Tag: Motley Fool

ASX, energy, metals and mining shares have underperformed the broad indices today, with investors winding back exposure following a period of strong gains.

The S&P/ASX 300 Metals and Mining Index (ASX: XMM) is down 2.26% at the time of writing, while the benchmark S&P/ASX 200 Index (ASX: XJO) has slipped 1.3%.

The Lynas Rare Earths Ltd (ASX: LYC) share price is no exception and is currently down 4.4%, now trading at $7.87 apiece despite no news.

What’s up with the Lynas share price?

Losses have extended into today’s session for Lynas from the broad selling pressure mentioned above, but also what appears a continuation of a downtrend that started on Tuesday.

Chief to the downside was a company announcement detailing disruptions to the water supply of one of its sites in Malaysia.

Lynas advised that between July and August 2022, water supply from the Malaysian local supplier was “unpredictable and on most days below the level required to run all 4 kilns”.

The rare earths player had employed a number of tactics to mitigate the uncertainty, namely sourcing alternative water sources and trucking external water in.

The ASX mineral explorer initially expected the supply disruption to resolve and normal water supply resume during September.

If true, this “would have enabled the shortfall from July and August to be mitigated,” it said. However:

Following a catastrophic equipment failure in early September, PAIP has not supplied any water
for seven days.

This issue is affecting all users in the Kuantan area, including residential customers… PAIP has now provided an update that the current situation of zero supply is expected to continue for at least the next week.

As a result of the disruption, Lynas estimates the water supply from PAIP will remain uncertain and unpredictable until the end of this month.

“Whilst Lynas’ alternative strategies will support some continued production during September, it will fall short of the level achieved in July and August 2022,” the company said.

After a choppy year on the chart, the Lynas share price is down 22.6% this year to date, having sunk another 20% this past month.

In the past 12 months, Lynas shares have clipped a 1.3% gain.

The post Lynas share price tumbles again, down 10% this week appeared first on The Motley Fool Australia.

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More reading

• The Lynas share price is sinking 5% amid market mayhem
• Why is the Lynas share price so volatile on Tuesday?
• Down 20% in 2022, is the Lynas share price too cheap to ignore?
• Why is the Lynas share price surging higher on Tuesday?
• Should investors ‘buy the dip’ in Lynas shares right now?

Motley Fool contributor Zach Bristow 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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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.

A Coinbase (NASDAQ: COIN) executive just explained the best part of the long-awaited Ethereum (CRYPTO: ETH) Merge. Coinbase COO Emilie Choi pointed out Ethereum’s most exciting strength — and how the platform upgrade shines a spotlight on this quality.

The Merge is in the books now, and cryptocurrency investors should keep an eye on how Ethereum executes its move from a proof-of-work (PoW) platform to a proof-of-stake (PoS) system. In Choi’s view, the journey is more important than the destination.

What is The Merge?

Around 2:40 a.m. ET on Thursday, Ethereum started merging its digital ledger with a new system, formerly running as a testing network known as the Beacon Chain. Ethereum’s developers and blockchain node operators had executed a couple of mergers on smaller test networks, and all signs pointed to a successful platform upgrade on Ethereum’s main network.

As expected, The Merge went off without a hitch. Leading crypto-trading platforms such as Coinbase, Kraken, Binance, and Robinhood Markets paused transactions for Ethereum and Ether-based tokens for a few hours, giving the technology update time to roll out. Today, Ethereum’s transactions are validated by a much faster system that requires just 0.05% of the electric power that the old PoW platform consumed.

This game-changing move has been in the works for six years, and also sets the stage for three more rounds of important network upgrades. Ethereum co-founder Vitalik Buterin considers Ethereum’s functionality to be 55% complete after The Merge, leaving plenty of room for further improvements.

What Choi said

That’s where Emilie Choi comes in. Choi delivered this crucial insight at the annual Goldman Sachs Communacopia + Technology Conference earlier this week:

“I think the most important thing that [The Merge] represents is that there can be continued sustained technological development done by decentralized communities at scale,” she said. “To me, that’s the most important kind of takeaway about the Ethereum merge.”

This is important. Like Buterin, Choi expects Ethereum to get better over time. This platform was designed with long-term flexibility in mind, allowing Ethereum to overcome expected challenges and uncharted surprises via platform updates. The Merge was a fantastic example of this capability, proving that the network can undergo truly fundamental changes without breaking the crypto platform.

