I think there’s a rare buying opportunity for Woolworths Group Ltd (ASX: WOW) shares today.

Woolworths shares have had a fairly interesting ride lately.

Back in February, Woolworths shares made a fresh new all-time high of $43.96. Then the March share market crash hit and the shares went all the way down to $32.12. When it became apparent that Australians were stocking up on food, toilet paper, and other essentials in February and March, the Woolies share price rebounded back to the $40 level.

But since then, Woolworths shares have languished while the rest of the market has surged. For some context, since 23 March the S&P/ASX 200 Index (ASX: XJO) has risen close to 28%. Woolworths shares? A 3.66% drop.

Why are Woolworths shares stuck in the mud?

You would think that after Woolworths reported a record quarter (ending 31 March 2020) that investors would be scrambling to get a hold of this company’s shares. Especially those investors who were willing to pay nearly $45 for the same shares just a few months ago.

But investors know that the healthy bump Woolies got in February and March isn’t here to stay. According to the company, consumption patterns have more or less returned to normal. What hasn’t returned to normal though is Woolworths’ spending. The company has had to ramp up costs considerably as a result of the coronavirus pandemic. Safety screens, extra cleaning, enforcing social distancing at its stores, and additional staffing costs are all expensive and will probably be weighing the company’s balance sheet down for at least the next year, possibly longer.

It’s my view that investors are seeing these costs and as a result, aren’t in a rush for Woolworths shares.

Why the Woolworths share price might be a buy today

At current levels, I’m seeing a pricing opportunity for Woolworths shares. Why? Because the company is trading at no premium to its arch-rival Coles Group Ltd (ASX: COL). Being a larger, more diverse company with a higher market share of the Australia grocery industry, Woolworths has historically commanded a pricing premium to Coles.

But today, the shares are neck-and-neck. On current prices of $35.28 (at the time of writing), Woolworths shares are trading on a price-to-earnings (P/E) ratio of 17.48 and a trailing dividend yield of 2.93%.

If we look at the Coles share price at $15.48, we can see a P/E ratio of 17.08 and a trailing dividend yield of 2.77%.

So the companies are pretty much dead-even on a P/E basis and Woolworths actually comes out on top regarding dividend yield.

Foolish takeaway

I think dividend shares will continue to be in demand in 2020 as a result of record-low interest rates. And in my view, Woolworths is one of the most reliable ASX dividend shares on the ASX today.

As such, I think Woolworths is a decent buy today.

More reading

• 3 ASX 200 tech shares to buy and hold beyond 2025
• In your 50s? Here are the 2 best ASX 200 shares to buy now
• These ASX shares are set to get a big boost from the next big government stimulus
• These 5 ASX 200 shares were last week’s biggest winners
• 3 leading ASX 200 shares to buy for market-beating returns

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Woolworths Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why Woolworths shares are offering a rare buying opportunity today appeared first on Motley Fool Australia.

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If you’re looking to add a few blue chip ASX shares to your portfolio this month, then the two listed below could be good options.

I believe these blue chip ASX shares have the potential to provide strong returns for investors over the next few years. Here’s why I would buy them in June:

CSL Limited (ASX: CSL)

The first ASX blue chip share to consider buying is this leading biotherapeutics company. Its shares were surprisingly out of form in May and are now trading around 17% lower than their 52-week high. I think this is a buying opportunity for investors that have been wanting to get a piece of the company.

And while there is a danger that the pandemic could have impacted its plasma collections during lockdowns, I believe higher unemployment will support collections once the crisis passes. Outside this, I believe its long term outlook remains very positive. This is thanks to the strong demand for immunoglobulin products, its growing Seqirus vaccine business, and its burgeoning research and development pipeline. All in all, I believe CSL is a blue chip to own for the long term.

Telstra Corporation Ltd (ASX: TLS)

I think Telstra is another great blue chip ASX share to own right now. After several years of struggles, the telco giant appears close to returning to growth once again. This is thanks to a combination of its T22 strategy, rational competiton, and the easing of the NBN headwind.

In fact, if it had not been for the NBN headwind, Telstra’s operating earnings would have been up on the prior corresponding period during the first half. In light of this and the current free cash flows it is generating, I believe its dividend cuts are over and 16 cents per share is the bottom. This equates to an attractive fully franked yield of almost 5%.

More reading

• In your 50s? Here are the 2 best ASX 200 shares to buy now
• 5 winning ASX dividend shares to buy in June
• Why Austal, CSL, Fortescue, & Star shares are charging higher today
• 5 ASX 200 winners and 3 losers from last week
• ASX 200 Weekly Wrap: Surging bank shares push ASX toward 6,000

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended Telstra Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why I would buy these ASX 200 blue chip shares in June appeared first on Motley Fool Australia.

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S&P/ASX 200 Index (ASX: XJO) investors in their 50s are likely starting to think about retirement. The makeup of your investment portfolio is an important consideration. You may want to purchase more dividend-paying shares, as well as larger more stable businesses. Further, diversification is more important than ever to preserve capital.

Investors in their 50s

As investors we’re a motley crew. We all have motley goals, motley resources and motley risk appetite. Because of this, it is important to understand your own personal circumstances and invest accordingly. The below ASX stocks will be fantastic options for most investors in their 50s, but not for all. 

2 best ASX 200 shares to buy now

CSL Limited (ASX: CSL)

The largest company in the ASX 200 is a compounding machine! Over the last 20 years CSL has provided investors with a mega 20% annualised total return. The company’s performance has been even better in recent times, returning more than 25% per annum in total returns over 5 and 10 years.

After seeing the CSL share price fall more than 10% in May, I think now provides a nice entry point for new ASX 200 investors. Most of the drop can be attributed to profit taking and concerns over plasma collection issues resulting from COVID-19.

Despite its vast size, CSL should continue to grow well in the future. The stock price may not appreciate as fast as in the past, but I believe that CSL can provide robust market outperformance with less volatility.

Betashares Asia Technology Tigers ETF (ASX: ASIA)

Most people earn their income in Australia, have their savings in Australia and invest in Australia. Australia is the lucky country, but I think ASIA is a great option for ASX 200 investors in their 50s because of its diversification.

This ETF is a great way to diversify geographically into one of the fastest growing economies in the world. Not only that, it provides access to the technology sector, which is underweight in the ASX. 

It can often be hard to pick the winner in new technologies. Investment trends such as e-commerce and cloud computing have enormous addressable markets. Because of this, there is likely to be more than one winner in a region. As a market capitalisation weighted ETF, you gain more and more exposure to the businesses winning in these trends over time.

Some of the largest holdings include Alibaba Group and Tencent.

Foolish takeaway

Your 50s is a great time to start diversifying your portfolio and structuring it towards your income needs. Shares should make up part of a well balanced portfolio of multiple investment classes.

More reading

• 3 ASX 200 tech shares to buy and hold beyond 2025
• Why Woolworths shares are offering a rare buying opportunity today
• Why I would buy these ASX 200 blue chip shares in June
• These ASX shares are set to get a big boost from the next big government stimulus
• These 5 ASX 200 shares were last week’s biggest winners

Lloyd Prout owns shares in Betashares Asia Technology Tigers Ltd and expresses his own opinions. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of and has recommended BetaShares Asia Technology Tigers ETF. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post In your 50s? Here are the 2 best ASX 200 shares to buy now appeared first on Motley Fool Australia.

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