Tag: Motley Fool

Despite the S&P/ASX 200 Index (ASX: XJO) rebounding 33.5% in the last year, there’s still plenty of shares that remain beaten down.

While there are shares on the ASX that look expensive, the price-to-earnings (P/E) ratio can be useful to make a rudimentary assessment of value.

So, let’s take a look at a few shares in the ASX 200 that are currently trading on relatively cheap earnings multiples — in addition to having a beaten-down share price.

ASX 200 shares trading at a discount

St Barbara Ltd (ASX: SBM)

This ASX-list gold mining company has been unloved over the last year. The St Barbara share price is down 12.5% from 12 months ago, and 28% lower in the last 6 months.

Being a gold mining company in the ASX 200, St Barbara’s share price is loosely tied to the value of the precious metal. Comparatively, the gold spot price has fallen 12.6% in the last 6 months. However, the price of gold has risen 5% in the past year.

Furthermore, St Barbara increased its earnings 26.7% from $100.26 million to $127.03 million, between 2019 and 2020. Due to the company’s earnings increasing while its share price tumbled, its earnings multiple has contracted to 11.6 times. For comparison, the metals and mining industry average is 13.3 times.

Austal Ltd (ASX: ASB)

The ASX 200 included Australian shipbuilder has fallen out of favour in recent times. This is reflected in the share price falling 15.8% in the past 12 months, and 22% in the last 6 months.

Austal has been integral in providing the US Navy and Australian Border Force with vessels. Hence, the news of America and Australia withdrawing from Afghanistan might have investors concerned. Regardless, the company is proceeding with the construction of a ship-building facility in Alabama, USA.

In its recent FY21 half-year report, Austal witnessed a 29% increase in its net profits on the prior corresponding period (pcp) to $52.4 million. With growing profits and a declining share price, Austal’s P/E ratio has reduced to 8.8 times — the lowest it has been since 2013 (disregarding negative periods).

Regis Resources Ltd (ASX: RRL)

Another gold miner on the list — Regis has suffered a heft 31% selloff over the last year. On a 6-month timescale, the Regis share price is down 41% — definitely passing the beaten-down criteria.

Looking at the financials, Regis has reasonably stable profits over the last few years. These range between $161 million to $200 million in earnings. During this period the gold miner has managed to grow its revenue from $590 million to $786 million. This has further potential to increase, with Regis acquiring a $900 million stake in the Tropicana gold project.

Analysts at Morgans believe the Tropicana acquisition will be transformational for the company’s long-term outlook. According to a recent note, the broker holds an add rating with a price target of $4.01. At the time of writing, the Regis Resource share price is trading at $2.79. The company is also trading at a discount to ASX 200 peers, trading on a 7.3 times P/E multiple.

More reading

• ABS data shows Australians maintained wealth during COVID
• Why the Regis Resources (ASX:RRL) share price is climbing
• Why the Santos (ASX:STO) share price is in focus
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 dips, Corporate Travel flies, Nuix sinks

Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Austal Limited. 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.

The post ASX 200 shares thrown in the bargain bin: Here’s 3 ideas appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3awcDhh

The AGL Energy Limited (ASX: AGL) share price is falling today after news the company’s CEO and managing director is stepping down. Brett Redman has been with AGL for 15 years but said he couldn’t continue as CEO after the company’s structural separation.

The AGL Energy share price is currently trading at $8.88, down 1.99% from yesterday’s closing price.

Let’s take a closer look at AGL’s news this morning.

Upper management shake-up

Redman is resigning from the role of managing director and CEO, effective immediately. He has been with the company for 15 years, holding the top job for the last 2 and a half years.  

Filling the role is the energy company’s chair, Graeme Hunt, who will relinquish his duties as chair to take up the position of interim managing director and CEO.

AGL advised that Hunt would lead the company through the planning process of its structural separation. He will be charged with appointing leaders to the company’s 2 new businesses.

AGL non-executive director Peter Botten will fill the role of company chair.

While Redman’s notice is effective immediately, AGL said he would remain available to the company until October, when his notice period expires.

