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The S&P/ASX All Ordinaries Index (ASX: XAO), aka the ASX All Ords, is on the ascent today. Heading into lunch, the popular Australian share market index is up 0.7% to 8,000 points. However, one company in its ranks is stuck at $2.08.

Electro Optic Systems Holdings Ltd (ASX: EOS) is stationary at the $2.08 price point today after requesting a trading halt.

Considering its track record so far this year, the uneventful trading session is almost out of character for this defence technology company. The Electro Optic Systems share price has darted 102% higher in less than four months — a return that would appease the most demanding investors.

Today, shares in this company have powered down. So what’s the reason for this intermission?

This ASX All Ords share is tapping the market

What we know for sure is that EOS plans to launch a capital raise. According to the trading halt request, it will take shape as an institutional placement and a share purchase plan.

Those are the official details — straight from the horse’s mouth.

Now for what is rumoured.

As reported by The Australian Financial Review (AFR), it is believed that this ASX All Ords stock is on the hunt for $40 million from investors. The AFR’s sources say the proceeds will be used as working capital to ‘fulfil customer orders’.

Over the past few years, EOS has used debt to help fund its operations. Last month two loans were still on its books: a $15 million working capital facility at 19% interest and a term loan facility of $35 million at an interest rate of 26%.

That is some costly capital. So it makes sense for the company to seek funds that don’t come with the baggage of interest.

Why now?

Electro Optic Systems has pulled itself out of a massive hole. Now back to winning contracts and pumping out weapon systems, the ship appears to have escaped the choppiest waters.

Record full-year revenue of $219.3 million was reported last month, lifting 59%. The haemorrhaging losses were also patched, with losses reducing to $34.1 million from $53.6 million.

All these positives have fed into the EOS share price doubling this year. Investors are beginning to take down their guard on this formerly bloodied defence company.

The return of enthusiasm presents a prime opportunity to capture investors’ appetite and put the company in better financial shape.

The post Up 102% in 2024, here’s why this ASX All Ords stock is now frozen appeared first on The Motley Fool Australia.

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More reading

• Why this ASX defence stock soared 16% on Wednesday
• Why APM, DroneShield, EOS, and NextDC shares are charging higher

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems. 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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It’s been a wild and woolly month for the Aussie Broadband Ltd (ASX: ABB) share price. Over the past four weeks, this ASX All Ords telco has traded as high as $4.80 a share and as low as $3.41.

The company began March on a high after the earnings report Aussie Broadband delivered in February got rave reviews from investors. Those same investors were also evidently feeling upbeat about the freshly announced plans for Aussie Broadband to purchase its telco rival Superloop Ltd (ASX: SLC).

However, investors were subsequently given a cold shower this month. On 14 March, it was revealed that Aussie Broadband had its white label agreement to provide telco services to Origin Energy Ltd (ASX: ORG) customers terminated, effective 12 April. Origin will be instead using none other than Superloop for its telco offerings from that date.

When this announcement was released, it saw Superloop shares gain 34%. But Aussie Broadband saw its shares slump 25%.

This complicates Aussie Broadband’s Superloop takeover offer. That’s because investors were initially offered 0.21 Ausse Broadband shares for every Superloop share owned in an all-scrip deal.

Trouble for the Aussie Broadband share price

But even more trouble was brewing for Aussie Broadband. At the time of the offer, Aussie Broadband had amassed a 19.9% stake in Superloop. However, on Monday, Superloop threatened legal action against Aussie Broadband if it didn’t reduce this stake to a maximum of 12%, citing its corporate constitution.

Aussie Broadband will be appealing this order at the Federal Court.

But that’s not where the drama ends for Aussie Broadband. Today, the company has released another announcement, this time responding to “market speculation”.

Here’s some of what that said:

Aussie Broadband… has become aware of market speculation and questions raised directly with us, that, at the time ABB purchased a 19.9% stake in Superloop Limited on 26 February 2024, it was aware that it had lost, or would shortly lose, its White Label Agreement… with Origin Energy…

ABB categorically denies this speculation. As ABB stated in its previous announcement on 14 March 2024 relating to the termination of the Agreement, the notice received from Origin was unexpected.

