Day: 21 December 2021

Shares in Beach Energy Ltd (ASX: BPT) have been on a lumpy run these past 3 months. Prices have come off a high of $1.50 and are trading at $1.22 at the time of writing. That’s up 0.41% on yesterday’s close.

As such, shares are now trading in line with July 2021 ranges and are down around 32% this year to date. Oil prices have been equally as volatile these past few months. That downward pressure has been spilling over into adjacent markets and ASX resource players such as Beach Energy.

Even with the recent pullback in share price, several analysts remain constructive on Beach Energy coming into 2022. So is it a buy? Let’s take a closer look.

Is Beach Energy a buy in 2022?

Interestingly, the team at Macquarie reckons that 30% shareholder Seven Group Holdings Limited (ASX: SVW) could obtain control over the entire business, which should be factored into the investment debate.

Macquarie notes “it would not be a stretch for Seven to obtain control (circa $500 million to $600 million additional stock)”.

It also notes that Seven has historically shown “an appetite to act rapidly, where it sees opportunity to add value from obtaining control of underperforming portfolio companies”.

Macquarie believes Beach’s gas-oriented portfolio is resilient to what it dubs “the energy transition”, however, it remains neutral on the shares at a $1.40 valuation.

Checking the spread of analysts provided by Bloomberg Intelligence, the sentiment appears overwhelmingly bullish on Beach Energy coming into 2022.

Specifically, 14 analysts — or around 74% of the list — reckon that Beach Energy is a buy, while just 3 have it as a hold and 2 as a sell.

According to the list, the consensus price target for the next 12 months is $1.64, implying an upside potential of 35% at the time of writing.

However, the sentiment shows significant spread, with the distance between the highest and lowest price targets spanning 159% from $2.70 to $1.04.

Plus, even if these forecasts play out and the stock gains 35% to the consensus price target, Beach Energy would still just be reclaiming its losses of 34% made over the last 12 months.

Moreover, Beach Energy has missed 6 out of its last 8 earnings per share (EPS) estimates and trades at a forward price to earnings (P/E) of 6.26x at the time of writing. That’s below the S&P/ASX 300 Metals and Mining Index (ASX: XMM)’s trailing P/E of 15.2x.

Beach Energy share price summary

The Beach Energy share price has lost momentum these past 12 months and is down 34% in that time after losing a further 33% this year to date.

The downward pressure has continued this last month with shares down more than 2% in that time.

The post What are these top brokers betting for Beach Energy (ASX:BPT) shares in 2022? appeared first on The Motley Fool Australia.

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• Why did the Beach Energy (ASX:BPT) share price lift today?
• 5 things to watch on the ASX 200 on Tuesday
• 5 things to watch on the ASX 200 on Wednesday

The author has no positions 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 recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 

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The Insurance Australia Group Ltd (ASX: IAG) share price is moving in circles on Tuesday. This comes as the insurance giant revealed a reshuffle in the senior management team.

At the time of writing, IAG shares are down 0.12% to $4.225 apiece. It’s worth noting that in the past month, its shares have fallen by more than 6%.

IAG finds CRO replacement

In a statement to the ASX, IAG advised it has appointed Peter Taylor as the new group chief risk officer (CRO).

Mr Taylor brings an extensive wealth of knowledge into the role, having held various titles with large organisations. 

His previous experience includes 11 years in risk-focused roles at Commonwealth Bank of Australia (ASX: CBA). Mostly comprising under the banner of EGM and chief risk officer through various departments.

Currently, Mr Taylor is serving as general manager of enterprise risk at Westpac Banking Corp (ASX: WBC). He is responsible for group-wide aspects of risk management, assurance and governance.

IAG managing director and CEO, Nick Hawkins commented:

Peter has more than 30 years of corporate experience including several enterprise risk roles with large financial services companies, with 10 years working with regulators, Boards and management. The combination of his skills with his passion for risk means he is extremely well equipped to take on this hugely important role for IAG.