Commentary from an all-new management

Outgoing CEO Redman said he was proud of his contribution to AGL Energy. He added:

I am also pleased to have established the case for the structural separation of the business. The timing of my departure will enable the leadership team to be established to execute upon the separation strategy and lead the business into its next chapter.

Hunt thanked Redman for his service:

Over his time as CEO, Brett has returned the company to growth in its customer base and stabilised relationships with key stakeholders at a time of unprecedented uncertainty in energy policy and market conditions.

In addition, the structural separation strategy Brett has sponsored gives AGL the opportunity to make material progress in our role in the energy transition.

Botten also thanked Redman and said Hunt’s interim role would “provide important continuity of leadership for the business and certainty for our people and shareholders while we work through the considerations of structural separation and establish a platform for future success”.

AGL Energy share price snapshot

The AGL Energy share price is down 27% year-to-date and has fallen 49% over the last 12 months.

The company has a market capitalisation of around $5.6 billion, with approximately 623 million shares outstanding.

More reading

• ASX 200 Weekly Wrap: ASX 200 hits new post-COVID high
• 2 ASX dividend shares with massive yields over 8% today
• Why the Tilt Renewables (ASX:TLT) share price is in focus
• Top brokers name 3 ASX shares to sell today
• Origin (ASX:ORG) share price edges higher after hydrogen update

Motley Fool contributor Brooke Cooper 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.

The post The AGL Energy (ASX:AGL) share price falls as CEO steps down appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3dESasy

You might have missed it, but yesterday, the US tech giant Netflix Inc (NASDAQ: NFLX) reported its quarterly earnings for the 3 months ending 31 March 2021.

It was quite a surprising result for a number of reasons. Firstly, despite its gargantuan US$225 billion market capitalisation, Netflix has long been priced as a growth company. Until yesterday’s report, Netflix had boasted a price-to-earnings (P/E) ratio of over 90.

That’s why it was a surprise to hear that Netflix had only added 4 million new subscribers over the quarter. Now that’s still a massive number to be sure. But it pales against the 16 million the company added over the same quarter last year. In other words, we have a big slowdown here. What was even more surprising was Netflix’s guidance for the quarter we are currently in (ending 30 June 2021). The company is only expecting to add another million subscribers. If that does come to pass it would be a 75% reduction on top of a 75% reduction.

Needless to say, the market reaction wasn’t fantastic for Netflix shares. The Netflix share price dropped 7.4% last night in US trading.

But perhaps we shouldn’t be surprised. The March quarter last year captured the most intense period of global COVID lockdowns. That is a near-impossible yardstick to compete with in 2021.

But it does sound a warning bell, which could extend to ASX tech shares.

Netflix: a warning for ASX tech shares

It’s fair to say that the markets have been extremely accommodating and even generous to many ASX shares that could be classed as ‘COVID winners’ at various points over the past year or so. Think of Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P), Kogan.com Ltd (ASX: KGN) or Temple & Webster Group Ltd (ASX: TPW). All of these companies have seen a huge, if not volatile investor interest over the past year. This interest has pushed the share prices of these companies to levels that some investors have found inexplicable. Xero Limited (ASX: XRO) still has a P/E ratio over 600, after all.

Some ASX tech shares have managed to keep much of their COIVID-fuelled gains, like Afterpay and Xero. But others have given back some of their winnings, like Kogan and (to a lesser extent) Temple & Webster.

As it stands today, the S&P/ASX All Technology Index (ASX: XTX) is still at a relatively high point – at ~84% above where it was this time last year.

But perhaps with Netflix, the market is telling us that its leniency has limits. If the seemingly limitless growth runways start to shorten, Netflix’s stock price gives us a good indication of what might be ahead.

Something to keep in mind for every ASX growth investor out there today.

More reading

• Analyst sees Netflix falling 38% after earnings
• Netflix misses sub addition target, shares crash
• Earnings: 2 hot stocks to watch this week
• Netflix is losing market share, but this is the actual risk to shareholders
• Netflix just fixed its only disadvantage in streaming

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Netflix. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Kogan.com ltd, Temple & Webster Group Ltd, Xero, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Kogan.com ltd, Netflix, and Temple & Webster Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Are Netflix’s woes a warning for ASX tech shares? appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3nbtUBO

The timing for the reopening of the global economy post COVID-19 remains highly uncertain, but this isn’t stopping brokers from picking ASX shares to buy now.

