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2023 has been a volatile but still overall positive year for ASX 200 shares and the S&P/ASX 200 Index (ASX: XJO). Year to date, the ASX 200 remains up by a healthy 6.13%, thanks mostly to the convincing rally it has enjoyed over the past month or so.

But let’s talk about one ASX 200 tech stock that has smashed the broader market by more than six-fold.

It’s WiseTech Global Ltd (ASX: WTC), yes, the company that put the W in WAAAX back when that was a thing.

Unlike its old WAAAX peers, the WiseTech share price has gone from strength to strength this year so far, as you can see below:

Yes, WiseTech started 2023 at $49.17 a share. But today, the company closed at $67.86, up 1.15% at the end of trading today. That puts this logistics company at a year-to-date gain of 38%. Not bad for three-and-a-half months.

WiseTech shareholders clearly don’t need too much more good news. But they’ve got it anyway. In addition to these stellar gains over 2023 so far, WiseTech has, just today, hit a fresh new all-time record high. Just before midday, the WiseTech Global share price touched $68.89 a share – the company’s new high watermark.

Why is ASX 200 tech stock WiseTech at a new record high today?

There hasn’t been much news out of WiseTech that might explain why investors have sent the company up to a new record high today. However, WiseTech did report some very impressive numbers back in its half-year earnings announcement in February.

As we covered at the time, WiseTech posted revenue growth of 35%, while underlying net profits after tax (NPAT) surged 40% to $108.5 million.

That might be more than enough to give investors some long-term optimism here.

But WiseTech has also been the recipient of some love from ASX brokers recently too. Just last week, we covered ASX broker Ord Minnet’s views on the logistics company.

Ord Minnet recently gave WiseTech an accumulate rating, with a 12-month share price target of $90. If that came to pass, it would mean another 32.7% in upside from the current levels. So that also might be driving investors towards buying WiseTech shares right now.

Overall, it has been a phenomenal year for the WiseTech share price and one that has no doubt delighted shareholders. Let’s see where this ASX 200 tech stock is headed next.

 

The post This ASX 200 tech stock is up almost 40% in 2023 and has just hit an all-time high appeared first on The Motley Fool Australia.

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More reading

• Analysts say these 3 blockbuster ASX 200 growth shares are buys
• Which ‘high conviction’ ASX 200 shares is this fundie backing to beat the market?
• Want growth and passive income? Here are the ASX shares I’d buy for the best of both worlds
• 5 things to watch on the ASX 200 on Thursday
• 7 ASX 200 stocks smashing new 52-week highs on Monday

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy. The good news is that brokers across the country are doing a lot of the hard work for you.

Three top ASX shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:

Corporate Travel Management Ltd (ASX: CTD)

According to a note out of Goldman Sachs, its analysts have retained their buy rating on this corporate travel booker’s shares with an improved price target of $22.60. Goldman was pleased with the company’s contract win from the UK government and has boosted its earnings estimates to reflect it. The broker now expects an EBITDA compound annual growth rate of 75% between FY 2022 and FY 2025. The Corporate Travel Management share price is trading at $21.35 today.

QBE Insurance Group Ltd (ASX: QBE)

A note out of UBS reveals that its analysts have retained their buy rating and $18.00 price target on this insurance giant’s shares. While the broker has been forced to reduce its earnings estimates to reflect higher motor claims, it expects most of the damage to be offset by strong premium prices. Overall, the broker remains very positive and sees plenty of value in its shares at the current level. The QBE share price is fetching $14.78 on Monday.

Whitehaven Coal Ltd (ASX: WHC)

Analysts at Morgans have retained their add rating but trimmed their price target on this coal miner’s shares slightly to $9.85. While the broker believes that persistent labour issues are likely to drag on its performance into FY 2024, it feels these issues are more than priced-in. In addition, the broker highlights that the current uptick in spot NEWC prices and in energy market sentiment could be the first ingredient to a re-rating. The Whitehaven Coal share price is trading at $6.83 today.

The post Leading brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

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More reading

• Passive income in Australia: How I’d invest in ASX 200 shares to easily earn $20 per day
• Brokers name 3 ASX shares to buy now
• 11 times your money? Yes, it’s possible (we did it)
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Corporate Travel Management. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Considering starting a side hustle or putting in overtime for extra cash? You’re not alone. However, I’d prefer my second income to be passive – and ASX dividend shares can help me build it.

