Tag: Motley Fool

It may have been Black Friday in the stores but it’s been a green day on the market with the benchmark S&P/ASX 200 Index (ASX: XJO) lifting to a new 25-week high.

The ASX 200 reached an intraday peak of 7,268.5 points today — up 0.37%. The last time we saw it above that level was on 31 May. It closed a little lower at 7,259.5 points, up 0.24%.

It seems appropriate that on one of the biggest shopping days of the year, the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) was the top-performing sector among the ASX’s 11 sectors, up 1.15%.

Why did ASX 200 retail shares take the lead?

A range of ASX 200 retail shares did some heavy lifting for the benchmark index today. The top movers include Harvey Norman Holdings Limited (ASX: HVN) shares, up 3.2% to $4.31.

Super Retail Group Ltd (ASX: SUL), the owner of Supercheap Auto and Rebel, finished 2.06% higher at $10.91.

Shares in shoe retailer Accent Group Ltd (ASX: AX1) were up 1.81% to $1.685. JB Hi-Fi Limited (ASX: JBH) shares were up 1.8% to $44.79.

With inflation and interest rates rising all year, there’s been plenty of fear-mongering about householders needing to tighten their belts.

And sure, that threat is a worry for the economy. After all, the Australian Bureau of Statistics says household consumption is worth about 50% of Australia’s gross domestic product (GDP).

But we’re not seeing any reduction in retail spending yet. The latest ABS figures on retail trade show sales volumes have been growing for four consecutive quarters.

In fact, spending in the September quarter reached a new record level.

But that trade growth is slowing down amid rising prices due to inflation. Retail sales volumes went up by just 0.2% in September, down from 1% in both the June and March quarters.

But consider the impact of Black Friday. The Australian Retailers Association predicts consumers will spend $6.2 billion between Black Friday and Cyber Monday.

Sheesh…

No recession in sight

Harvey Norman executive chair Gerry Harvey says Australia is nowhere near a recession, according to the Australian Financial Review (AFR).

The retail king pointed out that unemployment was still very low, and it was difficult to find staff.

Harvey Norman is a quintessential ASX 200 retail share. The company held its annual general meeting (AGM) yesterday and presented a trading update for FY23.

It revealed a 6.9% global sales revenue bump year over year during the first four months of FY23.

Harvey said:

We’ll have a really strong Christmas, but next year is a great unknown.

I don’t think there’s any doubt as retailers we will be affected, it’s just as a matter of some sectors more than others.

We have 65 per cent of our stores in regional areas, and because agriculture and mining is so strong they shouldn’t be affected as much.

Retail shares ‘way too cheap’

Motley Fool Australia’s chief investment officer Scott Phillips says many high-quality retail shares are “way too cheap right now“.

A number of them are trading on single-digit price-to-earnings (P/E) ratios.

Phillips said ASX investors were too focused on current short-term risks like rising inflation.

He said: “With a long-term lens, I think we’ll look back and see retail on single digit P/Es and say, ‘Man, really?’”.

He used using JB Hi-Fi as an example. It has a P/E today of 9.2, according to the ASX website.

Harvey Norman has a P/E of 6.5, and Super Retail has a P/E of 10.2.

Perhaps this is another reason why ASX 200 retail shares lead the market today.

Perhaps value investors are looking into ASX 200 retail shares since the Reserve Bank of Australia has reduced its monthly rate rise increments.

The RBA increased rates by 0.25% this month and in October, following four consecutive months of 0.5% rises.

The market was also surprised by a lower-than-expected increase in inflation in the United States this month.

The post Why did ASX 200 retail shares lead the market to fresh 25-week highs today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why is the Allkem share price diving 8% today?
• Brokers name 3 ASX shares to buy today
• Here are the 3 most heavily traded ASX 200 shares on Friday
• ASX 200 company banned from selling its products. Here’s why
• 8%+ dividend yields! 3 ASX 200 shares I’d snap up to beat inflation

Motley Fool contributor Bronwyn Allen has positions in Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia has recommended Accent Group and JB Hi-Fi Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/Ck31OAs

The Allkem Ltd (ASX: AKE) share price has fallen precariously into the red today.

