Tag: Motley Fool

It’s a small-cap ASX mining share that’s got the attention of a mega-cap mining CEO.

Andrew ‘Twiggy’ Forrest AO is the founder and executive chairman of the iron ore giant Fortescue Metals Group Limited (ASX: FMG).

In a disclosure to the ASX today, nickel miner Mincor Resources NL (ASX: MCR) revealed that Forrest invested $36.7 million in new shares between 31 May 2021 to 3 November 2022.

Forrest was already a ‘substantial holder’, meaning he already owned more than 5% of the company’s shares on issue. In fact, he owned 15%.

Over the 17-month period, he bought 27.44 million shares on-market, according to the disclosure. This and some other trading activity took his net overall stake in the company to 18.68%.

Forrest holds Mincor Resources shares personally, as well as through his private company, Tattarang, and also through Wyloo Metals, a subsidiary of Tattarang. Wyloo develops low-carbon mining projects.

Why is Forrest buying up this ASX mining share?

It’s no secret that Forrest is one of the leaders in Australian business pushing for a lower carbon future.

He’s investing substantially in every aspect of the global energy transition via his Fortescue Future Industries (FFI) business.

Forrest famously spent much of the first year of COVID-19 on a private jet with a special team travelling the world to pursue new mining and investment opportunities.

FFI is now developing a host of renewable energy and green hydrogen projects.

Nickel’s role in the energy transition largely has to do with powering electric vehicle (EV) batteries. It gives the batteries longer life. Nickel is also used in renewable energy storage systems.

What is Mincor Resources?

Mincor Resources is a nickel sulphide developer and explorer with three mines in Western Australia’s Kambalda and Widgiemooltha areas. It has a market capitalisation of $685 million.

Mincor has not produced nickel for six years but the company is now producing it again. It has an offtake agreement with the Nickel West concentrator owned by BHP Group Ltd (ASX: BHP).

The company is now calling itself “the Premier pure-play Australian nickel producer”, according to a presentation given to shareholders today.

Mincor Resources AGM today

The company held its annual general meeting today (AGM) and provided an investor presentation.

In his address, interim executive chair Brett Lambert said although Kambalda is a mature nickel mining district, discoveries at two new and previously unmined deposits indicated “clear potential remains to identify new nickel sulphide deposits of significance”.

He said:

To grow and sustain our business, we are continuing to explore our extensive Kambalda tenure. This is a core activity for the Company. Over the past 12 months we have expanded our capabilities …

We are applying these enhanced capabilities not only to the acquisition and evaluation of new data in the field, but also to the re-evaluation of historic data.

This is leading to the expansion of Mincor’s already broad portfolio of exploration targets, both greenfields and near mine.

Lambert said Mincor’s most outstanding exploration success in FY22 was “undoubtedly” the LN04a mineralised surface found in just the second drill hole of a 1.2 km untested area.

The initial ore reserve for LN04a was announced last week. At 12,500 tonnes of contained nickel, the reserve is 58% higher than previous estimates and extends the life of the mine by about one year.

Lambert said:

It is very pleasing to have achieved this so early and it reminds me of the very last words of my 2020 Chairman’s address, which were – “I see the five year plan mapped out in the DFS as just the beginning”. I say now that I am very confident there is much more to come.

The history of this ASX mining share

The Mincor Resources share price is up 0.14% to $1.41 as the close of trade draws near.

It’s down 20% year to date and up 7.7% over the past 12 months.

Over the past five years, this ASX mining share has delivered shareholders a 225% capital gain.

The post Guess which ASX mining share Andrew Forrest has been buying up this week (Hint: not Fortescue) appeared first on The Motley Fool Australia.

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More reading

• Appen share price sinks to another multi-year low despite new recruits
• Brokers name 3 ASX shares to buy today
• 3 obscure ASX All Ords shares going gangbusters today
• Who pays the tax if these companies don’t?
• Qantas boss says ‘we’re back’, but should you buy the ASX airline share?

Motley Fool contributor Bronwyn Allen has positions in BHP Billiton Limited and Fortescue Metals Group 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.

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The Appen Ltd (ASX: APX) share price has continued its disappointing slide on Friday.

In afternoon trade, the artificial intelligence data services company’s shares are down almost 3% to $2.49.

At one stage today, the Appen share price hit a multi-year low of $2.46, a far cry from its 2020 high of $43.66.

