Day: 19 November 2022

I think that the ASX share market is a very good way to build wealth. Not only can it be used to grow our wealth, but younger Australians have lots of options of how to invest.

There are numerous online brokers that don’t charge much in fees. Investors can go with individual ASX shares, managed funds or exchange-traded funds (ETFs). There’s the option of investing in internationally-listed shares as well, like Microsoft or Apple.

More millennials (born between 1981 to 1996) have bought shares than previous generations, according to research done by Motley Fool US. It asked 1,200 American adult investors to learn about people’s investing choices.

According to the research, some of the areas of the market that millennials are focused on include ETFs, financial shares and technology shares. So, with that in mind, I’m going to pick one ASX share from each category for beginner investors that could be a good place to start.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

I think this is one of the best, diversified ETFs. An ETF is a fund that allows investors to buy a group of businesses in a fund, through a stock exchange (like the ASX).

This one is invested in well over 1,400 globally-listed businesses. Its holdings come from a range of different countries like the US, Japan, the UK, Germany, the Netherlands, France, Canada, Switzerland and so on.

It has holdings like Apple, Microsoft, Visa, Nvidia, Home Depot, Pfizer, Costco, Walmart, McDonald’s, Walt Disney, ASML, LVMH, Salesforce and Toyota.

While ETFs can experience volatility too, I think the different industries and companies represented in the portfolio can lead to less volatility. For example, energy businesses have offset some of the declines of tech shares this year.

Macquarie Group Ltd (ASX: MQG)

Macquarie is one of the largest financial ASX shares. But, it’s not just a domestic bank focused on lending.

This business is a global investment bank. At least two-thirds of its income is actually generated overseas. I like the geographic diversification that the business has. This also gives the business the ability to invest almost anywhere in the world that it wants to.

Macquarie is diversified across different operating segments as well. It has four divisions – banking and financial services, commodities and global markets, investment banking (Macquarie Capital) and asset management (Macquarie Asset Management).

The mix of divisions means some bits of the financial ASX share can be defensive and continue chugging along, while other parts experience (typically) cyclical economic effects.

I like the management team and the company’s ability to keep delivering returns in tricky environments.

REA Group Limited (ASX: REA)

I like to think of REA Group as a way to benefit from the entire real estate market. It owns the real estate portal realestate.com.au. A lot of houses that are advertised for rent or sale are put up on realestate.com.au.

It’s the clear market leader when it comes to viewing statistics on the website, which means it’s likely indispensable for property owners. It gets 3.3 times more monthly visits on average than its nearest competitor. This enables the business to steadily increase its prices with little detrimental impact, while also unlocking more revenue from additional website features.

Not only is it doing well in Australia, but it’s invested in property sites in a number of other countries including India and the US which could be good profit generators for the business in the future.

The post Over half of millennials own shares. Here are 3 ASX share ideas to start your own portfolio appeared first on The Motley Fool Australia.

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More reading

• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?
• Morgans names 2 of the best ASX 200 dividend shares to buy
• Are ASX share investors getting their mojo back?
• 3 excellent ETFs for ASX investors to buy next week
• These ASX shares turned $20,000 into $100,000 in 10 years

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 positions in and has recommended ASML Holding, Apple, Costco Wholesale, Home Depot, Microsoft, Nvidia, Salesforce, Inc., Vanguard MSCI Index International Shares ETF, Visa, Walmart Inc., and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2024 $145 calls on Walt Disney, long March 2023 $120 calls on Apple, short January 2024 $155 calls on Walt Disney, and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended ASML Holding, Apple, Macquarie Group Limited, Nvidia, REA Group Limited, Salesforce, Inc., Vanguard MSCI Index International Shares ETF, and Walt Disney. 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 a new year on the horizon, now could be a great time to look at your portfolio and consider some additions for 2023.

But which ASX 200 shares could be good options for investors?

