In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a strong gain. At the time of writing, the benchmark index is up 1.5% to 6,778.4 points.

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

Austal Ltd (ASX: ASB)

The Austal share price is down 6% to $2.26. This is despite there being no news out of the shipbuilder on Monday. However, in recent news, last week, the company was ordered to pay a $0.65 million penalty for a disclosure breach.

New Hope Corporation Limited (ASX: NHC)

The New Hope share price is down 5% to $7.06. The catalyst for this has been the coal miner's shares trading ex-dividend this morning for its latest dividend. Thanks to sky high coal prices, last month the company was able to declare a mammoth fully franked final dividend of 56 cents per share. This was the equivalent of a fully franked 7.3% dividend yield at Friday's close price. Eligible shareholders can look forward to receiving this dividend on 8 November.

Playside Studios Ltd (ASX: PLY)

The Playside share price is down 2.5% to 60 cents. This morning the video game developer released its first quarter update and revealed a modest 6.5% quarter on quarter increase in revenue to $6.5 million. This wasn't enough to cover its operating costs, leading to an operating cash outflow of $0.85 million.

South32 Ltd (ASX: S32)

The South32 share price is down 2% to $3.64. This follows the release of a mixed quarterly update from the mining giant this morning. South32's production during the quarter was a little hit and miss. One of the disappointments was its met coal production, which fell short of expectations and has forced a reduction in its full year production guidance.

The post Why Austal, New Hope, Playside, and South32 shares are dropping appeared first on The Motley Fool Australia.

The Russia-Ukraine war has motivated private and institutional investors, as well as superannuation funds, to reinvest in ASX All Ords defence shares and energy shares, according to a new study.

Investors began shunning these two sectors a while back due to "a growing focus on environmental, social, and corporate governance (ESG) factors in investment decisions", according to Deakin University, which conducted the study.

They're now happy to reinvest in defence and energy because big businesses in these sectors are now proactively mitigating their greenhouse gas emissions and formally reporting on sustainability goals.

Why are investors returning to defence and energy?

The 'growing international appetite' for international and ASX All Ords shares in these sectors is primarily due to the strong prospects for investment returns, according to the research.

However, investors are also feeling more ethically comfortable investing in these sectors again.

Of defence stocks, Deakin Business School Associate Professor and researcher, Harminder Singh said:

… the Russia-Ukraine war has meant many countries are moving to invest in their sovereign defence capabilities. Countries want to be able to defend themselves in case there are wider ramifications from the conflict.

This makes stocks in the defence sector more appealing for investors. With more government money pouring in, there are more investment opportunities and the potential to earn greater stock returns.

Investing in defence stocks can now be reframed in the more acceptable context of national security and community safety.

Published in the journal Finance Research Letters, the research is based on a sample of global investment data. The numbers cover a three-year period from April 2019 to May 2022.

Singh added his thoughts on energy shares:

Russia is one of the world's major oil exporters, so the conflict and subsequent sanctions has left a gap in the market that needs to be met. This means other countries are developing their own alternative energy projects, offering the opportunity for greater investment and stock returns.

Like defence, the energy sector has faced ESG concerns. But we're seeing that view can change, as global pressures change.

Associate Professor Singh said the trend toward defence and energy shares might remain "for at least a couple of years, depending, as time tells, whether it is the financially fruitful move that investors hope".

Examples of ASX All Ords shares in defence

The ASX defence sector is fairly small with most stocks not in the ASX 200. But a few ASX All Ords shares in the sector have been going gangbusters in 2022 compared to the broader market.

In 2022 so far, the S&P/ASX All Ordinaries Index (ASX: XAO) has lost 13% in value. By comparison, defence shipbuilding company Austal Ltd (ASX: ASB) is up 21% in the year to date at $2.40 per share.

Some ASX defence shares are down.

ASX All Ords share Codan Limited (ASX: CDA) is down 49% in 2022.

Outside the ASX All Ords, military aircraft components manufacturer Quickstep Holdings Limited (ASX: QHL) is down 10% in 2022. DroneShield Ltd (ASX: DRO) is up 8% in the year to date at 20 cents per share.

Examples of ASX All Ords shares in energy

The stalwarts of the ASX energy sector include Woodside Energy Group Ltd (ASX: WDS), up 56% in 2022. There's also Santos Ltd (ASX: STO), up 15% in 2022, and Beach Energy Ltd (ASX: BPT), up 21%.

The post Expert reveals why these ASX All Ords shares are drumming up a 'growing international appetite' right now appeared first on The Motley Fool Australia.

That's according to Aron Pataki, global portfolio manager at Newton Investment Management.

As the Australian Financial Review reported, Pataki says the defence sector is a key area he's keeping an eye on in his hunt for growth stocks amid today's rising geopolitical turmoil and environment of fast rising interest rates.

Which could throw up some welcome tailwind for ASX shares with exposure to defence spending.

Russia's war in Ukraine sparks defence spending growth

With inflation rocketing after a decade of 'stubborn absence' and interest rates rising fast following 11 years of stable or falling rates, Pataki sees the advantage returning to active investors over passive investors.