Not even the announcement of some new recruits has been able to keep Appen’s shares in positive territory today.

What did Appen announce?

This morning Appen announced the appointment of Mini Peiris as an independent non-executive director.

Ms Peiris is currently the chief marketing officer of Doma, which is a technology company innovating the real estate market.

Appen chair, Richard Freudenstein, said:

We are delighted to welcome Mini to the Appen Board, as we continue our process of Board renewal. Mini is an experienced executive having worked extensively in Silicon Valley. She has led digital transformation and strategic change at several well-known high-tech companies. She has a successful track record in business-to-business marketing and in scaling and changing business models for both small high-growth companies and large enterprises.

In addition, Appen announced that Sean Carithers has joined the company as senior vice president, global. The company notes that Carithers is a seasoned executive with deep expertise in markets relevant to Appen and has successfully transformed and grown large businesses.

Why is the Appen share price at a multi-year low?

Investors have been selling down the Appen share price again this year due to its abject performance.

And, unfortunately, with many of its key customers struggling right now, such as Meta (Facebook), there are concerns that demand for its services could lessen further.

In addition, investors appear concerned by increasing competition in the industry from the likes of Amazon and Sagemaker.

For example, last week, Morgan Stanley put an underweight rating and $2.25 price target on Appen’s shares. This was due partly to the intense competition and more sophisticated platforms being offered from rivals.

Elsewhere, last month, JP Morgan reiterated its underweight rating and warned that Appen could require a capital raising if its performance doesn’t improve in the near future.

The post Appen share price sinks to another multi-year low despite new recruits appeared first on The Motley Fool Australia.

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More reading

• Leading fund manager names the 3 ASX stocks that drove its returns higher in October
• Why are ASX 200 tech shares getting bashed around today?
• Why is the Appen share price smashing the ASX 300 today?
• Why Appen, GQG, Paradigm, and Talga shares are tumbling lower
• Why Appen, De Grey Mining, Magellan, and Zip shares are dropping today

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

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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:

A2 Milk Company Ltd (ASX: A2M)

According to a note out of Bell Potter, its analysts have retained their buy rating on this infant formula company’s shares with an improved price target of $6.80. This follows news that the US FDA has approved the company’s entry into the country’s infant formula market. Bell Potter views the initial entry into the US infant formula category as incrementally positive and sees a major opportunity in the market if sales velocities approach levels seen in other markets. The A2 Milk share price is trading at $5.42 today.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

A note out of Morgans reveals that its analysts have retained their add rating and $88.00 price target on this pizza chain operator’s shares. Morgans was pleased with Domino’s first quarter update and was encouraged to see same store sales growth turn positive in October. Its analysts believe this could mark an inflection point for sales growth, which it feels is likely to accelerate as the year goes on. The Domino’s share price is fetching $54.57 on Friday.

Woolworths Group Ltd (ASX: WOW)

Analysts at Citi have retained their buy rating on this retail giant’s shares with a trimmed price target of $39.50. While Citi was disappointed with the performance of Woolworths’ supermarkets during the first quarter, it remains positive on the company. Particularly given its belief that margins will improve over the course of FY 2023 thanks to a return to predictable spending patterns. The Woolworths share price is trading at $32.45 today.

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

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More reading

• Why A2 Milk, Bravura, Magellan, and Pendal shares are dropping
• 5 big ASX announcements making news this week
• Goldman says Woolworths share price pullback provides ‘a value entry point to a quality player’
• 4 ASX 200 shares trading ex-dividend next week
• Hoping to bank the latest ANZ dividend? Read this

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 A2 Milk and Dominos Pizza Enterprises 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 All Ordinaries Index (ASX: XAO) is 0.29% in the green today, but these three ASX All Ords shares are charging higher.

3P Learning Ltd (ASX: 3PL), OM Holdings Limited (ASX: OMH), and GQG Partners Inc (ASX: GQG) shares are all surging today.

Let’s take a look at what is impacting these ASX All Ords shares.

OM Holdings

OM Holdings shares were leaping by 19% earlier in the day. They have since pulled back but are still 12.06% higher than Thursday’s close, at 76.2 cents. For comparison, the S&P/ASX 200 Materials Index (ASX: XMJ) is 1.79% in the green today.