Listed below are three ASX 200 shares that brokers rate very highly. Here’s what they are saying about them:

CSL Limited (ASX: CSL)

Bell Potter has this biotherapeutics giant’s shares on its champion stocks list. The broker likes the company due to the positive outlook for plasma volumes, its burgeoning research and development pipeline, and the recent acquisition of Vifor Pharma. It commented:

A leading global company in the development, manufacture, and distribution of plasma therapies as well as non-plasma biotherapeutic products and influenza related products. The recently completed acquisition of Vifor Pharma will add global leadership in pharmaceutical products for renal disease and iron deficiency. The global growth in plasma volumes is expected to be around a solid 8% per annum for the foreseeable future and, in addition, the group is planning to launch new products from its very extensive Research and Development portfolio

Treasury Wine Estates Ltd (ASX: TWE)

Another ASX 200 share that is highly rated is this wine giant. Analysts at Morgans have the company on its best ideas with an add rating and $15.71 price target. The broker believes Treasury Wine is well-placed for strong growth over the coming years. Morgans said:

TWE owns much loved iconic wine brands, the jewel in the crown being Penfolds. We rate its management team highly. The foundations are now in place for TWE to deliver strong earnings growth from the 2H22 over the next few years. Trading at a material discount to our valuation and other luxury brand owners, TWE is a key pick for us.

Woolworths Group Ltd (ASX: WOW)

A final ASX 200 share that could be a top option for investors in 2023 is Woolworths. The team at Goldman Sachs has the retail giant on its coveted conviction list with a buy rating and $41.70 price target. The broker likes Woolworths due to its belief that it is the “superior operator” in the supermarket industry and well-positioned to deliver solid growth in the coming years. It explained:

Despite a noisy and softer 1Q23, we remain confident that WOW is the superior operator within AU supermarkets with a clear growth pathway to deliver ~3% sales and ~9% NPAT FY22-25e CAGR. WOW is trading at 22.1x FY24E P/E vs our TP implied 27.8x and historical average of 23.2x, providing a value entry point to a quality player in our view. Reiterate Buy (on CL).

The post Are these the very best ASX 200 shares to buy for 2023? appeared first on The Motley Fool Australia.

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More reading

• How much dividend income will $20,000 worth of CSL shares buy right now?
• Outlook for Treasury Wine shares ‘is just phenomenal’: expert
• Considering CSL shares? Broker says this other ASX 200 healthcare share has 30% upside
• I’d use the Warren Buffett method to create a ‘best ASX shares to buy now’ list
• Experts name 2 ASX 50 shares to buy

Motley Fool contributor James Mickleboro has positions in CSL Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd. The Motley Fool Australia has recommended Treasury Wine Estates 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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Wesfarmers Ltd (ASX: WES) shares have always been a solid option for income investors to consider. This diversified ASX 200 retail and industrial conglomerate has a very long ASX history, and a strong dividend record to boast of.

After all, this is the ASX share that bought Coles Group Ltd (ASX: COL) in its entirety back in 2007, only selling it back to the market in late 2018.

Wesfarmers shares have had a rough 2022, though. The company remains down more than 20% year to date, and down by almost as much over the past 12 months.

But Wesfarmers has been ratcheting its dividends back up over the past couple of years since it was forced to trim its payouts in light of the initial COVID pandemic back in 2020. That year saw Wesfarmers dole out $1.70 worth of dividends per share.

But last year, Wesfarmers upped this to $1.78. In 2022, the company has paid an interim dividend of 80 cents per share in March and a final dividend of $1 per share in October. That’s an annual total of $1.80 per share. Both dividends came with full franking credits.

But exactly how much dividend income will an investor have earned this year from a $10,000 investment in Wesfarmers shares?

How much have Wesfarmers shares paid out in dividend income?

Well, $10,000 would have bought a hypothetical investor 168 Wesfarmers shares (with some change left over) based on a share price of $59.30, which was what Wesfarmers was asking at the start of January.

Wesfarmers’ March interim dividend would have yielded a cash payment for this investor of $134.40. The final dividend of $1 a share that was doled out back in October would have supplemented that $134.40 by another $168, giving the investor a total of $302.40 in dividend income for 2022.

Based on our original buy price of $59.30 per share, that represents a cash yield of just over 3% on our original $10,000.

The post If you’d bought $10,000 worth of Wesfarmers shares in January, this is how much you’d have earned in dividends appeared first on The Motley Fool Australia.

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More reading

• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?
• How to have your ASX 200 dividend cake and eat it too
• 3 passive ASX income machines to help fund your retirement
• Here’s the Wesfarmers dividend forecast through to 2025
• Here’s how much dividend income $10,000 worth of Coles shares will get you today

Motley Fool contributor Sebastian Bowen has positions in Wesfarmers. 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 positions in and has recommended COLESGROUP DEF SET and Wesfarmers 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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S&P/ASX 200 Index (ASX: XJO) shares closed Friday’s session only slightly in the green, up 0.23%.