According to Pataki (quoted by the AFR):

For decades, passive investing worked very well. It didn't really matter what you invested in, everything went up, and the mantra was whenever you have a dip, it's a brilliant buying opportunity. But I suspect the world might be more complicated than that going forward. Active investors like us will benefit where you need to be far more selective.

Russia's invasion of Ukraine has spurred governments the world over to rethink their defence spending, with further growth in defence budgets widely forecast over the coming years.

Having invested in global defence giants Lockheed Martin Corporation (NYSE: LMT) and BAE Systems plc (LON: BA), Pataki said defence is among the key sectors to watch "for runaway growth".

Which ASX shares have exposure to the defence sector?

Now, there are no ASX shares that can rival Lockheed Martin or BAE Systems for their sheer size.

At least, not yet!

But a number of small-cap shares trading on the ASX do have significant exposure to increased global defence spending. Though that's largely yet to filter down to their share price performance this year.

Electro Optic Systems Holdings Ltd (ASX: EOS), for example, develops electro-optic technologies for the aerospace market. The company's biggest revenue earner is its defence segment, which manufactures advanced fire control, surveillance, and weapon systems. Despite running sharply higher in the weeks following Russia's invasion of Ukraine, the Electro Optic share price is down 79% in 2022 amid slumping revenue figures.

DroneShield Ltd (ASX: DRO) is another ASX share that stands to benefit from increasing geopolitical tensions. DroneShield provides drone detection and disruption solutions to the defence sectors as well as commercial airports, prisons, and other critical infrastructure. The DroneShield share price is down 3% year-to-date, beating the benchmark performance.

Then there's Codan Limited (ASX: CDA). Codan develops electronics solutions with a strong focus on metal detectors. Codan sells its equipment to both private and government customers. The Codan share price is down 33% this calendar year despite reporting strong FY22 results. Those results included a 16% year-on-year increase in sales and a record underlying net profit after tax (NPAT) of $100.5 million.

Other ASX shares with a footprint in the defence sector worth exploring include Bisalloy Steel Group Ltd (ASX: BIS), Austal Ltd (ASX: ASB), and Quickstep Holdings Limited (ASX: QHL).

The post Could ASX shares in this sector be set 'for runaway growth'? appeared first on The Motley Fool Australia.

The Austal Ltd (ASX: ASB) share price is sliding during morning trade on Friday following the release of the company's FY22 earnings results.

At the time of writing, the Austal share price is fetching $2.61 apiece after sliding nearly 2% lower from the open.

Austal revenue, profit declines from FY21

Key takeouts from the company's earnings result include:

• Revenue of $1.43 billion, down 9.1% year on year from $1.57 billion
• Earnings before interest and tax (EBIT) of $120.7 million, up 5.3% year on year
• Net profit after tax (NPAT) of $79.6 million, down 1.8% from last year's $81.1 million
• Dividend of 4.0 cents per share declared, unfranked, bringing total year dividend to 8 cents
• EBIT guidance for FY23 of around $100 million

What else happened in FY22 for Austal?

For the 12 months to June 30 2022, Austal generated $1.43 billion in revenue and EBIT of $120.7 million, a decrease and increase of 9% and 5% respectively.

Austal states the decline in revenue is mostly attributed to reduced throughput as the Littoral Combat Ship (LCS) programme continues to mature through to FY25.

The company announced in July that it had secured a contract for the design and construction of up to 11 'Offshore Patrol Cutters', commissioned by the US Coast Guard.

"Even though the Award had no impact on Austal's FY2022 operational performance, it positively
impacted various cost assumptions, such as Estimates at Completion (EAC) and labour utilisation as
at 30 June 2022," the company said.

Management commentary

Speaking on the announcement, Austal Chief Executive Officer, Paddy Gregg said:

Austal is successfully delivering on its core strategic initiative to transition beyond these maturing programmes.

Our investment in steel capability is already paying off and combined with our deep track record of
operational excellence in aluminium, we are optimally positioned to achieve diversified, long-term and
sustainable growth.

We have a significant orderbook and our enhanced operational capabilities supported by a strong
balance sheet give us further potential to grow across both the USA and Australasia.

What's next for Austal?

Austal notes it enters FY2023 with an order book of approximately $7 billion, which is the largest in the company's history.

This is underscored by the US Coast Guard's, which is worth up to $4.35 billion. With these points in mind, the company provided EBIT guidance of $100 million for FY23.

Austal share price snapshot

Austal shares are up more than 33% in the past 12 months.

The post Austal share price slides as revenue, profit contract in FY22 appeared first on The Motley Fool Australia.

Those looking at what "smart money" investors are buying for clues on where bargains might lie may be interested in this S&P/ASX 300 Index (ASX: XKO) share.

Andrew "Twiggy" Forrest from Fortescue Metals Group Limited (ASX: FMG) just pumped in another $13 million plus into the Austal Ltd (ASX: ASB).

He did this through his investment vehicle Tattarang Ventures, which now owns 15.4% of the shipbuilder. This is up from its previous holding of 13.8%.

