Day: 16 May 2023

On Monday, the Pointsbet Holdings Ltd (ASX: PBH) share price came under significant pressure.

The sports betting company’s shares lost 20% of their value to end the day at $1.46.

They have continued to fall again on Tuesday and are currently down 7% to $1.35.

This means Pointsbet shares are now down 45% over the last 12 months.

Why did the Pointsbet share price crash into the red?

Investors were selling down the sports betting company’s shares after it announced the sale of its US business.

Pointsbet has agreed to sell its US operations to Fanatics Betting and Gaming for US$150 million ($222 million).

Once complete, Pointsbet will retain both its Australian and Canadian businesses. Furthermore, shareholders will receive the net proceeds of the sale directly in the form of capital returns. The company estimates these returns will have a value of between $1.07 and $1.10 per share.

Should you invest?

The team at Bell Potter has been looking at the news. And while it doesn’t appear overly impressed, it still sees value in Pointsbet shares following recent weakness.

In response to the news, the broker has retained its speculative buy rating with a heavily reduced price target of $2.00. This implies potential upside of 48% for investors over the next 12 months.

The broker explains that it now values Pointsbet shares with a sum of the parts model. It ascribes a 72 cents per share valuation to the Australian business and a modest 8 cents per share valuation to the Canadian business. The balance reflects the proposed capital return from the US business sale. It explains:

Following this announcement we move to a sum-of-the-parts valuation and assume the sale of the US business proceeds and $1.085 – the mid point of the range – is returned to shareholders. On top of that we assume a A$220m valuation for the Australian business ($0.72 per share), a token A$25m valuation for the Canadian business (A$0.08 per share) and cash of $35m ($0.11 per share). This equates to a valuation of $2.00 per share which is a 31% decrease on our previous valuation of $2.90. At a $2.00 valuation the expected return is still >30% so we retain our BUY (Spec.) recommendation.

Bell Potter also highlights that the value of the remaining assets is far less than what the company was rumoured to be selling them for just a few months ago. It said:

At the current share price the implied valuation for the Australian and Canadian businesses combined is <A$100m which is too low in our view especially when there was speculation of a sale price for the Australian business of >A$200m a few months ago.

The post Does the US business sale make Pointsbet shares dirt cheap? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX dividend shares aiming to give investors a payrise every year
• Are AGL shares going to become a dividend machine?
• ‘Bright outlook’: 2 ‘high quality’ ASX 200 shares to pounce on now 
• Why is the Appen share price in a trading halt?
• 2 dividend income beasts with big growth ideas

Fetching Disclosure…

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Many ASX dividend shares can pay investors a solid dividend yield. Indeed, there are some names that have an impressive payout growth streak going on.

Of course, nothing is guaranteed with dividend payments — they aren’t like term deposits. But if a business can grow its dividend per share year after year then it can be very rewarding, and a fine protection against inflation.

We can’t know for sure which businesses are going to increase their payouts, but their past records can indicate how committed a company is to increasing shareholder returns over time. Below, I’m going to talk about two of the companies with the longest dividend growth streaks.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

I’d describe Soul Pattinson as the ASX dividend share with the strongest dividend record. It has grown its dividend every year since 2000. The business has also paid some sort of dividend every year since it listed more than 100 years ago.

As we can see on the graph above, the dividend growth rate has picked up in the last couple of results. The recent FY23 half-year result showed a 24.1% increase in the interim dividend.

Soul Pattinson pays its dividend from the cash flow it receives from its investment portfolio of ASX shares, private businesses, and structured debt. Some of its biggest investments include Brickworks Limited (ASX: BKW), TPG Telecom Ltd (ASX: TPG), New Hope Corporation Limited (ASX: NHC), and Macquarie Group Ltd (ASX: MQG).

After paying its dividend, the ASX dividend share can then re-invest in more opportunities.

One of the company’s goals is to keep growing the dividend. Another objective is to outperform the market.

Using the company’s last two declared dividends (including the special dividend), it has a grossed-up dividend yield of 4%.

Sonic Healthcare Ltd (ASX: SHL)

Sonic is one of the world’s largest pathology businesses with a significant presence in Australia, the US, the UK, and Germany.

People can’t decide when to get sick based on economic cycles so ASX healthcare shares can provide shareholders with resilient earnings and dividends. As well, the increasing populations — and their ageing — in those major markets certainly provide a useful tailwind for healthcare earnings.

