Day: 3 June 2022

S&P/ASX 200 Index (ASX: XJO) tech shares are leading the market on Friday following a strong session on Wall Street overnight.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) rose 2.69% as most Australians slept. At the same time, the S&P 500 Index (SP: .INX) gained 1.84% and the Dow Jones Industrial Average lifted 1.33%.

At the time of writing, the ASX 200 Information Technology Index (ASX: XIJ) is 2.56% higher. It’s being driven by some of the market’s most well-known names. For comparison, the ASX 200 is currently up 0.79%.

Let’s take a look at what’s helping to boost ASX 200 tech shares today.

ASX 200 tech shares lead the market on Friday

ASX 200 tech shares are taking off on Friday after their international counterparts recorded strong gains.

Among Thursday’s Nasdaq-listed winners were tech giants Tesla Inc (NASDAQ: TSLA) and Meta Platforms Inc (NASDAQ: FB). They gained 4.68% and 5.42% respectively.

Meanwhile, Amazon.com Inc (NASDAQ: AMZN) leapt 3.15% higher.

ASX 200 tech giants such as WiseTech Global Ltd (ASX: WTC) and Block Inc (ASX: SQ2) have followed suit and are outperforming on Friday.

Right now, shares in WiseTech are trading 5% higher at $42.96, while Block shares are also among the sector’s best performers, gaining 4.67% to reach $119.93.

 Meanwhile, market favourites Novonix Ltd (ASX: NVX) and Xero Limited (ASX: XRO) are lifting 4.5% and 2.8% respectively.

Today’s gains are likely to be particularly welcome for ASX 200 tech fans as the sector has been severely underperforming in 2022.  

It has tumbled more than 32% since the start of this year. For context, the ASX 200 is down nearly 5% year to date.

The post Why are ASX 200 tech shares having such a cracking Friday? appeared first on The Motley Fool Australia.

More reading

• Xero share price has 19% upside potential, top brokers say
• Why is the Block share price tumbling 4% on Thursday?
• Why did the Novonix share price tumble 22% in May?
• Why did the Xero share price go backwards in May?
• These were the worst performing ASX 200 shares in May

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. 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 positions in and has recommended Amazon, Block, Inc., Meta Platforms, Inc., Tesla, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Block, Inc., WiseTech Global, and Xero. The Motley Fool Australia has recommended Amazon and Meta Platforms, Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Core Lithium Ltd (ASX: CXO) share price is continuing to recover from its disastrous Wednesday performance today.

At the time of writing, the Core Lithium share price is trading $1.23, 7.89% higher than its previous close.

For context, the broader market is also in the green today. The S&P/ASX 200 Index (ASX: XJO) is up 0.72% right now. Meanwhile, the All Ordinaries Index (ASX: XAO) is boasting a 0.81% gain.

 Let’s take a closer look at what might be going on with the ASX lithium share on Friday.

Is this driving the Core Lithium share price today?

Core Lithium stock is rebounding alongside many of its ASX lithium peers today after the sector suffered a major tumble earlier this week.

The company’s stock slumped 20.43% on Wednesday after a bearish outlook from Goldman Sachs and reports Chinese electric vehicle manufacturer BYD is aiming to produce its own lithium.

Today’s (and yesterday’s) gains might, therefore, be a simple market correction following the sell-off event.

Indeed, fellow ASX lithium shares such as Pilbara Minerals Ltd (ASX: PLS), Liontown Resources Limited (ASX: LIO), and Lake Resources NL (ASX: LKE) are rebounding today. They’re currently up 5.04%, 5.8%, and 10.5% respectively.

Additionally, shares in lithium giant Mineral Resources Limited (ASX: MIN) is among the leaders of the ASX 200 today, having gained 4.1%.

Despite Wednesday’s downfall, the Core Lithium share price is still 95% higher than it was at the start of 2022. It has also gained more than 370% since this time last year.

The post Why is the Core Lithium share price leaping 8% on Friday? appeared first on The Motley Fool Australia.