The next few updates will continue to lower transaction costs and boost execution speeds. They will also introduce a work-sharing feature known as sharding, improve Ethereum’s security model, and expand the system’s scalability. In the long run, Ethereum will evolve to take advantage of improvements in computing systems. For example, the Ethereum network of 2030 might secure and validate its transactions with quantum computing systems.

What’s good for the Ethereum goose may not be right for the Bitcoin gander

Every cryptocurrency indeed has some capacity for platform upgrades, but the Ethereum community takes this quality more seriously than most of its peers. Bitcoin (CRYPTO: BTC) has barely changed since its launch in 2009, apart from a few tweaks to tackle unexpected security issues. The unchanging nature of Bitcoin is an advantage because its holders can trust that the long-term supply is limited to 21 million coins.

However, the largest cryptocurrency should probably consider switching from PoW to PoS (or another validation system with lower computing and power requirements) someday. That change took years of planning and testing in the more flexible Ethereum community. Will we see a proof-of-stake version of Bitcoin in this decade? Probably not.

So the two leading crypto names are walking down strikingly different paths. One size does not fit all cryptocurrencies, and that’s quite all right. Each digital coin was designed with a unique set of features and long-term goals, and those fundamental differences will always drive their development. In Ethereum’s case, an openness to new ideas is the name of the game and investors should embrace that attitude.

The Merge showed us that even ambitious platform changes can take place without a hitch. As Choi said — and Buterin would surely agree — sustained development is the secret sauce in Ethereum’s recipe for success.

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

The post Ethereum’s merge spotlights a key strength, says Coinbase exec appeared first on The Motley Fool Australia.

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More reading

• 5 reasons I wouldn’t touch Shiba Inu with a 10-foot pole
• Why Ethereum is diving today
• Will the Ethereum Merge leave the crypto at greater risk of hacking?
• Why did the Bitcoin price just dip below US$20,000?
• Why you should buy Block stock (and it’s not Bitcoin)

Anders Bylund has positions in Bitcoin, Coinbase Global, Inc., and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin, Coinbase Global, Inc., and Ethereum. 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 Aristocrat Leisure Limited (ASX: ALL) share price has managed to avoid the market selloff on Friday.

In afternoon trade, the gaming technology company’s shares are up 0.5% to $34.39.

Why is the Aristocrat share price pushing higher?

Investors have been bidding the Aristocrat share price higher today after the company was the subject of a couple of bullish broker notes.

One of those notes came out of Morgan Stanley and saw its analysts put an overweight rating and $45.00 price target on the company’s shares.

Based on the current Aristocrat share price, this implies potential upside of 31% for investors over the next 12 months.

The broker sees a big opportunity for the company in the i-gaming market and believes it has the balance sheet strength for major M&A or capital management activities.

Who else is bullish?

Another bullish broker note came out of Goldman Sachs this morning.

According to the note, the broker has retained its buy rating and $43.00 price target on Aristocrat’s shares. This implies potential upside of 25% for investors.

Its analysts note that the company’s digital business is outperforming the market despite recent weakness. This has led to the broker revising “group earnings by +2.3% and +0.4% in FY22/23e.”

Outside this, Goldman continues to see plenty of value in the Aristocrat share price thanks to its very positive growth outlook. This is underpinned by its development pipeline, the recovery in land-based demand, and its strong balance sheet.

The broker commented:

We maintain our Buy rating on ALL based on the strong D&D commitment and pipeline support for future growth, well diversified digital business, leverage to the rapidly recovering land-based business as well as strength in their balance sheet.

The post Aristocrat share price defies the selloff thanks to bullish brokers appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Friday
• Are these ASX growth shares buys after the market selloff?
• Analysts name 3 ASX growth shares to buy next week
• Top brokers name 3 ASX shares to buy today
• 2 discounted ASX shares I’d buy now and one I wouldn’t touch: expert

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

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The Atlas Arteria Group (ASX: ALX) share price is down 14.85% today.

Shares of the toll road operator trade for $6.65. Earlier today, shares dipped to an intraday low of $6.38, and peaked late morning at an intraday high of $6.75.

The S&P/ASX 200 Industrials Index (ASX: XNJ), of which Atlas Arteria is a part, is only down 1.87%. So, what’s going on?