The ASX dividend share has grown its dividend each year since 2013, so its growth streak has been going on for around a decade now.

The company’s non-COVID testing revenue continues to grow, which bodes well for future profit generation and larger dividends. The business has a stated “progressive dividend policy”, meaning the board wants to grow the dividend each year, if possible.

The business continues to make bolt-on acquisitions, such as its two recent acquisitions in Germany that, between them, are expected to add €115 million (A$186.6 million) of revenue in FY24.

As well, the company’s expansion into artificial intelligence and its partnership with Microba Pty Ltd (ASX: MAP) in microbiome testing could boost Sonic Healthcare over time.   

Sonic Healthcare’s trailing grossed-up dividend yield is also 4%.

The post 2 ASX dividend shares aiming to give investors a payrise every year appeared first on The Motley Fool Australia.

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More reading

• 4 ASX companies that own CSL shares (and lots of them!)
• Turning ASX shares into a $40,000 annual passive income generator
• It’s still rare to find a term deposit paying over 5%. Why not buy ASX dividend shares instead?
• Why did the Washington H Soul Pattinson share price just smash a new 52-week high?
• How my ASX share portfolio is ready for a stock market crash

Motley Fool contributor Tristan Harrison has positions in Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks, Macquarie Group, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Sonic Healthcare and TPG Telecom. 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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AGL Energy Limited (ASX: AGL) shares have taken a big dive since 2020, but could this lower valuation mean the future dividend yield is really appealing?

When the share price goes down, the dividend yield goes up, assuming the dividend payment doesn’t change in size.

I’ll give you an example – if a share had a 5% dividend yield and then the share price drops 10%, it would increase the dividend yield to 5.5%.

However, a heavy fall in a share price can suggest that operating conditions have worsened significantly, which could mean that a lower profit and lower dividend are possible.

In the FY23 half-year result, AGL’s underlying net profit after tax (NPAT) dropped 55% to $87 million, while the interim dividend was halved to just 8 cents per share.

However, with management commentary and analyst projections reflecting a positive future, could AGL shares be a future dividend machine?

Dividend projections

FY23 is not expected to be a very profitable year (after what was seen in HY23) for AGL, and the estimate on Commsec suggests that AGL shares could pay an annual dividend per share of 27 cents. That would be a dividend yield of just 3% – nothing to get excited about considering (safe) term deposits offer an interest rate of above 4%.

But, the company pointed out with its HY23 result that wholesale electricity pricing was “elevated compared to prior periods with AGL expected to benefit as historical contract positions are reset in FY24 and FY25. Additionally, sustained periods of higher wholesale electricity prices are expected to flow through to retail pricing outcomes.”

A profit recovery in FY24 and FY25 could enable the business to pay much bigger dividends in the next two financial years.

In the 2024 financial year, the projection on Commsec suggests AGL shares might pay an annual dividend per share of 56 cents, which would be a dividend yield of 6.4%.

There could be an even bigger dividend in FY25 according to the Commsec projection. There could be a dividend per share of 70 cents, which would be a dividend yield of 7.9%. This would be a better dividend yield than what’s offered by names like Telstra Group Ltd (ASX: TLS) and Commonwealth Bank of Australia (ASX: CBA) in FY25, according to the Commsec estimates. Though there’s more to the consideration of an investment than just the dividend yield of course.

It’s very promising for AGL shares that both earnings and the dividend could rise strongly over the next two years.

Forecasts are not guaranteed

Just because experts have pencilled in these potential dividend payments, it doesn’t mean they’re a confirmed thing. AGL has to generate the profit before it can pay it out.

On top of that, AGL has committed to the decarbonisation of its energy generation efforts, which could cost billions for the business to build all of the transmission assets, solar panels, batteries and so on. It will need to keep at least some of its generated profit to re-invest in power generation to ensure it doesn’t take on too much debt to fund the spending.

But, if AGL is able to achieve the projected earnings per share (EPS) of 95.5 cents in FY25, this would mean the AGL share price is valued at just 9 times FY25’s estimated earnings.

The post Are AGL shares going to become a dividend machine? appeared first on The Motley Fool Australia.

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More reading

• 9 directors have bought up AGL shares in 2023. Should you jump in too?
• 3 ASX 300 shares being bought up by insiders
• Are AGL shares the most underrated ASX 200 stock opportunity?
• 6 excellent ASX 200 dividend shares that aren’t banks or miners
• Here’s how much I would need to invest in AGL shares to achieve $150 in monthly income

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 positions in and has recommended Telstra Group. 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 volatility that ASX investors suffered over the past 18 months is not expected to wane anytime soon.