More reading

• Which ASX lithium shares are rebounding on Thursday, and which are not?
• Core Lithium share price tumbles 8% as Goldman forecasts ‘sharp correction in lithium ‘
• Why is the Pilbara Minerals share price cratering 17% today?
• Why did the Core Lithium share price go backwards in May?
• Why has the Core Lithium share price surged 6% today?

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 Scott Phillips.

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At lunch on Friday, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a positive note. The benchmark index is currently up 0.75% to 7,230.3 points.

Here’s what is happening on the ASX 200 today:

Healius tumbles on trading update

The Healius Ltd (ASX: HLS) share price is tumbling lower today. This follows the release of an update which revealed that trading conditions have been tough in the second half. As a result, during the first five months of the half, the healthcare company has generated just under $100 million of EBIT. This compares to first half EBIT of $376 million.

Iron ore miners rise

Iron ore miners such as BHP Group Ltd (ASX: BHP) and Fortescue Metals Group Limited (ASX: FMG) are ending the week strongly. This follows a solid rise in the iron ore price overnight amid optimism that demand will strengthen now China is coming out of lockdowns. According to CommSec, iron ore futures rose by US$6.86 or 5.1% to US$142.20 a tonne.

Lithium shares rebound

It has been a much-needed positive day of trade for Australian lithium shares. The likes of Liontown Resources Limited (ASX: LTR) and Pilbara Minerals Ltd (ASX: PLS) are rebounding on Friday following strong gains by lithium stocks on Wall Street. Investors may believe that the selling this week has been overdone and created a buying opportunity.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Friday has been the Champion Iron Ltd (ASX: CIA) share price with a 7% gain. This follows a rise in the iron ore price overnight. Going the other way, the worst performer has been the Healius share price with a 6.5% decline following the healthcare company’s trading update.

The post ASX 200 midday update: Healius disappoints, BHP and Fortescue storm higher appeared first on The Motley Fool Australia.

More reading

• Could the Pilbara share price take off in June?
• It was an eventful month for Liontown shares in May. Here’s what went down
• Why is the Healius share price sinking to a 52-week low today?
• Was May a good month for the Pilbara Minerals share price?
• What is the BHP share price forecast for June?

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 Scott Phillips.

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The WAM Capital Limited (ASX: WAM) dividend is nearing an important milestone today.

However, this is not having a positive effect on the investment company’s shares as they slip 0.72% to $2.085 during late-morning trade.

Let’s take a look what’s the latest with WAM shares.

WAM shares set to go ex-dividend

The WAM board declared an interim dividend of 7.75 cents to eligible shareholders following the company’s half-year results in February.

However, to lock in the dividend, investors need to buy WAM shares before the market close today. The ex-dividend date is on Monday 6 June.

It’s worth noting though that historically when a company reaches its ex-dividend day, its shares tend to backtrack on the day. This is because the company’s value is often worth a tad less after paying out a portion of its profits to shareholders.

When can WAM shareholders expect payment?

For those who are eligible for the WAM interim dividend, shareholders will receive a payment on 17 June.

The dividend is also fully franked. Franking credits, or imputation credits, are highly regarded in the investing world. This is a type of tax credit that is passed onto shareholders when dividend payments are made by a company.

Essentially, the company is paying the tax on the dividends received by the shareholders.

In addition, investors can elect for the dividend reinvestment plan (DRP) which will add a portion of shares to their portfolio instead.

There is a 2.5% DRP discount rate, and the price will be determined by a daily volume-weighted average (VWAP).

The last election date for shareholders to opt-in to the DRP is on 9 June.

WAM share price snapshot

Since the beginning of 2022, the WAM share price has lost 6% and is down 5% in the last 12 months.

The company’s shares reached a 52-week low of $2.00 last month, before recovering some ground in the following weeks.

WAM commands a market capitalisation of roughly $2.26 billion and has a trailing dividend yield of 7.67%.

The post Hoping to secure the next WAM Capital dividend? Read this appeared first on The Motley Fool Australia.