Mr Taylor will join IAG in the middle of 2022, provided his appointment secures the necessary regulatory approvals. In the interim, Tim Plant who is chief insurance and strategy officer will take over as acting group chief risk officer.

The inclusion comes as IAG’s former chief risk officer, David Watts handed his resignation from IAG in September. Mr Watts is due to formally leave IAG on 11 February 2022.

In addition, group executive strategic projects, Craig Olsen will depart the company on 28 February 2022.

IAG share price snapshot

Over the last 12 months, the IAG share price has lost around 12%, with year-to-date down 10%. The company’s shares have lost 50% of its wealth since July 2019, particularly when COVID-19 hit.

In contrast, the S&P/ASX 200 Index (ASX: XJO) has gained 9% from this time last year and is up 10% year-to-date. The ASX 200 also reached a record high of 7,632 points in mid-August.

Based on today’s price, IAG presides a market capitalisation of roughly $10.43 billion, with approximately 2.47 billion shares on issue.

The post Why is the IAG (ASX:IAG) share price heading south today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras 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 owns and has recommended Insurance Australia Group Limited. The Motley Fool Australia has recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Race Oncology Ltd (ASX: RAC) share price is climbing today on the back of the company’s latest capital raise.

During morning trade, the pharmaceutical company’s shares are up 3.64% to $3.42 apiece.

What did the company announce?

Investors are driving up the Race Oncology share price following the company’s strongly supported share purchase plan (SPP).

According to its release, Race Oncology advised it has successfully completed its SPP, raising $29.7 million after a scale back. This represents around 6.6% of the company’s issued capital as of today. The offer received strong support from 2,340 shareholders, who applied for more than $43.9 million under the SPP.

The retail component of the company’s equity raising efforts will see 9.9 new million shares created at $3 each.

The funds raised will go towards a number of company programs. These include:

• Phase 1b/2 FTO solid tumour clinical trial ($8 million);
• Cardio-protection Phase 2b clinical trial in breast cancer patients ($7.5 million);
• Phase 2 EMD AML/MDS clinical trial in Europe ($9.2 million);
• Improved formulations of Zantrene ($3.2 million);
• Preclinical cardio-protection studies ($1 million); and
• Development of new molecules ($0.8 million).

The SPP shares are expected to be issued today, and be available for trading from tomorrow.

Race Oncology managing director and CEO Phil Lynch commented:

The number of applications reflects enthusiasm for the significant potential of our lead drug Zantrene, and this enables us to implement our planned clinical and drug development plans across the three-pillar program. We move into 2022 in an exceptional position, with many critical, reportable milestones ahead of us.

Race Oncology share price snapshot

The Race Oncology share price has gained more than 97% in the past 12 months and is up by 95% year to date.

Based on today’s price, Race Oncology has a market capitalisation of about $493 million, with 149.54 million shares on issue.

The post Here’s why the Race Oncology (ASX:RAC) share price is edging higher appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor Aaron Teboneras 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 Bruce Jackson.

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The AMP Ltd (ASX: AMP) share price is falling this morning amid news the company is ditching the New Zealand Exchange (NZX) prior to its demerger next year.

The company will delist from the country’s exchange in February and all shares traded there will be automatically moved to the ASX.

At the time of writing, the AMP share price is 90.7 cents, 1.41% lower than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) is up 0.03% this morning.

Let’s take a closer look at today’s news from the financial services company.

AMP share price falls amid plan to leave the NZX

Come early February, AMP will be a sole listed company, with its shares only available to trade on the ASX.

According to the company, delisting from the NZX will help it simplify its shareholder administration. In a letter to New Zealand-based shareholders, AMP says:

The number of AMP shareholders who hold shares on the New Zealand exchanged has significantly reduced over time. Given the accessibility of the ASX to New Zealand-based shareholders, AMP considers delisting from NZX is an appropriate step.