Travel-related ASX shares are the posterchild for the recovery trade and that explains why the Qantas Airways Limited (ASX: QAN) share price, Flight Centre Travel Group Ltd (ASX: FLT) share price and Sydney Airport Holdings Pty Ltd (ASX: SYD) share price have bounced as COVID fears receded.

However, one ASX travel share that stands out is the Corporate Travel Management Ltd (ASX: CTD) share price. Morgans calls the business travel agent its “key pick” in the sector.

First to return to profits

This is particularly so following Corporate Travel’s trading update yesterday. The group has reach breakeven at the earnings before interest, tax, depreciation and amortisation (EBITDA) level in March.

“CTD expects to be EBITDA positive in the 4Q21, lead [sic] by ANZ and UK/Europe,” said Morgans.

“CTD is now EBITDA positive. It is the first travel stock under coverage to be profitable which highlights its greater exposure to essential services customers, domestic travel, large pipeline of new client wins and low cost base.”

Other reasons this ASX share is a favourite COVID reopening trade buy

These aren’t the only reasons what Morgans thinks the stock is ahead of the pack. Corporate Travel’s balance sheet has no debt, when all its peers do. This means the group has the strongest balance sheet in the ASX travel sector.

Morgans has an “add” recommendation on the Corporate Travel share price with a price target of $21.75 a share.

US and EU key to more earnings upgrades

But Morgans isn’t alone in recommending the Corporate Travel share price as a “buy”. UBS reiterated its bullish rating on the shares as it noted the group’s leverage to the US and EU markets.

“The vaccine roll-out is well-advanced in the US/UK and remains the key catalyst for travel to materially lift,” said UBS.

“CDC US guidelines state fully vaccinated citizens can travel domestically & internationally without quarantining after travel.

“Meanwhile, international travel in the UK could potentially resume on 17 May with ‘green countries’.”

More room for the Corporate Travel share price to climb

The US accounts for around 45% of Corporate Travel’s proforma EBITDA while Europe makes up around 20%.

UBS’ 12-month price target is $22 a share, but it could upgrade this if there are more tangible signs of a travel recovery in the US and Europe.

More reading

• ASX 200 dips, Corporate Travel flies, Nuix sinks
• Why Corp Travel Management, Imugene, MoneyMe, & Syrah are pushing higher
• Why the Corporate Travel Management (ASX:CTD) share price is soaring today
• 5 things to watch on the ASX 200 on Wednesday
• Why Altium, Challenger, Lynas, & Sydney Airport shares are sinking

Motley Fool contributor Brendon Lau has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Brokers favourite ASX share for the COVID-19 reopening trade appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3nblOJ3

The Zip Co Ltd (ASX: Z1P) share price is rising today after the company announced an agreement with Adobe (NASDAQ: ADBE) to become an Accelerate partner in the Adobe Exchange Partner Program.

At the time of writing, the Zip share price is up 4.11% to $9.11.

Zip Pay is Australia’s second-largest buy now, pay later (BNPL) fintech company. It’s a financial technology company that operates across Australia and New Zealand, offering point-of-sale credit and digital payment services to consumers and merchants.

Zip first listed on the ASX in 2009 and is headquartered in Sydney. Currently, the company has around 10,000 retail partners and 1,200,000 customers in Australia.

What does the Zip, Adobe partnership mean?

Zip is now set to become the buy now, pay later provider of choice for Adobe’s e-commerce software, Magento.

Magento is a digital commerce platform that blends digital commerce, order management, and predictive intelligence. This enables online shopping across a wide array of industries and business models (B2C, B2B, and hybrid).

Adobe offers an enterprise-level, cloud-hosted application, Magento Commerce, as well as a free e-commerce solution, Magento Open Source.

Zip’s Accelerate partner agreement with Adobe will be mutually beneficial for Zip. Furthermore, allowing Zip to benefit from a range of technological and programmatic support from the US tech giants. 

Zip says the agreement will mean its BNPL services are marketed to thousands of new retail customers across the world. 