That’s why multiple experts are urging punters to back “quality” ASX shares rather than fall into the trap of becoming too speculative for quick riches.

A pair of advisors this week rated two such stocks as buys:

‘A discounted energy stock’

The Santos Limited (ASX: STO) share price has plunged 11.1% over the past 12 months.

That makes it a bargain buy, according to Bell Potter investment advisor Christopher Watt.

“In our view, Santos remains a discounted energy stock with the lowest implied oil price,” Watt told The Bull.

“The energy giant reported a solid first quarter production result in fiscal year 2023.”

Santos’ outlook is pleasing to Watt.

“The company retained fiscal year 2023 guidance,” he said.

“Santos is geographically diversified. Also, it offers a diversified product mix across LNG, domestic gas, crude oil and liquids.”

A 4.7% dividend yield also helps the buy case.

The team at Macquarie Group Limited (ASX: MQG) agrees with Watt’s bullishness.

The Motley Fool reported a fortnight ago that those analysts had a price target of $9.95 for Santos. That’s about a 40% upside from the current level.

The company with everything going for it

Industrial real estate manager Goodman Group (ASX: GMG) is Medallion Financial Group private client advisor Stuart Bromley’s pick.

The business has many tailwinds.

“It has high quality properties, blue chip tenants, an occupancy rate of 99% and long average lease expiries,” he said.

“Competition is modest and rental growth is accelerating.”

The market has certainly woken up to Goodman’s potential, sending the share price 16% up so far this year.

Bromley is confident the business is incubating further growth.

“The company continues to build, as it progresses $13.9 billion of existing projects,” he said.

“The gearing ratio is lower than other more exposed property plays. The company offers a bright outlook.”

Citigroup Inc (NYSE: C) analysts concur.

“Its analysts are forecasting double-digit earnings per share growth out until at least FY 2025,” reported The Motley Fool last week.

“It’s no surprise, then, to learn that Citi has a buy rating on its shares with a $24.00 price target.”

The target of $24 represents about a 20% premium on current levels.

The post ‘Bright outlook’: 2 ‘high quality’ ASX 200 shares to pounce on now  appeared first on The Motley Fool Australia.

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More reading

• I think this ASX 200 share is heavily underrated by the market
• 5 things to watch on the ASX 200 on Monday
• Here are 3 ASX 200 blue chip shares that analysts love
• Santos shares are down 10% in a year. Have the dividends been worth it?
• 2 ASX 200 stocks surging ahead following guidance upgrades

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Tony Yoo has positions in Macquarie Group. 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 Macquarie Group. The Motley Fool Australia has recommended Goodman Group. 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 Appen Ltd (ASX: APX) share price won’t be going anywhere on Tuesday.

That’s because the embattled artificial intelligence (AI) data service provider requested a trading halt this morning.

The company has requested that the halt last until the commencement of trade on Wednesday.

Why is the Appen share price paused?

The Appen share price is out of action today after the company announced plans to raise capital.

The request briefly explains:

The trading halt is requested as Appen expects to make an announcement to ASX in connection with a pro rata accelerated non-renounceable entitlement offer and institutional placement (the Offer). (b) Appen requests that the trading halt remain in place until the earlier of: (i) Appen making an announcement to the market regarding the outcome of the institutional component of the Offer (ii) the commencement of trading on Wednesday, 17 May 2023.

Capital raising

Interestingly, brokers were discussing the prospect of a capital raising after the company’s abject trading update last week. Bell Potter, for example, commented:

We have downgraded our 2023, 2024 and 2025 revenue forecasts by 17%, 18% and 18%. We now forecast an underlying EBITDA loss of US$(23.2)m in 2023 – previously we forecast positive US$14.3m – and have downgraded our underlying EBITDA forecasts in 2024 and 2025 by 49% and 30%. We now forecast Appen utilises some of its A$20m debt facility in 2H2023 and assume there is some increase in the size of the facility when the company refinances later this year. This should avoid any need of a capital raising and we have not assumed any in our forecasts.

Perhaps this could be a sign that its lenders are not confident enough in its outlook to increase the size of its debt facility.

What is Appen raising?

Appen has revealed that it is raising ~A$60 million via a fully underwritten equity raising to support the company’s strategic refresh and return to profitability.