The company made a significant announcement today, so, let’s investigate what happened.

What’s going on with the Atlas Arteria share price?

This morning the company announced the completion of its institutional component of entitlement offering for new ALX securities. This offer raises a total of $2.5 billion from the settlement of 403.5 million stapled securities which it expects to issue on 26 September.

Using the funds, Atlas Arteria will acquire a 66.67% stake in the Skyway Concession company. This includes partial ownership of the Chicago Skyway, where some red flags are being raised, according to insiders and commentators.

An audit will be completed for the bridge if the intended acquisition moves ahead. The company notes “there is a risk that these post-completion audits may identify the need for capex expenditure beyond what has been budgeted,” as reported by The Australian.

Skyway Concession company acquisition lampooned

Atlas Arteria’s biggest shareholder, IFM Investors, are critics of the deal. IFM’s head of infrastructure Kyle Mangini and executive director Aaron McGovern describing the deal as “significantly value destructive”, stating:

We do not believe the company could construct any credible set of parameters or assumptions in order to justify the pursuit of the Chicago Skyway acquisition.

Macquarie analysts also agree with some parts of IFM’s evaluation of the deal, focusing on the weakness of the Chicago Skyway.

The analysts said:

Traffic has been a material disappointment on the road. There once was expectation of growth, but this never eventuated and ultimately traffic is down 20 per cent on 2005 and 2.5 per cent on 2016. Core issues we think are population growth is weak, there is an alternative corridor and users are more price-elastic than normal roads.

However, the Macquarie analysts also said that “strategically, the acquisition gives Atlas scale”. And noted, “that strategic gain is at the expense of the dividend and dividend growth”.

Atlas Arteria dividends will continue in FY22 and FY223

Despite the possible long-term weaknesses of its dividend, the company said it would continue its hefty 40 cents per share dividend in the immediate future for FY22 and FY23.

My Fool colleague Brooke notes that the company has “considerable debt capacity,” with future dividends likely paid out of capital releases.

The company notes its dividend is “sustainable” after acquiring a stake in Skyway Concession.

Atlas Arteria share price snapshot

The Atlas Arteria Group share price is down 3.9% year to date. That’s considerably better than the S&P/ASX 200 Index (ASX: XJO), which has lost 9.3% over the same period.

The company’s market capitalisation is $7.48 billion.

The post Why did the Atlas Arteria share price just dive 16%? appeared first on The Motley Fool Australia.

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More reading

• Atlas Arteria share price remains on ice amid $3 billion cap raise
• Atlas Arteria share price halted amid $2.9 billion acquisition
• Why is the Atlas Arteria share price hitting the headlines on Monday?
• Atlas Arteria share price drives higher on record dividend guidance
• Here are the top 10 ASX 200 shares today

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 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 Anson Resources Ltd (ASX: ASN) share price has come out of a trading halt into a nosedive today.

During early morning trade, the lithium explorer’s shares fell to an intraday low of 38.5 cents before recovering some of their losses.

Currently, the share is down 6.47%, trading at 39.8 cents apiece.

What’s driving Anson Resources shares lower?

The Anson Resources share price is tanking after the company announced it had successfully completed a capital raise.

The impending share dilution that will follow may be behind today’s sell-off, along with broader weakness on the ASX.

In today’s release, Anson Resources advised it has received binding commitments to raise $50 million from global institutional investors.

Interest in the share placement had exceeded the company’s requirements, with management deciding to upsize the offer to $50 million.

The placement will see the company issue approximately 139 million shares at a price of 36 cents per share.

This represents a 15.3% discount on the last closing price of 42.5 cents per share on 14 September, before the company entered a trading halt.

The company will use proceeds from the placement to expand its project development workstreams at the Paradox Lithium Project in Utah, USA. This includes front-end engineering design work, permitting and ordering of long lead procurement items.

The company will also work towards a final investment decision (FID) on the project.

The new shares are expected to be issued on or around 27 September.

What did management say?

Anson Resources executive chair Bruce Richardson welcomed the news, saying:

The result of the capital raise is an outstanding endorsement of the Paradox Lithium Project and for ‘made in USA’ battery grade lithium carbonate.

We were delighted to price the Placement at a tight discount to the prevailing VWAPs, despite immediately following a significant market downward correction.

Anson Resources share price snapshot

Despite today’s losses, the Anson Resources share price is up 297% over the last 12 months.