In fact, ABB was engaged in negotiations with Origin towards the renewal of the Agreement right up to the time the termination notice was received by ABB.

How are investors responding?

Investors initially appeared unsure of how to respond to this news today. The Aussie Broadband share price bounced between $3.66 and $3.79 a share in early trading this morning. At present, the market seems to have settled on a positive outlook, with Aussie Broadband shares currently up 0.27% at $3.71 each.

That puts the All Ords telco down 2.3% over the past month and down 3.24% in 2024 to date. The company is also down more than 19% since 5 March.

The post Aussie Broadband share price whipsaws as company denies rumours appeared first on The Motley Fool Australia.

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More reading

• Why Aussie Broadband, Liontown, Metals Acquisition, and Seek shares are falling
• Aussie Broadband share price falls as legal proceedings commence against Superloop
• 3 ASX All Ords shares that brokers tip will grow 30% to 40% this year
• Why Arafura Rare Earths, Core Lithium, Goodman, and Superloop shares are falling today
• Aussie Broadband share price tumbles after telco told to sell $47 million stake in a competitor

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 Aussie Broadband. The Motley Fool Australia has recommended Aussie Broadband. 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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When a company’s shares drop 80% in space of a year, it’s easy to think that they must be in bargain territory now.

Well, that is exactly what has happened to Core Lithium Ltd (ASX: CXO) shares over the last 12 months.

So, is this lithium miner a bargain buy? Or could its shares still be overvalued at current levels? Let’s find out.

Why are Core Lithium shares down 80% in a year?

Investors have been rushing to the exits since this time last year for a number of reasons.

This includes softer-than-expected production guidance, the suspension of its underground development, the curtailing of production, and crashing lithium prices.

Unfortunately, with lithium prices showing no signs of improving materially in the near term, it seems quite likely that mining operations at the Finniss Operation will not be resuming any time soon.

Goldman Sachs recently commented:

While CXO is restructuring its business in response to the decrease in the spodumene price, we note that with the mining contract terminated and notice given on the processing contract, we expect that a near-term restart of the Finniss operation is increasingly unlikely.

It is for this reason that Goldman Sachs is forecasting revenue of $177.7 million in FY 2024 and then just a paltry $17.8 million in FY 2025.

Is it time to buy?

In light of the bleak revenue forecasts above, it will come as no surprise to learn that Goldman Sachs believes Core Lithium’s shares are still overvalued despite their fall from grace.

The broker currently has a sell rating and 13 cents price target on them, which implies potential downside of 21% for investors.

But Goldman isn’t alone in believing that its shares are still expensive. Earlier this week, Macquarie reaffirmed its neutral rating and cut its price target to 15 cents. Whereas, last week, Citi reiterated its sell rating and cut its price target down to just 11 cents. The latter would mean further downside of 33%.

Overall, investors may want to keep their powder dry and wait for a meaningful improvement in lithium prices before considering an investment. Until then, the risks appear firmly stacked against buyers and big capital losses seem to be a real possibility.

The post Are Core Lithium shares a bargain buy or overvalued? appeared first on The Motley Fool Australia.

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More reading

• Why Core Lithium, Deep Yellow, Iperionx, and Tuas shares are racing higher today
• Why Arafura Rare Earths, Core Lithium, Goodman, and Superloop shares are falling today
• These are the 10 most shorted ASX shares
• Why are ASX lithium shares being annihilated on Friday?
• Could Core Lithium shares really fall another 40%?

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 Goldman Sachs Group and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group. 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) is leaping higher on Thursday, up 0.9% in late morning trade.

The Aussie benchmark index is joining in the overnight US stock market rally.

Spurred by hopes of three coming interest rate cuts from the US Federal Reserve, the S&P 500 Index (SP: .INX) closed up 0.9%, marking yet another new all-time high.

Tech stocks continued their bull run as well, with the Nasdaq Composite Index (NASDAQ: .IXIC) gaining 1.3% overnight.

We’re seeing a similar moment here in Australia, with the S&P/ASX All Technology Index (ASX: XTX) up 1.1%, outpacing the ASX 200.

This comes on the heels of the US Federal Open Market Committee (FOMC) meeting.

Here’s what we know.