Here’s how I’d approach investing on the ASX with $10 a day and a goal to create a long-term income stream.

Turning $10 a day into a second income

Putting aside $10 a day is a powerful wealth-building habit. Over the course of a year, a daily $10 saving grows to become a $3,650 next egg.

That’s more than enough to kick-start my plan to create a second income.

Identifying ASX dividend shares to buy

Step two is likely to be the most daunting for new investors – buying ASX dividend shares. But it needn’t be difficult or confusing.

Shares are basically a piece of a company, and dividends are essentially spare cash that that company hands out to its investors.

So, if I were searching for dividend shares, I would be looking for a company that has the potential to earn consistent profits now and into the future.

And that means I’d be looking for a company (or companies) that offer in-demand products or services and boast competitive advantages over their peers.  

For instance, people have to eat. As a result, demand for supermarkets will always exist. So, Woolworths Group Ltd (ASX: WOW) probably won’t struggle for revenue any time soon.

Another example: those working in the healthcare industry will always need protective gloves. As a result, glove manufacturer and supplier Ansell Limited (ASX: ANN) will likely always realise an income.

I’d also take a good look at a company’s balance sheet. If it has substantial debts, I’d likely assume a fair chunk of its revenue will go towards servicing loans instead of into the pockets of shareholders.

Valuing dividend champions

But finding a business capable of long-term profits isn’t enough. I’d also want to buy it at a decent price.

Buying shares in a good company for more than they’re worth can make for a bad investment.

Not to mention the cheaper one buys a quality company, the better the dividend yield can be expected to be. A company’s dividend yield compares its share price against the amount it pays out annually.

There are plenty of ways to determine if a company is trading at an attractive price. Some simple methods include working out its price-to-earnings (P/E) ratio or price-to-book (P/B) ratio. All the information one needs to calculate these ratios can be found in a company’s financial reports.

Growing my second income

If I were to invest $3,650 in ASX shares capable of providing a healthy 5% dividend yield, I could realise $182.50 of passive income in my first year.

That’s probably nothing to write home about. However, by consistently setting aside $10 a day to invest, I would expect the passive income offered by my portfolio to grow alongside its value.

And if I didn’t need the extra cash, I’d use it to buy more shares. That way I could compound any gains I realise.

Though, it’s important to remember that there will most likely be some bumps in my wealth-building road. The market is prone to downturns, corrections, and even crashes, but it has always historically gone up.

Still, no investment is guaranteed to provide returns.

The post My $10-a-day approach to building a second income with ASX shares appeared first on The Motley Fool Australia.

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More reading

• The boosted Woolworths dividend is hitting bank accounts today. Here’s what you need to know
• Brokers say these ASX 200 blue chip shares are buys
• I’m looking for once-in-a-decade opportunities in the stock market recovery
• Is Woolworths ‘the granddaddy of recession-proof stocks’?
• Top defensive ASX shares to buy in April 2023

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 recommended Ansell. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on track to start the week with a gain. At the time of writing, the benchmark index is up 0.2% to 7,377.8 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are dropping:

AMA Group Ltd (ASX: AMA)

The AMA share price is down over 30% to 17 cents. This follows the release of a very disappointing update from the smash repair company. AMA has downgraded its FY 2023 normalised EBITDA guidance to between $60 million and $68 million from $70 million to $90 million. This was driven by ongoing margin compression. Together with its significant debt load, investors appear concerned about its future.

New Hope Corporation Limited (ASX: NHC)

The New Hope share price is down 9% to $5.27. This has been driven by the coal miner’s shares going ex-dividend this morning for its interim and special dividends. Last month, thanks to strong coal prices, the company released its half-year results and declared a 30 cents per share interim dividend (up 76% year over year) and a special 10 cents per share dividend. These will be paid to eligible shareholders at the start of next month.

Regis Resources Ltd (ASX: RRL)

The Regis Resources share price is down 12% to $2.13. Investors have been selling this gold miner’s shares following the release of its quarterly update. Regis delivered gold production of 103,728 ounces during the quarter, which was well short of expectations. This has led to the company revising its full-year production guidance lower.