Year-to-date the company’s shares are trading 194% higher.

Anson Resources commands a market capitalisation of $409.6 million with approximately 1.03 billion shares on issue.

The post Anson Resources share price dives 8% after $50m capital raise appeared first on The Motley Fool Australia.

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More reading

• Why is ASX lithium share Anson Resources on ice today?
• How are ASX lithium shares faring amid Wednesday’s carnage?
• Anson Resources share price surges to ASX all-time high on lithium news
• Vulcan Energy share price is one of the worst ASX lithium performers so far this year. Why?
• 4 ASX lithium shares that have rocketed more than 100% in 2022

Motley Fool contributor Aaron Teboneras 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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Over the last few years, the Fortescue Metals Group Limited (ASX: FMG) dividend has been among the most generous on the Australian share market.

This has been underpinned by the significant free cash flow the mining giant has been generating thanks to strong iron ore prices.

But after a couple of decades of polluting the earth, Fortescue is now focusing on green energy as well as iron ore.

Given the high level of investment required for these new activities, investors may be wondering what this means for the Fortescue dividend in FY 2023. Let’s take a look at what one leading broker is expecting from the miner.

How big will the Fortescue dividend be in 2023?

According to a note out of Goldman Sachs, its analysts are expecting an almighty cut to the Fortescue dividend in the next 12 months.

The broker expects Fortescue to go from paying a US$1.50 per share dividend in FY 2022 to an 80 US cents per share dividend in FY 2023. That’s a cut of 47% year over year.

Based on current exchange rates and the latest Fortescue share price of $17.78, this would mean a fully franked yield of 6.6% for investors in 2023. Not quite the bumper yields that investors have been accustomed to in recent years.

All in all, the broker appears to believe the Fortescue dividend has now peaked and is on a downward trajectory from here. It commented:

We continue to think FMG is at an inflection point on capital allocation, and to fund the ambitious new strategy, we assume the dividend payout ratio falls from the current ~75% in FY22 and then to ~50% from FY24 onwards.

The post How big will the Fortescue dividend be in 2023? appeared first on The Motley Fool Australia.

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More reading

• Reinvesting your Fortescue dividends? Here’s what you need to know
• ASX 200 mining shares stage significant rebound in afternoon trading
• Rio Tinto share price slides despite new $3bn iron ore project
• Why is the Fortescue share price getting hammered on Wednesday?
• Expert predicts stock market will crash 20% lower in the next four weeks as US inflation rages out of control

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The Northern Star Resources Ltd (ASX: NST) share price is trading down on Friday.

At the time of writing, shares in the gold miner are pushing nearly 5% lower at $7.33 apiece on no market-sensitive news.

Meanwhile, the S&P/ASX 300 Metals and Mining Index (ASX: XMM) is down around 2% on the day.

What’s up with Northern Star shares today?

Whilst it’s been quiet from the company’s camp today, it’s been anything but over in the gold markets.

The gold price dropped to its lowest mark since the onset of the pandemic in April 2020 following a period of heavy downside.

Adding to the pressure this week was higher-than-expected US inflation data that’s kept US Treasury yields buoyant, and the US dollar equally as tight.

The traditional ‘inflation hedge‘, gold has failed to live up to its namesake in light of the latest data. However, there’s a bit more to it than that.

Investors are looking at market expectations along with current performance, and, with higher inflation, comes the prospects of further interest rate hikes, and surging treasury yields.

Alas, both trends in these asset classes are a negative for gold; however, the most recent down-moves were rates-induced, analysts at RJO Futures say.

“Today the biggest factor are yields, [they] seemed pretty strong after taking a little bit of a reprieve,” RJO added.

“This [gold] sell-off into September, October has really been just on rate adjustments…and now they [yields] are right back up again and pushing gold lower,” it finalised.

Given Northen Star’s position as a price taker on the yellow metal, its share price can and does fluctuate in unison with the gold price.

It, therefore, stands to reason that the latest down-leg for Northern Star on the chart has somewhat to do with the recent downside in gold.

Meanwhile, the Northern Star share price is down nearly 23% over the past 12 months to date.

The post Why is the Northern Star share price trading 4% down today? appeared first on The Motley Fool Australia.