ASX 200 investors buoyed by US interest rate cut hopes

As widely expected, there was no interest rate cut from the Fed. The US benchmark rate remained unchanged in the range of 5.25% to 5.50%.

And Fed chair Jerome Powell may have held back an even stronger rally in US stocks and the ASX 200 by stressing that the central bank is still awaiting concrete evidence that inflation in the world’s biggest economy is retracing to its 2% target.

But speaking to the media after the Fed’s interest rate decision was announced, Powell said it was likely the bank would cut rates “at some point this year”.

Addressing the confidence the central bank needs that inflation is on its way back to 2%, Powell said (quoted by Bloomberg), “It is still likely in most people’s view that we will achieve that confidence and there will be rate cuts.”

Commenting on the outlook for Fed interest rate cuts that could offer further tailwinds for the ASX 200, the economics team at Commonwealth Bank of Australia (ASX: CBA) said (courtesy of The Australian Financial Review):

Resilient economic conditions mean we now expect the FOMC to start its rate cut cycle in July rather than in May. We now expect the FOMC to cut the funds rate by only 75 basis points (ie. three 25 basis point cuts) to 4.75% by the end of 2024.

However, we expect an extended rate cut cycle in 2025 until the funds rate reaches 3%. At 3%, the funds rate would be at the top end of the range of estimates of the ‘neutral interest rate’.

With the Reserve Bank of Australia (RBA) also having given the ASX 200 a boost this week amid signs that interest rates have likely topped out, it’s looking like more of a question of ‘when’ rather than ‘if’ the central banks will begin their easing cycle in 2024.

The post ASX 200 off to the races amid 2024 Fed rate cut hopes appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today
• ASX 200 lifts as RBA keeps interest rates steady

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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The Washington H Soul Pattinson & Company Ltd (ASX: SOL), or Soul Patts, share price is edging lower today.

Shares in the S&P/ASX 200 Index (ASX: XJO) diversified investment house closed yesterday trading for $35.04. In morning trade on Thursday, shares are swapping hands for $34.76, down 0.8%

For some context, the ASX 200 is up 0.7% at this same time.

This comes following the release of Soul Patts’ half-year results for the six months ending 31 December (1H FY2024)

Read on for the highlights.

Soul Patts share price edges higher on dividend boost

• Portfolio (pre-tax net asset value) of $11.5 billion, up 10% year on year
• Net cash flow from investments of $263.4 million, up 6.9% from 1H FY2023
• Fully franked interim dividend of 40 cents per share, up from 36 cents per share last year
• Statutory profit of $302.5 million, down 33.2% from 1H FY2023
• Cash balance at 31 January of $394.2 million

What else happened with the ASX 200 investment house over the half year?

The Soul Patts share price is in the red in early trade with the investment house increasing its portfolio by 10% to $11.5 billion. After adding dividends back in this delivered a total return of 8.3%, outperforming the All Ordinaries Accumulation Index by 2.4% (excluding the benefits of any franking credits).

The fully franked interim dividend of 40 cents per share will be paid out on 10 May. This represents the 24th consecutive year the company has increased its dividend payout.

Management attributed the 6.9% year on year increase in net cash flow from investments to ongoing growth of its credit portfolio and income from its strategic portfolio. These contributed an increase of $33.1 million and $12.9 million respectively.

On the negative side of the ledger, these gains were offset by a $14.9 million year on year decline from the company’s large caps portfolio due to its reduced size. The investment house also reported $13.2 million in lower realised trading gains from its emerging companies portfolio.

Also likely throwing up headwinds for the Soul Patts share price is the steep half-year decline in profits.

Statutory profit attributable to shareholders came in at $302.5 million, down 33.2% year on year. And regular profit after tax of $241.3 million was down 49.3%.

The company attributed the decline to a lower share of profit contributions from Brickworks Ltd (ASX: BKW) and New Hope Corp Ltd (ASX: NHC).

Soul Patts noted:

As an investment house, Soul Patts does not consider profit to be an accurate reflection of investment performance. The key drivers of success are growth in the capital value of the portfolio and a growing yield as measured by net cash flow from investments.

What did management say?