St Barbara Ltd (ASX: SBM)

The St Barbara share price is down 5% to 61.2 cents. This morning, this gold miner returned from a suspension and revealed that it has agreed to sell its Leonora assets to Genesis Minerals Ltd (ASX: GMD). The release notes that the acquisition of St Barbara’s Leonora assets will position Genesis as a gold industry leader with a dominant position in Western Australia’s world-class Leonora District.

The post Why AMA, New Hope, Regis Resources, and St Barbara shares are dropping appeared first on The Motley Fool Australia.

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More reading

• Why did ASX All Ords share AMA just crash 30%?
• ASX 200 gold stock Regis Resources is tumbling 12% today. Here’s why
• 3 ASX 200 shares trading ex-dividend this week
• Why is the New Hope share price crashing 8% today?
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 Scott Phillips.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small gain. At the time of writing, the benchmark index is up 0.15% to 7,372.9 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are racing higher:

EML Payments Ltd (ASX: EML)

The EML share price is up 16% to 66.5 cents. This morning, this struggling payments company announced the exit of its CEO and the scrapping of its previously announced strategy. Investors appear pleased with its temporary CEO, new strategy, and a strategic review that will look at selling parts or all of its businesses.

Lake Resources N.L. (ASX: LKE)

The Lake Resources share price has jumped over 18% to 54.5 cents. This follows the announcement of another major milestone at the lithium developer’s Kachi project in Argentina. The company revealed that it produced 2,500 kilograms of lithium carbonate equivalents through its ion exchange technology.

Lindsay Australia Ltd (ASX: LAU)

The Lindsay Australia share price is up 19% to $1.25. This morning, this logistics company made a big upgrade to its earnings guidance for FY 2023. It now expects underlying EBITDA of $85 million to $90 million, compared to previous guidance of $68 million to $71 million.

Sayona Mining Ltd (ASX: SYA)

The Sayona Mining share price is up 11% to 21.7 cents. This has been driven by the lithium miner announcing a major increase to the mineral resource estimate of its Canadian operation. Management estimates that the Moblan Lithium Project represents one of North America’s single largest lithium resources.

The post Why EML, Lake Resources, Lindsay, and Sayona Mining shares are racing higher appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Monday
• Lake Resources share price leaping 10% higher on ‘major milestone’
• EML share price rockets 11% after chief steps down
• Sayona Mining share price higher on big lithium news
• These are the 10 most shorted ASX shares this week

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 positions in and has recommended EML Payments and Lindsay Australia. The Motley Fool Australia has positions in and has recommended EML Payments. The Motley Fool Australia has recommended Lindsay Australia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Fortescue Metals Group Limited (ASX: FMG) share price has done very well since the end of October 2022. It has risen by around 50% since then. But here are a couple of key reasons why I think the ASX mining share could still be cheap.

Don’t get me wrong, I’d much rather invest in the ASX iron ore share at a price under $17 compared to its current price of around $22.50.

Certainly, buying at a lower price would give us a better margin of safety.

However, it’s good for Fortescue shareholders that the company’s share price has recovered so much, despite the iron ore price only trading at around US$120 per tonne currently. It is possible that the commodity price could rise if China’s economy keeps recovering, though I wouldn’t count on the iron price going up.

However, there are two good reasons why the Fortescue share price could keep rising even if the iron ore price doesn’t go any higher.

More production

There are a few elements to how much profit that Fortescue can make from its iron division.

It doesn’t have much control over the iron ore price. This is heavily impacted by the relationship between supply and demand for the commodity. Certainly, it would be beneficial for Fortescue if another country, such as India, wanted to buy more iron ore.

The next element is the cost of mining the iron ore per tonne. Fortescue has done a good job of keeping its costs low, with automation playing its part (such as automated trucks). C1 costs were US$17.43 per wet metric tonne (wmt) in the first half of FY23, compared to average revenue of US$87.18 per dry metric tonne.

But what I’m excited about for Fortescue is that its production can keep growing. Its HY23 ore shipments rose 4% to 96.9 million tonnes (mt). Fortescue’s market capitalisation could rise if its operations keep producing more. BHP Group Ltd (ASX: BHP) produced 132 mt in the HY23 result, though BHP produces other commodities as well.

Fortescue is now very close to production at its higher-grade Iron Bridge project which aims to produce 22mt per annum of iron. The increased earnings from this could provide a real boost for the Fortescue share price, as long as the iron ore price doesn’t drop.