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More reading

• Northern Star share price slides 3%: Is it time to load up?
• 5 things to watch on the ASX 200 on Wednesday
• The Northern Star share price has dumped 8% in a month. So what’s the dividend yield right now?
• 5 things to watch on the ASX 200 on Monday
• Do ASX 200 gold shares pay regular dividends?

Motley Fool contributor Zach Bristow 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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Some investors park their portfolios in the consumer staples, utilities, and healthcare sectors amid an actual or perceived bear market.

The thinking behind that is that companies in these sectors are expected to continue solid operations even as the rest of the economy struggles. This is because they sell products that people cannot live without.

So it would be logical to assume that these defensive sectors would outperform others in today’s volatile climate. But you’d reach the wrong conclusion.

In fact, the S&P/ASX 200 Utilities Index (ASX: XUJ) has been one of the worst-performing sectors over the past month, posting a 9.77% loss.

Confusing matters further, the S&P/ASX 200 Consumer Staples Index (ASX: XSJ) is also performing poorly, down 8.38% over the same period.

So, have blue-chip defensive shares begun to lose their shimmer? Let’s investigate by covering the highlights of these companies.

Woolworths Group Ltd (ASX: WOW)

Shares in Woolworths are down 10.23% for the past month. My Fool colleague Cathryn noted that the iconic Australian supermarket chain was challenged by supply chain and operations disruptions in FY22, which came amid a drop in its reported earnings before interest and tax (EBIT) for that financial year.

However, according to analysts at Goldman Sachs, Woollies could be in the process of turning the ship around. The investment bank just gave Woollies a buy rating and upgraded its price target to $44.10.

The analysts said in a broker note yesterday:

Despite the softer topline environment, we believe that WOW’s reducing COVID costs, strong Cartology growth as well as careful execution will result in EBIT margin expansion.

Coles Group Ltd (ASX: COL)

Coles shares have performed worse than Woollies over the past month, tracking 13.68% lower at the time of writing. The supermarket has received mixed coverage from analysts during this time, gaining both an upgrade and a downgrade for its share price.

On 6 September, a Citi broker said Coles would benefit from food inflation as prices rose. The bank has a $20.10 price target for the supermarket’s shares, expected to reach this level within the next 12 months.

The broker said:

Food inflation will benefit supermarkets significantly while operating costs should remain less than top-line inflation, benefiting margins.

Challenging news came on 14 September in the form of a broker note from Goldman Sachs, downgrading its rating on Coles shares to a sell and reducing its price target to $15.60.

Goldman explained its position with the following:

Downgrade COL from neutral to sell with new TP of A$15.60/sh, implying 9.5% share price downside due to laggard in digital transformation resulting in market share losses and entrance into high investment cycle for digital and supply chain pressuring margins over FY23/24.

Origin Energy Ltd (ASX: ORG)

Moving across to utilities, the Origin share price is currently down 3.48% over the past month. There has been plenty of bad news for the energy producer, including analysis that it could be a ‘zombie company’ with an interest coverage ratio of less than one and carrying significant debt.

Origin has also been pressured to cut down on its emissions. HESTA, a $68 billion Australian superannuation fund, has placed Origin and others on watch, saying if they failed to address climate risks, they could be dumped from the fund’s portfolio.

But the challenges for Origin started before the past month began, with the company reporting a $1.4 billion loss for FY22 on 18 August.

The post Are these ASX blue-chip shares losing their defensive benefits? appeared first on The Motley Fool Australia.

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More reading

• Attention Endeavour shareholders: Here’s some news on your dividends
• Have Woolworths shares ‘got their mojo back’?
• Why is the Coles share price tumbling today?
• 5 things to watch on the ASX 200 on Wednesday
• Supermarket shakeup: Do Coles shares offer better dividends than Woolworths?

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 positions in and has recommended Goldman Sachs. The Motley Fool Australia has positions in and has recommended COLESGROUP DEF SET. 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 Qantas Airways Limited (ASX: QAN) share price is dipping in Friday’s trade, down 0.2%.

Qantas shares closed yesterday trading for $5.35 and are currently trading for $5.34 apiece.

While a loss is a loss, the Qantas share price is holding up better than the broader market, with the benchmark S&P/ASX 200 Index (ASX: XJO) down 1.1% at this same time.

The ASX 200 sell-off follows another day of significant losses in US markets, with US futures pointing to another rough day ahead on the NASDAQ-100 (NASDAQ: NDX) and Dow Jones Industrial Average Index (DJX: .DJI).