Commenting on the half-year results that are seeing the Soul Patts share price nudge up today, CEO Todd Barlow, said:

Our investment team transacted $2.4 billion in value during the six-month period, which is equivalent to two-thirds of the transaction volumes in the prior 12 months. The market environment has provided many opportunities, as reflected in our $1.6 billion of capital allocated across listed equities and private investments.

We are increasingly active in how we manage the portfolio mix and our investment appetite continues with over $500 million in undrawn but committed funds.

Soul Patts share price snapshot

Over the past 12 months, the Soul Patts share price has surged 25%. And that’s not including dividends.

The post Soul Patts share price struggles on falling profits appeared first on The Motley Fool Australia.

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More reading

• Selling your investment property due to land tax hikes? 5 ASX shares I’d buy with the proceeds
• Own Soul Patts shares? Here’s the ASX 200 stock’s result preview
• Are you investing or gambling?
• Is it too late to buy Soul Patts stock?
• 5 ASX shares to buy for an effortless path to financial freedom

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 positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. 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 market may be charging higher today, but the same cannot be said for the Sigma Healthcare Ltd (ASX: SIG) share price.

The shares of the pharmacy chain distributor and operator, which is planning to merge with Chemist Warehouse, are down slightly to 1.5% to $1.20.

This follows the release of the company’s full-year results this morning.

Sigma share price falls on results

• Net revenue down 9.2% to $3.3 billion
• EBITDA up 3.9% to $51.5 million
• Net profit after tax up 149% to $4.5 million
• Partially franked final dividend of 0.5 cents per share.

What happened in FY 2024?

For the 12 months ended 31 December, Sigma posted a 9.2% decline in net revenue to $3.3 billion. This reflects its decision to dispose of its hospital distribution business during the year and elevated sales of Rapid Antigen Tests in FY 2023 that have not repeated.

Nevertheless, the company’s EBIT came in 20.4% higher year on year at $23.2 million, with reported net profit after tax increasing 149% to $4.5 million. This includes initial costs of $8.2 million relating to its proposed merger with Chemist Warehouse.

Excluding merger transaction costs, EBIT was $31.4 million and net profit after tax was $12.7 million for the year.

Management advised that it was able to deliver strong earnings growth despite its revenue decline thanks to efficiencies. Sigma’s CEO and Managing Director, Vikesh Ramsunder, said:

With our operating performance strong, we have been able to drive efficiencies across our business, reducing total operating costs by 10.7% after absorbing merger proposal costs, providing a catalyst for our current and future financial performance. The company-wide simplification program and divestment of non-core assets has delivered a leaner operating model.

Outlook

The company has re-affirmed its medium-term EBIT target of 1.5% to 2.5% on a standalone basis.

This compares to its EBIT margin (before Chemist Warehouse merger costs) of 0.95% for FY 2024.

Chemist Warehouse merger update

Ramsunder spoke briefly about the proposed merger with Chemist Warehouse, once again reiterating the benefits of the move. He said:

This merger proposal is truly transformational for Sigma. It will diversify our earnings and growth profile whilst also creating opportunities for Sigma to enhance the support provided to pharmacy owners, helping them to profitably grow their business and better support their communities.

Sigma submitted its submission to the ACCC in February, and on 8 March the competition regulator commenced a public consultation process. Mr Ramsunder is hopeful that a decision on the merger could be made in the second half of 2024. He adds:

This is a significant and complex transaction which will require a detailed review by the regulator. There will be community interest and a wide consultation process which adds to the complexity of predicting timeframes. We are hopeful of a decision from the ACCC in the second half of the calendar year, which will precede a number of other steps required to reach completion.

The post Chemist Warehouse merger target Sigma reports 149% FY24 profit jump appeared first on The Motley Fool Australia.

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More reading

• Soul Patts share price struggles on falling profits
• Why is the Webjet share price racing to a 52-week high today?
• Brickworks share price tumbles on disappointing half-year loss
• Guess which ASX mining stock is rocketing 39% on $920m US govt funding news
• How many Wesfarmers shares must I buy to get $100 in monthly passive income?

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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The Webjet Ltd (ASX: WEB) share price is on the move on Thursday.

In morning trade, the online travel agent’s shares are up 3.5% to $8.24.

Why is the Webjet share price rising?

Investors have been buying the company’s shares this morning after it held its 2024 WebBeds Strategy Day.