Shares in the lithium explorer are currently sliding 8.61% lower to trade at $13.17 apiece, after touching an intraday high of $14.48 near the open.

Putting weight on Allkem’s share price is the fact that materials is today’s worst-performing sector. The S&P/ASX 200 Materials Index (ASX: XMJ) is down 1.09% at the time of writing.

Adding to this is that a good number of Allkem’s ASX lithium share peers are also showing red this afternoon. Here’s a snapshot of how they’re doing as the market close draws near:

• Mineral Resources Limited (ASX: MIN) down 6.63%
• Core Lithium Ltd (ASX: CXO) down 5.65%
• Pilbara Minerals Ltd (ASX: PLS) down 7.1%

The broader market is also having a not-so-stellar session as the S&P/ASX 200 Index (ASX: XJO) is laying almost flat with a 0.19% gain for the day.

So why are lithium shares like Allkem performing poorly on Friday? Let’s investigate.

What’s going on with the Allkem share price?

Adding to the selling pressure on lithium shares like Allkem today is news that the lithium price may have hit a price ceiling, according to data from Trading Economics.

Prices for the commodity are creeping away from the recent high of CNY 600,000 per tonne on 11 November. It has since fallen 1.58% to CNY 590,500, effectively ending that lithium price rally.

The lithium commodity price has been on an enormous bull run year-to-date, gaining 113% during this period.

Supporting the price rise were subsidies for electric vehicles issued by the Chinese government, which were set to expire at the end of 2022. However, China Briefing reported in September that the government had exempted buyers of electric vehicles from paying vehicle purchase tax starting 1 January next year, lasting until 31 December.

Lithium commodity price could fall lower

These subsidies haven’t stopped analysts at Goldman Sachs from giving the lithium commodity price a bearish outlook starting in 2023, however.

My Fool colleagues in the US noted last week that the bank believes the sale of electric vehicles is set to slow down next year, which could lead to an oversupply of lithium and thus put downward pressure on the commodity’s price.

It was also noted that a cathode manufacturer in China was rumoured to have cut its production targets in anticipation of a slowdown in demand for its output.

So it appears the lithium commodity price is being hit from a couple of different angles, thus putting pressure on the share prices of lithium producers such as Allkem.

Allkem share price snapshot

The Allkem share price is up 26.8% year to date. That’s beating the ASX 200 by a substantial margin, as the index is down 2.53% over the same period.

The company’s market capitalisation is around $9.18 billion.

The post Why is the Allkem share price diving 8% today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why City Chic, Deep Yellow, Objective Corp, and Pilbara Minerals shares are falling
• What could be sending the Pilbara Minerals share price 7% lower today?
• Here’s why ASX 200 lithium shares are ending the week with a fizzle
• ASX 200 company banned from selling its products. Here’s why

Motley Fool contributor Matthew Farley 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.

from The Motley Fool Australia https://ift.tt/7pXBPMJ

With a new month on the horizon, now could be a good time to consider making some additions to your portfolio.

One investment option that continues to grow in popularity is exchange traded funds (ETFs).

But given the many ETF options out there, it can be difficult to decide which ones to buy ahead of others. To narrow things down, I have picked out three fantastic ETFs that are very popular right now. They are as follows:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The first ETF for investors to look at is the BetaShares Global Cybersecurity ETF.

This ETF gives investors access to the leading companies in the global cybersecurity sector. As we have seen this year, cyberattacks are becoming more and more prevalent. As a result, it is no surprise to learn that demand for cybersecurity services is expected to rise strongly in the future.

This bodes well for companies included in the fund such as Accenture, Cisco, Cloudflare, Crowdstrike, Okta, Palo Alto Networks, and Splunk.

BetaShares NASDAQ 100 ETF (ASX: NDQ)

Another ETF option for investors to consider is the BetaShares NASDAQ 100 ETF.

This ETF gives investors exposure to the 100 largest non-financial shares on the famous NASDAQ index. These are many of the largest companies in the world and household names such as Amazon, Alphabet, Apple, Meta Platforms, Microsoft, and Tesla.

Given the positive long term outlooks of these companies, the Nasdaq 100 (and therefore this ETF) has been tipped to outperform the broader market over the long term.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

A final ETF for investors to consider is the VanEck Vectors Morningstar Wide Moat ETF.

