18 Share Tips – 12th August 2024

Get our share tips straight to your inbox – Sign Up Here

Jabin Hallihan, Auburn Capital

BUY RECOMMENDATIONS

BUY – Mineral Resources (MIN)

MIN is a diversified resources company. It’s also a lithium and iron ore producer. Production volumes of 269 million tonnes in fiscal year 2024 were up 9 per cent on the prior corresponding period. The mining services operations provide security amid volatile commodity prices. The weaker share price presents a buying opportunity. Investors can consider MIN for its strong operational performance, diversified investment portfolio and current undervaluation.

BUY – Fortescue (FMG)

The company delivered record iron ore shipments of 53.7 million tonnes in the fourth quarter of fiscal year 2024, up 10 per cent on the prior corresponding period. It posted total shipments of 191.6 million tonnes in fiscal year 2024. The company is guiding for total shipments of between 190 million tonnes and 200 million tonnes in fiscal year 2025. The shares have significantly fallen to trade at a discount, in my view.

HOLD RECOMMENDATIONS

HOLD – Macquarie Group (MQG)

Shares in this diversified financial services group have risen from $184.59 on January 2 to trade at $200.67 on August 8. Prior to the market downturn, MQG shares finished at $211.31 on August 1. The final dividend was $3.85 a share. Investors may consider holding as I expect net profit to increase in fiscal year 2025.

HOLD – Seek (SEK)

This employment and education company will recognise a total impairment charge of $141 million related to its investment in Chinese based company Zhaopin. This is due to increased competition and a weaker recovery in the Chinese employment market. But, in my view, the shares are trading at fair value and worth holding for a brighter outlook.

SELL RECOMMENDATIONS

SELL – JB Hi-Fi (JBH)

This consumer electronics giant has proven to be a strong performer. The shares have risen from $54.40 on January 2 to trade at $65.91 on August 8. The shares finished at $70.30 on August 1 prior to the market downturn. In my view, the shares are still trading at a premium. My concern is high interest rates and soaring cost of living expenses reducing discretionary spending. I hold a trim recommendation.

SELL – Lovisa Holdings (LOV)

This global fashion jewellery and accessories retailer, with a vertically integrated supply chain, caters to millennials. It operates in more than 30 countries with standardised store formats in high traffic areas. The shares have risen from $24.40 on January 2 to trade at $32.61 on August 8. Investors may want to consider cashing in some gains in this volatile global economy. My recommendation is to trim holdings and wait for stability to return to the global economy.

James Nicolaou, PAC Partners

BUY RECOMMENDATIONS

BUY – Intelligent Monitoring Group (IMB)

IMB is a leading provider of monitored security and IoT (internet of things) service solutions to more than 180,000 businesses, homes and individuals across Australia and New Zealand. It has a big recurring revenue base with strong margins. The company recently upgraded EBITDA guidance for fiscal year 2024. It offers a stronger balance sheet and has increasing capacity to unlock growth in the commercial and residential markets. The company is trading on an attractive valuation.

BUY – Credit Clear (CCR)

This debt collection company generated unaudited revenue of $11.5 million in the fourth quarter of fiscal year 2024, an increase of 28 per cent on the prior corresponding period. The company recently upgraded underlying EBITDA guidance to about $4 million for full year 2024 compared to previous guidance in excess of $3.7 million. Using proprietary technology to digitise the collection process improves efficiency and effectiveness. A growing client base underpins a brighter outlook.

HOLD RECOMMENDATIONS

HOLD – Clearview Wealth (CVW)

Clearview is an Australian life insurance business that partners with financial advisers. Its integrated platform is attracting new clients, and the company is becoming a key player in the industry. The company is driving down costs by reducing re-insurance. CVW was recently trading an appealing dividend yield above 7.5 per cent.

HOLD – Superloop (SLC)

The internet service provider added 40,000 net new customers in the first half of fiscal year 2024, an increase of 38.1 per cent on the prior corresponding period. Total revenue of $197.6 million was up 32.7 per cent. SLC has been awarded a six-year exclusive contract to provide wholesale internet services to Origin Energy Retail’s broadband customer base of about 130,000. The shares have performed strongly in the past year.