It’s been a rough year for ASX 200 shares so far. From the first day of trading on 4 January, the index fell about 15% until bottoming in mid-June.

Since then, there’s been a highly volatile rebound with ASX 200 shares up about 11%. Overall, ASX 200 shares are down 5.8% in the year to date.

This market downturn had led to a bunch of ASX 200 shares trading on single-digit price-to-earnings (P/E) ratios.  

As we explain in Motley Fool’s Education Centre, the P/E ratio — also called the ‘earnings multiple’ or ‘price multiple’ — is a commonly-used metric that helps investors determine a company’s value.

What is a P/E ratio?

A P/E ratio measures a company’s current share price against its earnings per share (EPS). Stocks with P/E ratios below 15 are generally considered cheap and those above 18 are considered expensive. 

There are other factors to consider, though. For example, a high-quality ASX 200 stock might be deserving of a premium share price (and thus a high P/E ratio), so it’s not necessarily one to avoid.

Another consideration is that a low P/E might signal problems with the company. Perhaps its share price has taken a dive because significant structural headwinds have arisen that are unique to its business.

However, today we see a mixed bag of high-quality ASX 200 shares trading on single-digit P/Es because of a broader market downturn brought about by rising inflation and interest rates.

These macroeconomic headwinds are impacting most ASX 200 companies and the value of their shares in 2022. This makes low P/Es more relevant as potential buying signals for long-term investing.

Motley Fool Australia’s chief investment officer, Scott Phillips recently discussed low P/Es among ASX 200 retail shares, saying: “With a long-term lens, I think we’ll look back and see retail on single digit P/Es and say, ‘Man, really?’”.

Phillips used JB Hi-Fi Limited (ASX: JBH) shares, trading on a P/E ratio of 9.01, as an example and said:

I think what we’ll do is look back and when JB Hi-Fi’s profits are whatever they are in 2027, and we look back and say, ‘Man, we had an opportunity to buy that, [but] we were so worried about the short term’.

Which ASX 200 shares have single-digit P/E ratios?

For the purposes of this article, we’ll focus on ASX 200 shares representing large, established businesses that we all know well by either their names or their products, which are trading on single-digit P/Es.

These are not buying recommendations. As all investors know, thorough individual company research is required before choosing which shares to buy. We’re just highlighting a few ASX 200 shares on single-digit P/Es for you to consider.

We’ve excluded mining companies because many commodity prices are at the height of their cycle. This is distorting P/E ratios at the moment because earnings are so high — but are inevitably temporary.

For example, the biggest ASX 200 share by market cap, BHP Group Ltd (ASX: BHP), currently has a P/E ratio of 7.52. ASX coal share Whitehaven Coal Ltd (ASX: WHC) has a P/E ratio of 4.43.

Over to you for review.

First up we have a selection of ASX 200 real estate shares or real estate investment trusts (REITs).

ASX 200 blue chip Goodman Group (ASX: GMG) has a P/E ratio of 9.99.

Stockland Corporation Ltd (ASX: SGP) has a P/E of 6.07 and Vicinity Centres (ASX: VCX) has a P/E of 7.26. There’s also apartment developer Mirvac Group (ASX: MGR) with a P/E ratio of 9.22.

Among ASX 200 retail shares, we have the household name Harvey Norman Holdings Limited (ASX: HVN) with a P/E ratio of 6.3.

There’s also Super Retail Group Ltd (ASX: SUL), owner of Supercheap Auto and Rebel, with a P/E ratio of 9.89.

We pointed out JB Hi-Fi earlier. Nick Scali Limited (ASX: NCK) falls just outside the list with a P/E of 10.13.

Among ASX 200 financial shares, we have Virgin Money UK CDI (ASX: VUK) with a P/E ratio of 3.75. Just outside the list is Australia and New Zealand Banking Group Ltd (ASX: ANZ) with a P/E of 10.27.

The post Time to buy? Which ASX 200 shares are trading on single-digit P/E ratios? appeared first on The Motley Fool Australia.