Green energy efforts

Fortescue is also making excellent progress on its green hydrogen project plans, with a number of projects getting close to the go-ahead.

At this early stage, there are still plenty of risks involved in executing these projects. But Fortescue says it has lined up customers to buy its production of green hydrogen, including E-ON, JCB, and Ryze.   

Why does this make Fortescue cheap? Company founder and chair Andrew Forrest revealed last year that Fortescue had been approached by investment banks suggesting Fortescue Future Industries (FFI) could be worth US$20 billion if it went through an initial public offering (IPO) process.

It’s anyone’s guess what FFI may be worth right now. But if we said the investment banks were being too ambitious and that FFI could instead be worth A$20 billion (after the last six months of progress), that would represent more than a quarter of the current Fortescue market capitalisation of $69 billion, according to the ASX.

Certainly, I think the Fortescue share price would look cheap if it were reduced by the underlying FFI value.

The post 2 reasons I think Fortescue shares are still cheap appeared first on The Motley Fool Australia.

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More reading

• Passive income in Australia: How I’d invest in ASX 200 shares to easily earn $20 per day
• Could more FFI spending be a saviour or stumbling block for Fortescue shares?
• Here’s how much I would need to invest in Fortescue shares to generate a $150 monthly income
• Which is the best ASX 200 iron ore stock now: BHP, Fortescue, or Mineral Resources?
• Why did the Fortescue share price smash the ASX 200 in March?

Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group. 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 Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) has clearly gotten out of bed on the right side this morning, with a positive start to the week’s trading so far this Monday. After what was a fairly positive week for ASX shares last week, the ASX 200 has kept the party going so far today. The Index is presently enjoying a decent 0.17% lift, putting it back over 7,370 points. 

Let’s hope this goodwill holds for the rest of the week. But time now to delve a little deeper into today’s gains. So let’s check out the ASX 200 shares that are topping the share market’s trading volume charts right now, according to investing.com. See if you can spot a trend today.

The 3 most traded ASX 200 shares by volume this Monday

Pilbara Minerals Ltd (ASX: PLS)

First up we have ASX 200 lithium stock Pilbara Minerals. So far this Monday, a sizeable 18.95 million Pilbara shares have been bought and sold on the markets. There hasn’t been any news or announcements out of Pilbara itself today. So this volume looks like it might be being caused by the movements of Pilbara shares themselves.

Pilbara has indeed had a rather volatile session so far. The company is presently up by 0.53% at $3.77 a share, but has had several stints in both positive and negative territory over the trading day, and has fluctuated between $3.66 and $3.79 a share. This bouncy showing is the likely cause behind the high volumes on display here.

Lake Resources N.L. (ASX: LKE)

Next up we have another ASX 200 lithium share in Lake Resources, with a hefty 26.53 million shares that have changed hands as it currently stands. It’s a bit easier to see what is behind the volumes of this company. This morning, Lake revealed that it has hit a “major milestone” at its Argentinian Kachi Project.

Kachi has produced 2,500 kilograms of lithium carbonate, successfully using ion exchange technology for the first time. Investors have responded with unbridled enthusiasm, adding almost 19% to the Lake share price to 55 cents a share. No wonder so many shares are flying around.

Sayona Mining Ltd (ASX: SYA)

Last up this Monday is yet another ASX 200 lithium share in Sayona Mining. Sayiona has seen a whopping 71.2 million of its shares bought and sold at this point of the trading day. It’s been a big day for ASX 200 lithium stocks today, with Sayona revealing that it has significantly expanded its Canadian lithium operations.

The company now estimates that its Moblan Lithium Project is now one of the largest lithium resources in North America. Investors have also flocked to Sayona shares today, sending the company up an eye-watering 15% at one point.

Right now, Sayona is sitting on a 10.3% gain at 22 cents a share. This is almost certainly why the company has had so many of its shares bouncing around the ASX boards.

