Stock Pick

  • 3 top ASX dividend shares I would buy for income right now

    word dividends on blue stylised background, dividend shares

    Next week the Reserve Bank of Australia will be deciding on the cash rate once again.

    According to the latest cash rate futures, at present the market is pricing in a 47% probability of a rate cut at this meeting.

    While I’m not convinced rates will go lower from here, I am convinced that they will stay at ultra-low levels for a number of years to come.

    In light of this, I continue to see the share market as the best place for investors to turn to for income.

    But which shares should you buy? These three top ASX dividends shares are high on my list:

    Commonwealth Bank of Australia (ASX: CBA)

    If you don’t already have exposure to the big four banks, then I think it would be worth considering Commonwealth Bank. While trading conditions are tough for the banks, I’m optimistic that the worst is largely behind them now. This could make it an opportune time to make a patient investment in Commonwealth Bank’s shares. I expect the bank to cut its dividend to ~$3.70 per share in FY 2021, which implies a forward fully franked 6% yield.

    Rio Tinto Limited (ASX: RIO)

    I think Rio Tinto could be worth considering. Especially with iron ore prices trading at lofty levels and some tipping prices to go even higher. This should lead to Rio Tinto delivering strong profits for at least the next couple of years. And given the strength of its balance sheet, I expect the majority of its free cash flow to be returned to investors. Last week Morgans suggested that Rio Tinto’s shares offer a fully franked ~9% FY 2021 dividend yield.

    Wesfarmers Ltd (ASX: WES)

    A final dividend share to consider buying is Wesfarmers. It is the conglomerates behind brands such as Bunnings, Kmart, Target, online retailer Catch, and Officeworks. It also owns a number of businesses in the chemicals and industrials industries. And while its shares may not offer the biggest yield, I believe its businesses leave it well-placed to grow its dividend at a solid rate over the next decade. At present I estimate that its shares offer a forward fully franked ~3.7% dividend yield.

    And here is another dividend share which looks well-positioned to grow strongly over the next decade. This could make it a must buy for income investors..

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    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Wesfarmers 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 3 top ASX dividend shares I would buy for income right now appeared first on Motley Fool Australia.

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  • 5 things to watch on the ASX 200 on Wednesday

    ASX share

    On Tuesday the S&P/ASX 200 Index (ASX: XJO) continued its sensational form and stormed a further 2.9% higher to 5,780 points.

    Will the market be able build on this on Wednesday? Here are five things to watch:

    ASX 200 expected to tumble.

    The ASX 200 index looks set to give back some of yesterday’s gains on Wednesday. According to the latest SPI futures, the index is expected to open the day 63 points or 1.1% lower this morning. This follows a positive but not spectacular start to the week on Wall Street overnight following Monday’s public holiday. The Dow Jones rose 2.2%, the S&P 500 climbed 1.2%, and the Nasdaq edged 0.2% higher.

    Oil prices climb higher.

    Energy producers including Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) could be on the rise today after oil prices jumped higher. According to Bloomberg, the WTI crude oil price has pushed 3% higher to US$34.24 a barrel and the Brent crude oil price is up 1.9% to US$36.20 a barrel. Traders appear optimistic that major producers are following through on their supply cut promises.

    Gold price sinks lower.

    It could be a difficult day for gold miners including Evolution Mining Ltd (ASX: EVN) and St Barbara Ltd (ASX: SBM) after the gold price sank lower overnight. According to CNBC, the spot gold price fell 1.9% to US$1,703.00 an ounce. This was driven by investors switching out of safe haven assets and back into risk assets.

    ALS full year update.

    The ALS Ltd (ASX: ALQ) share price will be on watch today when the testing services company releases its full year update. Last week analysts at Credit Suisse upgraded its shares to an outperform rating with an $8.00 price target. They appear confident that ALS will deliver a decent result this morning.

    Coca-Cola Amatil upgraded.

    The Coca-Cola Amatil Ltd (ASX: CCL) share price will be on watch today after analysts at Goldman Sachs upgraded the beverage company’s shares to a neutral rating with a price target of $9.50. This follows the release of a trading update at its annual general meeting on Tuesday. The broker made the move on valuation grounds after a sharp pullback in its share price over the last 12 months.

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    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. 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 5 things to watch on the ASX 200 on Wednesday appeared first on Motley Fool Australia.

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  • Sorrento’s COVID-19 Antidote Could be a Game Changer, Says Analyst

    Sorrento’s COVID-19 Antidote Could be a Game Changer, Says AnalystHow do we protect those at the frontline facing COVID-19 head on? Sorrento Therapeutics (SRNE) is on it.Looking at billions of antibodies, the company identified a small group that demonstrated the ability to block the S1 protein's interaction with human angiotensin-converting enzyme 2 (ACE2), the receptor used for viral entrance into human cells. Based on this, SRNE wants to develop an antibody cocktail against SARS-CoV-2, the virus that causes COVID-19, that is still effective even if mutations occur.Weighing in for Dawson James, analyst Jason Kolbert tells clients that SRNE’s antibody, STI-1499, has already exhibited a strong performance in an early clinical setting. Expounding on this, he stated, “What was also equally impressive was the low dose, which suggests the antibody ‘fits’ its target extraordinarily well and, as such, can work at a very low dose. This could translate into the ability to scale up rapidly to millions of treatments at a very effective cost of goods.”It should be noted that the company is set to develop STI-1499 as part of this “antibody cocktail,” known as COVISHIELD, with it hoping to discuss the best pathway to make any potential treatment available as quickly as possible with regulators. Kolbert added, “Through the U.S.'s Project Warp Speed, it's possible we could see STI-1499 move rapidly to commercialization.”Adding to the good news, management said that it has the capacity to produce up to two hundred thousand doses per month. While the current goal is to manufacture a million doses, the company thinks it can produce tens of millions of doses in a short timeframe.Speaking to the market opportunity, Kolbert commented, “We see a significant market opportunity in treating frontline workers (doctors, nurses and other mission critical personnel, as well as occupants of military ships at sea) to prevent and treat COVID infection. If we assume pricing below Remdesivir ($4,000) and a million doses equals a $4 billion opportunity for this potential antidote.”STI-1499 isn’t the only thing the company has going for it. Through its majority owned position in Scilex, SRNE is working on several non-opioid pain management therapies including resiniferatoxin, a toxin that ablates afferent nerves, as well as Scilex SP-102, an epidural steroid injection designed as a treatment of sciatica pain. It also boasts cell therapy programs that target both solid and liquid tumors.To this end, Kolbert initiated coverage on Sorrento shares with a Buy rating, while setting a $24 price target. This target puts the upside potential at a whopping 373%. (To watch Kolbert’s track record, click here)Judging by the consensus breakdown, it has been relatively quiet when it comes to other analyst activity. Only one review has been issued recently, and it was bullish, so the consensus rating is a Moderate Buy. (See Sorrento stock analysis on TipRanks)To find good ideas for healthcare stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

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