The ASX 300 share that's in the money for Twiggy

Tattarang started its latest on-market purchase on 18 June and it seems to have picked a good time to make the purchase.

The average price Twiggy paid in the latest round is circa $2.29. The Austal share price is currently trading down 0.74% at $2.68.

Meanwhile, the ASX 300 benchmark is shedding 0.57% of its value.

Timing is everything, or is it?

Perhaps Twiggy's growing stake in the Austal share price is bolstering investor confidence during these volatile times. Austal hasn't issued any market-sensitive news recently and Twiggy's increased investment comes ahead of the company's full year results.

You would think that one would wait for a company to hand in its earnings report card before committing many more millions to the investment.

But Tattarang tend to be long-term shareholders and Austal is facing several medium to longer-term tailwinds.

Rising tide lifts this ASX 300 share

Not least is the increase global defence spending due to rising geopolitical tensions in Europe and in our neck of the woods. There's no need to mention names here.

While concerns about Austal's sales pipeline had sunk the ASX 300 share to the depth of $1.80 on June 30 this year, management has managed to win back investors.

It announced last month that the US Navy awarded it a US$156.2 million ($225.5 million) contract to build two Navajo-class Towing, Salvage, and Rescue Ships.

Significantly, these are steel hull ships. There were concerns that Austal might miss out on more US Navy contracts if the customer looked to build more of such ships. Austal's legacy has arguably been in the construction of lighter aluminium hulled vessels.

Further, Austal also announced in July this year that it was awarded a contract that could be worth as much as US$3.3 billion. This time, the contract is for the design and construction of up to 11 Offshore Patrol Cutters for the United States Coast Guard.

Other ASX shares that Twiggy has been buying

Maybe these developments were enough to convince Twiggy to up his investment in the ASX 300 share.

After all, Tattarang is no stranger to investing in ASX shares. It also has substantial holdings in the likes of Bega Cheese Ltd (ASX: BGA) and Swoop Holdings Ltd (ASX: SWP), among others.

The post Guess which ASX 300 share Fortescue's Twiggy just loaded up on appeared first on The Motley Fool Australia.

So today, let's take a look at three such All Ords shares that managed to hit new 52-week highs.

3 All Ords shares at 52-week highs today

BWP Trust (ASX: BWP)

BWP is a real estate investment trust (REIT) that is well-known for owning commercial real estate assets, including several of the warehouses occupied by the Wesfarmers Ltd (ASX: WES)-owned Bunnings. This REIT had a rather strange session.

Yes, it initially rose upon market open to a new 52-week high of $4.35 a unit. But BWP quickly lost steam throughout the day and ended up closing at $4.24, down 0.93% for the day. Even so, the new high watermark still counts.

Austal Ltd (ASX: ASB)

Shipbuilder Austal is next up this Monday. Austal shares also had a strange day of trading today. The company, like BWP, was out of the gate like a bull this morning, quickly rising to $2.79 a share, its new 52-week high.

But investors appeared to get cold feet as well, and Austral shares spent the rest of the day falling away from this new high. The company ended up finishing at $2.64 a share, down 1.49%.

It was only last week that we were discussing another new 52-week high for Austral. So it's certainly been a great week for this company.

COG Financial Services Ltd (ASX: COG)

Third and finally, we have Cog Financial Services. Alone on this list, Cog actually finished in the green this Monday. The company closed at $1.87 a share this afternoon, up a pleasing 4.47%. However, that's not Cog's new 52-week high.

That came at market open when the company rocketed as high as $2 a share. That happens to be Cog's new high watermark. Cog shares are now up close to 20% since 21 July, when the company released a well-received trading update.

The post These 3 ASX All Ordinaries shares hit new 52-week highs on Monday appeared first on The Motley Fool Australia.

While a good number of shares rose with the market, some climbed more than most. Here's why these were the best performing ASX 200 shares in July:

Zip Co Ltd (ASX: ZIP)

The Zip share price was the best performer on the ASX 200 last month with a massive 159% gain. Investors were buying this buy now pay later provider's shares after it scrapped its merger with rival Sezzle Ltd (ASX: SZL). Management believes that it will help the company become profitable sooner. This went down well with investors who were scrambling to buy its beaten down shares. Though, it is worth noting that the Zip share price is still down 83% over the last 12 months even after this gain.

Megaport Ltd (ASX: MP1)

The Megaport share price was some way behind as the next best performer despite recording a very strong gain of 78%. As well as getting a lift from a rebounding tech sector, the release of a strong quarterly update got investors excited. Megaport reported a 13% increase in monthly recurring revenue (MRR) to $10.7 million and its first quarterly operating profit of $1 million.

St Barbara Ltd (ASX: SBM)

The St Barbara share price was on form and stormed 50% higher last month. This followed a decent quarterly update from the gold miner and news that it could be looking to bolster its business with M&A activity. St Barbara confirmed that it is in talks with gold explorer Genesis Minerals Ltd (ASX: GMD) about a potential merger. The gold miner sees possible synergies in the Leonora region of Western Australia.

