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It’s again looking like a disappointing day for the S&P/ASX 200 Index (ASX: XJO) this Tuesday.

After going backwards yesterday, the ASX 200 looks to be on track to record another loss for this session. At the time of writing, the index has lost 0.12% of its value, dropping down to 7,138 points.

But let’s not dwell on all that. Instead, it’s time to check out 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 Tuesday

Telstra Group Ltd (ASX: TLS)

First up today is the ASX 200 telco Telstra. So far this Tuesday, a sizeable 26 million Telstra shares have been dialled in to a new owner. We haven’t heard any fresh news out of the company today. So perhaps we can put this high volume down to the volatility we have seen with Telstra shares this Tuesday.

The telco is presently bucking the market with a gain of 0.52% to $3.88 a share. But Telstra has had several stints in both positive and negative territory this session, fluctuating between $3.84 and $3.89 all day. It’s probably this volatility that has caused the high trading volumes we see.

Pilbara Minerals Ltd (ASX: PLS)

From TLS to PLS! ASX 200 lithium share Pilbara Minerals is next up for this session. This Tuesday has seen a hefty 52 million Pilbara shares find a new ASX home. We haven’t heard anything out of Pilbara itself either.

But, as my Fool colleague Bernd went through this afternoon, ASX lithium shares of all shapes and sizes are getting a drubbing today. In Pilbara’s case, the company is down by a nasty 9.83% to $4.77. This follows the company’s 11% gain yesterday. With all of this bouncing around, it’s no wonder so many shares are taking flight.

Core Lithium Ltd (ASX: CXO)

Our final ASX 200 share today is another ASX lithium stock in Core Lithium. This Tuesday’s session has had a whopping 78.2 million Core Lithium shares change hands as it currently stands. We seem to have a similar situation to Pilbara Minerals with this company.

Despite no news out from Core itself, the Core Lithium share price has been walloped by investors today. The company is down a depressing 14.4% to $1.60 a share. With a loss of that magnitude, there was always going to be a high number of shares being traded.

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

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More reading

• Why Allkem, Core Lithium, Flight Centre, and NAB shares are dropping today
• How I’d aim to generate a growing passive income from dividend shares
• Why are ASX 200 lithium shares hitting the dirt on Tuesday?
• Why is the Pilbara Minerals share price tumbling 10% on Tuesday?
• Why is the Core Lithium share price falling 12% on Tuesday?

Motley Fool contributor Sebastian Bowen has positions in Telstra Corporation 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 positions in and has recommended Telstra Corporation 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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S&P/ASX 200 Index (ASX: XJO) shares met with wildly varying fortunes in the months, and indeed years, following the onset of the global pandemic.

ASX travel stocks, as you’d expect, were among those that got absolutely smashed. And this sector has taken more than two years to rebound following the virtual halt of global air travel in April 2020.

On the flip side, ASX 200 healthcare shares tended to strongly outperform after COVID-19 became an unwanted household name as demand for their products and services surged.

That outperformance means that some of these top companies are struggling today as markets work to rebalance the post-pandemic supply and demand dynamics.

Which is not to say there aren’t some potentially juicy opportunities out there.

Why this ASX 200 share is ‘one of the best’ on the market

Speaking to Livewire, David Moberley, portfolio manager at ClearLife Capital named medical device company Fisher & Paykel Healthcare Corp Ltd (ASX: FPH) as the ASX 200 share he doesn’t currently own but that tops his watchlist.

Why doesn’t he own Fisher and Paykel just now?

“Unfortunately… COVID was a huge beneficiary for them. A lot of their machines were put out into the market to support hospitals over that COVID treatment period. And the industry, at the moment, is trying to digest some of that inventory,” Moberley said.

At the moment, ClearLife is awaiting a better entry point as they examine the demand outlook for the company’s devices. Moberley explained that they’re “having a look at that inventory and when it draws down,” adding that the ASX 200 share “looks good on a medium-term view”.

On that medium-term view, Moberley is quite bullish on the outlook for Fisher & Paykel Healthcare:

It’s one of the best businesses in the market. The balance sheet’s rock solid, management is really strong, and it’s a global leader in its space. Its Optiflow oxygen therapy is basically close to a monopoly position, and they’re very underpenetrated. So we’re talking single-digit type penetration and the opportunity is huge for them.

Fisher & Paykel Healthcare share price snapshot

Going back to the first year of the pandemic, the Fisher and Paykel Healthcare share price gained 62% in the first eight months of the year (3 January to 28 August).