OM Holdings produces ferrosilicon (FeSi) and manganese. In a presentation late last week, the company advised it is on track to meet its 2022 production guidance of 340 to 360 kilotonnes per annum.

In the September quarter, the company’s FeSi production lifted by 6%. However, manganese allow production fell by 11.1%.

3P Learning

3P Learning shares are currently soaring by 13.15% to $1.42, having earlier been up almost 19%.

The ASX All Ords share is a global online education company providing e-learning programs in mathematics, spelling, reading, phonics, and literacy.

Overnight, news emerged the global online tutoring market could reach US $19.47 billion by 2030 at a compound annual growth rate of 13.5%. Online learning demand has soared since COVID-19 school closures.

3P Learning will hold an AGM on 16 November in Sydney.

GQG Partners

Global asset management firm GQG Partners shares are currently leaping 6.57% today to $1.46. For perspective, the ASX 200 Financials Index (ASX: XFJ) is 0.49% in the red today.

The GQG Partners Global Equity Fund holds shares in Exxon Mobil Corp, UnitedHealth Group, AstraZeneca, and HDFC Bank, among other shares.

In an article yesterday, my Foolish colleague Tristan recommended investors buy the GQG partners share price. He highlighted this ASX dividend share aims to distribute 90% of its earnings to investors.

The ASX All Ords share declared total dividends of US$0.0182 per share on 18 October.

The post 3 obscure ASX All Ords shares going gangbusters today appeared first on The Motley Fool Australia.

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More reading

• I think right now is the time to buy these 2 ASX dividend shares
• Why GQG, Megaport, Melbana Energy, and St Barbara shares are dropping today
• Morgans names 2 ASX dividend shares to buy right now
• Want to collect BIG dividends every month? Buy these 3 ASX shares
• Leading brokers name 3 ASX shares to buy today

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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Welcome to my Friday article.

On Fridays I do things a little differently. Punchier, format-wise. And sometimes, well, it’s just punchy.

Speaking of which…

Who pays the tax if they don’t?

Did you see the list, earlier this week of the largest public companies, and the tax they pay.

Or, in almost one-third of cases, the tax they don’t pay?

And this isn’t a list of companies the ATO has caught doing the wrong thing!

I’m 99.9% sure they’re paying every single cent of tax they’re obliged to pay.

The problem, then?

The tax laws, themselves.

A company can, for example, use inter-company loans to lower the profit in, say, Australia, while increasing profits in, say, the Cayman Islands, where there’s a lower rate of company tax.

Or they can get the accountants to make sure that they make no- or little profit in Australia, instead making those profits in, say, Singapore, where their ‘marketing hubs’ make all of the money.

And more. And more.

Now, there are legitimate reasons for paying no tax in a given year. Very legitimate. I have no beef with loss-making businesses or those with carry-forward losses.

But if you have the money, the accountants and the interest, it’s remarkable how little tax you can pay, especially if you’re a multinational.

And if they can (again, legally) pay less tax with a little smoke-and-mirrors, who pays?

Yep.

You and me.

It’s been in the government too-hard pile for years, under both sides of politics, where a lack of will, interest or effort has allowed it to go on, and on and on.

Over to you, Treasurer. You have a Budget in structural deficit. This is an obvious solution.

(And, dear reader, if you’re not as mad as hell, can I suggest you either haven’t seen the story, or you don’t understand the scope of this thing. You should be ropeable!)

I’d rather have our problems than theirs

Tuesday was ‘Rates Day’ here in Australia.

The US upstaged us on Wednesday night with a 0.75% increase in their official interest rate.

Then, the Poms gave us both an almighty ‘Hold my beer’, as they not only went up 0.75%, but then forecast the UK economy could contract for the next two years.

Make no mistake, things are bleak over there. Thank goodness they had the sense to give former-PM Liz Truss’ plans the short shrift, but they still have a lot of work to do.

I’m not saying we should be happy about what’s going on here at home, but it could be much, much worse.

Never stop asking our legislators and regulators to be better… but don’t forget how lucky we are, at the same time.

Who’s that storming down the outside as they reach the winning post?

Our regulators have, shall we say, a variable record of holding Australian companies to account.

But the picture has been brightening in recent months and years.

The Hayne Royal Commission exposed a welter of wrongdoing in our finance sector (though the government squibbed the response!).

The various casino inquiries have gone through those companies like a dose of salts… and then some.

