hit hard by the COVID market sell-off of March 2020, losing 53.9% of its value in the space of two and a half months.

Its recovery since then has been steady but it has still not reached its pre-pandemic levels.

CVC has a market capitalisation of $228 million.

The post Why is the CVC Limited (ASX:CVC) share price sinking today? appeared first on The Motley Fool Australia.

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The DroneShield Ltd (ASX: DRO) share price is taking off today after the company announced it has received a new $3.8 million defence contract.

In morning trade, DroneShield shares rocketed 12.12% higher to 18.5 cents apiece before partially retreating. At the time of writing, the company’s shares are swapping hands for 17.25 cents each, up by 4.55% for the day so far.

New defence contract

Investors are buying up DroneShield shares after the company updated the market with a positive release.

According to the statement, DroneShield has received a 2-year defence contract with a Five Eyes country. The term ‘Five Eyes’ relates to a signals alliance between the United States, Canada, Australia, the United Kingdom, and New Zealand.

The deal, valued at about $3.8 million, represents ongoing commitments from government agencies, which have sought DroneShield products in the past.

DroneShield said the agreement contains the usual customary clauses of a research and development contract. It is expected around $2 million of the contract’s value will be collected during the June and September 2021 quarters.

DroneShield CEO Oleg Vornik said, “This contract is testament to the world-leading capabilities of the DroneShield team”.

What does DroneShield do?

DroneShield specialises in drone security technology. The company designs and develops detection systems that use specialised technology to protect people, organisations and critical infrastructure from drone incursions.

Specifically, its multi-layered products are centred around detection and disruption from unmanned aerial systems.

DroneShield share price summary

Over the past 12 months, DroneShield shares have been recovering from the fallout of COVID-19. After hitting a 52-week low of 10 cents in July last year, the company’s share price has lifted by around 70%. However, DroneShield shares are still some way off their 52-week high of 25 cents achieved in September.

DroneShield has a market capitalisation of around $69 million. The company holds more than 389 million shares on its registry.

The post Why the DroneShield (ASX:DRO) share price jumped 12% this morning appeared first on The Motley Fool Australia.

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I was a guest on a webinar, yesterday, hosted by NAB.

Hosted by Gemma Dale, it was a fun chat, and a chance to share my thoughts on portfolio construction, stock picking and some of the hottest trends around.

(Yes, I was asked about Bitcoin. And lithium. And China. And renewables.)

And I made the point that there are trends.

And then there are trends that make money for investors.

Huh?

I used the example of oil.

Now, if you had been told, in early 1900, the story of oil demand over the next 120 years, you would have sold your house, your car and your dog, and put the lot into oil, right?

The data is a little sketchy from the very early days, but from a standing start of, well, zero back then, the world was producing around:

— 500 million barrels of oil, per year, in 1920

— 2.5 billion barrels per year in 1945

— 5 billion per year by 1955

— 10 billion in 1963 or 1964

— 20 billion by 1970; and

— Just under 35 billion barrels of oil per year, in the most recently available data.

Can you imagine how much money you would have made???

Oh… you want something else?

You want to know the price?

I see you’re onto me.

Now, I couldn’t easily find data back as far as the early 1900s, but according to one website, the price of oil, adjusted for inflation, is the same as it was back in 1974.

It’s barely double what it was in 1948.

So, volumes were up around 17 times, but the price went up by a factor of only 2!

The answer — you’re ahead of me already, aren’t you — is that supply came on stream, and fast, keeping prices down, even as volumes skyrocketed.

Air travel is a similar, but even worse example.

Even before COVID, while the number of passenger miles skyrocketed over the previous 50 years, airlines went broke.

Repeatedly.

The lesson is clear: while a ‘trend’ — say, skyrocketing demand for oil, or a huge and sustained growth in air travel — might be real, it just simply doesn’t follow that prices or profits will necessarily follow.

You still want to bet on lithium prices? 

Iron ore?

Gold?

Be my guest — but history isn’t full of examples of sustained high prices — or profits — for things best described as ‘commodities’.

Unless you have a sustainable cost advantage…

… or supply is limited…

… or you can lock up a market …

… I don’t like your odds.

Because remember: the oil price has merely doubled in 70 years… and that’s even with the OPEC cartel doing its best to control supply!