Austal Ltd (ASX: ASB)

The Austal share price was a strong performer and sailed 49% higher during July. A good portion of this gain came at the start of the month following the release of a very positive announcement relating to a major contract win in the United States. According to the release, the shipbuilder has been awarded a contract with a potential value of US$3.3 billion (A$4.35 billion) for the detail design and construction of up to 11 Offshore Patrol Cutters for the United States Coast Guard.

The post These were the best performing ASX 200 shares in July appeared first on The Motley Fool Australia.

But this miserly start to the trading week has not held back at least some ASX 300 shares. So let's look at two that have just clocked new 52-week highs this Monday.

2 ASX shares hitting new 52-week highs today

Vicinity Centres (ASX: VCX)

ASX real estate investment trust (REIT) Vicinity is our first ASX 300 share to check out today. Vicinity Centres units have had a rather mild day of gains so far. The REIT is currently up by 0.75% at $2.01 a unit. But this comes after Vicinity hit $2.03 a unit earlier this morning. That happens to be the shopping centre operator's new 52-week high.

This latest rise means Vicinity is now up a healthy 13.84% year to date in 2022 thus far. It also puts the REIT up an even more impressive 37% or so over the past 12 months.

However, we don't know what's behind this new 52-week high today. There hasn't been any news or announcement out from the REIT since 12 July. So perhaps investors are just in the mood to add a retail-based REIT to their portfolios.

Austal Ltd (ASX: ASB)

Shipbuilder Austal is our next ASX 300 share to have a look at today. So far this Monday, the Austal share price has risen a robust 1.19% to $2.56 a share. But that comes after the shipbuilder rocketed as high as $2.60 a share this morning, which is the company's new 52-week high.

What a start to the 2023 financial year it has been for Austal too. Since 30 June, the company has risen an impressive 42.2%. Austal shares are also up almost 30% year to date in 2022 thus far, and up almost 18% over the past 12 months.

So do we have a smoking gun for Austral's new 52-week high? Yes.

The company released a statement to the ASX this morning. This announced that Austal has been awarded a new "fixed-price incentive contract option from the United States Navy for the construction of two Navajo-class Towing, Salvage, and Rescue Ships (T-ATS 13 and 14)".

This is the second US Navy contract Austal has won in as many years, having already accepted a contract to build two of these same ships in October 2021.

Investors have clearly given Austal the tick of approval for this news, considering the new 52-week high today.

The post 2 ASX 300 shares rocking new 52-week highs on Monday appeared first on The Motley Fool Australia.

Four ASX shares that are climbing more than most today are listed below. Here's why they are charging higher:

Austal Ltd (ASX: ASB)

The Austal share price is up 22% to $2.20. This follows the announcement of a major contract win in the United States. According to the release, the shipbuilder has been awarded a contract with a potential value of US$3.3 billion (A$4.35 billion) for the detail design and construction of up to 11 Offshore Patrol Cutters for the United States Coast Guard.

Mesoblast limited (ASX: MSB)

The Mesoblast share price is up 17% to 71.5 cents. This is despite there being no news out of the biotechnology company on Friday. However, it is worth noting that the company's shares sank to a decade low on Thursday. Some investors may believe that they have now bottomed. Mesoblast's shares are still down ~50% in 2022.

Regis Resources Limited (ASX: RRL)

The Regis Resources share price is up 9% to $1.42. This follows news that Andrew 'Twiggy' Forrest attempted to acquire a 15% stake in the gold miner. The iron ore billionaire was hoping to snap up the stake for $1.48 per share, which represents a 13.8% premium to its last close price. However, Forrest's kill or fill order fell short of target at 12% filled and was cancelled.

Zip Co Ltd (ASX: ZIP)

The Zip share price is up 9.5% to 48.2 cents. This is despite there being no news out of the buy now pay later provider. Though, with its shares down 50% last month, some investors may believe they were oversold. Not even a bearish note out of Jefferies has held Zip's shares back today. The broker retained its underperform rating and cut its price target to a lowly 38 cents.

The post Why Austal, Mesoblast, Regis Resources, and Zip shares are charging higher appeared first on The Motley Fool Australia.

The Austal Limited (ASX: ASB) share price is on the move during Friday morning trade.

This comes after the shipbuilder announced it has won a new contract with the United States Coast Guard (USCG).

At the time of writing, Austal shares are swapping hands at $2.30 apiece, up 27.78%.

What are the details of the contract?

According to its release, Austal revealed it has been awarded a potential US$3.3 billion (A$4.35 billion) contract from the USCG.

Under the deal, Austal will design and construct up to 11 Offshore Patrol Cutters (OPC) at its steel shipbuilding facility in Mobile, Alabama.

Construction of the first vessel is expected to commence next year, with an option for another 10 ships to be built.

The Coast Guard's 110 metre steel OPCs will provide a crucial capability for the USCG in conducting a variety of missions. This includes law enforcement, drug and migrant interdiction, and search and rescue operations.

Management noted that although the contract has been awarded in FY23, it will positively impact some of Austal's FY22 EBIT.