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

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More reading

• What can ASX 200 investors expect from the US Fed in 2023?
• If I’d invested $1,000 in Liontown shares at the start of 2023, here’s what I’d have now
• Here’s why Bank of Queensland shares are making news again this week
• ASX 200 gold stock Regis Resources is tumbling 12% today. Here’s why
• Lake Resources share price leaping 10% higher on ‘major milestone’

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

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Extra income is an appetising proposition that is hard to pass up. The idea of getting paid to hold an asset while doing no direct work for it entices many of us who are seeking financial freedom. It’s no wonder ASX dividend shares can often be found in the average Aussie’s portfolio.

However, like the sweetness of sugar, there can be too much of a good thing. Right now, swathes of investors are prioritising near-term returns (such as dividends) over future growth.

In response, ‘growth‘ companies are getting booted to make room for dividend-paying alternatives. This move might look good on paper, for now, but I believe there are potential downsides to a completely dividend-centric portfolio.

Let’s unpack some important considerations before going ‘all-in’ on ASX dividend shares and abandoning growth altogether.

All the rage right now

It’s hardly a surprise that people are turning more toward dividend stocks at a time when money is tight. Inflation is still eroding the purchasing power of our currency and the uptick in interest rates has put those with a mortgage in a stranglehold.

The reality is, a stake in a company doesn’t help pay the bills unless it is sold or provides dividends. As such, investors who still want exposure to the stock market — but are in need of additional cash — are more likely to turn to ASX dividend shares.

I’m not going to say whether that is a right or wrong choice. The truth is such decisions are highly dependent on individual financial circumstances. Though, investors could be switching to a sole dividend focus on what could be short-term conditions.

A bribe in exchange for accepting mediocrity

There’s a great quote from Charlie Munger (Warren Buffett’s right-hand man at Berkshire Hathaway), which reads:

Using volatility as a measure of risk is nuts. Risk to us is 1) the risk of permanent loss of capital, or 2) the risk of inadequate return.

I think there is a common misconception that simply because a company pays a dividend it is ‘less risky’ than more volatile shares such as those in the growth bracket. Management can destroy capital regardless if a dividend is being paid or not.

Take for example the ASX dividend shares shown in the chart below. Each of these companies could be considered relatively ‘safe’ dividend-paying investments. Yet, all of them have underperformed the S&P/ASX 200 Index (ASX: XJO) over the past five years — even when dividend returns are included.

Ultimately, this reveals the durability — or lack thereof — of a company’s economic moat or competitive advantage. If dividends can’t be paid while also retaining a high return on equity (ROE), then more purposeful uses for those funds should probably be found.

Not all ASX dividend shares are poor compounders

Don’t get me wrong, there are plenty of high-quality dividend shares on the ASX. Such companies are able to pay out profits while simultaneously growing them.

The point is I wouldn’t invest in a company purely based on whether or not it pays a dividend.

In my opinion, it is far more important to make a decision based on the fundamental quality of the business and the potential for long-term compounding. In some cases that will be a company that pays a dividend. At other times, it possibly might not.

For reference, 26 out of the 50 best-performing ASX shares over the last decade did not pay a dividend in the last year.

The ASX shares I’m eager to buy (dividends or not)

Personally, I much prefer high growth over high yield. As such, a large runway for growing profits is the first characteristic I look for when hunting for investments. From there, dividends are treated as the cream on top if they’re offered.

The track record of growth, management experience and ownership, balance sheet health, and competitive edge take the front seat over dividends. Right now, ASX shares that are catching my eye include:

• Nanosonics Ltd (ASX: NAN)
• Propel Funeral Partners Ltd (ASX: PFP)
• Imdex Limited (ASX: IMD)
• Altium Limited (ASX: ALU)

I’m doubtful that some of the ASX dividend shares known for their ‘safeness’ could outperform these growing businesses over the next decade — let alone beat the index. That’s why I believe it’s important to remain diversified and maintain a balanced portfolio of growth and income.

The post What to know before giving up on growth and going all-in on ASX dividend shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler has positions in Propel Funeral Partners. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Berkshire Hathaway, Imdex, and Nanosonics. The Motley Fool Australia has positions in and has recommended Imdex and Nanosonics. The Motley Fool Australia has recommended Berkshire Hathaway, Propel Funeral Partners, and Westpac Banking. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It’s been a rather pleasant start to the trading week so far this Monday for the All Ordinaries Index (ASX: XAO). At this point of today’s session, the All Ords has gained a decent 0.14%. But one All Ords share isn’t joining this party. That would be the AMA Group Ltd (ASX: AMA) share price. 