The company is raising the funds at $1.85 per new share, which represents a 19.6% discount to where the Appen share price last traded.

Proceeds will be used to fund one-off costs associated with its previously announced cost reduction program, provide balance sheet flexibility and general working capital to support Appen’s return to profitability, and transaction costs.

The equity raising comprises a ~$38 million 1 for 6 pro rata accelerated non-renounceable entitlement offer and a ~$21 million institutional placement.

The post Why is the Appen share price in a trading halt? appeared first on The Motley Fool Australia.

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More reading

• Macquarie forecasts Appen shares to crash a further 47%
• Broker gives its verdict on the Appen share price crash
• Better ASX tech share to buy now that the Nasdaq bear market is over: Altium or Appen?
• Why Appen, Bank of Queensland, Kogan, and Mayne Pharma shares are dropping
• Here are the 3 most heavily traded ASX 200 shares on Wednesday

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 positions in and has recommended Appen. 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 ASX dividend income beasts in this article are leading contenders for passive income as well as achieving capital growth through their business plans, in my opinion.

A dividend is paid from a company’s profit, so if it’s able to grow that profit over time, then this could unlock higher shareholder payments as well as a rising share price if the market appreciates the growing profit profile.

Here’s why I think these two ASX shares are worth watching for appealing dividend payments and growth.

Wesfarmers Ltd (ASX: WES)

Wesfarmers owns many well-known brands in Australia, including Bunnings, Kmart and Officeworks. The company is doing a solid job of growing earnings over the longer term, with Bunnings the key profit generator.

One of Wesfarmers’ goals is to increase its shareholder payment over time. To achieve that, the dividend income beast may be able to generate good growth over the long term with its expansion into lithium and healthcare.

In March 2022, the company acquired Australian Pharmaceutical Industries (API), which saw it take control of brands like Priceline and Clear Skincare Clinics. It’s currently offering to buy the ASX business SILK Laser Australia Limited (ASX: SLA).

Wesfarmers is attracted to healthcare because it “provides access to structural growth”, with opportunities for bolt-on acquisitions. This division includes ‘well-being’ and ‘beauty’ as well. Ageing demographics could be a useful tailwind for this segment’s earnings.

The company is also working on the Mt Holland Lithium Project in Western Australia. Wesfarmers sees strong growth ahead for lithium thanks to increasing demand for electric vehicles and other types of batteries.

Indeed, one fund manager has suggested that Mt Holland could generate more than $1 billion of earnings for Wesfarmers each year when operational.

According to Commsec, Wesfarmers could pay an annual dividend per share of $2.08 by FY25. This would be a grossed-up dividend yield of 5.75%, which would be a solid payout from the ASX dividend income beast.

Brickworks Limited (ASX: BKW)

When it comes to dividend history, Brickworks is impressive, in my opinion. It has maintained or grown its dividend every year since 1976. In other words, it’s been 47 years since the company last decreased its dividend payments to shareholders. And Brickworks has grown its dividend each year over the past decade.

I think the shares it owns in Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) have been key for enabling resilient dividends and growth over the past few decades. However, Brickworks’ industrial property trust could have an increasingly important role over the next five to ten years.

This is where excess Brickworks land is sold into an industrial property trust that owns industrial estates across Sydney and Brisbane with high-quality tenants. Brickworks owns half of the trust, with Goodman Group (ASX: GMG) owning the other half.

The property trust made up to $2 billion of net asset value (NAV) for Brickworks at 31 January 2023.

Further industrial estates may be built in the future thanks to the identification of key development sites, including in Horsley Park in NSW, in Craigieburn in Victoria and in Pennsylvania in the United States.

Over the next five years, Brickworks expects the leased asset value of the property trust could increase by around 33%. The rental income could grow by at least 54% as property developments are finished and organic rental growth flows through.

Those future potential land sales from Brickworks into the property trust could mean that even more capital value and rental income are achieved through the trust.

By FY25, the ASX dividend income beast could be paying an annual dividend per share of 69 cents, according to Commsec, which would be a grossed-up dividend yield of 4%.

The post 2 dividend income beasts with big growth ideas appeared first on The Motley Fool Australia.