After the company leaves the NZX, AMP’s New Zealand investors will need to approach a broker with the ability to buy and sell on the ASX in order to trade their shares.

The AMP share price opened 1.03% lower in New Zealand today and has been trading flat since.

The delisting will go ahead prior to the company’s planned demerger during which its Private Markets business will be split from the company. That’s expected to go ahead in the first half of 2022.

According to the company, NZX Regulation Limited, an entity charged with the NZX’s regulatory functions, has approved the delisting.

Though, it’s still subject to AMP meeting certain conditions. Investors who trade the company’s stock through the NZX don’t need to do anything ahead of the delisting.

AMP plans to stop the trading of its shares on the NZX at 5 pm on Wednesday 2 February. It will delist on 4 February.

Any formerly NZX-listed stock will trade on the ASX from 7 February.

Following the delisting, AMP will still offer its dividend in New Zealand Dollars. It also offers dividends in Great British Pounds.

The post AMP (ASX:AMP) share price slides amid NZ delisting news appeared first on The Motley Fool Australia.

More reading

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• Own AMP shares? Here’s why the company could be looking to raise capital
• Top brokers name 3 ASX shares to sell next week

Motley Fool contributor Brooke Cooper 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 Bruce Jackson.

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The BlueScope Steel Ltd (ASX: BSL) share price has reclaimed some territory in December and jumped by 4% yesterday to close at $21.91.

The price of steel rebar has bounced off a low of 4303 Chinese Yuan per tonne (CNY/T) to now trade at more than 4651 CNY/T in December. That gain has inflected positively for the BlueScope share price.

Zooming out over a wider timer frame, it’s clear there’s been an all-out war between the bulls and the bears since late September.

BlueScope shares have traded within a tight range of around $1 over that time, meaning the trend channel has been largely sideways. Prices have been capped at $21 at the upper resistance mark and have hit and/or nudged past that level 10 times in the last 3 months. Meanwhile, prices have had good support at the $20 level from the bottom as well.

With this in mind, and with mixed commentary around the price of steel, let’s look at what the experts are saying about the outlook for BlueScope as an investment in 2022.

What are the brokers saying?

According to the team at Jefferies, BlueScope could be a buy right now. The firm recently upgraded it to a buy, and now values the company 7.4% higher at $24.60 per share.

Jefferies notes that it overshot its estimates on how quickly spreads would compress when it downgraded BlueScope to a hold back in September.

Analysts at the firm reckon market expectations on steel and BlueScope are too pessimistic. They note that “estimates look much too low and seemingly ignore the growth initiatives being actively pursued by BSL across its portfolio”.

These initiatives are yet to be priced in by the market, Jefferies says. It reckons 2022 might be a year of inflection for the BlueScope share price given the recent volatility, which could offer opportunities.

JP Morgan agrees with its fellow broker and also retained its buy rating in a recent note to clients. The firm has “factored in the latest forward curves for steel prices, along with lower iron ore prices”, even when downgrading its CY22 iron ore price by 12% to $92/tonne.

The firm also made both 13% and 9% cuts to East Asia and US hot-rolled coil (HRC) prices that reduce its FY22/23 earnings before interest and taxes (EBIT) estimates by 6% and 25%, respectively. These now sit at 7% and 10% above the consensus figure, according to the release.

JP Morgan is heavily bullish on the BlueScope share price. It reckons the company will continue to top up its $500 million share buyback program by another $500 million–$750 million with the February results (equivalent to over 10% of market capitalisation).

It subsequently revised its free cash flow yield estimates to 29% in FY22 and 15% in FY23 – figures that help prop up BlueScope’s buyback program – and adjusts its valuation on the company to $30 per share.

In fact, in the list provided by Bloomberg Intelligence, 62% of the brokers covering BlueScope support it as a buy coming into 2022. The remainder have it as a hold or sell.

The consensus price target is $25 from this list, implying around $3 of upside potential at the time of writing.