More reading

• Is AFIC the best LIC on the ASX?
• 2 compelling All Ordinaries ASX shares this fund manager likes
• WAM Capital’s ASX founder has been buying shares. Here’s what we know

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 Scott Phillips.

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ASX lithium shares could make a rebound as some experts have come out to defend their bullish outlook for the sector.

These views stand in sharp contrast to the boom-to-gloom prediction from Goldman Sachs for lithium.

The broker’s forecast of a sharp retracement in the price of the battery-making ingredient is one of the key reasons ASX lithium shares were flogged on Wednesday.

Pilbara share price and peers getting a recharge

But bargain hunters could be returning already. The Pilbara Minerals Ltd (ASX: PLS) share price surged 6.1% to $2.42, Allkem Ltd (ASX: AKE) share price jumped 3.3% to $11.82 and Core Lithium Ltd (ASX: CXO) share price rocketed 7% to $1.22 in early trade.

Their redemption comes as Macquarie said it sees material valuation upside for lithium miners under its coverage. The broker commented:

Battery grade lithium carbonate prices are the key driver to our valuation outlook for lithium miners. We note that PLS is currently pricing in realised prices around US$13,000/t (China Lithium Carbonate 99.5%, US$/t, Ex VAT).

This is ~80% below current spot lithium carbonate prices in China and is equivalent to a flat spodumene price of ~US$950/t, 85% below the last BMX spot sale.

Pilbara share price is the top pick for Macquarie

Further, news that Chinese electric vehicle (EV) maker BYD bought six African lithium mines isn’t as bearish as it sounds. Lithium bears took the news to mean that the large EV maker will no longer add to demand pressure for the commodity.

That certainly sounds credible given that the mines are said to hold one million tonnes of lithium carbonate equivalent (LCE).

But Macquarie believes logistical challenges are likely to limit the pace of mine development and production.

The broker’s top pick among ASX lithium shares is the Pilbara share price.

Supply-side response slower than you’d might think

Meanwhile, Shaw and Partners have also expressed doubts about how readily new supplies of lithium can be brought to the market.

While the earth’s crust has an abundance of lithium, the broker noted that commercial lithium deposits are scarce.

No substitute for ASX lithium shares

Shaw doesn’t think now is the time to be bearish on ASX lithium shares. Its positive view is also driven by its belief that there is little threat from substitutes for lithium when it comes to batteries.

This is unlike cobalt and nickel with some battery manufacturers developing new technologies to replace these metals.

Shaw said:

Lithium ties into the electrification thematic that is taking over the globe. The reason for the hype is lithium has unique characteristics that are difficult to replicate. It is a light metal but is able to store large amounts of energy and is an excellent conductor of electricity.

The post Could the Pilbara share price take off in June? appeared first on The Motley Fool Australia.

More reading

• Was May a good month for the Pilbara Minerals share price?
• Aside from Goldman Sachs, what are other brokers saying about ASX lithium shares?
• Which ASX lithium shares are rebounding on Thursday, and which are not?
• ASX 200 midday update: Pilbara Minerals names new CEO, Wesfarmers’ strategy update
• Is this the real reason ASX lithium shares cratered on Wednesday?

Motley Fool contributor Brendon Lau has positions in Allkem Limited. 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.

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The Woodside Energy Group Ltd (ASX: WDS) share price is edging lower, down 0.06% in late morning trade.

Woodside shares closed yesterday at $31.75 and are currently trading for $31.73.

This comes after the S&P/ASX 200 Index (ASX: XJO) energy share kicked off its first day of trading on the New York Stock Exchange yesterday (overnight Aussie time).

Why did the company dual list on the US exchange?

If you’re looking to see how the Woodside share price is tracking on the NYSE, it still trades under the same name but with the ticker (NYSE: WDS).

The shares are listed in the form of American Depositary Shares.

What are those?