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More reading

• Ballin’ on a budget: The best ASX shares to buy for under $5
• Here are the top 10 ASX 200 shares today
• Are BHP shares in the buy zone following the latest OZ Minerals news?
• Here are the 3 most heavily traded ASX 200 shares on Friday
• Why Arafura, Nanosonics, NextDC, and OZ Minerals shares are rising today

Motley Fool contributor Bronwyn Allen has positions in Australia & New Zealand Banking Group Limited, BHP Billiton Limited, Goodman Group, Harvey Norman Holdings Ltd., Nick Scali Limited, and Super Retail Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia has positions in and has recommended Harvey Norman Holdings Ltd. and Super Retail Group Limited. The Motley Fool Australia has recommended JB Hi-Fi 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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It’s been a pretty ordinary few weeks for cryptocurrencies and cybersecurity.

In Australia, millions of consumers have had to deal with the theft of their private information from Medibank Private Ltd (ASX: MPL) and Optus.

Globally, the finance industry has been left bemused — and distressed — at the collapse of giant crypto exchange FTX.

While these issues are front-of-mind, the Australian Securities and Investments Commission this month warned Australians to be vigilant about crypto scams.

According to ASIC deputy chair Sarah Court, Australians lost in excess of $710 million from investment fraud in 2021, which was a shocking 135% higher than the previous year.

“The main driver of the increase was cryptocurrency investment scams, where losses increased by 270%,” she said.

“The ACCC have advised that losses to crypto scams have increased further in 2022.”

If you’re in one of these 10 situations, watch out

The corporate watchdog stated crypto scams fall into one of three broad types:

• Scams where the investor thinks they’re putting money into a genuine asset, but the app, exchange or website is fake
• Scams selling fake crypto tokens to steal your legitimate cryptocurrency (like Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH)) in return and crypto trading jobs that are just facilitating money laundering
• Scams that use digital assets to make a payment

So how can you tell if something is a scam? 

ASIC has published 10 signs that likely mean you’re dealing with a criminal trying to steal money or data. 

Be very suspicious if one or more of these things happen to you:

1. You receive a golden offer or opportunity just out of the blue
2. You see a faked celebrity endorsement
3. A romantic interest you only know online starts asking for crypto
4. You’re pressured to transfer crypto from your current wallet or exchange to another site
5. You’re directed to pay for a financial service using crypto
6. The app you’re about to install isn’t available on Google Play or the Apple Store
7. You have to pay a fee to access your own money
8. You are guaranteed a certain level of returns or offered free money
9. Unfamiliar digital tokens land in your digital wallet
10. The exchange withholds investment returns for supposed “tax purposes”

Court implored those who suspect they’ve fallen for a scam to “act quickly”.

“Don’t send any more money. Block all contact from the scammer,” she said.

“Do not delay. Contact your bank or financial institution immediately to report the scam. Ask them to stop any transactions. Also, warn your family and friends so they can watch out for potential follow-up scams.”

The deputy chair reminded investors that financial loss is not the only cost when falling victim to such fraud.

“Scams cause emotional stress and can impact relationships.”

More information on crypto scams can be found on ASIC’s Moneysmart website. Crisis support is available through Lifeline on 13 11 14 and emotional support via Beyond Blue on 1300 22 46 36.

The post Top 10 signs you’ve been crypto-scammed appeared first on The Motley Fool Australia.

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More reading

• Why are Medibank shares lifting on Wednesday?
• Down 20% in a month, can things get any worse for the Medibank share price?
• The Bitcoin price has dumped 23% since the FTX collapse. Now what?
• Considering buying the dip in Medibank shares? Here’s the latest on the company’s data hack woes
• Medibank share price sell-off ‘excessive’: expert

Motley Fool contributor Tony Yoo has positions in Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin and Ethereum. The Motley Fool Australia has positions in and has recommended Bitcoin and Ethereum. 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 Australian share market is home to a good number of shares offering attractive dividend yields.

But which ones should you buy over others? Here are two that brokers rate as buys right now:

Elders Ltd (ASX: ELD)

The first ASX 200 dividend share that has been rated as a buy is Elders. It is a leading agribusiness company offering services to rural and regional customers across the ANZ region.

Despite delivering a strong full year result last week, the company’s shares crashed deep into the red.

The team at Goldman Sachs believe this was a mistake by investors and has reiterated its conviction buy rating with a price target of $18.40. It said:

We view the share price reaction today (-23%) as unwarranted. The fundamentals of this company remain unchanged, and strong in our view. The result was near the top of guidance, delivering 39% EBIT growth (vs. guidance of 30-40%).

While heavy rainfall poses a short term headwind, Goldman remains positive on the future and believes “ELD is very well positioned to grow through the cycle.”