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More reading

• How does $50,000 of annual passive income sound? Buy 78,100 shares of this ASX 200 stock
• How much would I need to invest in ASX shares for a retirement income of $65,000 per year?
• Hunting for passive income? Guess what you’re earning if you invested $5,000 in Wesfarmers shares last June
• UBS tips 4 ASX 200 retail shares to benefit from the federal budget
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Motley Fool contributor Tristan Harrison has positions in Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks, Washington H. Soul Pattinson and Company Limited, and Wesfarmers. The Motley Fool Australia has recommended Goodman Group and Silk Laser Australia. 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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Macquarie Group Ltd (ASX: MQG) shares are frequently sought out for their reliable dividend payments as well as a lengthy run of capital gains.

Since January 2013, the diversified S&P/ASX 200 Index (ASX: XJO) financial stock has gained some 400%.

And in 2013, and every year since then, Macquarie shares have also delivered two partly franked dividends. That’s placed it high on the radar of investors seeking some useful passive income.

So far in 2023, the Macquarie share price is up 6.5%. Shares closed yesterday trading for $174.84 apiece.

What’s the dividend yield on Macquarie shares bought on 3 October?

The Macquarie board declared a final dividend of $4.50 per share, 40% franked when the company reported its full-year results earlier this month.

With profits coming in at $5.2 billion, that was a 29% increase from the $3.50 final dividend Macquarie shares delivered the prior year.

The stock traded ex-dividend yesterday, 15 May. Shareholders will see that passive income land in their bank accounts on 4 July.

Together with the $3.00 per share interim dividend, paid out on 13 December, that adds up to a full-year payout of $7.50 per share.

That’s approximately $2.9 billion of passive income delivered to shareholders over the 12 months.

At the current share price, that equates to a trailing yield of 4.3%, with some potential tax benefits from the franking credits. Or $430 in annual passive income from a $10,000 investment.

Of course, like all stocks, Macquarie shares haven’t gone up in a straight line. There are always plenty of dips and peaks along the way.

Well-advised, well-researched, or just plain lucky investors who bought shares on 3 October, when the stock closed for $151.41 per share, will be sitting pretty today.

First, they’ll have enjoyed a 16% lift in the Macquarie share price.

Even more importantly, from a passive income perspective, they’ll be earning a dividend yield of 5.0% on that investment.

Or a very handy $500 second income from that $10,000 investment. And, mind you, that’s just since October.

The post Did you buy the October dip in Macquarie shares? Here’s the dividend yield you’re now earning appeared first on The Motley Fool Australia.

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More reading

• The top 10 ASX shares held by millionaires
• The 2 ASX 200 shares with the highest profit margins right now
• 2 top ASX 200 dividend shares to buy this week: brokers
• Here are the top 10 ASX 200 shares today
• ‘A quality franchise’: Why this broker sees major upside ahead for Macquarie shares

Motley Fool contributor Bernd Struben 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 positions in and has recommended Macquarie Group. 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 Telstra Group Ltd (ASX: TLS) share price pushed higher on Monday after the telco giant announced mobile plan increases.

The company’s shares ended the day 0.7% higher at $4.35.

This latest gain means the Telstra share price is now up 9% since the start of the year.

Are these plan increases good news for the Telstra share price?

Analysts at Goldman Sachs have responded to the news positively and believe this action is supportive of solid earnings growth in FY 2024.

The broker also believes that the price increases are evidence of rational competition in the telco industry, which is good news for future returns. The broker explains:

Telstra has announced that postpaid mobile plans will be increasing in price by $3-6/m from July-23, in-line with inflation & our recent expectations. Although not impacting our earnings forecasts, today’s announcement: (1) Reinforces our confidence in our +5.6% EBITDA growth in FY24E, which is driven by Telstra mobile division (=99% of our EBITDA growth); (2) Is evidence of Telstra continuing to be a rational incumbent, leading mobile market pricing higher, and signaling to competitors it remains focused on improving industry returns; and (3) Increases the likelihood that Telstra will fully utilize CPI within its 2024 plan revision – with our +3.1% inflation forecast in the Mar-24 qtr implying a $2/m increase.

In light of the above, Goldman remains very positive on the Telstra share price and has reiterated its buy rating and $4.70 price target.

This implies potential upside of 8% for investors over the next 12 months from current levels.

In addition, the broker is expecting a 17 cents per share dividend in FY 2023 and an 18 cents per share dividend in FY 2024. This equates to fully franked yields of 3.9% and 4.1%, respectively, stretching the total potential 12-month return to approximately 12%.