SELL RECOMMENDATIONS

SELL – Spartan Resources (SPR)

SPR recently announced a mineral resource estimate update for its Dalgaranga gold project in the Murchison region of Western Australia. The emerging underground mining operation comprises several deposits, including Never Never and Pepper, among others. Drilling at Never Never and Pepper outlined 1.87 million ounces at 8.65 grams a tonne. It was announced in June 2024 that Ramelius Resources (ASX: RMS) had made a strategic investment in SPR. Investors may want to consider taking a profit in Spartan as the shares have risen from 51 cents on January 2 to trade at $1.087 on August 8.

SELL – Mineral Resources (MIN)

Two of the company’s global commodities, iron ore and lithium, have been experiencing supply gluts. Iron ore inventory is building in Chinese ports as construction slows. The lithium price has plunged in the past 12 months. MIN’S share price has fallen from $79.49 on May 20 to trade at $50.45 on August 8. Investors may want to consider selling MIN until a brighter outlook emerges for iron ore and lithium. Please note Mineral Resources is recommended as a buy and a sell this week as experts offer different views about the company.

Don’t Buy Just Yet

You will want to see this before you make any decisions.

Before you decide which shares to add to your portfolio you might want to take a look at this special report we recently published.

Our experts picked out The 5 best ASX shares to buy in 2024.

We’re giving away this valuable research for FREE.

Click below to secure your copy

John Edwards, Novus Capital

BUY RECOMMENDATIONS

BUY – APA Group (APA)

APA Group is the biggest owner of natural gas pipelines in Australia and is looking to grow its electricity transmission business. It contracts with energy retailers transporting gas via its pipelines from production fields to customers in major cities. The recent dividend yield of around 7 per cent per annum is sustainable, with growing franking in coming years. Core earnings momentum should build as cost growth stabilises and new investment generates income.

BUY – Ricegrowers (SGLLV)

Ricegrowers has acquired an Australian premium dog food company to be integrated into its existing pet food business. This should provide synergies to its supply chain and distribution, with the purchase funded from existing cash and borrowings. SGLLV shares have performed well in calendar year 2024 to rise from $6.53 on January 2 to trade at $8.59 on August 8. Our 12-month price target is $11.

HOLD RECOMMENDATIONS

HOLD – Deterra Royalties (DRR)

The company manages a portfolio of royalty assets across a range of commodities. Deterra has made a debt funded, all cash offer to acquire Trident Royalties PLC for about $276 million via a UK scheme of arrangement. Concerns exist that the proposed acquisition may dilute the high quality iron ore royalty and lower its future dividend yield. Keep a close eye on developments.

HOLD – Meteoric Resources NL (MEI)

Meteoric has raised $27.5 million in a placement at 11 cents a share. The company is also undertaking a share purchase plan at 11 cents a share to raise up to an additional $5 million.   Proceeds will be used to develop the Caldeira rare earth element (REE) project in Brazil. Proceeds will also be used to complete a pre-feasibility study, build a pilot plant and for licences and approvals. The Caldeira project is one of the highest-grade ionic absorption clay REE deposits in the world. I own the stock.

SELL RECOMMENDATIONS

SELL – Fortescue (FMG)

The share price of this iron ore giant has fallen from $29.39 on January 2 to trade at $18.24 on August 8. We believe FMG shares are still trading at a premium to the more diversified BHP Group and Rio Tinto. We’re concerned about Fortescue’s lower grade iron ore. A focus on decarbonisation is resulting in a preference for higher grade ore. Our 12-month price target is $17. Please note Fortescue is recommended as a buy and a sell this week as experts offer different views about the company.

SELL – Kogan.com (KGN)

The online retailer operates in a fiercely competitive sector. It competes against Amazon, eBay, Temu and others. Gross sales of $184.1 million in the fourth quarter of fiscal year 2024 fell by 1.5 per cent on the prior corresponding period. Gross profit of $39.9 million was up by 1.5 per cent. The share price has fallen from $8 on April 2 to close at $4.29 on July 1. The shares were trading at $4.01 on August 8. Strained household budgets leave us with a 12-month target of $3.50.

Related Articles:

• The best automated trading platforms
• The Best CFD Trading Platform in Australia
• Stock Trading in Australia
• A Guide to Day Trading ASX Shares

The above recommendations are general advice and don’t take into account any individual’s objectives, financial situation or needs. Investors are advised to seek their own professional advice before investing. Please note that TheBull.com.au simply publishes broker recommendations on this page. The publication of these recommendations does not in any way constitute a recommendation on the part of TheBull.com.au. You should seek professional advice before making any investment decisions.