In case you’re not familiar with the business, WebBeds is a global marketplace for the travel trade. It provides hotel distribution solutions that make selling and buying accommodation easier.

WebBeds sources content from travel suppliers, and then connects, aggregates, and merchandises that content in the WebBeds Marketplace, and distributes it to a global network of travel buyers, who sell to the travelling public.

In recent years, it has become the growth engine of Webjet. And with the business still having a huge market opportunity to grow into, it is likely to be key to the company’s future.

Today’s presentation emphasised exactly that. Management noted that WebBeds is on track to achieve total transaction value (TTV) of $4 billion in FY 2024 and then $5 billion in FY 2025. After which, it is targeting TTV of $10 billion in FY 2030 with a 50% EBITDA margin.

To get to the latter, it will mean at least 2x market growth for the business. And while this is clearly a very strong growth rate, management is confident it has what it takes to get there.

The company has laid out its “Pillars of Growth” that it believes will help it achieve its targets. These are “growing our existing portfolio,” “new customers, supply and markets,” and “conversion.”

In other news

In case you missed it earlier this week, Webjet released an update on its guidance for FY 2024.

It reaffirmed its FY 2024 earnings guidance for underlying EBITDA to be above the midpoint of the $180 million to $190 million range.

The post Why is the Webjet share price racing to a 52-week high today? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
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• These ASX 200 growth shares could be strong buys in March

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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The Brickworks Limited (ASX: BKW) share price is falling on Thursday.

In morning trade, the building products company’s shares are down 4% to $28.02.

This follows the release of its half-year results before the market open.

Brickworks share price tumbles on first-half loss

• Total revenue down 6% to $547 million
• Underlying EBITDA loss of $40 million
• Underlying net loss of $37 million
• Fully franked interim dividend up 4% to 24 cents per share

What happened during the half?

For the six months ended 31 January, Brickworks reported a 6% decline in revenue to $547 million. This reflects an 11% decline in Australian Building Products revenue to $323 million and broadly flat Building Products North America revenue of $224 million.

Things were much worse for the company’s earnings due to its Property Trust segment, which posted an EBITDA loss of $178 million for the period. This includes a $233 million non-cash devaluation on its assets following the independent valuation process. Management notes that the loss reflects an increase in capitalisation rates across the portfolio to 5.1% from 4.1% in July 2023.

It is also worth noting that this devaluation follows $615 million in revaluation gains being delivered in the prior five years, as capitalisation rates compressed.

This offset 5% EBITDA growth from the Building Products Australia business to $52 million and a 43% lift in Building Products North America EBITDA to $21 million, which ultimately led to Brickworks recording an underlying EBITDA loss of $40 million and a net loss of $37 million for the half.

Despite this loss, the company’s board elected to increase its interim dividend for the 10th year in a row to 24 cents per share. This will be paid to eligible shareholders on 1 May.

Outlook

The company’s managing director, Lindsay Partridge, acknowledged that Brickworks faces short term challenges, but believes its long-term outlook is very positive. He said:

Although macroeconomic conditions may cause some short-term challenges across the portfolio, each of our businesses have a strong longer-term outlook. Within Property, structural trends towards e-commerce and the digital economy will continue to drive demand for our prime industrial facilities for many years to come. Our Building Products business is well placed to meet the demands of the expected building boom over the next decade in Australia and North America.

Partridge also remains confident on the company’s investment in Washington H Soul Pattinson and Company Ltd (ASX: SOL). He adds:

Meanwhile, WHSP is expected to continue to deliver a stable and growing stream of earnings and dividends over the long term. Following a period of significant investment, our short-term priority is to maximise cash generation. With our diversified portfolio of high-quality assets, Brickworks is well placed to meet any future challenges and continue to deliver good performance for shareholders.

The Brickworks share price is up 25% over the last 12 months.

The post Brickworks share price tumbles on disappointing half-year loss appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Own Brickworks shares? Here’s your half-year results preview
• Is it too late to buy Brickworks stock?
• Why did the Brickworks share price just smash another record?
• Seeking retirement income from ASX bank shares at 52-week highs? What I’d buy instead

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 Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. 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 Australian Strategic Materials Ltd (ASX: ASM) share price is rocketing higher on Thursday.