The post Broker says mobile price increases are good news for the Telstra share price appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Tuesday
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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 positions in and has recommended Telstra Group. 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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If you’re looking for exposure to the sky high gold price, then you may want to check out what analysts at Morgans are saying about a few ASX 200 gold shares.

As you will see below, the broker believes that only one of these three popular ASX 200 gold shares are buys right now.

Let’s see what its analysts are saying:

Evolution Mining Ltd (ASX: EVN)

This ASX 200 gold share has been a great place to invest in 2023. Since the start of the year, Evolution’s shares are up 32%. In light of this, the broker believes its shares are fully valued now. Morgans has a hold rating and $3.74 price target on them. It commented:

EVN’s share price reflects a solid run in the gold price. The gold miner is trading above our target price, and given revised production and underperformance at Red Lake, we maintain a Hold.

Newcrest Mining Ltd (ASX: NCM)

With its proposed $28.8 billion takeover by Newmont looking likely to happen, the broker believes investors should skip Newcrest now. Morgans has a hold rating and $25.70 price target on the mining giant’s shares. It said:

NCM’s share price is gravitating towards the Newmont offer price and currently trades at 8.8x EV/EBITDA. We see limited upside from here and maintain a Hold rating.

Regis Resources Ltd (ASX: RRL)

Regis Resources is the ASX 200 gold share to buy right now according to Morgans. With its shares underperforming the rest of the industry this year, the broker believes a buying opportunity has been created. Particularly given its recent quarterly update, which impressed Morgans. The broker has an add rating and $2.51 price target on its shares. It commented:

RRL delivered a decent March quarter result, with a healthy AISC margin of US$650/oz. RRL expects a better Q4FY23 as the capex phase tapers off and the cash build begins. RRL’s McPhillamys (growth project) FID is anticipated in Q3FY24.

Within our current formal coverage, Regis Resources (RRL) remains our preferred producer for its attractive valuation, low-risk profile (assets in WA/NSW), sustained capital spending, and organic growth project. Additionally, consolidation in the large cap domain will benefit RRL, in our view.

The post Buy this ASX 200 gold share instead of Newcrest: broker appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX 200 shares today
• Why InvoCare, Newcrest, Silver Lake, and Silver Mines shares are rising today
• Newcrest share price lifts as $28.8 billion Newmont takeover greenlighted
• Did you invest $5,000 in Evolution Mining shares in 2018? If so, here’s how much dividend income you’ve earned

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 fund manager Wilson Asset Management (WAM) has identified two undervalued All Ordinaries (ASX: XAO), or ASX All Ords shares, in its portfolio that did well in April 2023.

WAM predominately looks for growth businesses it believes are mispriced by the market and where there could be a catalyst that sends the share price higher.

Let’s dive into two of the ASX All Ords share names that WAM talked about.

IPH Ltd (ASX: IPH)

The fund manager described IPH as an international intellectual property services group. It’s made up of a network of member businesses, servicing more than 25 countries.

In March, the company’s law business detected a portion of its IT systems had been subject to unauthorised access. That access was “primarily limited to the document management systems of the IPH head office and two IPH member firms in Australia, Spruson & Ferguson (Australia) and Griffith Hack, and the practice management systems of those member businesses”.

After becoming aware of the incident, IPH said it immediately isolated the systems and removed them from the network. It then implemented its “business continuity plan” to resolve the cyber incident.

WAM pointed out that in April, the ASX All Ords share confirmed it had established new network infrastructure and enhanced security. Those measures “helped alleviate concerns held by the market, which ultimately led to the share price rallying throughout the month”.

Estimates on Commsec currently suggest that IPH could grow its earnings per share (EPS) by 16% between FY23 to FY25.

Emerald Resources (ASX: EMR)

Another business WAM talked about was Emerald Resources. The fund manager described the Perth-based company as a business that explores and develops gold projects.

In April, the ASX All Ords share announced it had achieved its quarterly guidance for the three months to March 2023. It produced 28,764 ounces of gold at the Okvau gold mine in Cambodia.

The investment team noted the mine’s operating cash flow of US$34.9 million “continues to underpin Emerald Resources’ ability to advance its exploration and development”.

WAM explained its positivity on the business with the following comments:

We continue to see positive results in gold exploration at its other sites in Cambodia and domestically, and further growth opportunities for the business in its underexplored projects.

The post 2 ASX All Ords shares that are ‘mispriced opportunities’: fund manager appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares 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 IPH. 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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