BlueScope share price summary

Despite the recent volatility, the BlueScope share price has climbed by more than 23% in the last 12 months. It has also rallied 25% this year to date.

In the last month, it has gained around 5%, beating the benchmark S&P/ASX 200 index (ASX: XJO)’s return in that time.

In early trade today, it is slipping 0.78% to $21.74.

The post Is it a buy? Here’s what brokers are predicting for the BlueScope (ASX:BSL) share price in 2022 appeared first on The Motley Fool Australia.

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The author has no positions 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 Bruce Jackson.

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The Australian Clinical Labs Ltd (ASX: ACL) share price has hit a record high on Tuesday morning.

At the time of writing, the pathology services provider’s shares are up 10% to $5.47.

Why is the Australian Clinical Labs share price charging higher?

Investors have been bidding the Australian Clinical Labs share price higher this morning after it upgraded its guidance for the first half of FY 2022.

According to the release, the company expects its first half revenue to be between $497.3 million and $517.2 million. And on the bottom line, Australian Clinical Labs’ net profit after tax (NPAT) is expected to come in at between $116.3 million and $128 million.

As a comparison, the company’s previous guidance was revenue of $437.5 million to $454.9 million and NPAT of $86.3 million to $94.9 million.

At the mid-point of all ranges, this represents an upgrade of 13.7% for its revenue guidance and 35% for its NPAT guidance.

What drove the upgrade?

Management advised that the revenue guidance upgrade reflects continued strong demand for COVID-19 testing, particularly in VIC and NSW, as well as a sustained resilient performance of the non-COVID-19 business.

Whereas the profit guidance upgrade was driven by a combination of revenue growth and expanding margins from increased scale and operating leverage.

Positively, while the company has not provided guidance for the full year, management appears confident demand for testing will remain strong in the second half.

Australian Clinical Labs’ Chief Executive Officer, Melinda McGrath, commented: “We anticipate heightened volumes of COVID-19 testing to continue during the remainder of FY22 due to the impact of new variants and outbreaks, the lifting of travel restrictions and increased demand for both commercial and travel testing.”

The post Why the Australian Clinical Labs (ASX:ACL) share price is up 10% to a record high appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor James Mickleboro 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 recommended Australian Clinical Labs Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Healius Ltd (ASX: HLS) share price has been bouncing around in recent trading sessions.

This has been caused by a mixed reaction to a new acquisition, with some analysts questioning the price it paid.

What did Healius acquire?

Last week Healius announced an agreement to acquire leading bioanalytical laboratory business Agilex for an enterprise value of $301.3 million.

Agilex is expected to generate revenue and EBITDA in the range of $36-40 million and $14-16 million, respectively, in calendar year 2022. This values the transaction at 20x forward EBITDA.

Though, management does note that Agilex has strong future earnings growth potential and is expected to deliver low single digit earnings per share accretion in the first full year of ownership.

The reaction

The team at Citi was not overly impressed with the deal. In response the broker retained its neutral rating and $5.10 price target on Healius’ shares.

Citi commented: “We place a lot of emphasis on ROIC when assessing businesses because high excess returns have a positive compounding effect on valuations. We estimate the proposed HLS acquisition of Agilex was priced at a ~20x EBITDA or CY22E EBIT ROIC of <5%, well less than the cost of capital. It is not obvious to us that this acquisition is so strategic that it justifies the price paid.”

Elsewhere, Morgans has a few concerns over the price paid, but not enough to stop it from upgrading Healius’ shares to an add rating with a $5.79 price target.

Morgans commented: “Healius is acquiring Agilex Biolabs, a leading Australian bioanalytical laboratory, for A$301.3m in cash funded via existing debt. We see limited conditions to close (Jan-22), with the transition expected to be low single digit EPS accretive in the first full year. However, paying a peak multiple (20x EV/EBITDA) in a frothy market sees return metrics fall short and reliant on future above market growth for shareholder value.”