This popular ETF gives investors access to a diversified portfolio of companies with sustainable competitive advantages and fair valuations. The portfolio changes constituents periodically but usually includes approximately 50 US based stocks.

At present, its holdings include Amazon, Berkshire Hathaway, Etsy, Intel, Microsoft, and Walt Disney.

The post 3 fantastic ETFs for ASX investors to buy in December appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here’s how I’d invest $20,000 in ASX shares today to double my money
• 3 ASX shares to buy for the end-of-year tech comeback: expert
• 3 top ETFs for ASX investors to buy and hold for a decade
• 2 ASX growth shares I reckon are buys right now
• Why the Betashares Nasdaq 100 ETF (NDQ) is on my buy radar right now

Motley Fool contributor James Mickleboro has positions in BETANASDAQ ETF UNITS. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BETA CYBER ETF UNITS and BETANASDAQ ETF UNITS. The Motley Fool Australia has positions in and has recommended BETA CYBER ETF UNITS and BETANASDAQ ETF UNITS. The Motley Fool Australia has recommended VanEck Vectors Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/yDmS7d5

It has been another busy week for Australia’s top brokers. This has led to the release of a large number of broker notes.

Three broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

Harvey Norman Holdings Limited (ASX: HVN)

According to a note out of Citi, its analysts have retained their buy rating and $4.70 price target on this retail giant’s shares. This follows the release of a trading update which revealed stronger than expected like for like sales growth for the first four months of FY 2022. Overall, the broker believes the company’s shares are cheap and feels there is sufficient downside buffer built into expectations. The Harvey Norman share price is trading at $4.31 this afternoon.

New Hope Corporation Limited (ASX: NHC)

A note out of Macquarie reveals that its analysts have retained their outperform rating but trimmed their price target on this coal miner’s shares to $6.40. This follows the release of a softer than expected quarterly update earlier this week. While disappointed with the update, the broker continues to see value in the company’s shares thanks to strong thermal coal prices. It expects these strong prices to underpin a full year dividend of $1.79 per share. The New Hope share price is fetching $5.34 today.

Rio Tinto Limited (ASX: RIO)

Analysts at Goldman Sachs have retained their buy rating and lifted their price target on this mining giant’s shares to $114.70. The broker has been looking at the company’s Rhodes Ridge development and likes what it sees. Goldman believes it could be significant for the miner’s Pilbara business as it could lift system capacity, utilise spare infrastructure, and help close the FCF/t gap with BHP Group Ltd (ASX: BHP). The Rio Tinto share price is trading at $105.61 on Friday afternoon.

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

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Does an investment in Fortescue shares provide the ‘healthiest’ ASX exposure to iron ore?
• What’s happening with ASX 200 coal shares this week?
• 3 reasons this fundie is still bullish on ASX mining shares
• 8%+ dividend yields! 3 ASX 200 shares I’d snap up to beat inflation
• The Rio Tinto share price is trading at a ‘compelling’ level: broker

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

from The Motley Fool Australia https://ift.tt/nZfCrFo

It’s been a rough year so far for the Vanguard Australian Shares Index ETF (ASX: VAS). The exchange-traded fund (ETF) has fallen nearly 7% year to date.

But looking longer-term, say, over the last 10 years, has it proven a worthwhile investment? Let’s take a look.

Right now, units in the Vanguard Australian Shares ETF are swapping hands for $90.40.

Has Vanguard Australian Shares ETF been a good 10-year buy?

Those invested in the Vangaurd Australian Shares ETF will likely have been slightly disappointed this year as the fund underperforms the index it’s intended to track.

The ETF is designed to reflect the return of the S&P/ASX 300 Index (ASX: XKO). Indeed, they appear very similar in most measures.

The ETF holds 307 stocks right now, compared to the index’s aptly-named, 300. They both offer a 4.5% dividend yield and focus most of their holdings in Australia.

However, the ETF has fallen 6.9% this year while the index is down 4.8%. Looking longer-term, the same applies. The ETF’s share price has gained around 61% over the last 10 years while the index has lifted 67%.

However, the true benefits of investing come into play when we factor in dividends.