AMA shares have had an absolute clanger so far today. This automotive care and servicing company closed at 25 cents a share last week. But today, the AMA share price opened at 22 cents before falling as low as 16 cents a share, a drop of roughly 34%.

Right now, AMA shares have stabilised at 17 cents each, but that still puts the company down a painful 30.6%.

So what on earth has gone so wrong for AMA this Monday?

Why did the AMA share price tank 30% today?

Well, it seems the culprit is a quarterly cash flow and activities report that AMA released to investors this morning before market open.

This report revealed that AMA has been forced to revise its previous earnings guidance for FY2023.
Previously, the company had guided for an earnings before interest, tax, depreciation and amortisation (EBITDA) figure of between $70-90 million for FY2023.

But today, AMA has revised this guidance to between $60-68 million.

The company has blamed “ongoing margin compression adverse to expectations” for the downgrade.

It noted the following causes of its expected lower earnings:

• Strong repair volume demand adversely impacted by industry-wide labour constraint related
  throughput challenges.
• Elevated lateral hiring activity as industry participants seek to fill vacancies from a limited
  labour pool contributing to higher employee costs per hour and operational disruption.
• Many industry contracts still do not contain appropriate dynamic adjustment mechanisms
  that insulate parties from external pressures such as inflation or increasing repair severity.
• Supply strategy progressing slower than anticipated.

So this is almost certainly why investors are selling out of AMA shares today and have sent the company’s shares down by such a dramatic margin.

AMA also reported that it was sitting on a cash balance of $20.5 million at the end of the March quarter (the three months ended 31 March 2023). That’s after the company generated a net cash from operating activities of $0.3 million over the period. AMA is also anticipating that it can be operating cash flow-positive over the second half of FY2023.

Even so, it’s clear investors are disappointed (to say the least) over what AMA has revealed today. Here’s some of what AMA CEO Carl Bizon had to tell investors:

We are disappointed that we no longer expect to meet the previously stated guidance range as a result of a number of short- to medium-term challenges.

However, we remain confident in the strategy in place, the fundamentals of the business, and, consequently, the business’s ability to realise our medium-term operating margin target.

We have made significant progress across all the areas which are key to the long-term success of the business after weathering the very real challenges of the COVID-19 period and I look forward to the future of AMA Group.

Today’s share price falls puts AMA shares at a loss of 19% in 2023: 

The post Why did ASX All Ords share AMA just crash 30%? appeared first on The Motley Fool Australia.

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

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ASX lithium share Latin Resources Ltd (ASX: LRS) gained 5% in last week’s trade, closing Friday at 11 cents per share.

But you won’t see the Latin Resources share price moving today.

Here’s why the ASX lithium stock is on ice.

Why was trading in the ASX lithium share halted?

Latin Resources entered a trading halt this morning at the company’s request.

According to the ASX release, the company’s management asked for the trading halt pending the release of a capital raising announcement.

Investors can expect the ASX lithium share to resume trading by Wednesday or once that capital raise announcement is made, whichever is sooner.

It was only last Wednesday that Latin Resources updated the market on promising drilling results at its 100% owned Salinas Lithium Project in Brazil.

The miner said the results provided additional confidence in a significant resource upgrade in June.

Commenting on those results, Latin Resources’ geology manager Tony Greenaway said:

We continue to see great results coming out of the resource definition drilling at our Colina Deposit.

The consistency in both the pegmatite thickness and lithium grades is extremely encouraging, bolstering our confidence to be able to deliver what we believe will be a significant upgrade to the Colina mineral resource in June.

Is Latin Resources a good investment?

The Latin Resources share price, pictured below, is up 10% in 2023 but down a painful 45% over the past 12 months.

As for what’s ahead, Bell Potter sees significant upside potential for the ASX lithium share.

The broker notes that Salina has an initial mineral resource estimate of 13.3Mt @ 1.2% Li2O. But citing prior positive drilling results at the project’s Colina Deposit, Bell Potter believes that MRE could be significantly increased.

Bell Potter has a speculative buy rating on the ASX lithium share.

The broker has a price target of 22 cents per share, representing a 100% upside to Latin Resources’ current halted share price.

The post Why is ASX lithium share Latin Resources on ice today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben 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 Scott Phillips.

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