As such, the company now expects its FY22 EBIT to be higher than the previously forecast $107 million.

However, the exact figure is yet to be quantified but will be provided in due course.

Evidently, this appears to have excited investors, sending the Austral share price to an 11-month high.

Austal CEO, Paddy Gregg welcomed the foreseeable contract, saying:

The United States Coast Guard's new Offshore Patrol Cutters are an outstanding opportunity for Austal USA to further demonstrate the shipyard's new steel shipbuilding capability; based on years of proven construction experience through the delivery of the LCS and EPF programs for the United States Navy.

Austal share price summary

Despite today's euphoric gains, Austal shares have continued to move in circles over the past 12 months. Its shares are up around 11% for the period.

On valuation grounds, Austal commands a market capitalisation of roughly 669.44 million.

The post Why is the Austal share price sailing 28% higher today? appeared first on The Motley Fool Australia.

At the time of writing, the shipbuilder's shares are up 0.5% to $1.91.

This means the Austal share price is now up by almost 8% since this time last week.

Why is the Austal share price rising this week?

The catalyst for the rise in the Austal share price this week appears to be news that Andrew "Twiggy" Forrest has been building a position in the shipbuilder.

According to a substantial shareholder notice, Twiggy's investment vehicle, Tattarang Ventures, has become a major Austal shareholder this week.

The release advises that Tattarang acquired an economic interest in 17,731,049 shares (the equivalent of 4.9% of Austal's shares on issue) pursuant to a cash-settled equity swap transaction. This was at an average price of $1.905 per share, which equates to a total consideration of approximately $33.8 million.

In addition, through a series of on-market purchases of Austal shares up to Monday 28 March, Tattarang acquired a further 11,495,771 shares for a total consideration of approximately $20.7 million or an average of $1.801 per share.

All in all, this gives Twiggy's investment vehicle an 8.1% interest in the shipbuilder.

Why is Twiggy buying Austal shares?

With the Austal share price losing over half of its value since peaking around $4.50 in September 2019, Tattarang appears to have seen this as an opportunity to snap up a major interest in a company it described as a "leading example of Australian ingenuity".

Courtesy of the AFR, Tattarang's chief investment officer John Hartman said: "Austal is a leading example of Australian ingenuity and Tattarang is pleased to join the Perth-based company's register as a long-term investor."

Time will tell if Twiggy has made the right call, but you'd be brave to bet against him.

The post Twiggy has been quietly buying up 8% of this ASX-listed company. Why? appeared first on The Motley Fool Australia.

Unfortunately, not all shares were able to climb higher with the market. Here's why these were the worst performers on the ASX 200 last week:

Telix Pharmaceuticals Ltd (ASX: TLX)

The Telix share price was the worst performer on the ASX 200 last week with a 17.6% decline. This was despite the radiopharmaceuticals company revealing that the buildout of its Belgian production facility has begun. To fund the development, the company has secured an $18.2 million loan and applied for $3 million of grants. In other news, Telix issued 1,400,000 shares upon the exercise of unlisted share options. This is the third such issue in the space of four weeks. Given how these were exercisable at a much lower price than the current Telix share price, it's possible that they were swiftly sold.

Austal Limited (ASX: ASB)

The Austal share price wasn't far behind with an 11.8% decline over the five days. Investors were selling the shipbuilder's shares after the Philippines Navy decided to sole-source foreign-built Offshore Patrol Vessels. This was instead of purchasing Austal-built vessels facilitated through a Government Memorandum of Understanding with the Commonwealth of Australia. Austal will now focus on securing orders for commercial ferries for its Philippines shipyard. The company also copped a downgrade from Macquarie late in the week.

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

The Fisher & Paykel Healthcare share price was out of form and sank 11.6% last week. This was driven by the release of a trading update out of the medical device company. Fisher & Paykel Healthcare advised that it expects FY 2022 operating revenue in the range of NZ$1.675 billion to NZ$1.70 billion. This represents a 13.7% to 15% year on year decline from NZ$1.97 billion in FY 2021. It also warned that higher freight costs would impact margins.

Magellan Financial Group Ltd (ASX: MFG)

The Magellan share price continued its slide and dropped a further 9.8% last week. Investors were selling the embattled fund manager's shares after its founder, Hamish Douglass, resigned as a director with immediate effect. Douglass took indefinite leave from the role as chairman last month following a period of intense pressure and focus on both his professional and personal life. This may be being interpreted as a sign that he won't be coming back.

The post These were the worst performing ASX 200 shares last week appeared first on The Motley Fool Australia.

Many ASX shares have managed to claw their way back from morning losses but two entities have to contend with being hit by a broker downgrade.

One in the firing line is online job ads group Seek Limited (ASX: SEK). The Seek share price has slumped 2.8% to $29.49 at the time of writing even as the All Ordinaries Index (ASX: XAO) rebounded 0.12% higher.

The other is shipbuilder Austal Limited (ASX: ASB). Let's take a closer look at the pair.

