Stock Pick

  • 3 strong ASX dividend shares to buy next week

    mining dividend shares

    According to the latest weekly economic report out of Westpac Banking Corp (ASX: WBC), its team continue to expect the cash rate to stay on hold at 0.25% until at least the end of 2021.

    I suspect that this forecast will prove accurate, which could be bad news for income investors who will have to contend with low interest rates for some time to come.

    But don’t worry, because the ASX dividend shares listed below could help you earn an income in this low interest rate environment. Here’s why I like them:

    Coles Group Ltd (ASX: COL)

    The first dividend share to look at is Coles. I believe the supermarket giant is well-positioned to grow its earnings and dividend at a solid rate over the next decade. This is due to its defensive business, refreshed strategy, expansion opportunities, and its focus on automation. Together with its enviable track record of delivering consistent same store sales growth, I believe the outlook for Coles and its shareholders is very positive. At present I estimate that its shares offer a fully franked 3.8% FY 2021 dividend.

    Commonwealth Bank of Australia (ASX: CBA)

    Another dividend share I would consider buying is Commonwealth Bank. Although its shares have recovered strongly from their lows, I still believe they offer a lot of value for investors at this level. While a dividend cut in FY 2021 seems inevitable, I’m optimistic it won’t be as brutal as some believe. I suspect a dividend of ~$3.70 per share is possible. If this proves accurate it will mean a forward fully franked yield of 5.5%. This is certainly a very generous yield in this low interest environment.

    Rural Funds Group (ASX: RFF)

    A third and final dividend share to consider buying is Rural Funds. It is a property company that owns a diversified portfolio of high quality Australian agricultural assets. These asset include cattle properties, vineyards, and orchards. Due to the nature of these industries, tenants will generally sign up for ultra long leases. This gives Rural Funds great visibility with its future earnings. Which means it has been able to provide guidance for not just this year, but also next year. It plans to pay distributions of 10.85 cents per share in FY 2020 and then 11.28 cents per share in FY 2021. This equates to yields of 5.45% and 5.7%, respectively.

    3 “Double Down” Stocks To Ride The Bull Market

    Motley Fool resident tech stock expert Dr. Anirban Mahanti has stumbled upon three under-the-radar stock picks he believes could be some of the greatest discoveries of his investing career.

    He’s so confident in their future prospects that he has issued “double down” buy alerts on each of these three stocks to members of his Motley Fool Extreme Opportunities stock picking service.

    See the Double Down Stocks

    *Extreme Opportunities returns as of June 5th 2020

    More reading

    Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. The Motley Fool Australia owns shares of COLESGROUP DEF SET. 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.

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  • 3 ASX blue chip shares that could give your portfolio a boost

    blue chip shares

    One group of shares that are particularly popular with retail investors are blue chip shares.

    A blue chip is generally a large and well-established company that has operated for many years. More often than not, they will be a leader in their industry.

    The Australian share market is home to a large number of blue chips and investors will no doubt have a hard time deciding which ones to buy.

    To narrow things down, I have taken a look at three popular blue chip shares to see if they are in the buy zone right now. They are as follows:

    Goodman Group (ASX: GMG)

    One of my favourite blue chip shares is Goodman Group. It is an integrated commercial and industrial property group which owns, develops, and manages industrial real estate in 17 countries. Among its portfolio you’ll find warehouses, large scale logistics facilities, and business and office parks. It is the warehouses and logistics facilities that I’m most excited about. These give Goodman Group exposure to the structural tailwinds of the ecommerce market through its relationships with the likes of Amazon and Walmart. And given how rapidly online shopping is growing, I believe these assets will be in demand for a long time to come. This could underpin solid earnings and distribution growth over the next decade.

    Telstra Corporation Ltd (ASX: TLS)

    Another blue chip share to consider buying is Telstra. The telco giant has fallen out of favour with investors over the last few years due to its earnings decline, but I believe it is time to reconsider your view of the company. I think Telstra’s dividend is now at a sustainable level and feel that a return to growth is not too far away. This is thanks to its sizeable cost cutting, simplification of the business, and the easing of the NBN headwind. In fact, Telstra’s operating earnings would have grown during the first half if it were not for the NBN headwind. Overall, I believe now could be the time to make a long term investment in its shares.

    Woolworths Limited (ASX: WOW)

    This conglomerate could be another blue chip share to consider buying. I like Woolworths due to its quality brands, defensive qualities, and strong management team. Combined, I believe they have positioned the company to deliver solid earnings and dividend growth over the next decade. Another positive is the planned spin off of its hotels business. I expect this to unlock value for shareholders if it goes ahead.

    Looking for more options? Then don’t miss out on the highly recommended shares named below…

    3 “Double Down” Stocks To Ride The Bull Market

    Motley Fool resident tech stock expert Dr. Anirban Mahanti has stumbled upon three under-the-radar stock picks he believes could be some of the greatest discoveries of his investing career.