It expects this to underpin fully franked dividends per share of 53 cents in FY 2023 and 57 cents in FY 2024. Based on the current Elders share price of $10.30, this will mean yields of 5.1% and 5.5%, respectively.

Westpac Banking Corp (ASX: WBC)

A second ASX 200 dividend share that could be a top option for income investors is Westpac. It is of course Australia’s oldest bank and one of the big four.

The team at Morgans recently responded to the bank’s full year results by retaining its add rating with a price target of $25.80. It commented:

We viewed Westpac Banking Corp’s FY22 performance as at or above expectations. The interest rate leverage in the Net Interest Margin (NIM) was the key positive, while the key negative (but not unexpected) was the upsized FY24 cost guidance.

After reviewing the results, the broker is now forecasting fully franked dividends of $1.53 per share in FY 2023 and $1.59 per share in FY 2024. Based on the current Westpac share price of $23.62, this will mean yields of 6.5% and 6.7%, respectively.

The post Brokers say these ASX 200 dividend shares are buys appeared first on The Motley Fool Australia.

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More reading

• 3 ASX 200 shares trading ex-dividend next week  
• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?
• Why is the Westpac share price tumbling on Thursday?
• Goldman says these ASX 200 bank shares can deliver 12%+ returns for three years
• Why is Wilsons selling down its ASX 200 bank shares?

Motley Fool contributor James Mickleboro has positions in Westpac Banking Corporation. 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 Elders Limited and Westpac Banking Corporation. 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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Let’s say you have $1,000 to invest in ASX shares. If you were to buy S&P/ASX 200 Index (ASX: XJO) biotech giant CSL Limited (ASX: CSL), your $1,000 would buy you the grand total of precisely three shares, along with around $120 in change.

That’s because CSL shares currently trade a little shy of $300 a pop — the highest individual share price of any company on the ASX.

If the thought of being the proud owner of just three shares doesn’t exactly rock your world, perhaps you’d prefer to invest in some ‘cheaper’ options. Obviously, a smaller share price doesn’t necessarily mean ‘cheap’, since a company’s overall valuation is based on market cap. But companies trading at the lower end of the individual-share-price spectrum can certainly be more accessible (and indeed appealing) for many investors.

Furthermore, there are lots of high-quality companies trading on the ASX with share prices going for under a fiver. With that in mind, we asked our Foolish contributors to pop their thrifty thinking caps on and let us know which ASX shares they reckon are the best buys under $5 right now.

Here is what the team came up with:

8 best ASX shares under five bucks (smallest to largest)

• Volpara Health Technologies Ltd (ASX: VHT), $166.36 million
• Adairs Ltd (ASX: ADH), $385.46 million
• Imdex Limited (ASX: IMD), $875.67 million
• Core Lithium Ltd (ASX: CXO), $2.57 billion
• HomeCo Daily Needs REIT (ASX: HDN), $2.64 billion
• Harvey Norman Holdings Limited (ASX: HVN), $5.12 billion
• South32 Ltd (ASX: S32), $17.94 billion
• Telstra Group Ltd (ASX: TLS), $45.52 billion

(Market capitalisations as of 18 November 2022)

Why our Foolish writers love these ASX $5 finds

Volpara Health Technologies Ltd

What it does: Volpara “makes software to save families from cancer”. Healthcare providers use Volpara’s product to better understand a patient’s cancer risk and guide recommendations on additional imaging, genetic testing and other interventions. The software can help radiologists perform their duties faster and more effectively.

By Tristan Harrison: Volpara continues to grow at an impressive pace. In the first quarter of FY23, cash receipts were up 23% to NZ$8.8 million. The healthcare company’s annual recurring revenue (ARR) also continues to rise and is now above US$19 million.

Client retention rate remains high, and Volpara is hoping to grow its average revenue per user (ARPU) by selling more software modules to customers.

The gross profit margin is currently around 90% (which is high), so any extra revenue is highly beneficial to the bottom line. Volpara has the opportunity to reinvest extra gross profit into driving more growth by spending on further product development and marketing. The company is now focused on profitable growth.

Motley Fool contributor Tristan Harrison does not own shares in Volpara Health Technologies Ltd.

Adairs Ltd

What it does: Adairs is home furniture and decor retailer. It has an established network of more than 170 stores across Australia and New Zealand as well as an established and growing online channel.

By Matthew Farley: After plunging by around 44% year to date, I believe Adairs shares are now selling at an attractive discount. And at $2.25 as of Friday’s close, the Adairs share price is also sitting substantially below its 52-week median price of $2.88 for its 52-week range, which makes it even more attractive to me right now.