Seek at risk of earnings disappointment

What might be weighing on the Seek share price is broker Macquarie's decision to cut its recommendation on the shares from outperform to neutral.

This is despite Seek posting a solid set of results with strong revenue growth over the last 12 months.

Australia's severe labour shortage can likely be credited for the increase in revenue. Businesses that are desperate to hire are not only advertising more on the site, but they are paying for premium services to attract workers.

Downgrade risk for this ASX share

While the current environment provides a positive backdrop for the Seek share price, the good times may not last as long as the market may expect.

Macquarie noted that the market had incorrectly assumed depth revenue (sales of its premium services) as a structural event. This in turn is elevating earnings through to FY23.

But as the labour market normalises, the broker questions if this assumption is too bullish, saying:

SEEK remains a high-quality business with a favourable labour market backdrop. The price-to-value strategy may offer upside in the longer term as well.

However, this is offset by near term downside risk to earnings; limited valuation support; and longer-term upside already expected (price-to-value captured in forecasts).

Macquarie's 12-month price target on the Seek share price is $32 a share.

Austal share price recovery offers little comfort

Meanwhile, the broker has also hit the Austal share price with a downgrade. It cut its rating on the shipbuilder to neutral too, with a 12-month target of $1.91 a share.

The bad news hasn't seemed to sink the Austal share price today though. It's up 1.24% to $1.80 in early afternoon trade.

However, this comes off the back of an 11% plunge for Austal yesterday when the Philippines Navy decided not to award the ASX company with a contract.

Fog of war clouds its ASX share price

It appears the market was assuming that the contract to build offshore patrol vessels was a given. Austal management said it would look for new customers and pursue commercial ferry work for its Philippine shipyard.

But the loss is making investors nervous and puts extra focus on Austal's upcoming US contract. A decision is expected in late May or June this year.

Austal needs the new US contract to replace its current LCS program, which will finish by FY24.

The lack of visibility on its order book is the key reason why Macquarie decided to downgrade the Austal share price.

The post Why has Macquarie downgraded these 2 ASX shares? appeared first on The Motley Fool Australia.

The Austal Ltd (ASX: ASB) share price plunged today amid the company receiving some "disappointing" news.

Austal shares finished the day at $1.775 each, a fall of 11.25%. In contrast, the S&P/ASX 200 Index (ASX: XJO) finished 0.5% higher.

Let's take a look at what impacted Austal's performance today.

Key project collapses

Austal's plan to build offshore patrol vessels [OPVs] for the Philippines Navy has fallen apart. Austal is a global shipbuilder and defence company with 7 shipyards in 5 countries, including the Philippines.

The Philippines Navy has decided to sole-source foreign-built vessels instead of Austal's vessels. These were to have been acquired through a Government Memorandum of Understanding with the Commonwealth of Australia.

Commenting on the news, Austal CEO Paddy Gregg said:

It's disappointing that after several years of working together with PN to develop an agreed specification and price for this project, at the final stages of negotiations PN elected to pursue an offshore build on different terms.

However, we remain very enthusiastic about the capabilities of our Cape platform for OPVs and look forward to discussing it with other potential buyers in future.

Austal now plans to work on securing orders for commercial ferries at its Philippines shipyard.

The company recently delivered the 14th guardian-class patrol boat to the Australian Department of Defence. This is the first of 9 navy ships scheduled for delivery to the federal government in 2022.

Austal share price snapshot

The Austal share price has dropped 19% in the past 12 months, shedding almost 14% in the past week alone.

In comparison, the benchmark ASX index has gained 9% in the past 12 months.

Austal has a market capitalisation of about $642 million based on its current share price.

The post No deal: Here's why the Austal (ASX:ASB) share price sank 11% today appeared first on The Motley Fool Australia.

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

Austal Limited (ASX: ASB)

The Austal share price is down over 8% to $1.83. Investors have been selling the shipbuilder's shares after the Philippines Navy decided to sole-source foreign-built Offshore Patrol Vessels rather than proceed to purchase Austal-built vessels facilitated through a Government Memorandum of Understanding with the Commonwealth of Australia. Austal will now focus on securing orders for commercial ferries for its Philippines shipyard.

Cettire Ltd (ASX: CTT)

The Cettire share price is down 14% to $1.33. This has been driven by news that its founder and CEO, Dean Mintz, sold a large number of shares. According to the release, the luxury online retailer's CEO has sold 35 million shares in the company at a discount of $1.35 per share via a block trade. This represents 9.18% of the company's issued capital.

Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)

The Fisher & Paykel Healthcare share price is down 7% to $23.95. This follows the release of a trading update out of the medical device company. Fisher & Paykel Healthcare advised that it expects FY 2022 operating revenue in the range of NZ$1.675 billion to NZ$1.70 billion. This represents a 13.7% to 15% year on year decline from NZ$1.97 billion in FY 2021. It also warned that higher freight costs would impact margins.

Resimac Group Ltd (ASX: RMC)

The Resimac share price is down over 3% to $1.60. Investors have been selling the residential mortgage lender's shares after it announced the settlement of Premier Series 2022-1 prime $1 billion residential mortgage backed securities (RMBS) transaction.