What both companies’ management said

Zip CEO Peter Gray said the Adobe partnership was a milestone in global expansion for the Australian company:

Adobe is a global leader in digital commerce and this collaboration will help us reach thousands of merchants and their customers with our better way to pay. With partners like Adobe, we are well on our way to making Zip the first payment choice, everywhere and every day.

Adobe vice president, Jason Woosley, said BNPL services were a value addition for Magento.

While brands are looking for ways to engage customers with new, exceptional experiences, the realities of COVID-19 have catapulted digital commerce technologies to the forefront of the market

Consumers love installment payment solutions because they’re fast, fair and interest-free. Zip enables Magento merchants globally to implement these capabilities effortlessly at checkout, improving cash flow, increasing order value, and keeping customers coming back again and again.

Zip share price snapshot

The Zip share price is down more than 5% this week. However, it has gained nearly 10% this month and is up over 350% over the past 12 months. 

More reading

• BrainChip and Zip were among the most traded ASX shares last week
• Why Accent, Bank of Queensland, Freelancer, & Zip shares are pushing higher
• This major US bank has bought 6% of Zip (ASX:Z1P) shares
• Why GPT, Mayne Pharma, Talga, & Zip shares are tumbling lower
• Top broker picks ASX shares next in line for a profit upgrade

Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. 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.

The post Zip Pay (ASX:Z1P) share price rising after ‘global leader’ agreement appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3sFW6hc

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.

Square (NYSE: SQ) came back from an underwhelming first half of 2020 with big increases in revenue and gross payment volume in the fourth quarter. But the bigger story is that the fintech company’s long-term potential became more apparent as the year went on, and the market rewarded shareholders with roughly 350% gains over the course of the year. ARK Invest chief Cathie Wood, whose investment decisions are watched by growth investors everywhere, has made Square one of her largest holdings. Is it the right long-term stock for you?

The cashless society is coming

Square operates two ecosystems: one for sellers, which caters to the small and medium-sized business clients that use its fintech solutions, and Cash App, which individuals use to send payments and related functions. In many ways, it’s similar to fintech leader PayPal, which offers similar products and services. 

As would be expected, the seller division was mixed during the pandemic. Physical small businesses suffered during lockdowns, but many with digital capabilities flourished. Square sees a $100 billion addressable market, of which it has less than 3%.

Cash App, though, was a high performer during the pandemic as people stayed home and relied on mobile wallets to send and receive money. The company also expanded features for Cash App, such as stock and Bitcoin trading, as well as Cash Card and a rewards program. More than a million Cash App users bought Bitcoin for the first time in Q4, and the cryptocurrency was traded two and a half times more than in Q4 2019. Square itself bought $230 million of Bitcoin recently as it steers itself toward an expanded digital payment ecosystem. 

CashApp users increased 50% over the prior year in the fourth quarter to 36 million, and Cash App revenue increased more than 500%. A little bit of context is necessary here: Square records Bitcoin volume as revenue, and Bitcoin accounted for 80% of Cash App revenue in the fourth quarter and more than half of total revenue. Without Bitcoin, though, Cash App still grew 137%.

According to a McKinsey survey, digital penetration reached 78% in 2020, and that includes 93% for ages 13-34. People using more than one type of digital payment increased to 58%. More than half of survey respondents said they shifted to online shopping during the pandemic, and more than a third said they would increase that. The pandemic accelerated what was already a shift to digital payments, and that’s good news for Square.

The power of the mobile wallet

Square is poised to benefit from the move to digital wallets, and that means increased revenue from a growing and engaged user base. A Cash App account is simpler to use than a bank account, and the “ecosystem” aspect of Cash App as a peer-to-peer payments account and trading account is a very attractive feature. As we become more cashless, Square’s investments in its platform are likely to yield more customers, higher engagement, and increased revenue.

Cash App is also becoming more profitable, with gross profit per user up 70% year over year in Q4. Square became profitable for the first time in 2018, and it’s been posting more consistent profits over the past two years. Q4 earnings of $294 million were a 24% decrease year over year, but as the seller business gets back up to speed, that should increase. 

Square sees a more than $60 billion addressable market for Cash App, of which it has less than 2%. In the near term, it’s planning to gain market share by expanding the Cash App product line and improving customer service. But it has strong tailwinds that will continue to accelerate digital payment adoption as we move away from the pandemic.