But atop the podium, as far as I’m concerned, is the anti-money-laundering regulator AUSTRAC.

They have been astonishingly good – and thorough – in rooting out wrongdoing.

You really, really, don’t want a call from them.

Which is what happened to Sportsbet and Bet365 recently.

To quote an ABC article, AUSTRAC “…told the ABC it has “reasonable grounds to suspect that Sportsbet and Bet365 may have contravened or are contravening the anti-money laundering and counter-terrorism financing law and rules”.

That’s… not ideal.

But also, it’s wonderful.

Our economy and society works best where there are clear rules, well-enforced (and when companies and people can reasonably expect that if they do the wrong thing, they’ll be caught.)

We make no allegations of wrongdoing about either company. If there’s no case to answer, they should be publicly exonerated.

But it’s great to see a regulator really getting stuck into its work. It should be a model for other regulators – whose employees also work bloody hard, to be fair – to follow.

In defence of Facebook

Whoa… what?

Who defends Facebook these days?

It’s funny, you know. Once upon a time we hated Microsoft. Then Google (I own shares). Now it’s fashionable to hate Facebook.

But don’t worry – I’m not going to defend social networks or their algorithms that one the Motley Fool investing team called ‘a cancer to society’ this week (and isn’t wrong!).

But I am going to defend it – and CEO Mark Zuckerberg – against the short-termism of the market.

He’s made a big, big call to go neck deep into the so-called Metaverse.

Now, for the record, I think the hype is overdone. We will end up using immersive technology to communicate, but I’m not sure a capital-T ‘The Metaverse’ is necessarily where we’ll end up.

But then again, Zuck is the visionary, not me. He might well be right.

He’s certainly spending a large fortune to make it happen.

And, right now, the market hates it. Hates. Despises it.

Facebook’s market value has plunged by $1 trillion in the last year or so.

That’s gotta hurt.

But is Zuck wrong?

I don’t know. And you don’t know. And the market doesn’t know.

What you’re seeing is market impatience at work.

Some CEOs would read the tea leaves and say ‘the market hates this, I’ll stop’.

But a good CEO – a shareholder-friendly CEO, focussed on building long term value – should ignore the market and push on.

Or, as Amazon (I own shares) founder Jeff Bezos once said:

“When I have a good quarterly conference call with Wall Street, people will stop me and say, ‘Congratulations on your quarter,’ and I say, ‘Thank you,’ but what I’m really thinking is that quarter was baked three years ago.”

I don’t know if Zuckerberg is right. But I do know that this year’s results – or the current market sentiment – don’t help answer that question.

He should be responsible and thoughtful in capital allocation. Perhaps he has been, perhaps not.

But we won’t know if he’s right or wrong for years. The recent slump in Facebook’s share price has nothing to tell us – or him – in that regard.

Here’s my best advice on this topic: If you want a company with steady, predictable results, buy shares in one.

If you buy shares in a business trying to change the world (or even its tiny little corner of the world) don’t expect consistency, and be prepared to wait.

Mixing up the two is a recipe for disappointment. And maybe worse.

Quick takes

Overblown: I can’t tell you how many times we’ve been told there’s a ‘new normal’. In fact, betting against the ‘new normal’ has been the best bet. Yes, things change. We adapt. Some businesses arrive, some grow, some die. But the fundamental underpinnings of business haven’t changed in decades. New categories, a new lick of paint, but the ‘old normal’ persists.

Underappreciated: Did you know that October was the best month for the Dow Jones Industrial Average in 46 years? Fourty Six! It was barely reported. Or that the ASX gained 6% in October? No-one rang a bell on October 1. Most were worried that inflation would get worse (it did) and that interest rates would go up (they did). The correlation between market returns and the economy is tenuous, at best.

Fascinating: The Melbourne Cup had many fewer free-to-air viewers this year (1.02m) than the year before (1.21m). And that’s the continuation of a long term trend (more than 2m people watched in 2015). Maybe they’re streaming. Maybe watching in pubs. Or maybe losing interest. I don’t know which, but it’s worth thinking about whether it’s a trend, and what the implications might be.

Where I’ve been looking: I guess I’m an ‘environmentalist’ (whatever that means) and I want strong action on Climate Change. But the coal mining companies are incredibly cheap – with one big ‘if’. They’re cheap if they use the cash flows to create long-term value for shareholders. If I was in charge, I’d be distributing huge dividends and/or investing in less structurally risky businesses. Some are. Others are doubling down. It’s a risky area in which to invest, but the rewards for careful stock selection – assuming responsible company management – could be significant.

