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Trading Places: Which ASX lithium favourite got the backing of State Street in February?
News
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- State Street becomes substantial shareholder of Liontown Resources and Sandfire Resources
- BlackRock has got off a flight and ceased to be a substantial shareholder in Qantas
- State Street ceases to be a share holder in Evolution Mining and Mineral Resources
Trading Places is Stockhead’s semi-regular, pretty damn fascinating recap of the latest red flag buying and selling of ASX stocks. It is here that the rubber really hits the road for fund managers, stakeholders, distant (and not-so-distant) relatives and other famous or infamous investors.
Specifically, Trading Places tracks substantial shareholder movements – namely when a trade in a company’s stock crosses or falls below the 5% threshold.
Substantial shareholders are usually directors, individual investors, institutional investors… or their distant (and not-so-distant) relatives, which they will refer to as listed related bodies corporate or something similar. You can see in detail these listed bodies on the company’s ASX announcement.
Shareholders are required to publicly declare via the exchange when their personal stake goes below or above 5%, and from there, every movement in their holdings while owning above 5%.
Those becoming and those ceasing to be substantial shareholders are the ones we think are worth noting, where a trade takes an investor over the 5% threshold or has them drop back below.
Here’s the form to get you started, if reading this makes you twitchy.
February market overview
There was little joy for investors in February with the ASX slumping after strong gains in January. According to S&P Dow Jones Indices (S&P DJI) latest report the S&P/ASX 200 dropped 2.5% in February, reducing YTD gains to 3.6%.
Mid and small caps lagged their blue-chip peers in February. The S&P/ASX MidCap 50 lost 3.2%, the S&P/ASX Small Ordinaries fell 3.7%.
February also coincided with reporting on the ASX. Datt Capital chief investment officer Emanuel Datt noted whether Australia experiences a recession or not, the message from reporting season was one of unevenness in opportunities and obstacles to performance going forward.
“Labour shortages, inflation and an increasing cost of capital are three of the most visible take aways from the current crop of company postings,” he said.
However, despite the topsy-turvy markets and outlook there were no shortage of changes in substantial holdings throughout February. Here’s some that got our attention at the month’s end.
Recent Buys
Swipe or scroll to reveal full table. Click headings to sort.
| Code | Company | Market cap | Date | Holder | Holding |
|---|---|---|---|---|---|
| SIQ | Smartgroup Corporation | $884.90 million | Feb-24 | Morgan Stanley and listed subsidiaries | 6.22% |
| IEL | IDP Education Limited | $7.79 billion | Feb-24 | Challenger Limited and its entities listed | 5.04% |
| NET | NetLinkz Ltd | $54.73 million | Feb-22 | Regal Funds Management Pty Ltd and its associates | 7.80% |
| LTR | Liontown Resources | $3.73 billion | Feb-22 | State Street Corporation and subsidiaries named | 5.70% |
| SFR | Sandfire Resources | $2.75 billion | Feb-27 | State Street Corporation and subsidiaries named | 5.34% |
| OML | Ooh!Media Limited | $938.45 million | Feb-27 | Australian Retirement Trust Pty Ltd | 5.04% |
| CSR | CSR Limited | $2.45 billion | Feb-22 | Blackrock Group and subsidiaries named | 5.04% |
State Street buys into lithium plays
State Street Corporation has become a substantial shareholder in one of the ASX’s favourite lithium stocks Liontown Resources (ASX:LTR) along with copper miner come base metals player Sandfire Resources (ASX:SFR).
As Stockhead’s Emma Davies reported LTR’s dream of becoming Australia’s next lithium producer is underway with the on-schedule start of open pit mining operations at its Kathleen Valley project in WA in early February.
SFR recently reported a mixed H1 FY23 result including record half-year sales revenue of $431.7 million, up 38% from $311.8 million in H1 FY22, EBITDA of $135.9 million, down 16% year on year and a net loss after tax of $27.1 million, down from a net profit of $55.2 million in H1 FY22.
The LTR share price has surged 40% YTD while SFR is up 10.87% for the same period.
Super Giant sees upside to Ooh! Media
Australian Retirement Trust has become a substantial shareholder of outdoor advertising and media company Ooh! Media (ASX:OML).
The company recently announced it had delivered an adjusted net profit after tax of $56.2 million. OML continued to capitalise on audience growth across its key Out of Home formats to deliver an 18% increase in revenue to $592.6 million.
Revenue in Road and Retail grew above pre-pandemic (CY19) levels while OMG said second half revenue in the Fly format grew 78% over the first half as airline capacity continued to increase back towards pre-COVID levels.
The OML share price has risen 23% for the same period.
The LTR, SFR and OML share price today:
Recent Sells
Swipe or scroll to reveal full table. Click headings to sort.
| Code | Company | Market Cap | Date of change | Holder |
|---|---|---|---|---|
| OZL | OZ Minerals Limited | $9.39 billion | Feb-22 | Mitsubishi UFJ Financial Group |
| QAN | Qantas Airways | $11.92 billion | Feb-27 | Blackrock Group and subsidiaries named |
| MIN | Mineral Resources | $16.96 billion | Feb-27 | State Street Corporation and subsidiaries named |
| KAR | Karoon Energy | $1.20 billion | Feb-21 | Mitsubishi UFJ Financial Group |
| BPT | Beach Eenrgy | $3.32 billion | Feb-22 | Macquarie Group and its controlled bodies corporate listed |
| VSL | Vulcan Steel | $1.08 billion | Feb-24 | Regal Funds Management Pty Ltd and its associates |
| EVN | Evolution Mining | $5.33 billion | Feb-22 | State Street Corporation and subsidiaries named |
Blackrock gets off a flight with Qantas
Blackrock has ceased to be a substantial holder of Qantas (ASX:QAN), which posted a record $1.4bn profit for the half vs the $456 million loss it reported a year ago.
The airline’s revenue more than tripled to nearly $10 billion as domestic and international travel restrictions ended.
However, the flying kangaroo has continued to struggle with reputational challenges. The QAN share price has risen 10.61% YTD.
State Street out of Evolution Mining and Mineral Resources
While favouring LTR and SFR, the shine has become dull in gold miner Evolution Mining (ASX:EVN) for State Street which ceased to be a substantial shareholder in February.
EVN has seen its statutory profits lift from $91m last half-year to $101m in 2022-23, with underlying NPAT up from $100m to $103m and EBITDA 13% higher at $446m.
Mine operating cash flow rose from $396m in H1 2022 to $477m in H1 2023, though net mine cash flow fell from $120m to $86m because of $302m of investment in projects, up from $203m in 2021-22.
State Street has also ceased to be a substantial shareholder in Mineral Resources (ASX:MIN), which as Stockhead’s Josh Chiat reported recently signed off last week on a near $1 billion investment with US-listed Albemarle (NYSE: ALB) to take a 50,000tpa half share in new lithium hydroxide processing capacity in China.
The EVN share price has fallen 4.77% YTD, while the MIN share price is up 16.82% for the same period.