Now, that’s not to say you can’t find, and profit from, trends.

After all, the internet as a megatrend has made a lot of money for a lot of people.

But even there, the internet itself became a medium, more than a profit centre per se — and the winners were those who could most successfully take advantage of the new technology to capture audiences and create businesses — in e-commerce, social media, streaming and hardware and software design.

Trends can be a fantastic wave on which to surf.

Or they can wash you straight onto the rocks.

Wave — and trend — selection is key.

Fool on!

The post Lithium might be the new oil… in all the wrong ways appeared first on The Motley Fool Australia.

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ASX gold share Red 5 Limited (ASX: RED) is having a wild ride today, up 3% in early morning trade and then down 3% by late morning at the time of writing. 

Below we take a look at the company’s latest project update.

What did Red 5 report?

Red 5’s shares are currently lower despite the ASX gold share reportedly continuing progress at its King of the Hills Gold Project (KOTH). The 2.4-million-ounce project is located in Western Australia.

Significantly, the company said it has received approval from the Department of Environment and Water Regulation to commence construction on the KOTH power station well in advance of the scheduled start of construction.

The ASX gold share said the project remains within its forecast budget and is on track to deliver its first gold production in the June quarter of 2022. Its KOTH village is now also fully operational. The village has already been accommodating the onsite construction teams for several months.

Commenting on the progress, Red 5 Managing Director, Mark Williams, said:

We are continuing to complete the permitting, development and construction milestones at KOTH, with solid progress being made since our last update in early May 2021.

Construction activities continue to advance, gaining good momentum, with the construction of the CIL tanks for the processing circuit rapidly advancing. It’s also great to see structural steel now beginning to arrive at site and key items of imported equipment, including the steel liners for the SAG Mill and the SAG Mill pinions, motors, bearings and lubrication skids arriving in Fremantle.

This is a consequence of our decision last year to lock in key fixed-price contracts and long-lead items early in the project development schedule, well ahead of the recent increase in activity in the resources and construction sectors.

How has this ASX gold share performed?

It’s been a tough year for Red 5 shareholders, with shares down 39% over the past 12 months. By comparison, the All Ordinaries Index (ASX: XAO) gained 23% over that same time.

Year-to-date, the ASX gold share continues to struggle, down 37% so far in 2021.

The post Why ASX gold share Red 5 (ASX:RED) is on a rollercoaster today appeared first on The Motley Fool Australia.

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At lunch on Friday, the S&P/ASX 200 Index (ASX: XJO) is fighting hard to stay in positive territory. The benchmark index is currently up 0.1% to 7,265.9 points.

Here’s what is happening on the market today:

Tech shares under pressure

It has been a disappointing finish to the week for Australian tech shares. This follows a poor night of trade on Wall Street, which saw the tech-heavy Nasdaq index fall 1% after investors rotated into cyclical stocks. The likes of Xero Limited (ASX: XRO) and Zip Co Ltd (ASX: Z1P) shares are trading lower today and dragging the S&P/ASX All Technology Index (ASX: XTX) 0.8% lower.

Appen CEO sells shares

The Appen Ltd (ASX: APX) share price has been a particularly poor performer on Friday. At the time of writing, the artificial intelligence data services company’s shares are down 5.5%. This follows news that its CEO, Mark Brayan, has sold 109,430 Appen shares for a total consideration of $1.43 million. However, it is worth noting that the sale was made to satisfy tax obligations arising from the vesting of 173,153 performance rights.

Gold miners tumble

Another area of the market underperforming on Friday is the gold sector. The likes of Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) are tumbling lower after the spot gold price fell almost 2% during overnight trade. The S&P/ASX All Ords Gold index is down a disappointing 3.1% at lunch.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Friday has been the ARB Corporation Limited (ASX: ARB) share price with a 5% gain. This follows the release of a positive broker note out of Ord Minnett this morning. The worst performer has been the De Grey Mining Limited (ASX: DEG) share price with a 7% decline following the weakness in the gold price.

The post ASX 200 up 0.1%: Tech shares fall, gold miners tumble appeared first on The Motley Fool Australia.

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Woolworths Group Ltd (ASX: WOW) has made a step towards its carbon emissions targets, signing its first renewable power purchase agreement. At the time of writing, the Woolworths share price is up 1%, with shares in the company trading for $43.35.