Quote: “The stock market is filled with individuals who know the price of everything, but the value of nothing.” — Phillip Fisher

Fool on!

The post Who pays the tax if these companies don’t? appeared first on The Motley Fool Australia.

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More reading

• Qantas boss says ‘we’re back’, but should you buy the ASX airline share?
• Here are the 3 most traded ASX 200 shares on Friday
• Why Allkem, Block, Bowen Coking Coal, and CSR shares are racing higher
• Forget Dogecoin, this crypto could be the even bigger winner from Elon Musk’s Twitter takeover
• Why has the WA1 Resources share price exploded 1,200% in two weeks?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Scott Phillips has positions in Alphabet (C shares), Amazon, and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Meta Platforms, Inc., and Microsoft. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, and Meta Platforms, Inc. 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 WA1 Resources Ltd (ASX: WA1) share price has been on fire over the past two weeks.

On Friday 21 October, shares in the ASX copper explorer closed at 14 cents. With WA1 Resources up another 25% today to $1.87, the share price is up an eye-popping 1,236% in just two weeks.

In other words, a $100 investment in the company two weeks ago would be worth $1,336 today.

Quite a performance for a junior explorer that only recently listed on the ASX, commencing trading on 8 February.

Here’s what’s been driving investor interest.

WA1 Resources share price surges amid promising early drilling

The WA1 Resources share price got a huge lift on 26 October after the miner released the first drill results from its West Arunta Project in Western Australia.

The miner reported it had intersected mineralised carbonate with significant yields of niobium. Niobium is listed as a critical and strategic mineral for its vital role in global technology by Australia, the United States, the European Union, Japan and India.

The intersections came amongst the seven holes drilled as part of the explorer’s maiden drill program.

Commenting on those results, WA1 Resources managing director Paul Savich said:

For our first hole at P2 to have intersected high-grade niobium mineralisation that remains open and with the highest grade at the end-of-hole (2m at 1.22% Nb2O5) along with elevated rare earth elements and phosphorus, is an exciting result.

Savich noted that ferroniobium metal (65% Nb) sells for US$45,000 per tonne.

The WA1 Resources share price closed up… wait for it… 418.5% higher on the day.

What happened next?

With shares continuing to surge over the following days, albeit at a slower pace, WA1 requested that its share be placed into a trading halt on Tuesday, 1 November, pending a market announcement.

That announcement, released after the closing bell on Wednesday in response to an ASX volume query, stated that WA1 was complying with the listing rules, and said its share price and volume moves could be due to “substantial recent media coverage” of the niobium discovery it reported at West Arunta.

The WA1 Resources share price went on a rollercoaster after the miner resumed trading after that release, initially rocketing 47% before closing the day down 25%.

As mentioned up top, WA1 shares are again leaping higher today, up 25% at the time of writing.

The post Why has the WA1 Resources share price exploded 1,200% in two weeks? appeared first on The Motley Fool Australia.

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More reading

• Up 47% and down 25% in one day, what’s with this ASX mining share?
• Why was this ASX mining share placed on ice after exploding 60% today? 
• 3 ASX mining shares going gangbusters on Thursday

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) has recovered from a poor start and is pushing higher. At the time of writing, the benchmark index is up 0.35% to 6,881.4 points.

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

A2 Milk Company Ltd (ASX: A2M)

The A2 Milk share price is down 1.5% to $5.40. This follows a lukewarm reaction to its US FDA approval from analysts at Credit Suisse. The broker has responded by retaining its neutral rating with a slightly higher price target of $5.30. The broker warned that the quality of A2 Milk’s earnings in the US will be lower due to higher costs and lower pricing.

Bravura Solutions Ltd (ASX: BVS)

The Bravura share price is down a further 3.5% to 60.7 cents. This financial technology company’s shares have been smashed this week after it announced the results of a strategic review. Following the review, management admitted that the Bravura will need to be “reconfigured.” This will involve “enhancing the existing technology stack to unlock the existing microservices strategy, drive higher resale multiples on technology development and reduce single customer efforts.”