The company explained:

ADSs are US dollar denominated negotiable instruments represented by American Depositary Receipts (ADRs) issued by a depositary bank that facilitate US trading and investment in shares of non-US companies. The ADRs will be issued under Woodside’s existing ADR program, which is administered by Citibank, N.A.

Each Woodside ADS represents one ordinary Woodside share.

The dual listing comes the day after the merger transaction between Woodside and BHP Group Ltd’s (ASX: BHP) petroleum business was officially completed.

Woodside share price drops on NYSE listing debut

Woodside fluctuated between modest gains and losses for most of its initial day of trading in the US markets. But in the final 30 minutes of trade, selling took over and the stock closed down 1.5% for the day at US$23.15 per share (AU$31.71).

In after hours trading, the Woodside share price has lifted on the NYSE to US$23.35.

Woodside shares gained 6.1% on the ASX yesterday, likely supported by a $1.1 billion block trade the previous night, prior to the release of 900 million new shares related to the merger with BHP.

Woodside share price snapshot

Woodside has been a strong performer in 2022, buoyed by soaring energy prices.

Year-to-date the Woodside share price is up 45%. That compares to a 3% loss posted by the ASX 200 over that same period.

The post Woodside share price edges lower following NYSE debut appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Friday
• Why Bubs, IGO, Strike Energy, and Woodside shares are pushing higher
• Why is the ‘new’ Woodside share price leaping 6% today?
• ASX 200 midday update: Pilbara Minerals names new CEO, Wesfarmers’ strategy update
• 5 things to watch on the ASX 200 on Thursday

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.

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Shares of Xero Ltd (ASX: XRO) have jumped from the open today and now rest at $87.18 apiece.

The Xero share price has struggled in 2022 and having booked extensive losses since trading resumed in January.

Brokers are bullish on Xero

Despite the ASX tech stock’s lacklustre performance this year to date, analyst sentiment appears to be tilted towards the upside for Xero.

JP Morgan identified its reasoning for Xero in a recent note, stating the company “has proven its credentials in the ANZ market and is now looking to replicate its model in its international markets”.

The JP Morgan team added:

In addition, the company is embarking on a ‘platform’ strategy that is expected to lead to higher ARPU [average revenue per user] and growth in LTV [loan-to-value].

We rate Xero overweight with the stock trading below our price target [$97/share].

Meanwhile, around 59% of brokers covering Xero have it rated as a buy right now, whereas around 18% have it rated as a hold, according to Bloomberg data. The remaining coverage urges clients to sell Xero shares.

Within this group, the consensus price target is $100.97 per share, offering around 19% upside potential should the Xero share price surge to that mark.

But the company needs “big customer growth” to first get there, in the opinion of Bloomberg Intelligence senior equity analyst Matt Ingram. He wrote:

Xero needs to sustain its 20% plus 2019-22 customer growth and lift ARPU, while controlling costs to reach a decent level of profit.

ARPU is the key driver; International’s NZ$358, well below QuickBook’s NZ$783 outside the US, needs to improve outside Australia.

Xero also needs to sustain strong subscriber growth outside the US. Operating leverage may boost operating income, but investment will curb profit.

In the last year of trade, the Xero share price has clipped a 34% loss, after heading south a further 6% this past single month.

The post Xero share price has 19% upside potential, top brokers say appeared first on The Motley Fool Australia.

More reading

• Why did the Xero share price go backwards in May?
• Best ASX shares to buy in June 2022
• 3 ASX shares I’m telling my clients to buy: advisor
• Xero share price charges higher: Can this tech share keep rising?
• 5 things to watch on the ASX 200 on Monday

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 positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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With Firefinch Ltd (ASX: FFX) shares trading ex-dividend this morning, it won’t be long until we see Leo Lithium Limited (ASX: LLL) shares on the ASX boards.

Ahead of its listing later this month, let’s take a look at the Australian share market’s latest lithium share.

What is Leo Lithium?

Leo Lithium will be home to Firefinch’s demerged lithium operation. This comprises a 50% ownership in the Goulamina Lithium Project in Mali. Chinese giant, Ganfeng Lithium, owns the balance.