If you’re looking for a growth stock that offers potential in the short and long term, Square is a candidate for you. Square stock has gained more than 1,500% over the past five years, but there is much more opportunity ahead, and the company is making moves to harness its potential.

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

More reading

• Aussie fintech lets ANYONE receive salary in Bitcoin (CRYPTO:BTC)
• ASX 200 Weekly Wrap: ASX 200 hits new post-COVID high
• Forget the Bitcoin price, the Dogecoin price is on fire!
• Do you think the Bitcoin price is a bubble? Read this
• Why Cryptocurrency stocks like Marathon Digital and Riot Blockchain crashed Today

Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Bitcoin, PayPal Holdings, and Square and recommends the following options: long January 2022 $75 calls on PayPal Holdings. The Motley Fool Australia has recommended PayPal Holdings. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Is Square the long-term stock for you? appeared first on The Motley Fool Australia.

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

from The Motley Fool Australia https://ift.tt/32CjeCE

The Australian Bureau of Statistics (ABS) released its ‘Household Financial Resources‘ data on Wednesday, illustrating the importance of the Australian Government’s JobSeeker and JobKeeper programs to Australian household income from September 2019 to September 2020.

The data shows that Australian household income and wealth were stable throughout the worst of the pandemic. The ABS’ reporting period finished after the peak of Victoria’s COVID-19 crisis, where the state was plunged into one of the world’s harshest and longest lockdowns. 

The ABS reported that, despite the Australian economy shrinking by 2.5% during the COVID recession, Australia’s average private household income remained stable at $2,117 per week compared to September 2019.

Income from government payments was a significant contributor to this stability. JobSeeker and JobKeeper spearheaded an average increase in government payments of 30% – or $89 per week – to $300 per week. 

The survey also provided insights into how those accessing the controversial early superannuation withdrawal scheme used their funds. The data showed that the majority of people accessing the scheme used their withdrawals for mortgage or rent payments (29%) or household bills (27%). Another 15% of people used the funds to pay down credit card or personal debt, while around one in eight people (13%) added to their savings. 

The ABS tracks Australia’s household income and subsequent spending capability on a quarterly basis, in order to inform government spending and drill deeper into the various impacts slow wage growth or rising inequality has on the broader Australian economy.

Government spending key to broader household stability

As mentioned, the ABS data showed that government spending helped maintain Australian household incomes at similar levels to those seen before the pandemic. It stated that, despite increased government pensions and allowances, total average household income remained stable in the September 2020 quarter.

This illustrates that household income would have fallen were it not for the increases in government payments. By how much, however, is speculative given that job losses generally affected lower-income households to a greater extent than their higher-income counterparts during the recession.

Meanwhile, families appeared to benefit most from the increases in government spending.

Average government pensions and allowances increased for most family types between September 2019 and September 2020. These increased by 82% for couple families with dependent children, the largest proportional increase by household composition.

The data also showed that JobKeeper was particularly important for middle-class families with mortgages. Of those households including an individual collecting JobKeeper, half owned their dwelling with a mortgage. Nearly half (47%) of all households with a member collecting JobKeeper were couple families with dependent children.

Household wealth more resilient than the ASX

While the ABS data didn’t track share market value, a look at the ASX’s major indexes over the same period shows that, despite household income remaining resilient, Australian listed businesses fared far worse. The S&P/ASX 200 Index (ASX: XJO) fell by nearly 1,000 points over September 2019 to September 2020. Meanwhile, the All Ordinaries Index (ASX: XAO) tumbled by around 800 points.

It wasn’t until January this year that the Australian markets returned to roughly similar levels as those seen in February 2020, before the onset of the pandemic. However, of particular interest, the S&P/ASX All Technology Index (ASX: XTX) largely rose steadily throughout the entire period of the pandemic, aside from an initial fall in March, coinciding with the bottom of the bear market.

After a 600 point decline between February and March 2020, the index then rose until February this year, more than doubling in value.

Foolish takeaway

More reading

• Why the Santos (ASX:STO) share price is in focus
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 dips, Corporate Travel flies, Nuix sinks
• What’s with the Advanced Human Imaging (ASX:AHI) share price today?
• ASX stock of the day: Freelancer (ASX:FLN) shares shoot higher

Motley Fool contributor Lucas Radbourne-Pugh 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.