However, 2022 has been a different story, with the ASX 200 share down 43% year to date.

It is currently up 1% at $17.87 in late afternoon trade on Tuesday.

The post This ASX 200 share is ‘one of the best businesses in the market’: fundie appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today

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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small decline. At the time of writing, the benchmark index is down 0.2% to 7,134.1 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are pushing higher:

Commonwealth Bank of Australia (ASX: CBA)

The CBA share price is up 1.5% to $106.47. This follows the release of the banking giant’s first quarter update this morning. For the three months, CBA reported a 2% increase in cash earnings over the second half average to $2.5 billion. Goldman Sachs commented: “Cash profit from continuing operations in 1Q23 of c.A$2.5 bn was up 13% vs 1Q22 and run-rating c.5% ahead of what is implied by our 1H23E forecasts.”

DGL Group Ltd (ASX: DGL)

The DGL share price is up 17% to $1.72. Investors have been buying this industrial chemicals company’s shares following the release of its annual general meeting update. DGL confirmed that it expects to report underlying EBITDA of $70 million to $72 million in FY 2023. This will be up from $65.6 million in FY 2022.

Incitec Pivot Ltd (ASX: IPL)

The Incitec Pivot share price has jumped 7% to $4.00. This morning this agricultural chemicals company released its full year results and revealed a 186% increase in net profit after tax excluding individually material items to a record $1,027 million. Incitec Pivot also announced a $400 million share buyback.

Readytech Holdings Ltd (ASX: RDY)

The Readytech share price is up 2.5% to $3.98. This has been driven by an update on its potential takeover by Pacific Equity Partners. According to the release, following recent meetings and the due diligence undertaken to date, Pacific Equity Partners has reconfirmed that it remains willing, on a conditional, non-binding indicative basis, to pursue an acquisition of ReadyTech at an offer price of $4.50 per share.

The post Why CBA, DGL, Incitec Pivot, and Readytech shares are pushing higher appeared first on The Motley Fool Australia.

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More reading

• ASX 200 chemicals giant Incitec Pivot leaps 8% on record year and share buyback news
• Why is the CBA share price charging higher today?
• CBA share price on watch amid $2.5b Q1 cash profit
• 5 things to watch on the ASX 200 on Tuesday
• Looking to buy CBA shares? Here’s what to watch in Tuesday’s update

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 DGL Group Limited and Readytech Holdings Ltd. The Motley Fool Australia has recommended DGL Group Limited and Readytech Holdings Ltd. 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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Are you thinking of buying your first ASX shares? Well, congratulations. Getting started on your investing journey can be daunting, but it’s a phenomenal step to take for your financial future. Considering the effects of compound interest, the earlier one starts investing, the better.

But which shares to choose? That’s going to be a personal decision at the end of the day. But here are three ASX shares that I think would make worthy candidates for a first ASX share.

3 ASX starter shares for a beginner investor

BetaShares NASDAQ 100 ETF (ASX: NDQ)

This investment isn’t really a share, but rather an exchange-traded fund (ETF). ETFs are investments that hold a collection of (usually) shares within them. In this case, we are getting the 100 largest companies on the American NASDAQ stock exchange.

The NASDAQ is famous for housing most of the US tech giants. Its top holdings are well-known names like Apple Inc, Microsoft and Amazon.com Inc.

The NASDAQ indisputably holds some of the best companies on the planet. Who can match the brand power of Apple, or the endemic use of Microsoft’s software? Because this ETF is an index fund, it will always hold the largest companies at any given time, meaning the BetaShares NASDAQ 100 ETF is a perfect ‘bottom drawer’ investment.

Woolworths Group Ltd (ASX: WOW)

We all know Woolworths as the largest supermarket chain in Australia. And that is a great place to start with an investing portfolio.

If you are buying a company’s shares, you are buying a part-ownership of that company. So owning Woolies shares means that you can go to your local supermarket and look at the store you have a share in.

Woolworths may not be a millionaire-making kind of company. But I think it is a company that is almost certainly going to be around in 10 years’ time, and with a larger business than today. I think Woolies is a perfect company for someone wanting slow and steady returns, as well as a nice fully franked dividend for some extra income.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is not a name that too many ordinary Australians might know. But there’s little doubt that almost everyone in the country would know at least one of Wwsfarmers’ retail brands.

This is the company behind Bunnings, Officeworks, Target and Kmart. But Wesfarmers also has many other businesses as well. These include interests in mining, industrial chemicals, fertiliser and gas.