One thing I like about the company is its revenue growth over the past couple of years. Adairs’ group sales have grown from $388.9 million in FY2020 to $564.5 million in FY2022. The company expects sales revenue to grow further this fiscal year to between $625 million and $665 million.

Due to the market sell-off over the past year, Motley Fool’s chief investment officer Scott Phillps recently highlighted the fact that some ASX retail shares are now trading at low valuation ratios. With a current price-to-earnings (P/E) ratio standing at just 8.7, arguably, Adairs is one of them.

Motley Fool contributor Matthew Farley does not own shares in Adairs Ltd.

Imdex Limited

What it does: Founded 42 years ago, Imdex has grown into a truly global tech company with sales in more than 100 countries. The business provides software solutions to the mining industry for optimising drilling and providing ore insights and actionable analytics.

By Mitchell Lawler: Imdex shares were perched at $2.20 apiece at the close of trade on Friday, amounting to a market capitalisation of around $875 million. The profitable tech company is a minnow relative to the broader Australian share market.

However, I believe the financial history of Imdex should speak volumes. Since the end of 2015, the company has evolved from a barely profitable biz raking in $145 million in revenue, to a profit printer with $341.8 million in revenue in FY22.

Despite its historical success, Imdex is still tinkering with new technology. Recently, Fortescue Metals Group Limited (ASX: FMG) entered a joint venture to implement the first commercial use of Imdex’s Blast Dog tech.

Motley Fool contributor Mitchell Lawler does not own shares in Imdex Limited or Fortescue Metals Group Limited.

Core Lithium Ltd

What it does: Core Lithium is the Australian lithium developer behind the Finniss Project in the Northern Territory. Management claims it to be the most capital-efficient lithium project with arguably the best logistics chain to markets of any Australian lithium project.

By James Mickleboro: Core Lithium shares closed of Friday at $1.40 apiece, which is meaningfully lower than the 52-week high of $1.88 it reached just a few days ago. This weakness has been driven by concerns that the Finniss Project could run behind schedule and fears that lithium demand is softening in China.

However, the online lithium auction results from rival Pilbara Minerals Ltd (ASX: PLS) this week appear to demonstrate that demand is as strong as ever. In light of this and the expectation that lithium prices will remain high for some time, I think this is a buying opportunity for investors. Especially given that Core Lithium shares are trading at a reasonably modest 8x FY2024 earnings based on Macquarie’s forecasts.

Motley Fool contributor James Mickleboro does not own shares in Core Lithium Ltd or Pilbara Minerals Ltd.

HomeCo Daily Needs REIT

What it does: HomeCo Daily Needs REIT is an Aussie real estate investment trust (REIT) focused on convenience-based assets. It boasts 53 properties, $4.6 billion of assets under management, and a 99% occupancy rate.

By Brooke Cooper: The HomeCo Daily Needs REIT has had a good run lately. Its funds from operations lifted 30% year on year in the 2022 financial year, while its net tangible assets rose 12%.

The trust has also announced more than $75 million worth of new development projects to be commenced this financial year.

Despite such tailwinds, the ASX 200-listed REIT’s share price has tumbled 20% year to date to now trade at $1.27. Such a fall might have presented a buying opportunity, if Goldman Sachs is to be believed. The broker has a buy rating and a $1.57 price target on the share.

Motley Fool contributor Brooke Cooper does not own shares in HomeCo Daily Needs REIT.

Harvey Norman Holdings Limited

What it does: Harvey Norman Holdings Limited is the franchisor of Harvey Norman, a leading Australia-based retailer that sells home furniture and household goods.

By Bronwyn Allen: Personally, I like investing in the permanent cultural tailwind of Australia’s property mania. We love upgrading our homes when our finances allow. We’re very house-proud and increasingly partial to luxury furnishings, interior design, and the latest electronics.

We love watching The Block and spend millions on home renos annually. These are long-term trends. A strong, short-term trend also underway is that thousands of us are relocating from the expensive capital cities to cheaper regional areas since COVID ushered in the era of permanently working from home.

And when people change homes, they buy new stuff. I believe all of this bodes well for the iconic furniture and household goods retailer, Harvey Norman.

For the hard numbers analysis, let’s look to broker Goldman Sachs. It’s positive on the company with a price target of $4.80 and very healthy forecast dividend yields of 9% in FY23 and a bit below 8% in FY24.