The company highlights that the Goulamina Lithium Project in Mali is one of the world’s largest undeveloped high quality spodumene deposits.

Its recent definitive feasibility study update confirmed Goulamina as a long life, large scale and low-cost open pit project which is expected to produce 726,000 tonnes of annual spodumene concentrate at an average cash cost of US$312 per tonne.

In partnership with Ganfeng, Leo Lithium has commenced initial development activities. If all goes to plan, stage one production of 506,000 tonnes per annum is anticipated to commence during the first half of 2024.

Pleasingly, Ganfeng has contributed US$130 million in equity funding to the joint venture and will either source up to US$64 million in external debt or provide US$40 million of debt itself to fund the development of stage one.

Leading the charge will be Simon Hay. He was previously the CEO of Galaxy Resources prior to its merger with Orocobre, which later became Allkem Ltd (ASX: AKE).

When are Leo Lithium shares trading?

There’s still a little time to wait before Leo Lithium shares commence trade on the ASX boards.

According to its most recent timetable, management expects them to start trading on 23 June 2022.

Shareholders will no doubt be hoping the recent volatility in the lithium industry will have calmed down by then.

The post When will Leo Lithium shares be roaring on the ASX boards? appeared first on The Motley Fool Australia.

More reading

• Why is the Firefinch share price crashing 66% today?
• Why BlueScope, Firefinch, Monash IVF, and South32 shares are pushing higher
• Why is the Firefinch share price shooting 10% higher today?
• Why has the Firefinch share price tumbled 22% in a week?

Motley Fool contributor James Mickleboro owns Allkem shares. 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.

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The National Australia Bank Ltd (ASX: NAB) share price has been outperforming the S&P/ASX 200 Index (ASX: XJO) this year. Can the shares keep rising?

In 2022 to date, the ASX 200 has fallen 5%. In comparison, the NAB share price has gone up 6%.

But, as the saying goes, past performance is not a guarantee of future performance. So can NAB shares continue to perform?

While it’s impossible to know precisely what a share price is going to do, we can gain insights from what the company says. Analysts can also outline their research and opinions.

NAB commentary

Last month, NAB said that recent data highlighted ongoing strength in the Australian economy. It’s expecting consumption to remain robust, partly supported by a run-down in accumulated household savings.

NAB also said there was a healthy outlook for business investment with high levels of dwelling investment and government spending, supporting forecast GDP growth of 3.4% in 2022 and 2.1% in 2023.

In addition, the big four ASX bank is expecting the unemployment rate to remain low “for some time”.

NAB also said that it’s optimistic about the growth outlook. The bank said that its investments positioned it well, “particularly at a time when business investment intentions are high and business credit is growing at the fastest rate since the GFC”.

It’s focused on cash earnings per share (EPS) growth in a period of higher growth, higher inflation and higher interest rates. Within the business, its lending growth has accelerated and it’s focused on productivity. It’s expecting cost growth of between 2% to 3% in FY22.

Broker opinion on the NAB share price

The broker Ord Minnett does think that NAB shares can keep rising. It has a price target on the bank of $34.50, which implies a possible rise of around 10%.

Ord Minnett thinks that NAB will benefit from rising interest rates, helping the net interest margin (NIM).

Based on the projections, the broker calculates that the NAB share price is valued at 15x FY22’s estimated earnings and 13x FY23’s estimated earnings. The NAB grossed-up dividend yield in FY22 could be 6.8% according to Ord Minnett.

However, it was recently pointed out by the broker Morgan Stanley that the big four ASX banks could be impacted by stressed exposure in the construction sector in the event of a downturn.

The NAB CEO Ross McEwan himself said about the construction industry:

It’s certainly one of the sectors that we are keeping a close eye on very recently.

A lot of them have been having some difficulties there so that is, as a sector, the most worrying part of our bank when we look across it.