Quite simply, this is one of the largest and most diverse businesses on the ASX share market. Wesfarmers has a long history of delivering returns to its shareholders, and with such strong businesses under its belt, I don’t see why this can’t continue well into the future. Investors will also enjoy a decent dividend from Wesfarmers shares as well.

 

The post Thinking about buying your first ASX shares right now? Here are 3 stocks I’d invest in appeared first on The Motley Fool Australia.

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More reading

• How I’d aim to generate a growing passive income from dividend shares
• Building a passive income for retirement? Check out these 3 ASX 200 dividend shares
• Experts name the blue chip ASX 200 dividend shares to buy now
• Why this broker sees ‘downside risks’ to the current Woolworths share price
• Are ASX share investors getting their mojo back?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Amazon, Apple, and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Apple, BETANASDAQ ETF UNITS, and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has positions in and has recommended BETANASDAQ ETF UNITS and Wesfarmers Limited. The Motley Fool Australia has recommended Amazon and Apple. 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 Flight Centre Travel Group Ltd (ASX: FLT) share price is dropping again on Tuesday.

In afternoon trade, the travel agent giant’s shares are down almost 3% to $15.92.

This means the Flight Centre share price is now down over 6% this week.

Is the Flight Centre share price weakness a buying opportunity?

A number of brokers have been running the rule over the company’s trading update and given their verdict on the Flight Centre share price.

One of those is Goldman Sachs.

According to a note from this morning, the broker has mixed feelings over the company’s update. While its analysts note that the “trading update flagged strong recovery momentum for travel overall,” Flight Centre’s costs disappointed. It commented:

Cost ramp up has been ahead of recovery, especially for corporate. We expect this to be a temporary setback to profit recovery with strong profit recovery coming through in late FY23 and FY24.

Goldman also has concerns over Flight Centre’s revenue margin, which has been facing a number of headwinds. It explained:

As noted post FY22 results, revenue margin recovery remains a key concern for us. While there are undoubtedly temporary factors impacting this such as mix and elevated ticket prices, we remain concerned regarding longer term structural move towards online, which are weaker margin channels.

In light of this, the broker has retained its neutral rating with a trimmed price target of $16.10. This is broadly in line with where the Flight Centre share price is trading today.

It concludes:

Overall, we revise our earnings outlook for FLT to reflect the higher interim costs and better than expected topline recovery. Our 1H23 EBITDA outlook remains at the top-end of guidance at A$89mn (A$70-90mn) as we remain positive on continued momentum in activity recovery, which is the key delta impacting the guidance range.

The post Here’s what Goldman Sachs is saying about the Flight Centre share price appeared first on The Motley Fool Australia.

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More reading

• Here are the 10 most shorted ASX shares
• Why Elders, Flight Centre, Perpetual, and Telstra shares are dropping
• Are ASX share investors getting their mojo back?
• Flight Centre share price tumbles on trading update
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group 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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Receiving passive income from ASX dividend shares is one of the best things about investing. Dividend income is truly passive income, requiring nothing more than an investment of capital. An investor will receive their dividends, rain or shine, sick or healthy, if they own dividend-paying shares.

But knowing this is the easy part. So how does one choose the ASX dividend sources that are to provide this passive income?

Well, that’s the $64 million question.

Want passive dividend income? Start with an ETF

I would start with an exchange-traded fund (ETF). An ASX index ETF like the iShares Core S&P/ASX 200 ETF (ASX: IOZ) holds all 200 shares in the ASX 200 Index. Right off the bat, this includes dozens and dozens of dividend-paying shares.

Holding the top spots are famous payers like the ASX big four banks, BHP Group Ltd (ASX: BHP), Telstra Group Ltd (ASX: TLS) and Woolworths Group Ltd (ASX: WOW). All dividends and franking credits received by an ETF have to get passed on to investors, so the iShares ASX 200 ETF always pays out dividend distributions that reflect the ASX at the time.

These tend to grow over time in line with the Australian economy too. For example, back in 2017, the iShares ASX 200 ETF paid out a total of 97.84 cents per unit in dividend distributions. Over this year, that same ETF has paid out $1.74 per unit in income.

Considering all of this, I think an ASX index fund like this is a great foundation to build a portfolio of passive income-paying investments.

But what about when it comes to individual dividend shares?

Here are two things to consider. The first is a company’s strength. A strong company can usually afford to pay out strong and consistent dividend income. When I buy a share, I like to ask myself a simple question: will this company be bigger and stronger in ten years than it is today? I think the answer for many of the ASX’s top companies is most certainly ‘yes’.