The post ABS data shows Australians maintained wealth during COVID appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3veBBtJ

The Oz Minerals Limited (ASX: OZL) share price is slipping after the company announced a solid first-quarter update for the 2021 calendar year today.

At the time of writing, the Oz Minerals share price has fallen 1.1%, trading at $24.35. 

However, shares in the copper and gold producer are up almost 26% year-to-date thanks to copper surging to an 11-year high of US$4.2/lb. 

What’s driving the Oz Minerals share price today?

In its update for the three months ending 31 March, the company highlighted strong operational performance and advised it was on track to meet its FY21 production guidance.

The company’s first-quarter production came in at 26,842 tonnes of copper and 55,150 ounces of gold, ticking the boxes to meet annual guidance. 

Despite well-controlled cost performance over the quarter, the strengthening Australian dollar and weaker gold prices are expected to negatively impact comparative all-in sustaining costs and unit costs over the year. As a result, the company has modified its 2021 cost guidance. 

A soaring copper price has helped counter rising costs and support robust operating cash flows. Furthermore, gold prices appear to have hit a short-term bottom in the past few weeks, bouncing from US$1,680/oz in late March to US$1,795/oz this week. 

Advancing pipeline projects to drive growth

Oz Minerals continues to advance its growth pipeline projects, demonstrating the quality of organic growth options available. The company highlighted key drilling programs underway at Prominent Hill, West Musgrave and Santa Lucia. These projects are all progressing to support key milestones and decision points later this year.  

Broker Macquarie had previously highlighted Oz Minerals as its preferred exposure to copper with several key organic catalysts headlined by its Prominent Hill expansion update later this year.

The broker rated its shares as outperform with a $30.00 target price on 16 March. Oz Minerals expects to complete a shaft expansion study in 3Q21 at Prominent Hill to enable 6Mtpa of production from 2025. 

More reading

• ASX miners in focus as the copper price looks poised to crack above 10-year highs
• Why ASX mining shares are likely to jump this morning
• Why the BHP (ASX:BHP) share price is surging today
• The new race between US and China is good news for these ASX shares
• Why ASX copper shares are cheering for Joe Biden

Motley Fool contributor Kerry Sun 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.

The post Oz Minerals (ASX:OZL) share price slips despite solid update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/2Pf71ki

ASX mining shares could soon rediscover the meaning of having too much of a good thing as talk of a super profits tax returns.

Former prime minister Keven Rudd is rattling the cage on introducing the extra levy on our largest iron ore producers, reported Peter Ker of the Australian Financial Review.

Super profit tax on ASX miners back from the grave

Rudd is accusing the major ASX miners of ripping off Australians as the iron ore price looks poised to break new highs.

The ex-PM tried to introduce a similar tax during the last commodity boom in 2010. This contributed in no small part to his downfall.

Extra cash would be handy right now for the country

An extra tax on cashed-up miners could certainly be handy in paying down the record federal government deficit. The Morrison government will release the budget on the second Tuesday in May.  

As highlighted yesterday, the BHP Group Ltd (ASX: BHP) share price and Rio Tinto Limited (ASX: RIO) share price are likely facing profit upgrades in the near-term due to the expectation-defying iron ore price.

This same tailwind also bodes well for the Fortescue Metals Group Limited (ASX: FMG) share price.

Iron ore likely to set new record soon

A growing number of experts are warming to the idea that the iron ore price will soon crack above its previous high of US$193 a tonne set in February 2011.

But if the idea of a super profits tax gains momentum, this could dampen the party for the major miners.

“As was the case during the last resources boom, and the one before that, the super-profits earned by a handful of resource majors in this country are a giant rip-off of the Australian people,” the AFR quoted Rudd as saying.

“Furthermore, the greed of these three is unbelievable: they haven’t even bothered to establish serious, large-scale charitable foundations to benefit the Australian people at the scale that other serious global firms do. And in Rio’s case, they dynamite Indigenous heritage in the way.”

The real commodity supercycle

Also worth noting that it isn’t only the iron ore price that is reaching for the stars. A wide range of metals, including copper and lithium, are booming.