According to Vanguard, the Australian Shares ETF boasts a cumulative 10-year return of around 130% – that’s certainly nothing to scoff at.

Indeed, a $10,000 investment in the fund on 31 October 2012 would have been worth $22,861.27 at the end of last month. That’s not a bad return for a single decade.

The ETF boasts $28 billion of assets under management. 9% of that is tied to BHP Group Ltd (ASX: BHP) shares. Another 8.5% is invested in Commonwealth Bank of Australia while CSL Limited (ASX: CSL) makes up 6.4%. It commands a 0.1% annual management fee.

The post Has the Vanguard Australian Shares ETF (VAS) been a worthwhile investment over the past decade? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?
• Are the Vanguard Australian Shares ETF (VAS) fees expensive?
• Are ASX share investors getting their mojo back?
• 3 excellent ETFs for ASX investors to buy next week
• Are Vanguard Australian Shares ETF (VAS) dividends fully franked?

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 positions in and has recommended CSL 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 Scott Phillips.

from The Motley Fool Australia https://ift.tt/ynsp7vx

It looks as though the S&P/ASX 200 Index (ASX: XJO) is set to end the week on a high note. At the time of writing, the ASX 200 has risen by a decent 0.21% to just under 7,260 points. If the index finishes up in the green today, it will be the fourth positive day in a row.

But let’s now dive deeper into these gains by taking a look at the shares currently topping the ASX 200’s share trading volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume this Friday

Liontown Resources Ltd (ASX: LTR)

Our first share worth checking out this Friday is ASX 200 lithium stock Liontown Resources. So far today, a hefty 11 million Liontown shares have found a new ASX home. We haven’t had any fresh news out of Liontown today.

However, ASX 200 lithium shares seem to be on the nose this session. This follows what could be weakening growth in the lithium-hungry Chinese economy, as my Fool colleague dove into earlier today.

In Liontown’s case, we have seen a nasty 4.95% drop, putting the company at $1.98 a share. It’s this share price fall that is probably behind Liontown’s presence on our list.

Core Lithium Ltd (ASX: CXO)

Another ASX 200 lithium share is next in Core Lithium. This Friday has had a sizeable 23.08 million Core Lithium shares bought and sold at this point. It looks as though we have a similar situation going on here to that of Liontown.

Core Lithium shares are also facing investors’ cold feet this Friday. In this case, we have an even more disappointing 5.2% share price drop to report, which puts Core Lithium at $1.4 a share at the time of writing. Again, it’s this drop that has probably caused the volumes we are seeing.

Pilbara Minerals Ltd (ASX: PLS)

Our third, final and most traded ASX 200 share of the day thus far is yet another ASX 200 lithium stock. Pilbara Minerals has watched a whopping 34.8 million of its shares swap hands as it currently stands.

At risk of receiving the ‘broken record’ label, again we see a massive share price drop that seems to be the culprit behind the high share volumes on display here.

Unfortunately for Pilbara shareholders, this lithium producer is leading the losses today, down a nasty 6.9% to $4.45 a share at present.

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

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why City Chic, Deep Yellow, Objective Corp, and Pilbara Minerals shares are falling
• What could be sending the Pilbara Minerals share price 7% lower today?
• Here’s why ASX 200 lithium shares are ending the week with a fizzle
• ASX 200 company banned from selling its products. Here’s why
• If I’d bought $5,000 of Core Lithium shares at the start of this financial year, guess how much I’d have now?

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.

from The Motley Fool Australia https://ift.tt/xerVUmd

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a positive note. At the time of writing, the benchmark index is up 0.2% to 7,256 points.

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

City Chic Collective Ltd (ASX: CCX)

The City Chic share price is down a whopping 28% to $1.00. Investors have been hitting the sell button in a panic today after an abject trading update from the plus sized fashion retailer. City Chic reported a decline in sales despite benefiting from a weaker Australian dollar. It also revealed significant margin pressures and expectations that it would end the first half with an inventory position of $168 million to $174 million. City Chic’s market capitalisation is currently $230 million.

