Insights

Here’s why the IGO share price is making headlines on Wednesday

A Western Australia Supreme Court made orders yesterday to affirm a major acquisition.
The post Here’s why the IGO share price is making headlines on Wednesday appeared first on The Motley Fool Australia. –

Shares of diversified miner IGO Ltd (ASX: IGO) have lifted 1.9% in afternoon trade on Wednesday and now fetch $12.05 apiece.

Despite trading down in recent weeks, IGO found buyers at the $10.54 mark and again at $11.16 as sellers were pushed out of the market.

The IGO share price has rallied 14% from 13 May to the time of writing, having whipsawed in 2022, as seen below.

IGO settles Western Areas transaction

Helping drive equity returns for IGO is confirmation the company’s acquisition of Western Areas Ltd (ASX: WSA) is now legally effective.

Following a Supreme Court of Western Australia’s orders to approve the scheme yesterday, IGO will now acquire all of the shares in Western Areas through its subsidiary, IGO Nickel Holdings Pty Ltd.

“[W]e are looking forward to welcoming the Western Areas team into the IGO business once the transaction has been completed on 20 June 2022,” the company wrote.

CEO Peter Bradford said the acquisition represented “a logical consolidation of key nickel assets in Western Australia”.

It enhanced IGO’s position “as a leading, independent producer of metals critical for a clean energy future”, he added.

We are looking forward to unlocking unique synergies across the combined nickel portfolio comprised of Nova, Forrestania and Cosmos, as well as the immediate commencement of the downstream nickel sulphate feasibility studies – bringing IGO closer to key customers in the clean energy and electric vehicle industries.

The Western Areas acquisition is a key milestone in the company’s growth narrative, having stirred controversy on its announcement on questions the company may be overpaying for the asset.

What do the brokers say?

Further clamping returns in recent weeks was a shift in sentiment from Goldman Sachs about the prospects of battery metals and electric vehicles.

Nevertheless, various research notes from other brokers have contrary evidence to Goldman’s assessment.

The Macquarie team pushed back on several of the downside risks covered by Goldman and note there were still legs for both sectors to run in the coming years.

Analysts at JP Morgan were also constructive on the sector earlier this year.

Meanwhile, analysts remain bullish on the stock on average, with more than 64% of coverage saying its a buy right now, according to Bloomberg data.

The average price target from this list is $13.20, around 9.5% above the current market price.

In the last 12 months, the IGO share price has gained 61%.

The post Here’s why the IGO share price is making headlines on Wednesday appeared first on The Motley Fool Australia.

Should you invest $1,000 in IGO right now?

Before you consider IGO, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and IGO wasn’t one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

More reading

Why Macquarie still sees ‘material upside’ for ASX lithium shares
Is the ASX about to wave goodbye to this billion-dollar nickel miner?
Why is the Galileo share price soaring 9% on Tuesday?
One broker’s outlook for lithium supply and demand and what it could mean for ASX lithium shares
Why Bubs, IGO, Strike Energy, and Woodside shares are pushing higher

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.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

  • This field is for validation purposes and should be left unchanged.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex Securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

FREE AAPL, TSLA, AMZN, PFE or MRO Share(s)
REGISTER TO BE ELIGIBLE FOR FREE SHARES
TRAVEL ACROSS THE FINANCIAL WORLD
Act Fast - Promotion Ends In
Click Here To Get Started
FREE AAPL, TSLA, AMZN, PFE or MRO Share(s)
REGISTER TO BE ELIGIBLE FOR FREE SHARES
TRAVEL ACROSS THE FINANCIAL WORLD
Act Fast - Promotion Ends In
Click Here For More Info