Magellan Financial Group Ltd (ASX: MFG)

The Magellan share price has fallen 3% to $9.50. This has been driven by the release of another disappointing funds under management (FUM) update from the struggling fund manager. Magellan revealed further net outflows of $2.4 billion for the month. This comprised net retail outflows of $0.4 billion and net institutional outflows of $2 billion.

Pendal Group Ltd (ASX: PDL)

The Pendal share price is down 1.5% to $4.45. This follows the release of the fund manager’s full year results this morning. Pendal reported a 17% increase in underlying profit after tax to $194.2 million but a 32% decline in statutory profit after tax to $112.8 million. The latter reflects significant seed investment gains in 2021 that reversed in the current year as global equity markets declined.

The post Why A2 Milk, Bravura, Magellan, and Pendal shares are dropping appeared first on The Motley Fool Australia.

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More reading

• This ASX 200 dividend share has a 19% yield right now. Why it’s a trap: experts
• Magellan share price hits multi-year low following $2.4b horror month for outflows
• Here are the top 10 ASX 200 shares today
• Why Bravura, Domino’s, Lendlease, and Woolworths shares are sinking
• Why A2 Milk, New Hope, Perpetual, and Talga shares are charging higher

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 Bravura Solutions Ltd. The Motley Fool Australia has positions in and has recommended Bravura Solutions Ltd. The Motley Fool Australia has recommended A2 Milk. 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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Atlassian Corp (NASDAQ: TEAM) may be the most famous Australian company that isn’t listed in Australia. Sure, the names of its founders and co-CEOs, Mike Cannon-Brookes and Scott Farquhar, may be household names in the ASX investor community at least.

That’s been helped in recent times by Cannon-Brookes’ ongoing moving and shaking at AGL Energy Limited (ASX: AGL). But Atlassian is, for all intents and purposes, an American company. It’s listed solely on the US NASDAQ exchange after all, with no ASX presence.

But even so, Atlassian could be having an outsized impact on ASX tech shares today.

This tech company has just had a shocker over on the US markets. Atlassian shares last closed at US$174.17 each. But that was during normal trading hours. Its after-hours performance was far bleaker. In after-hours trading, Atlassian shares were down a horrible 22.6% to just UD$134.73. That would be a loss of close to US$10 billion in market capitalisation. Ouch.

The catalyst for this precipitous drop appears to be a quarterly earnings update the company put out after the close of last night’s US trading session.

Atlassian shares smashed on less-than-rosy outlook

Atlassian reported US$807.4 million in revenues for the three months to 30 September, up 31%. Gross profits also rose from US517.77 million to US$668 million. However, operating income fell from US$165.43 million to US$147.9 million.

But perhaps investors were more spooked about what Atlassian had to say about its outlook:

Last quarter, we shared that we saw a decrease in the rate of free instances converting to paid plans. That trend became more pronounced in Q1. This quarter, we started seeing a slowing in the rate of paid user growth from existing customers.

The above two trends are the result of companies tightening their belts and slowing their pace of hiring. In other words, Atlassian is not immune to broader macro impacts. Our outlook assumes these trends will persist…

Whatever the reasons, it is clear that investors were pretty put off by what Atlassian had to say.

So this could be why we are seeing some big gyrations in ASX tech shares today. As an Australian-run US tech company, Atlassian could be described as something of a north star for our own ASX tech shares.

Thus, it’s perhaps no surprise that we saw companies like Xero Limited (ASX: XRO) and WiseTech Global Ltd (ASX: WTC) get a pounding this morning. WiseTech was down by 2.2% at one stage, while Xero had lost 1.35%.

Both of these companies have since recovered. But even now, Hub24 Ltd (ASX: HUB) and Pro Medicus Ltd (ASX: PME) are down by 3.8% and 2.9%, respectively.

Perhaps Atlassian is to blame.

The post US$10 billion was just wiped from the value of Atlassian. How are ASX 200 tech shares responding? appeared first on The Motley Fool Australia.

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More reading

• Leading fund manager names the 3 ASX stocks that drove its returns higher in October
• What’s the outlook for the Xero share price in November
• How are ASX 200 tech shares faring after the overnight NASDAQ plunge?
• Two 5-bagger health tech ASX shares ready to rocket again: expert
• These were the best-performing ASX 200 shares in October

Motley Fool contributor Sebastian Bowen has positions in Atlassian. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Atlassian, Hub24 Ltd, Pro Medicus Ltd., WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Hub24 Ltd, Pro Medicus Ltd., WiseTech Global, and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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ASX lithium shares are just all the rage on the share market right now. And why wouldn’t they be? The world is going crazy for electric vehicles (EVs) and lithium is the stuff that makes EV battery engines work.