The post Why Austal, Cettire, Fisher & Paykel Healthcare, and Resimac shares are sinking appeared first on The Motley Fool Australia.

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

Austal Limited (ASX: ASB)

The Austal share price is down 1.5% to $2.03. Today's decline is entirely attributable to the shipbuilder's shares trading ex-dividend this morning for its unfranked 4 cents per share interim dividend. Eligible shareholders can look forward to receiving this dividend in their bank accounts next month on 21 April.

Contact Energy Limited (ASX: CEN)

The Contact Energy share price has dropped 5.5% to $7.32. This morning the New Zealand based energy company released its operating report for the month of February. While that report revealed a decent increase in customer connections year on year, it also showed a meaningful jump in energy costs.

Nanosonics Ltd (ASX: NAN)

The Nanosonics share price is down 3.5% to $3.74. This is despite there being no news out of the infection prevention company. However, with its shares among the most shorted on the Australian share market, sentiment certainly is low right now. Short sellers have been building up positions in response to its shock sales model update in the US.

Uniti Group Ltd (ASX: UWL)

The Uniti share price is down 2% to $3.94. Investors may be taking a bit of profit off the table today following a very strong rise in the Uniti share price on Tuesday. The telco's shares rocketed over 30% higher after confirming reports that it was in takeover talks. According to the release, Morrison & Co. has tabled a non-binding $4.50 cash per share offer to acquire the company.

The post Why Austal, Contact Energy, Nanosonics, and Uniti shares are dropping appeared first on The Motley Fool Australia.

As we know, the share prices of businesses on the ASX are changing all the time, so opportunities can open up quite quickly.

Brokers are always on the lookout for opportunities so let's take a look at what stocks top analysts currently rate as buys:

Insignia Financial Ltd (ASX: IFL)

Insignia Financial, which used to be called IOOF, is a business which aims to create financial wellbeing for Aussies. This company owns a number of financial brands, including MLC.

Citi currently rates it as a buy, with a price target of $5.20. That suggests a possible increase in the share price of more than 40% over the next several months.

On Citi's numbers, the Insignia share price is valued at 11x FY22's estimated earnings with a projected grossed-up dividend yield of 10.25%.

In the first quarter, Insignia noted that it continued to see growth in funds under management and administration (FUMA). At 30 September 2021, the group FUMA increased by $2.4 billion to $321.1 billion. Funds under administration rose $1.8 billion and funds under management increased $0.6 billion. Market growth more than made up for the net outflows that each division suffered.

Management boasted strong early momentum since the acquisition of MLC with the progression of its transformation program. The ASX share said that its synergy goals of $218 million per year by the end of FY24 and a run-rate of between $80 million to $100 million in FY22 are on track.

The company is evaluating the potential of accelerating synergies, though this would come with extra costs. It will tell the market about this analysis by the time of its FY22 half-year result.

Austal Limited (ASX: ASB)

This business designs, constructs and supports advanced defence and commercial vessels for the world's leading operators.

A few different brokers currently rate it as a buy, including Credit Suisse. This broker has a price target on the Austal share price of $2.50 – that's almost 30% higher than where it is right now.

An important win for Austal could be taking on a lease in the San Diego docks in the US.

Austal said its USA division will use the 15-acre site to focus on ship repair for the US Navy, Military Sealift Command, and Coast Guard ships. The site is immediately adjacent to the US Naval Base San Diego, which will include a newly-built dry dock designed specifically to handle small surface combatants and other small to medium size ships.

The ASX share will establish a full service ship repair capability, providing maintenance and modernisation for small surface combatants, autonomous vehicles, and other vessels. Services will include technical and material support, topside work, and dry docking availabilities.

The lease has a duration of 27 years and the deal is estimated to be worth around A$112.5 million.

Recently, the company announced it had been awarded a A$100.4 million contract by the US Navy to perform maintenance on Littoral Combat Ships deployed to the Western Pacific and the Indian Ocean. This contract could increase to around A$299 million if options for further periods are exercised.

According to Credit Suisse, Austal is valued at under 10x FY22's estimated earnings with an estimated FY22 dividend yield of 5.25%.

The post Brokers rate these 2 top ASX shares as buys in January 2022 appeared first on The Motley Fool Australia.

In afternoon trade, the shipbuilder's shares are up over 4% to $1.95.

Why is the Austal share price charging higher?

The catalyst for the rise in the Austal share price today has been the release of an announcement.

According to the release, the company's US business has been awarded its first steel vessel construction contract by the United States Navy.

The US Navy contract is worth a total of US$145 million (~A$198.5 million) and is for the construction of two Towing, Salvage, and Rescue ships (T-ATS 11 and 12).

The release also notes that the contract includes options for up to three additional T-ATS ships. If these options were exercised, it would bring the total cumulative value of the contract to US$385 million (~A$528.6 million).

This contract award follows the initial award of a US$3.6 million contract by the United States Navy for the functional design of the Navajo-class T-ATS vessels.