Woolworths, for example, is the most dominant grocer in Australia. We’ll all continue to need to buy food and other household essentials. And I think Woolworths is the place that most Australians will continue to use to this end. Thus, Woolworths is the kind of ASX dividend share I would consider for a portfolio to provide growing passive income.

The past can tell us what to expect in the future

The second is a company’s dividend history. I believe that if a company can demonstrate a solid track record when it comes to dividend payments, it bodes well for the potential of a future investment. Take Washington H. Soul Pattinson and Co Ltd (ASX: SOL).

Soul Patts has one of, if not the, best dividend streak on the ASX 200. It has increased its annual dividend payment every single year since 2000, a feat no other ASX 200 share can match today. That alone gives me a great deal of confidence in including this ASX share as part of a passive dividend income portfolio.

So that’s where I would start if I wished to build a passive income portfolio of ASX shares from scratch. The key is to find investments that you can make a reasonable assumption will be able to fund a growing dividend well into the future.

The post How I’d aim to generate a growing passive income from dividend shares appeared first on The Motley Fool Australia.

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More reading

• Building a passive income for retirement? Check out these 3 ASX 200 dividend shares
• Morgans names 2 of the best ASX 200 dividend shares to buy
• Why did the Telstra share price tumble 3% today?
• 3 reasons I think the Telstra share price can beat the ASX 200 in 2023
• Here are the 3 most traded ASX 200 shares on Monday

Motley Fool contributor Sebastian Bowen has positions in Telstra Corporation Limited and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Telstra Corporation Limited 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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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.

What happened

Shares of many Chinese stocks — among them, Alibaba (NYSE: BABA), Kanzhun (NASDAQ: BZ), and Full Truck Alliance (NYSE: YMM) — were up strongly Monday even as US indices were down. Those three stocks were trading higher by 1.9%, 6.4%, and 10.7%, respectively, as of 1:24 p.m. ET.

The broad gains among US-listed Chinese stocks were likely propelled in part by some positive moves made by the Chinese government.

Authorities announced measures to contain the decline in the country’s massive property sector, and on Monday, Chinese President Xi Jinping and US President Joe Biden met in person for the first time since Biden’s election, a meeting that could perhaps pave the way for less strained relations between their two countries.

Additionally, China appears to be relaxing some of its most intensive zero-COVID policies. Those news items combined to give a boost to the beaten-down valuations of Chinese stocks.

So what

On Sunday, the People’s Bank of China, in conjunction with the China Banking and Insurance Regulatory Commission, sent a directive to the country’s financial institutions that featured 16 steps aimed at supporting the nation’s property sector.

Investment bank Jefferies estimated that the new measures would inject around $184 billion into the sector, which should stave off developer defaults for another year, allowing the healthiest developers to continue operating and preventing the whole sector from freezing up.

Home prices across 100 Chinese cities have fallen for four straight months, threatening the country’s economy.

In addition, China began relaxing some aspects of its zero-COVID policy, though cases are rising in the country as the weather cools.

While the zero-COVID policy is likely to remain in place until spring, investors applauded the easing of quarantine rules and the end of routine mandatory community testing, and the shifts likely show that authorities are reassessing the economic trade-offs the policy demands.

In any case, the new measures seemed to light a fire under some of China’s more economically sensitive stocks.

Full Truck Alliance is a digital freight platform that connects shippers with truckers in the country. Kanzhun is a digital employment marketplace that links job-seekers and employers. Increased economic activity, consumption, and employment growth would be positives for each of these companies.

China’s unemployment rate came in at 5.5% in September, higher than expected, and unemployment in the 16- to 24-year-old demographic clocked in at a whopping 17.9%. That’s high by historical standards, and Kanzhun has felt the impact. Its share price is down 69% year to date — a worse decline than Full Truck’s 43% slide or Alibaba’s 46% tumble.

Alibaba shares also gained ground Monday, though by a smaller percentage than these other companies. That perhaps reflects its size as well as its status as a prime target of regulators.

Chinese e-commerce companies last week held their annual Singles’ Day, which is a retail event similar in scope to America’s Black Friday.

Alibaba and other e-commerce players chose not to publicize the details of their Singles’ Day results for the first time ever, leading some to believe China’s current economic malaise may have led to a poor showing.

Instead, Alibaba only noted that this year’s sales figures were roughly “in line with last year’s GMV performance, despite macro challenges and Covid-related impact”.