Deep Yellow Limited (ASX: DYL)

The Deep Yellow share price is down 3.5% to 68.5 cents. This follows the release of an update on the Tumas project in Namibia. The uranium developer has completed its DFS, with the preliminary results indicating that the project remains “commercially attractive despite capital and cost inflation.” While positive, investors may have been hoping for more bullish rhetoric.

Objective Corporation Limited (ASX: OCL)

The Objective Corp share price is down 14% to $12.93. This follows the release of a trading update from the technology solutions company after the market close on Thursday. Objective Corp revealed that its shift to a SaaS business is impacting revenue growth and higher costs are squeezing its margins.

Pilbara Minerals Ltd (ASX: PLS)

The Pilbara Minerals share price is down 7% to $4.45. Investors have been selling Pilbara Minerals and other battery materials shares today amid concerns over the outlook for lithium prices. This follows bearish notes from Credit Suisse and Goldman Sachs, as well as soaring COVID cases in the key China market.

The post Why City Chic, Deep Yellow, Objective Corp, and Pilbara Minerals shares are falling appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the 3 most heavily traded ASX 200 shares on Friday
• What could be sending the Pilbara Minerals share price 7% lower today?
• Here’s why ASX 200 lithium shares are ending the week with a fizzle
• Why is this ASX All Ords tech share crashing 15%?
• What is driving the City Chic share price 21% lower on Friday?

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 Objective Corporation 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 Scott Phillips.

from The Motley Fool Australia https://ift.tt/MY0nDHf

S&P/ASX 200 Index (ASX: XJO) iron ore favourite Fortescue Metals Group Limited (ASX: FMG) is the smallest of the three major shares involved in mining the steelmaking ingredient.

It offers a market capitalisation of $58 billion. While impressive, such a valuation places it firmly in last place when it comes to the market’s three favourite iron ore miners.

Peers BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) are worth a respective $224 billion and $159 billion.

But could an investment in Fortescue shares provide a ‘healthier’ exposure to iron ore? Let’s delve into its balance sheet to find out.

How does Fortescue stack up against other iron ore shares?

One measure to assess the ‘health’ of a company is to look at its debt-to-equity ratios. Doing so can evaluate how much it relies on debt to fund its operations.

But can shares in ASX 200 iron ore favourite Fortescue outperform its major competitors on this front?

As of the end of financial year 2022, Fortescue held US$6.1 billion of total debt and US$5.2 billion of cash. That leaves the company US$879 million in the red and boasting US$17.3 billion of equity.

Thus, the iron ore giant offers 35.19% debt to equity, or a debt-to-equity (D/E) ratio of 0.35.

A D/E ratio is found by dividing a company’s total debt by its total equity. Both figures can be found on its balance sheet.

BHP, meanwhile, had gross debt of US$16.4 billion and US$17.2 billion of cash at the end of financial year 2022. It also boasted US$44.9 billion of total equity. That left the largest iron ore goliath with 36.48% debt to equity, or a D/E ratio of 0.36.

However, Rio Tinto might be the most ‘healthy’ ASX 200 iron ore stock based on these metrics.

It boasted U$50.5 billion of equity as of 30 June 2022. It also held US$11.6 billion of borrowings and US$13.7 billion in cash. That left the stock with a 23% debt to equity or a D/E ratio of around 0.23.

It’s also worth pointing out that Fortescue is the only ASX 200 iron ore major with less cash than debt. Though, its net debt position is relatively light compared to many other ASX 200 stocks.

Right now, the Fortescue share price is trading at $19.01, 0.86% lower than its previous close.

For comparison, the ASX 200 is up 0.20% right now while shares in BHP and Rio Tinto have fallen 0.84% and 0.61%, respectively.  

The post Does an investment in Fortescue shares provide the ‘healthiest’ ASX exposure to iron ore? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 3 reasons this fundie is still bullish on ASX mining shares
• The Rio Tinto share price is trading at a ‘compelling’ level: broker
• BHP share price has ‘no upside’: Goldman Sachs
• ‘Rare opportunity’: Expert explains why he just added this ASX 200 share
• 5 things to watch on the ASX 200 on Friday

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

from The Motley Fool Australia https://ift.tt/1orYUVC

The S&P/ASX 200 Index (ASX: XJO) is on course to end the week with a gain. In afternoon trade, the benchmark index is up 0.25% to 7,259.2 points.