Management notes that the T-ATS contract is the first steel ship construction program awarded by the United States Navy to Austal USA. It will also be the first program to be delivered in the new steel shipbuilding facilities, which are nearing completion at the shipyard in Mobile, Alabama.

The Navajo-class T-ATS has ocean-going tug, salvage, and rescue capabilities and a multi-mission common hull platform, capable of towing heavy ships. These ships will be able to support the US Navy in a variety of missions. This includes oil spill response, humanitarian assistance, and wide area search and surveillance.

"An exciting milestone"

Austal's Chief Executive Officer, Paddy Gregg, was very pleased with the news.

He believes the contract is an exciting milestone in the history of the company and a great demonstration of its new steel shipbuilding capabilities in the United States.

Mr Gregg added: "This is great news for Austal USA as they enter a new era of steel shipbuilding in the United States, supporting the Navy's requirements for steel ships."

Positively for the company, and potentially the Austal share price, this is just one of several steel shipbuilding programs Austal USA is pursuing as it diversifies its capabilities. Shareholders will no doubt be hoping the company has similar success with those submissions.

The post Here's why the Austal (ASX:ASB) share price is charging higher today appeared first on The Motley Fool Australia.

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

Afterpay Ltd (ASX: APT)

The Afterpay share price is up 3.5% to $117.49. This follows a strong night on Wall Street which saw the Square share price rebound with a gain of 4.3%. As Square is acquiring Afterpay in an-scrip deal, the value of the takeover rises and falls with the Square share price.

Austal Limited (ASX: ASB)

The Austal share price is up over 4% to $1.95. This follows news that the shipbuilder has been awarded its first steel vessel construction contract by the United States Navy. According to the release, the US$145 million (~A$198.5 million) contract is to build two Towing, Salvage, and Rescue ships.

Baby Bunting Group Ltd (ASX: BBN)

The Baby Bunting share price is up 5% to $5.69. Investors have been bidding this baby products retailer's shares higher today following a bullish broker note out of Morgans. According to the note, the broker has upgraded the company's shares to an add rating with a $6.20 price target. This follows the release of the company's trading update on Tuesday at its annual general meeting.

Nick Scali Limited (ASX: NCK)

The Nick Scali share price is up 5% to $12.92. This morning Citi retained its buy rating and lifted its price target on the furniture retailer's shares to $16.80. It was pleased with the company's acquisition of Plush for $103 million. The broker described Plush and Nick Scali as a compatible low risk match.

The post Why Afterpay, Austal, Baby Bunting, & Nick Scali shares are storming higher appeared first on The Motley Fool Australia.

The Austal Limited (ASX: ASB) share price is finding its feet on Thursday. This follows the appointment of a new president of the company's United States operations.

In morning trade, shares in the defence vessel constructor are lurching higher. Currently, the Austal share price is fetching $1.76, up 4.45%. However, this is still a far cry from its position only a month ago. The company's value has been stuck in a downtrend, resulting in a near 30% erosion over the past 4 weeks.

Let's take a look at the latest appointment, as well as some developments in the Australian military space.

Fresh-ish eyes at the helm

They say change can be as good as a holiday. Austal shareholders are likely hoping this holds true with the most recent change in the company's ranks.

According to its announcement, Austal's board of directors have appointed Rusty Murgaugh as president of Austal USA. This decision was effective as of 9 September 2021, putting Murgaugh at the helm for a week already.

The newly appointed president began his time at Austal in 2017 as chief financial officer. While the announcement marks a 'newly' appointed president, Murgaugh has been serving as interim president since February 2021. During this time, the now President led an operational expansion, adding steel shipbuilding to the company's manufacturing capability.

Commenting on the appointment, Austal CEO Paddy Gregg said:

Rusty has overseen a number of significant, positive developments at Austal USA in a short period of time, including the start of construction of new infrastructure to enable steel shipbuilding; and new contracts that position the company exceptionally well for further growth. I congratulate him on his appointment and look forward to working with him to achieve further success in the US and international markets.

New defence developments

In other defence-related news, reports from ABC News state that Australia has announced plans to acquire a nuclear submarine fleet. Although there is no direct connection between Austal and this announcement, investors might be speculating over the potential ripple effects to defence shares. However, there is nothing set in stone to give surety for influencing the Austal share price.

The move by Australia is part of its newly formed security partnership, known as AUKUS. As you might have guessed from the acronym, this involves Australia, the United Kingdom, and the United States.

Speaking at the announcement, Australian Prime Minister Scott Morrison stated:

Over the next 18 months, we will work together to seek to determine the best way forward to achieve this. This will include an intense examination of what we need to do to exercise our nuclear stewardship responsibilities here in Australia.

Austal share price snapshot

It has been a slobber-knocker of a year for the Austal share price. Over the past 12 months, the company's shares have lost roughly 46% of their value. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) has conjured up a 25.4% gain.

As a result, Austal currently trades on a price-to-earnings (P/E) ratio of 7.72 times.

The post Why the Austal (ASX:ASB) share price is lifting today appeared first on The Motley Fool Australia.