Motley Fool contributor Bronwyn Allen owns shares in Harvey Norman Holdings Limited.

South32 Ltd

What it does: South32 is an ASX 200-listed miner with a focus on uncovering and digging up aluminium, manganese, silver, lead, zinc, and metallurgical coal across three continents. It has a market cap of just under $20 billion.

By Bernd Struben: With its focus on metals critical to a low-carbon future, I believe the outlook for South32 is promising. And I think the price for its met coal (used for steel making) is undervalued today compared to the rocketing price of thermal coal (used to generate electricity).

Katana Asset Management’s Romano Sala Tenna says the miner “has tier-one assets in tier-two commodities”.

South32 shares do run the risk of “some downgrades in the coming months” with cooling commodity prices, he said. However, “They’ve been one of the best companies in terms of capital management.”

Down 2.5% year-to-date, the South32 share price has still outperformed the benchmark in 2022. At current prices, the stock pays a 9.4% trailing dividend yield, fully franked.

Motley Fool contributor Bernd Struben does not own shares in South 32 Ltd.

Telstra Group Ltd

What it does: Telstra is the leading provider of telecommunications, mobile and internet services in Australia

By Sebastian Bowen: Despite being a relatively large ASX 200 company, Telstra asks well under $5 per share. The telco has been going flat out with its restructuring and cost-cutting programs in recent years. After the success of its T22 plan, Telstra is now undertaking its T25 strategy and has just completed its corporate restructuring.

I believe this has the potential to rewrite the valuation Telstra commands. We’ve already seen Telstra secure some generous valuations for some of its underlying assets, such as its mobile towers. I feel there is plenty of potential for the market to place a premium valuation on some of the telco’s other assets too.

As such, I think this is a great company to hold onto going forward, with a nice dividend to keep you company as well.

Motley Fool contributor Sebastian Bowen owns shares in Telstra Group Ltd.

The post Ballin’ on a budget: The best ASX shares to buy for under $5 appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended ADAIRS FPO, Harvey Norman Holdings Ltd., Imdex Limited, and VOLPARA FPO NZ. The Motley Fool Australia has positions in and has recommended ADAIRS FPO, Harvey Norman Holdings Ltd., Imdex Limited, Telstra Corporation Limited, CSL Limited, and VOLPARA FPO NZ. 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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For Australian income investors, the Commonwealth Bank of Australia (ASX: CBA) dividend is among the most popular options out there.

And that’s for good reason. Australia’s largest bank regularly shares a good portion of its profits with its shareholders.

First quarter update

Last week, CBA released its first quarter update and revealed a 9% increase in income over the second half average to $6.6 billion and a 2% lift in cash earnings to $2.5 billion. This was driven by higher margins and volume growth, partly offset by reduced non-interest income.

Following this update, brokers have been busy adjusting their estimates for CBA’s earnings and dividend for FY 2023 and beyond. Let’s take a look to see what one analyst is saying.

Where is the CBA dividend heading?

As a reminder, the banking giant paid its shareholders a fully franked $3.85 per share dividend in FY 2022.

According to a note out of Morgans, its analysts are expecting this to increase by 6.5% to a fully franked $4.10 per share in FY 2023. Based on the current CBA share price of $105.82, this will mean a yield of 3.9% for investors.

The broker is then expecting an even greater rise in the CBA dividend to $4.55 per share in FY 2024. This equates to a fully franked 4.3% dividend yield for that financial year.

Interestingly, Morgans is expecting the bank’s earnings and dividend to then take a small step backwards in FY 2025. This is based on its belief that “the NIM [net interest margin] uptick begins to fade and is outpaced by cost growth.”

As a result, it has pencilled in a fully franked $4.50 per share dividend for FY 2025, which represents a 4.25% yield at current prices.

Overall, income investors appear likely to continue receiving attractive dividend yields from CBA’s shares in the coming years. Though, it is worth remembering that a lot can change between now and 2025.

The post Here’s the CBA dividend forecast through to 2025 appeared first on The Motley Fool Australia.

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More reading

• What’s happening with CBA shares this week?
• I’d use the Warren Buffett method to create a ‘best ASX shares to buy now’ list
• 3 key things I look for when buying ASX dividend shares
• 5 of the craziest things making news on the ASX this week
• Which stocks are in the Vanguard Australian Shares Index ETF (VAS) right now?

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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