Woolworths shared the news of its power purchase – which will cover 30% of Woolworths’ supermarket’s electricity use – yesterday.

According to the group, its energy needs make up around 1% of Australia’s total energy use. Woolworths Group is aiming to be powered entirely by renewable energy by 2025.

Let’s take a closer look at Woolworths’ news.

Renewable power purchase agreement

Woolworths has signed a 10-year agreement with CWP Renewables to purchase power from the new Bango wind farm – located near Yass, NSW.

The agreement will see Woolworths paying to put 195,000 megawatt hours of renewable electricity into the NSW electricity grid each year. By doing so, it will avoid the release of 158,000 tonnes of carbon emissions annually.

Woolworths already has a network of 140 rooftop solar panels scattered around Australia.

The retail giant is aiming to cut its carbon emissions by 63% by 2030 and by 100% by 2050. It’s already reduced its emissions by 25% since 2015.

Woolworths is one of a handful of ASX companies to have its emission reduction targets backed by the United Nations Science-Based Target Initiative, which aims to limit global warming to 1.5 degrees.

Woolworths stated it plans to continue searching for opportunities to directly invest in renewable power purchases.

The Bango wind farm will begin producing power for Woolworths in early 2022.

Commentary from management

Woolworths Group’s director of format, Rob McCartney, commented on the power purchase agreement:

Going beyond net carbon neutral, we’ve committed to take more carbon out of the atmosphere than we produce by 2050 and our first renewable power purchase is a key milestone in that pursuit.

Supermarkets are particularly energy intensive to run and we want to use our scale for good by supporting the transition to renewable electricity.

Woolworths share price snapshot

The Woolworths share price has been performing well on the ASX lately.

Currently, it’s 7.27% higher than it was at the start of this year. The Woolworths share price has also gained 17.27% since this time last year.

The group has a market capitalisation of around $54 billion, with approximately 1.2 billion shares outstanding.

The post Woolworths (ASX:WOW) inks first renewable power deal appeared first on The Motley Fool Australia.

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The S&P/ASX 200 Index (ASX: XJO) has slipped 0.1% from record all-time highs on Friday.

This follows a weak overnight performance on Wall Street with all three indices, the Nasdaq Composite (NASDAQ: .IXIC), S&P 500 Index (SP: .INX) and Dow Jones Industrial Average Index (DJX: .DJI) down between 0.07% and 1.03%.

Despite the slight pullback, ASX gold miners have taken a worse hit on Friday.

Large cap ASX gold miners including Northern Star Resources Ltd (ASX: NST), Evolution Mining Ltd (ASX: EVN) and Newcrest Mining Ltd (ASX: NCM) are currently down 4.10%, 3.20% and 1.73% respectively.

Mid-tier players such as Perseus Mining Ltd (ASX: PRU) and Ramelius Resources Ltd (ASX: RMS) are a little worse off, down 5.61% and 7.18% respectively, but Regis Resources Ltd (ASX: RRL) is faring better, down just 1.91%.

At the more speculative end of town, gold explorers have also taken a hit with popular names such as De Grey Mining Ltd (ASX: DEG) slumping 7.32% at the time of writing.

Higher treasury yields smacks gold prices

US bond yields ticked upwards on Thursday night in response to better than expected labour market data. The United States reported a surge in private-sector employment in May, while initial jobless claim figures came in within expectations.

Benchmark US 10-year treasury yields rose about 4 basis points to 1.626%. 10-year treasury yields have been range bound between 1.5% to 1.7% since March this year. This follows its meteoric rise from lows of 0.50% in August last year to a peak of 1.75% in late March.

Coinciding with the uptick in treasury yields and positive labour market data, gold prices slumped about 2% overnight from US$1,900 to US$1,870.

Why do treasury yields matter?

There is an opportunity cost when it comes to holding gold. The yellow metal does not bear any yield, so a capital flow from gold to bonds can be expected when yields become sufficiently high.

For most of last year, the opposite was happening as 10-year yields plunged from 1.95% pre-COVID to lows of 0.50% by August 2020. In conjunction with the fall in yields, gold prices surged from around US$1,650 to a peak of over US$2,060 on 6 August 2020.

