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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