Alibaba also noted that Singles’ Day ran completely on its cloud for the second year in a row, and pointed to an 8% decline in computing cost per resource unit compared with last year.

Now what

Alibaba will report its third-quarter earnings later this week, and analysts project that it will reveal that its sales increased by only 4.3%. However, analysts also expect to hear that its margins improved compared to the past few quarters thanks to cost-cutting moves and layoffs that took place earlier this year.

With the potential for an economic rebound in 2023, it’s no wonder Chinese stocks are rising off their beaten-down valuations.

Also, the meeting between Biden and Xi is expanding the communication between their two diplomatic teams. Xi cut off some areas of dialogue between the nations after US Speaker of the House Nancy Pelosi visited Taiwan in August.

However, significant tensions still remain between China and the US, especially over the issue of Taiwan, as well as recently imposed restrictions on semiconductor sales to China.

Investors should remember that investments in Chinese companies come with added risks, as the government there can and does clamp down on private enterprise at will, and the geopolitical risks of US-China tensions will continue to be an overhang on US-listed Chinese stocks.

Chinese stocks may have room to run from their current low valuations given Monday’s incrementally “less bad” news, but for the longer term, the picture is much murkier.

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

The post Why Chinese stocks were surging today appeared first on The Motley Fool Australia.

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More reading

• How I’d aim to generate a growing passive income from dividend shares
• Why did Macquarie just downgrade Lynas shares?
• Guess which ASX tech share is surging 46% on news of earlier-than-expected profitability
• Are the Vanguard Australian Shares ETF (VAS) fees expensive?
• Why are ASX 200 lithium shares hitting the dirt on Tuesday?

Billy Duberstein 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 Jefferies Financial Group Inc. 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.

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

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The Lynas Rare Earths Ltd (ASX: LYC) share price is in the red today.

Lynas shares are down nearly 7% and are currently trading at $8.53. For perspective, the
S&P/ASX 200 Index (ASX: XJO) is falling 0.37% today.

Let’s take a look at what is going on with the Lynas share price.

Broker downgrade

Analysts at Macquarie have downgraded the Lynas share price to a neutral with a $9.10 price target.

Lynas is a rare earths producer exploring the Mt Weld mine in Western Australia. The company also has a processing plant in Malaysia.

Macquarie analysts highlighted that the company’s earnings forecast will depend on the commodity price outlook. In comments cited by The Australian, Macquarie said:

While we believe Lynas enjoys a valuation premium given it is world’s only significant producer of separated rare earth materials outside of China, its earnings outlook depends on commodity prices outlook.

Analysts highlighted there are “signs of NdPr price support” from rising pressures on rare earth concentrate costs, the publication noted. But on the flip side, smartphone sales have declined in the last two quarters.

In its latest quarterly report, Lynas said rare earth prices were “quite volatile during this quarter”. Lynas said:

NdPr oxide pricing started to decrease in July and this continued until mid-September prior to rebounding and stabilising at around 700 RMB/kg at the end of the quarter.

This corresponds to USD88/kg CIF1 China. This pricing trend was triggered by
concerns that the 25% production quota increase in China would lead to oversupply.

However, once these concerns were found to be excessive, prices started to recover.

Lynas was awarded a contract from the United States to establish a commercial heavy rare earths separation facility in June.

The S&P/ASX 200 Materials Index (ASX: XMJ) is 1.62% in the red today.

Lynas share price snapshot

Lynas shares have gained 6% in the past year, while they have descended 16% in the year to date. Lynas shares have climbed nearly 14% in a month.

For perspective, the ASX 200 has fallen 4.69% in the past year.

Lynas has a market capitalisation of about $7.7 billion based on the current share price.

The post Why did Macquarie just downgrade Lynas shares? appeared first on The Motley Fool Australia.

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• Up 20% in a month, here’s the bull and bear case for the Lynas share price
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• Could the Lynas share price have another 15% upside from here?

Motley Fool contributor Monica O’Shea 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 Whispir Ltd (ASX: WSP) share price is having an explosive day on Tuesday.

In afternoon trade, the communications management systems provider’s shares are up a massive 46% to 73 cents.

At one stage today, the Whispir share price was up 72% to 85 cents.

Though, this beaten down tech share is still a world away from its 52-week high of $2.95.

Why is this tech share rocketing?

The catalyst for the rise in the Whispir share price on Tuesday has been the release of a positive update on the company’s quest to be profitable.