In morning trade, the ASX mining stock is up 39% to $1.65.

Why is this ASX mining stock rocketing?

Investors have been fighting to get hold of the company’s shares this morning after it made a major announcement.

According to the release, the critical metals focused integrated materials business and emerging mine to manufacturer has received a non-binding and conditional letter of interest (LOI) from the Export-Import Bank of the United States (US EXIM).

The US EXIM is the official export credit agency of the United States federal government.

Australian Strategic Materials advised that the LOI is for the provision of a debt funding package of up to US$600 million (A$923 million) for the construction and execution phase of the Dubbo rare earths and critical minerals project.

The release notes that US EXIM’s support is linked to the potential US content (equipment, goods and services) to be supplied in the construction phase of the Dubbo project and the key strategic role the project can play in the critical minerals supply chain.

The LOI is subject to completion of due diligence by US EXIM and Australian Strategic Materials obtaining all necessary approvals for the Dubbo Project.

The ASX mining stock’s CEO, Ms Rowena Smith, was very pleased with the news. She said:

The Dubbo Project is a globally significant rare earths and critical minerals asset, well positioned to support the joint objective of Australia and the US to develop and expand reliable, responsible and secure global access to critical minerals.

We are delighted to receive this letter of interest from US EXIM following extensive collaboration with multiple government and industry stakeholders in the US and look forward to building on the relationships we have established in this jurisdiction.

The post Guess which ASX mining stock is rocketing 39% on $920m US govt funding news appeared first on The Motley Fool Australia.

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More reading

• How many Wesfarmers shares must I buy to get $100 in monthly passive income?
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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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Owning Wesfarmers Ltd (ASX: WES) can be very rewarding in terms of the passive income we get. In this article, we’re going to look at how many Wesfarmers shares we need to get $100 of monthly dividends.

The business has delivered lots of capital growth recently, and over the long-term. In the past six months, it has risen 24%, in the last year it has gone up 35% and in the past five years it has climbed 90%.  

Wesfarmers dividend forecast

The company wants to grow its dividend each year for shareholders if it can and if it has made enough profit to do so.

Looking at the estimates on Commsec, Wesfarmers is predicted to grow its dividend per share to $1.95, which would be a year-over-year increase of 2%.

The projection on Commsec suggests it could grow its annual dividend per share to $2.35 by FY26, which would be a 20% rise between FY24 and FY26.

How many Wesfarmers shares are needed for $100 of passive income per month?

Wesfarmers usually pays a dividend every six months, not monthly. Therefore, it’s better to think about the goal as $1,200 per year.

How many Wesfarmers shares do we need to own for $1,200 per year? If Wesfarmers does pay a dividend per share of $1.95, we’d need to own 616 Wesfarmers shares (for a cost of $40,755). If we include the franking credits as part of the annual income, we’d need 431 Wesfarmers shares (for a cost of $28,515).

Can the payout keep growing?

In the FY24 first-half result, Wesfarmers’ board decided to increase its interim ordinary dividend per share by 3.4% to 91 cents.

It had a decent start to the financial year despite the difficult trading conditions amid the high cost of living for Australians. HY24 revenue increased 0.5% to $22.67 million, and net profit after tax (NPAT) rose 35% to $1.4 billion.

Kmart Group and Bunnings continue to deliver growth, with Kmart performing particularly well as customers look for good value. In the first five weeks of the second half of FY24, Kmart Group has “continued to deliver strong sales growth”.

It seems there is a good chance of dividend growth this year and beyond, particularly when interest rates start coming down, which could help households’ finances.

Wesfarmers shares are certainly one of the stocks I’d like to have in my portfolio for passive income.

The post How many Wesfarmers shares must I buy to get $100 in monthly passive income? appeared first on The Motley Fool Australia.

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More reading

• If I’d put $5,000 in Wesfarmers shares at the start of 2024, here’s what I’d have now
• If you’d put $1m into shares vs property at the start of COVID, how much would you have now?
• Selling your investment property due to land tax hikes? 5 ASX shares I’d buy with the proceeds
• How much passive income will I get from shares vs. property?
• The Wesfarmers share price has jumped 30% in a year, is it too late to buy?

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has positions in and has recommended Wesfarmers. 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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