This commodities supercycle looks more enduring than the last too. Production output is up, costs are down and demand for commodities is coming from several countries, not just China.

Foolish takeaway

However, it’s too early to be pricing in a super profits tax on ASX mining shares. The federal Liberal coalition that’s in power is unlikely to back such an idea – especially one that comes from an ex-Labor prime minister.

But ASX miners will be keeping their fingers crossed that such an idea won’t find widespread popular support!

More reading

• Is the BHP (ASX:BHP) share price in the buy zone after its update?
• ASX 200 dips, Corporate Travel flies, Nuix sinks
• Why Rio Tinto (ASX:RIO) and BHP (ASX:BHP) look set for another profit upgrade
• Fortescue share price falls as Twiggy calls fossil fuels ‘most dangerous industry in the world’
• BHP (ASX:BHP) share price drops despite 10-year iron ore highs

Motley Fool contributor BrenLau owns shares of BHP Billiton Limited, Fortescue Metals Group Limited and Rio Tinto Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Super profits tax risk rising for ASX miners as commodity prices chase record highs appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3tI8dvg

The Audinate Group Ltd (ASX: AD8) share price is climbing higher today following the release of its quarterly trading update.

At the time of writing, the media networking solutions provider’s shares are swapping hands for $8.03, up 2.03%.

What did Audinate announce?

The catalyst for the rise in the Audinate shares this morning has come from its quarterly trading update.

According to its release, Audinate reported robust growth for the March quarter, achieving unaudited revenues of US$7 million. The sound performance reflects a 31% increase on the prior corresponding period.

Audinate attributed the result to its newly released Bluetooth and USB-C AVIO adapters as well as an increase in customer orders. Furthermore, the company also strived to manage supply chains disruptions caused by COVID-19.

Pleasingly though, Audinate highlighted that the chips, cards, and modules revenue have continued to grow when compared to H1 FY21. Predominately, this has derived from the entire range of AVIO adaptors and Ultimo chips.

Audinate CEO Aidan Williams provided an update on the company’s outlook, saying:

We are pleased with the ongoing revenue trajectory of the business and the initial contributions from our new AVIO adaptors. However, we are closely watching global supply chains for potential negative impacts on both our customers and Audinate, which may constrain our near-term revenue and growth.

Along with our manufacturing and OEM partners, we are working to mitigate supply chain challenges and expect this near-term uncertainty to resolve itself as CY21 progresses. We remain very confident in the long-term outlook for the business.

Leadership change

In further news, possibly boosting Audinate shares, the company restructured some of the leadership team.

Audinate co-founder, Dr. Varuni Witana will move into the role of chief technology officer, heading up R&D activities of technology architecture. Previously, Dr. Witana worked alongside Audinate CEO Aidan Williams to develop the core Dante technology at the National ICT Australia (NICTA).

In addition, John Rush will take up the position of chief marketing officer, expanding on his current responsibilities in sales. Prior to joining Audinate, Mr. Rush held the role of vice president of marketing and product at Vesta — an electronics payment solutions company.

Mr. Williams commented on the management change:

I am thrilled to have someone of Varuni’s calibre and track record in such an important role for Audinate. I’m confident she will continue to drive our long-term strategy forward through innovation and R&D. Additionally, we are pleased to further expand Josh’s role to incorporate the global sales function. His market and product knowledge combined with a strong analytical approach will bring immediate benefits to our global sales teams.

Audinate share price snapshot

Over the past 12 months, the Audinate share price has accelerated to almost 70%. Year-to-date, however, the company’s shares are flat.

Audinate presides a market capitalisation of around $617 million, with more than 76 million shares outstanding.

More reading

• 2 fantastic ASX shares that brokers rate as buys
• 3 growing small cap ASX tech shares to watch
• 3 exciting small cap ASX shares for your watchlist
• 3 exciting small cap ASX shares to watch

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 AUDINATEGL FPO. The Motley Fool Australia has recommended AUDINATEGL FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Audinate (ASX:AD8) share price climbs on Q3 update appeared first on The Motley Fool Australia.

from The Motley Fool Australia https://ift.tt/3dDmVy1