According to the release, an internal restructure to place the company on track to be cash accretive from the third quarter of FY 2023 has been approved by the board.

Whispir intends to reduce its workforce by 80 roles or 30%, delivering annualised savings of approximately $14.3 million. The company will also scale back its investment in R&D, via a reduction in headcount in the product and technology teams, until sufficient cash is being generated to ensure sustainable and self-funded reinvestment.

Savings will also be realised across marketing, customer services, and administration functions, with the direct sales teams largely unaffected. Approximately 70% of the roles affected are based in Australia. A total of $1.8 million is anticipated to be incurred as a one-off restructuring cost.

Management highlights that this cost reduction will ensure the company’s current annual recurring revenue (ARR) of $62 million exceeds its annualised cost base.

In light of this, with cash reserves of $17.1 million, Whispir will not need to raise capital to fund its ongoing operations. This had been a major concern for investors, which explains the rallying Whispir share price today.

Profitable growth

Whispir’s CEO and founder, Jeromy Wells, commented:

We have taken this step to enable Whispir to establish itself as a profitable growth business. The Company has been through a period of significant growth which means that there are now areas that can be scaled back to pre-COVID levels for a period as the Company transitions to growing sustainably and profitably without the need for additional capital.

With this restructure we expect the Company will be both EBITDA positive and cash accretive from next quarter onwards. Given our confidence in the Whispir platform and the substantial growth opportunities for our Company, we are no less ambitious for the future. This plan ensures we will now have the financial stability to grow profitably and self-sustainably from this coming Quarter.

The post Guess which ASX tech share is surging 46% on news of earlier-than-expected profitability appeared first on The Motley Fool Australia.

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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 positions in and has recommended Whispir Ltd. The Motley Fool Australia has recommended Whispir Ltd. 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 Vanguard Australian Shares Index ETF (ASX: VAS) is one of the most popular ways for investors to get exposure to ASX shares. But, does it offer investors a good way to invest?

At the end of October 2022, this exchange-traded fund (ETF) was $11.4 billion in size, making it a sizeable player in the ASX share market.

The idea of this ETF is that it aims to track the return of the S&P/ASX 300 Index (ASX: XKO). That’s a group of 300 of the largest businesses on the ASX.

It’s provided by Vanguard. It operates quite differently to its main competitors.

Vanguard is owned by the investors that use its services, rather than big shareholders.

Vanguard says that this “unique mutual structure aligns our interests with those of our investors and drives the culture, philosophy, and policies throughout the Vanguard organisation worldwide.”

A focus on low-cost investing

The ETF provider explains the benefits of lower fees and how it’s able to provide its cheap service:

Investors can’t control the markets, but they can control the costs of investing. Providing low-cost investments isn’t a pricing strategy for us. It’s how we do business.

We can keep costs low because of our unique ownership structure in the United States, which allows us to return profits to investors through lower costs.

Vanguard’s scale also helps to keep costs low. As our assets under management increase globally, we can reduce expense ratios for the investors in our funds.

Vanguard Australian Shares Index ETF management fee

As of October 2022, the ETF charges investors an annual management fee of 0.10% per annum. There are 0% indirect costs.

In terms of investing in ASX shares, it isn’t the cheapest ETF out there.

I’m thinking about the BetaShares Australia 200 ETF (ASX: A200). It has a management fee of just 0.07% per annum. That’s slightly cheaper than Vanguard, though it’s only invested in 200 ASX shares.

Are there any other cheaper ETFs?

The Vanguard Australian Shares Index ETF is certainly one of the lowest on the ASX.

But, there are a couple of ASX ETFs that are noticeably cheaper.

For example, there’s the iShares S&P 500 ETF (ASX: IVV) which has an annual management fee of 0.04%. This investment gives investors access to 500 of the biggest US-listed businesses.

A Vanguard offering has an even lower management fee with one particular fund. The Vanguard US Total Market Shares Index ETF (ASX: VTS) has an annual management fee of just 0.03%.

Foolish takeaway

In terms of fees, Vanguard Australian Shares ETF is one of the cheapest on the ASX. Definitely not expensive. However, there are a few other options that are even cheaper. But, fees are just one part of the investment equation – the net returns are probably the most important element.

The post Are the Vanguard Australian Shares ETF (VAS) fees expensive? appeared first on The Motley Fool Australia.

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• Are ASX share investors getting their mojo back?
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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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended iShares Trust – iShares Core S&P 500 ETF. 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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