Nevertheless, thanks to strong COVID-19 testing demand, the broker has upgraded its earnings estimates and recommendation accordingly.

The broker concluded: “While we view adding a pricey clinical testing company adds another layer of complexity as the company continues to transition to a specialist diagnostic and day hospital operator, the near term remains all about COVID testing, with Omicron driving a new phase of the pandemic which we view as underappreciated by the market.”

In early trade on Tuesday, the Healius share price is up over 1% to $5.36.

The post Healius (ASX:HLS) share price higher despite analysts questioning acquisition value appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro 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 Bruce Jackson.

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The Goodman Group (ASX: GMG) share price has kept rising this month. It has notched up several all-time highs in December 2021. What’s going on?

Goodman is one of the world’s biggest industrial property groups. It has a presence in Australia, New Zealand, Asia, Europe, the UK, North America and Brazil. Goodman aims to create innovative property solutions that meet the individual requirements of customers, whilst finding long-term returns for investors.

What’s going on with the Goodman share price?

Since the start of the month, Goodman shares have risen another 6.5%.

The business has been benefiting from structural trends for a while now and COVID-19 effects are accelerating those trends.

Indeed, Goodman says that it has been deliberately positioning its portfolio over the last decade to adapt to and leverage the changes in the digital economy. Those changes are now being realised. Customer demand for high-quality properties close to consumers has never been greater, according to Goodman.

Those trends are helping Goodman’s rental growth, increased development activity and higher valuations.

The rental side of the business is seeing very high levels of utilisation. At 30 September 2021, Goodman had an occupancy rate of 98.4% with a portfolio weighted average lease expiry of 4.7 years. Its 12-month like for like net property income growth was 3.2% in the last quarter.

The assets under management (AUM) had increased to $62 billion.

Further growth is expected

Goodman is benefiting from increased customer demand, which has resulted in an acceleration of development, particularly in infill locations.

At 30 September 2021, its work in progress (WIP) had reached $12.7 billion, with an annual production rate for the year expected to average approximately $6.8 billion. The strong demand is driving “strong margins” and the yield on cost is currently at 6.8%. These are some of the underlying factors that may be helping the Goodman share price.

The pre-commitments have a long WALE of 14 years.

Regeneration of existing brownfield sites is providing more sustainable development opportunities closer to consumers. Goodman expects this activity to continue to be a major source of development into the future.

Goodman said that its outlook is strong and it’s expecting its AUM to grow to around $70 billion by June 2022. Last month, Goodman acknowledged that COVID disruptions have been managed so that they have had less impact on the business than initial assumptions.

The property business also said that due to the strength of development projects, leasing success and stronger-than-expected performance of its partnerships, it increased its FY22 market guidance for operating earnings per security (EPS), which is now expected to be at least 15%.

Broker rating on the Goodman share price

There are still quite a few buy ratings on the business. However, Goodman shares have risen to those price targets.

One of the highest price targets at the moment is from Morgan Stanley, which has a target of $26.50 on the business. That’s only slightly higher than where it is now, suggesting the price may not move much over the next year if the broker is right (or doesn’t change the target).

The post The Goodman Group (ASX:GMG) share price has notched up 8 all-time highs this month. Here’s why appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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 Bruce Jackson.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

What happened

The price of Ethereum (CRYPTO: ETH), the world’s second-largest cryptocurrency by market cap, was slipping today on a broader sell-off in crypto and stocks.

As of 2:31 p.m. ET, Ethereum was down 1% over 24 hours after losing as much as 4% earlier in the day.

So what

The only Ethereum-specific news out today was positive, as the Ethereum Foundation launched the Kintsugi Merge testnet, a step in the process to Ethereum’s Merge, which is its transition to Eth2, a set of upgrades that will make the cryptocurrency more scalable, secure, and sustainable.  