Gold could be at its crossroads, with factors such as a weak US dollar and high inflation propping up prices, while a potential breakout of yields could send prices further south.

The post Why ASX gold miners are taking a hit today appeared first on The Motley Fool Australia.

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Appen Ltd (ASX: APX) shares are falling this morning after the company’s chief executive officer sold a sizeable amount of his shareholding.

At the time of writing, the Appen share price is trading 4.9% lower at $12.42.

Why is the CEO selling?

According to the announcement by the artificial intelligence data provider, CEO Mark Brayan disposed of 109,430 shares last Friday. The sale was actioned at $13.0805 per share — an approximate total sale value of $1.43 million.

Whenever a CEO cashes out of the company they are leading, eyebrows are raised. So, why has Brayan sold down his holding?

The company’s release specifies the sale was to satisfy tax obligations arising from the vesting of 173,153 performance rights in March.

Post-sale, Brayan retains 482,032 shares in the company. On that basis, this recent sale would represent a selldown of roughly 18.5% of Mr Brayan’s holdings in Appen.

Poor timing for Appen share price

Usually, shareholders aren’t too bothered by management taking some pocket change for their efforts. However, cashing out after a period of share price underperformance is a surefire way to leave investors with a bitter taste.

The Appen share price has fallen approximately 70% from its high back in August last year. Disappointment has lingered since the company issued a guidance downgrade in December, following a sluggish quarter.

More recently the shares have rebounded somewhat after the company announced a business restructuring. The move to reposition Appen with four distinct business units — Global, Enterprise, China, and Government — seemed to restore some shareholder optimism.

However, today’s down move indicates shareholders may feel the restructure alone isn’t enough to warrant a $1.4 million payday for the CEO.

Looking ahead

Shareholders will be hoping Appen delivers on its full-year guidance, which was reaffirmed in May. Between US$83 million and US$90 million is expected in underlying earnings before interest, tax, depreciation, and amortisation (EBITDA).

Once a growth company starts missing forecasts, it can get ugly quickly. The Appen share price will be skating on thin ice if FY21’s result disappoints — especially after seeing the CEO reduce his own interests in the company.

The post Here’s why the Appen (ASX:APX) share price is falling 5% today appeared first on The Motley Fool Australia.

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The Adriatic Metals PLC (ASX: ADT) share price is gaining in morning trade, up 2% at time of writing.

Below we look at the ASX silver company’s latest permitting success.

What did Adriatic Metals report?

The Adriatic Metals share price is gaining after the company announced the Bosnian Federal Ministry of Spatial Planning had greenlighted the Urban Planning Permit (UPP) for its Rupice underground deposit.

The Rupice deposit makes up part of the silver explorer’s Vares silver project in Bosnia and Herzegovina. It received the UPP for the other part of the Vares silver project – called Veovaca – in November 2020, with an exploitation licence granted in January. The company said Veovaca received its permits earlier because it’s a brownfield open pit deposit, whereas Rupice is a greenfield underground deposit.

Adriatic Metals said receipt of the permits involved approval from significant government stakeholders, including neighbouring municipalities, as well as local commercial service providers.

Commenting on the permit, Adriatic Metal’s CEO, Paul Cronin, said:

The award of the UPP represents the last major step before obtaining the Rupice Exploitation Permit, which I remain confident it will be received within the coming weeks. Since Adriatic’s incorporation in March 2017, the company has worked very hard with the local community and the various levels of government to work through the project permitting process.

This award demonstrates the level of expertise in our team, as well as the support and cooperation from the local community and government in building the Vares Project.

Adriatic reported it will immediately apply for the exploitation permit, a technically focused process.

Construction can commence on receipt of the exploitation permit for Rupice, which will give Eastern Mining, Adriatic’s wholly owned Bosnian subsidiary, the right to mine and process ore at the Vares silver project.

How has the Adriatic Metals share price been performing?

Adriatic Metals’ share price is up 82% over the past 12 months. By comparison the All Ordinaries Index (ASX: XAO) has gained 23% over that same time.

Year-to-date, Adriatic shares have gained 9%.

The post Here’s why the Adriatic Metals (ASX:ADT) share price is gaining today appeared first on The Motley Fool Australia.

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