In a recent investor presentation, Argo Investments Limited (ASX: ARG) demonstrated that global EV sales are expected to climb dramatically from about six million in 2022 to 30 million in 2030.

Consequently, global demand for lithium — while already big now — has a long runway ahead.

The lithium carbonate price has already hit yet another record high this month at US$78,384.93 per tonne.

The consensus among analysts is the long-term price will fall back to US$36,000 per tonne.

Some experts say that’s “far too low” but regardless, it would still be historically high. Two years ago, lithium was going for US$5,435 per tonne.

As a resource-rich nation that is already the world’s biggest lithium exporter, Australia is extremely well-positioned to capitalise on this trend.

Over the next year alone, the federal government forecasts the value of our lithium exports to rise to $13.8 billion in 2022-23, up from $4.9 billion in 2021-22.

Which ASX lithium shares should you buy?

The fun part of this lithium investing craze is that there are many ASX shares for investors to choose from.

On our own stock market, we’ve got pure-play lithium explorers, lithium mining and refining companies, and major miners that have recently diversified into lithium.

Here we pit two of the most popular options against each other. Core Lithium Ltd (ASX: CXO) shares vs. Allkem Ltd (ASX: AKE) shares.

Let’s review some of the key metrics and differences to try and determine which might be the better buy.

Should you buy Core Lithium shares?

Core Lithium shares are the best-performing ASX lithium shares in 2022, up 119% year to date.

In fact, Core Lithium is the fourth fastest-growing share out of the 500 shares that comprise the S&P/ASX All Ordinaries Index (ASX: XAO).

At the time of writing, the Core Lithium share price is $1.38, up 2.2% for the day so far.

The company has a market capitalisation of $2.55 billion.

Core Lithium is a lithium explorer. It is reportedly only months away from first production at its Finniss Lithium Project in the Northern Territory. The mine was officially opened last month.

Core Lithium recently increased its mineral resources and ore reserve estimate for Finniss.

About 80% of planned production from Finniss over its first four years of operations is currently covered by offtake agreements. That’s a great headstart on sales in anyone’s language.

The company’s latest report to the ASX covered the three months to 30 September. Bear in mind that Core Lithium is not yet producing any lithium, so it’s not making any money.

As my Fool colleague Brooke reported:

• Used $3.75 million of cash in operating activities
• Used $35.8 million in investing activities, including exploration and the purchase of equipment
• Ended the quarter with $95.5 million in cash and equivalents

Core Lithium announced a fully underwritten $100 million institutional placement on 30 September. The funds will be used to expand ramp up progress at Finniss.

Should you buy Allkem shares?

Allkem shares are up 32% in the year to date.

The Allkem share price is currently $14.75, up 4.65% for the day so far.

The company has a market capitalisation of $9.21 billion.

One of the biggest differences between Allkem and Core Lithium is that Allkem is producing lithium now.

As my Fool colleague Bernd recently covered, Allkem’s projects are primarily located in Argentina. It supplies lithium carbonate to a variety of industrial and technical sectors.

The miner is among the lowest-cost lithium producers in the world. It aims to triple its production by 2026. Management is aiming for a 10% share of global lithium production over the long term.

Another key difference between Core Lithium and Allkem is that Allkem is making money.

Here are the company’s FY22 results in summary:

• Revenue up 800% yoy to US$770 million
• EBITDAIX of US$513.1 million
• Consolidated net profit after tax (NPAT) of US$337 million, up from a loss of US$89.5 million in FY21

In its September quarter results, Allkem reported group revenue of US$298 million and a cash margin of approximately US$244 million. It reported group net cash of US$447 million, up US$28.9 million on the June quarter. The company revealed some cost pressures, as my Fool colleague James reported.

What do the experts think?

As amateur investors, it’s always a good idea for us to read the experts’ opinions on the ASX shares we’re looking to invest in. The experts can sometimes disagree, but what’s important is learning the information that led to them forming their views. They’re professionals and they’re likely to know more about each company than we do, and they’re likely to have considered factors we might not have thought about.