But, what’s this about Qantas’ competitor Virgin Australia eyeing merger opportunities?

Is Virgin Australia looking to spread its wings?

If you cast your mind back a few years, you will likely recall that Virgin Australia used to trade on the ASX. And, indeed, it may do so again with a potential initial public offering (IPO) flagged for as early as next year.

Virgin entered voluntary administration in April 2020. That was right when domestic and global air travel came to an abrupt halt amid the early months of the pandemic.

Bain Capital bought Virgin in October 2020 for $3.5 billion and continues to hold the airline today.

Regarding Virgin’s acquisition plans, in an article published by The Australian after markets closed yesterday, the paper said its sources had indicated Virgin and Air New Zealand Limited (ASX: AIZ) have discussed a merger. The column also said Virgin is investigating acquiring Regional Express Holdings Ltd (ASX: REX).

According to the article, unnamed sources reported that investment banks Goldman Sachs and Jarden have been offering assistance to Virgin regarding possible merger plans. It was said the plan would involve “a back door dual listing” on both the ASX and the New Zealand Exchange (NZX).

As far as the Air New Zealand discussion goes, the airline responded to the media merger speculations this morning, stating:

Air New Zealand confirms that it has not been approached, and is not in discussions with any parties, regarding a potential merger transaction.

As for any potential impact on Qantas shares, if Virgin were to acquire Rex, The Australian said its sources indicated that would only move forward if Rex were to return to solely flying regional routes.

Qantas share price snapshot

The Qantas share price has outperformed in 2022, up 3.7%. That compares to a 10.8% loss posted by the ASX 200.

The post Qantas share price outperforming as Virgin eyeing merger opportunities appeared first on The Motley Fool Australia.

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More reading

• How this fundie is beating the ASX 300 without fossil fuels
• Qantas share price lifts 3% following Wednesday’s rout
• While the Qantas share price is stalling, Rex is surging 5%. What’s happening?
• What’s the growth runway for Qantas shares in the coming year?
• Qantas share price holds firm despite Virgin ‘Switch-A-Roo’ play

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

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The Lake Resources N.L. (ASX: LKE) share price has continued its slide on Friday.

In afternoon trade, the lithium developer’s shares are down almost 3% to 90 cents.

This means the Lake Resources share price is now down approximately 30% since this time last week.

Why is the Lake Resources share price falling?

Investors have been selling down the Lake Resources share price today amid another market selloff.

The selling has been strongest in higher risk assets such as lithium shares. This has seen the likes of Liontown Resources Limited (ASX: LTR) and Pilbara Minerals Ltd (ASX: PLS) fall 5% and 3%, respectively, today.

What about the rest of its declines?

Also weighing particularly heavily on the Lake Resources share price this week has been news that a dispute has arisen between the company and its partner Lilac Solutions.

The company revealed that the dispute relates to the date by which certain milestones need to be achieved for Lilac to earn a 25% stake in the Kachi Lithium Project. Lake believes that these milestones must be achieved by 30 September, whereas Lilac believes it has until 30 November to do so.

To resolve the dispute, Lake has exercised its rights to have the dispute resolved either by agreement of both Lake and Lilac or by arbitration.

This is particularly worrying for investors as Lake’s Kachi project is highly dependent on Lilac’s unproven DLE technology. In fact, it recently commented on Lilac’s technology. It said:

Lake believes DLE will become the primary method of lithium extraction because it is the only practical way to ramp up lithium supply sustainably and in a way that conforms to increasing ESG scrutiny on lithium projects.

However, in the lithium industry not all DLE processes are the same. This is why Lake has taken the time to identify the process that is not only most efficient but also delivers a product that represents the most socially and environmentally sustainable approach to lithium extraction through ion exchange DLE and brine managed reinjection.

Investors will no doubt be hoping that this dispute doesn’t impact the partnership. But time will tell if it does.

The post Why is the Lake Resources share price tumbling again? appeared first on The Motley Fool Australia.

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More reading

• Why Lake, Pushpay, South32, and Tyro shares are dropping
• Lake Resources share price continues to dive, down 24% in a week
• How are ASX lithium shares faring amid Wednesday’s carnage?
• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• Why Lake Resources, Lovisa, Megaport, and St Barbara 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 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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