However, that news wasn’t enough to push the token’s price higher as Ethereum instead pulled back with the rest of the crypto and stock markets. Most high-profile cryptocurrencies and stocks were down today on fears of the omicron variant, which is already driving a spike in cases in the New York area. Investors are fearing that it could cramp the global economy, especially ahead of the busy holiday travel season.

The explanation for cryptocurrencies being down on the omicron news is less direct. You might expect another COVID-19 outbreak to drive gains in cryptocurrencies, as digital currencies benefitted from the initial phases of the pandemic and related lockdowns.

However, that hasn’t been the case. The new asset class has largely moved in tandem with big stock market moves because investors still view crypto as a risk asset. It goes up as risk appetites increase and it goes down as investors look for safer assets. 

Now what

There are few fundamental drivers when it comes to cryptocurrencies as the asset class is devoid of metrics that guide other productive asset classes like stocks or real estate.

However, Ethereum, which is the network on which most non-fungible tokens (NFTs) are bought and sold, has more real-world utility than any other crypto, and that along with its usage should help guide its value.

Still, it’s helpful to remember that cryptocurrencies are still likely to move with the broader direction of the stock market, and increased worries about omicron and an extended sell-off in stocks will likely push Ethereum lower. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Why the Ethereum price was sliding today appeared first on The Motley Fool Australia.

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Jeremy Bowman owns Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends Ethereum. 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 Bruce Jackson.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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With interest rates at virtually zero, bank deposits are not even counted as investments these days.

For example, at the Commonwealth Bank of Australia (ASX: CBA), you can lock away your money for 5 years and it would only earn 0.25% per annum.

That’s actually shrinkage in real terms, as inflation would likely run much higher than that.

So if an ASX shares fund declared that it’s on track for 10% gross income this financial year, a few eyebrows would be raised.

But that’s exactly what Plato Australian Shares Income Fund did this month.

Buybacks and miners handing out cash like there’s no tomorrow

Senior portfolio manager Dr Peter Gardner said multiple factors had come together to form a tsunami of yields.

“Because we manage our portfolio specifically for low tax investors such as retirees, we have been able to take advantage of off-market buybacks undertaken by key portfolio holdings including CBA, Woolworths Group Ltd (ASX: WOW) and Metcash Limited (ASX: MTS).”

After buybacks, ASX shares in the mining sector had treated investors well too.

“While the retraction in the iron ore price has worried investors, we’ve seen companies such as BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) generate exceptional cash and franking credits for investors in recent months and many of these strong companies remain highly profitable,” said Gardner.

“Looking ahead, there will be further tax-effective income opportunities in the sector. In particular, we think the BHP and Woodside Petroleum Limited (ASX: WPL) merger could result in BHP’s petroleum assets being spun-off in the form of a special dividend with franking credits attached.”

Don’t worry about Omicron

Even with the COVID-19 Omicron raging across the world, Gardner reckons the Australian economy looks strong heading into 2022.

“There appears to be little political appetite for widespread lockdowns in the foreseeable future and while variants bring uncertainty, we feel the strong economic bounce-back we’ve seen over the past year is sustainable,” he said.

“So when you look at financials, a return to pre-COVID levels of dividends looks likely over the next year and many of the leading banks have robust balance sheets.”

And with consumers armed with a cash stockpile after lockdown, retail ASX shares have much potential in 2022.

“We expect strong retail trading over Christmas to benefit select retailers such as JB Hi-Fi Limited (ASX: JBH) and Super Retail Group Ltd (ASX: SUL),” Gardner said.

“The retail sector is another area that could generate strong income in the second half of the financial year.”

Gardner added that an actively managed portfolio is critical to maximise the yields currently on offer.

“We do think investors are in the midst of a bonanza year for dividends.”

Over its 10-year life, the Plato Australian Shares Income Fund has returned 9.4% of income per annum including franking credits.

The post Fed up with term deposits? How to get 10% income from ASX shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Super Retail Group Limited. The Motley Fool Australia owns and has recommended Super Retail Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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