The Fool routinely reports on ratings changes and buy, sell, or hold recommendations from the top brokerage firms. As my Fool colleague James wrote yesterday, Macquarie is very positive on the outlook for Allkem. It has a 12-month share price target of $21 on Allkem, implying a 42% upside from here.

Last month, another Fool colleague Zach wrote that Refinitive Eikon data shows three out of three brokers covering Core Lithium rate it a buy. The consensus price target among them is $1.60. That implies a potential upside of 16% from here.

Who wins?

It’s impossible to give you all the information you need to make this important decision in one article.

Today, we’ve given you a snapshot of some key metrics and differences between the two companies.

From here, we suggest you read the Core Lithium annual report and the Allkem annual report.

You may find our article ‘How to choose which shares to buy‘ useful.

We also have a report ‘Investing in ASX lithium shares‘ where you can read about other companies in the lithium space.

The post Which is the better ASX buy, Allkem or Core Lithium shares? appeared first on The Motley Fool Australia.

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More reading

• Why are ASX lithium shares smashing the market today?
• 2 excellent ASX growth shares that analysts say are buys
• Here are the 3 most traded ASX 200 shares on Thursday
• Why is the Core Lithium share price tanking 3% today?
• Could ‘no deal’ with Tesla actually be good news for Core Lithium shares?

Motley Fool contributor Bronwyn Allen has positions in Allkem Limited and Macquarie Group 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 recommended Macquarie 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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The Pointsbet Holdings Ltd (ASX: PBH) share price is once again in the red, falling another 2.4% on Friday. That brings its fall for the last two days to a whopping 8.6% despite no news having been released by the company in that time.

However, AUSTRAC has put the corporate bookmaking sector on notice as it launched an investigation into industry giants.

That same day, the Pointsbet share price plunged 6.4%. Today, it’s back in the red.

The Pointsbet share price is currently down 2.4%, trading at $2.01.

For comparison, the All Ordinaries Index (ASX: XAO) is lifting 0.3% right now.

Let’s take a closer look at the warning the watchdog has issued the industry.

Could this be weighing on the ASX bookmaker share?

The Pointsbet share price has tumbled over the last two sessions alongside some of its ASX-listed peers.

The share price of gambling and entertainment services provider Tabcorp Holdings Limited (ASX: TAH) slipped 1% yesterday, and is down 2.4% right now. And while that of Bluebet Holdings Ltd (ASX: BBT) went nowhere yesterday, it’s falling 6.8% today.

The gaming stocks’ falls come amid news AUSTRAC is intent on cracking down on suspected breaches of anti-money laundering and counter-terrorism financing among their peers.

AUSTRAC CEO Nicole Rose commented on the regulator’s latest probe, saying:

Sportsbet and Bet365 are amongst the largest operators in the corporate bookmaking sector. AUSTRAC is putting the whole industry on notice to lift their game.

AUSTRAC has appointed an external auditor to assess Sportbet’s and Bet365’s compliance with anti-money laundering and counter-terrorism financing legislation.

The watchdog will decide the extent of the probe and the bookmakers will pick up the bill. The outcome will form the regulator on whether action is required.

It comes just months after the watchdog commenced an enforcement investigation into Ladbrokes operator Entain Group following “an extensive supervisory campaign that assessed entities within the corporate bookmakers sector”.

Pointsbet, nor any other ASX-listed entity, were named in either of AUSTRAC’s releases. Though, it’s yesterday’s news that likely put focus on some of the stocks.

Pointsbet share price snapshot

This week’s falls are just the latest faced by the Pointsbet share price this year.

The stock has tumbled 70% since the start of 2022. It has also dumped 75% since this time last year.

Comparatively, the All Ordinaries Index has fallen 11% year to date and 9% over the last 12 months.

The post Why has the Pointsbet share price dumped 9% in 2 days? appeared first on The Motley Fool Australia.

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More reading

• Why is the PointsBet share price dropping today?
• Why is the PointsBet share price on a losing streak today?
• Why did the Pointsbet share price surge 12% on Wednesday?
• Why Baby Bunting, Calidus, Pointsbet, and South32 shares are falling
• Why Lake, Pilbara Minerals, PointsBet, and PolyNovo shares are charging higher

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 Pointsbet Holdings Ltd. The Motley Fool Australia has recommended BlueBet Holdings Ltd and Pointsbet 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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