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Whitehaven Coal (ASX:WHC) shares gain amid market losses

Story Highlights

Whitehaven shares have continued to soar amid strong demand and high prices for coal. The company’s additional share buyback plan could drive the stock price to new highs in the future.

Whitehaven Coal (ASX:WHC) defied broader market losses to see its shares gain more than 4% in Australian morning trading today, hitting a new 52-week high of AU$9.33.

Rising alongside Whitehaven shares, were New Hope Corporation Limited (ASX:NHC), Rio Tinto Limited (ASX:RIO), and Fortescue Metals Group Ltd (ASX:FMG).

Whitehaven has benefitted from increased coal prices, which have soared this year amid strong demand from coal-fired power plants. 

2022 sustainability report

Whitehaven released its sustainability report, which highlights how the company is delivering value to its customers, partners, investors, workforce, and the community.

The company detailed its increasingly diverse workforce. More than 11% identify as Aboriginal and/or Torres Strait Islander, and more than 15% of staff are female.

Whitehaven also spent AU$354.5 million with local suppliers, as part of the company’s efforts to support regional growth.

Whitehaven’s share buyback program

Whitehaven shares also surged as the company plans to roll out an additional share buyback program. The company has almost finalised its first share repurchase program that has seen it spend more than AU$504 million since March 2022, with a target to buy back, up to 10% of the company’s shares. 

Whitehaven plans to seek shareholders’ approval from a fresh repurchase program at its next AGM slated for 26 October. Under the fresh buyback plan, the company plans to repurchase up to 240 million shares, or about 25% of its share count, over a 12-month period. At the current Whitehaven share price, the buyback program could cost the company more than AU$2 billion.

Whitehaven’s share price forecast 

Whitehaven has been among the high-flying ASX stocks in a volatile market, with its shares up more than 250% since the beginning of the year. According to TipRanks’ analyst rating consensus, Whitehaven stock is a Strong Buy based on eight Buys and one Hold. The average Whitehaven share price forecast of AU$8.84 implies nearly 5% downside potential, a sign that the stock has climbed faster than analysts expected. 

Whitehaven scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

Final thoughts

Whitehaven has not only delivered strong capital gains for investors this year, but the stock also offers an above-average dividend yield. The additional share buyback approval Whitehaven is seeking, has the potential to make the stock more scarce and increase its value in the future.

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