We are yet to see that the economy is having difficulty…but as interest rates start to rise, we have to be conscious that there will be some customers who may have some difficulties.

Morgan Stanley’s rating on the bank is ‘equal-weight’, with a price target of $31.80. The rating is essentially a ‘hold’ or ‘neutral’. The price target implies a slight rise over the next year.

The broker’s numbers put the NAB share price at 15x FY22’s estimated earnings and 14x FY23’s estimated earnings. Morgan Stanley’s dividend estimate for FY22 implies a grossed-up dividend yield of 6.8%.

The post What’s the outlook for the NAB share price in June? appeared first on The Motley Fool Australia.

More reading

• 2 top ASX dividend shares to buy according to analysts
• What’s dragging on ASX 200 bank shares like NAB on Thursday?
• Why did the NAB share price go backwards in May?
• ASX 200 midday update: NAB completes acquisition, lithium miners sink, Origin tumbles
• NAB share price higher after completing $1.2bn Citi consumer business acquisition

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 Scott Phillips.

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The JB Hi-Fi Limited (ASX: JBH) share price is currently rated a buy by multiple brokers.

As investors, it can be worth paying attention to a potential opportunity if more than one analyst thinks that the business is a buy.

JB Hi-Fi is one of the largest retailers in Australia. It operates three different businesses – JB Hi-Fi Australia, JB Hi-Fi New Zealand and The Good Guys.

While the business has seen growth since the onset of the COVID-19 pandemic, the company is rated as a buy by analysts that think the JB Hi-Fi share price can keep rising.

Buy ratings

One of the latest brokers to rate JB Hi-Fi as a buy is Macquarie. It currently has a price target of $57.80 on the company. That implies a potential rise of around 25% over the next year if the broker is right.

One of the main things that Macquarie noted was a recent trading update which showed growth from JB Hi-Fi. The broker thinks that JB Hi-Fi can continue to benefit from the consumer being in good shape.

Looking at that update for the third quarter of FY22, JB Hi-Fi said that total JB Hi-Fi Australia sales were up 11.9% year on year, JB Hi-Fi New Zealand sales were up 4.8% in New Zealand dollars and The Good Guys sales increased by 5.5%.

That brought the total year-to-date figures to a growth of 1.9% for JB Hi-Fi Australia and 1.1% growth for The Good Guys. However, JB Hi-Fi New Zealand sales were down 1.8% for the nine months to 31 March 2022.

Another broker that currently rates JB Hi-Fi as a buy is Credit Suisse, with a price target of $60.08. That implies a possible rise of the JB Hi-Fi share price of around 30%.

Sizeable dividends expected

Both of these brokers think that JB Hi-Fi is going to pay a fairly substantial dividend in FY22 and again in FY23.

According to Macquarie, JB Hi-Fi could pay a grossed-up dividend yield of 8.2% in FY22 and 7.6% in FY23.

Credit Suisse has estimated that JB Hi-Fi is going to pay a grossed-up dividend yield of 8.5% in FY22 and then 6.6% in FY23.

JB Hi-Fi share price valuation

While both brokers may rate the business as a buy, they have different projections on how much net profit after tax (NPAT) the company is going to generate in FY22 and FY23, leading to different forward price/earnings (p/e) ratio estimates.

Using Macquarie’s numbers, the JB Hi-Fi share price is valued at 11x FY22’s estimated earnings and 12x FY23’s estimated earnings.

Credit Suisse’s projections put JB Hi-Fi shares at 11x FY22’s estimated earnings and 14x FY23’s estimated earnings.

The post Why experts rate the JB Hi-Fi share price a buy right now appeared first on The Motley Fool Australia.

More reading

• Why are ASX 200 retail shares climbing on Friday?
• What’s the outlook for ASX 300 retail shares in June?
• Why are ASX 200 retail shares getting hammered on Thursday?
• ASX 200 midday update: Aristocrat’s earnings beat, Webjet flops, retailers smashed
• Why is the JB Hi-Fi share price being slashed 8% today?

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 recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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