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

Nanosonics Ltd (ASX: NAN)

The Nanosonics share price is up almost 9% to $4.53. This appears to have been driven by a broker note out of Ord Minnett. According to the note, the broker has upgraded the infection prevention company’s shares to a hold rating with an improved price target of $4.00. Its analysts believe the company is well-placed to beat its sales guidance in FY 2023 following a strong start to the financial year.

Nick Scali Limited (ASX: NCK)

The Nick Scali share price is up 7.5% to $11.00. In response to yesterday’s trading update at the furniture retailer’s annual general meeting, analysts at Citi have retained their buy rating and lifted their price target to $15.83. Citi notes that Nick Scali is performing notably better in FY 2023 than it was expecting.

NRW Holdings Limited (ASX: NWH)

The NRW share price is up 2% to $2.61. This morning the contract services provider announced that it has been awarded a contract for drill and blast services at the Greenbushes Mine in Western Australia. Management estimates that the seven-year (plus two-year option) contract is valued at $300 million over the initial period. It is scheduled to commence in July 2023.

Tyro Payments Ltd (ASX: TYR)

The Tyro share price is up over 6% to $1.58. This may have been driven by a broker note out of Morgans this morning. According to the note, the broker has retained its add rating and lifted its price target on the payments company’s shares to $2.05. Morgans notes that Tyro lifted its guidance to the top end of its target range at its annual general meeting.

The post Why Nanosonics, Nick Scali, NRW, and Tyro shares are charging higher appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why Kogan, Nick Scali, PointsBet, and Sayona Mining shares are pushing higher
• Why is this ASX 300 retail share soaring 13% today?
• Could these be the best ASX dividend shares to buy now for 2023?
• Top brokers name 3 ASX shares to buy today
• Why Fortescue, Healius, Nanosonics, and PEXA shares are dropping

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

from The Motley Fool Australia https://ift.tt/lBkaOyI

The Pilbara Minerals Ltd (ASX: PLS) share price is having a disappointing finish to the week.

In afternoon trade, the lithium miner’s shares are down 6% to $4.48.

At one stage, the Pilbara Minerals share price was down as much as 7.5% to $4.42.

What’s going on with the Pilbara Minerals share price?

Investors have been hitting the sell button in the lithium industry on Friday, leading to a number of high flying lithium shares recording sizeable declines.

Here’s a summary of some of the movers and shakers:

• The Allkem Ltd (ASX: AKE) share price is down 7%
• The Core Lithium Ltd (ASX: CXO) share price is down 5%
• The Lake Resources N.L. (ASX: LKE) share price is down 4.5%
• The Liontown Resources Ltd (ASX: LTR) share price is down 5%
• The Mineral Resources Limited (ASX: MIN) share price is down 4%

This appears to have been driven by concerns about lithium prices amid recent bearish calls from both Credit Suisse and Goldman Sachs. With high prices baked into lithium share valuations, any risk that they fall short of expectations is always likely to cause alarm.

Though, it is worth remembering that forecasting commodity prices is notoriously difficult.

What else?

In addition, with COVID cases soaring in China, there are fears that lockdowns could return and economic growth could suffer.

Given that China is a huge consumer of lithium, this could lessen demand and put downward pressure on the sky high prices the white metal is commanding.

Though, it may not be too long until investors will be able to see if that is the case. Last month, Pilbara Minerals held two online lithium auctions via its BMX platform. One was in the middle of the month and the other came late in the month.

If the company holds two auctions this month, we could hear as early as next week whether it is still receiving high prices for the battery making ingredient. Stay tuned for that!

The post What could be sending the Pilbara Minerals share price 7% lower today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here’s why ASX 200 lithium shares are ending the week with a fizzle
• 3 ASX 200 shares analysts are tipping for stellar growth
• What $10,000 in ASX lithium shares a year ago would be worth today
• Is Macquarie still recommending Pilbara Minerals shares as a buy?
• Here are the 3 most heavily traded ASX 200 shares on Wednesday

Motley Fool contributor James Mickleboro has positions in Allkem Limited. 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.

from The Motley Fool Australia https://ift.tt/5lU6eug