    He’s so confident in their future prospects that he has issued “double down” buy alerts on each of these three stocks to members of his Motley Fool Extreme Opportunities stock picking service.

    See the Double Down Stocks

    *Extreme Opportunities returns as of June 5th 2020

    More reading

    Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool Australia owns shares of 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 3 ASX blue chip shares that could give your portfolio a boost appeared first on Motley Fool Australia.

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  • 3 Value Stocks to Buy for Smart Investors

    3 Value Stocks to Buy for Smart InvestorsWith ultra-expansionary monetary policies coupled with re-opening of economies globally, stock markets have surged. The indexes in the United States have almost erased all losses incurred due to the novel coronavirus-driven economic slowdown.As bullish sentiments sustain, it makes sense to remain invested or consider fresh equity exposure. However, investors need to abstain from stocks that are trading at rich valuations. At any point of time, there are value stocks up for grabs.Let's discuss three value stocks in this column that trade at attractive valuations. These names can deliver strong returns with a medium to long-term investment horizon.InvestorPlace – Stock Market News, Stock Advice & Trading Tips * 7 Great Biotech Stocks to Buy and Hold Now * Alibaba Group (NYSE:BABA) * Chevron Corporation (NYSE:CVX) * Qualcomm Incorporated (NASDAQ:QCOM) Value Stocks to Buy for Smart Investors: Alibaba Group (BABA)Source: BigTunaOnline / Shutterstock.com Before I talk about the growth potential for Alibaba, investors will question the company's categorization as a value stock. BABA stock currently trades at a price-to-earnings-ratio of 26.68. This might look expensive.However, I would focus on the company's potential earnings growth. Analyst estimates suggest that earnings growth is likely at 18% annually for the next five years. Therefore, factoring the potential growth, Alibaba Group is a value investment.I also believe that the company's earnings growth can accelerate in the coming years. The first reason is e-commerce expansion in Southeast Asia besides strong growth in China. Another reason is the company's strong growth in the cloud business, which holds immense potential. For FY2020, the company's cloud business growth was 62% with total revenue touching $5.7 billion.It's also worth noting that Alibaba reported free cash flow of $18.5 billion for the last financial year. The company has high financial flexibility and has pursued inorganic growth in the past. Acquisitions can also trigger higher earnings growth in the coming years.Overall, BABA stock is attractively valued considering the growth potential. I believe that the stock belongs to the core portfolio. With Asia's e-commerce boom, Alibaba Group is well positioned to make it big. Chevron Corporation (CVX)Source: JL IMAGES / Shutterstock.com In the recent market meltdown, energy stocks were battered. Several stocks have trended higher with renewed economic optimism and relatively higher oil prices. Among value stocks, Chevron Corporation deserves a mention.One of the reasons to like Chevron Corporation is the company's quality balance sheet. The company expects its net-debt ratio to remain below 30% even if Brent remains at $30 per barrel through the year and in FY2021.Brent is already trading at $40 and Chevron Corporation is a long-term cash flow machine. To put things into perspective, Chevron expects free cash flow of $4 to $5 billion annually just from the Permian.With strong fundamentals, the company's diverse asset base will translate into sustained production and cash flow growth. Another reason to like CVX stock is the fact that the company pays an annual dividend of $5.16. With ample liquidity buffer and improving oil price, dividends are sustainable. Furthermore, dividends will increase once the current headwind is navigated. * The 9 Best Cryptocurrencies to Watch for the Rest of 2020 At a current EV/EBITDA of 5.9, CVX stock is worth considering. As a matter of fact, another fundamentally strong name, Exxon Mobil (NYSE:XOM), trades at an EV/EBITDA of 8.3. Therefore, on a relative basis, the stock is attractive. Qualcomm Incorporated (QCOM)Source: photobyphm / Shutterstock.com QCOM stock also finds a place in my basket of value stocks. Again, the stock is trading at a P/E of 24.6, but earnings growth is likely at 18% on an annual basis over the next five years. While QCOM stock trades at a price-earnings-to-growth ratio of 1.34, the industry PEG is 2.68. Clearly, the stock is attractively valued in the industry with strong growth potential.It's no secret that Qualcomm is "the" company to consider in the 5G space. On the potential for the coming years, it's estimated that 5G will enable $13.2 trillion of global economic output by FY2035. The application and impact will be across sectors like healthcare, manufacturing and automobile, among others.It's worth noting that Qualcomm has provided guidance for 5G handset shipments at 175 to 225 million for the current year. As economies re-open and consumption spending on non-essentials increases, the company stands to benefit.From a balance sheet perspective, Qualcomm reported $10 billion in cash and equivalents as of March 2020. With a strong cash buffer, there is ample flexibility to invest in research-driven growth. I would consider QCOM for the core portfolio with 5G growth acceleration likely for the coming decade.Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modelling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * Top Stock Picker Reveals His Next 1,000% Winner * The 1 Stock All Retirees Must Own * Look What America's Richest Family Is Investing in Now The post 3 Value Stocks to Buy for Smart Investors appeared first on InvestorPlace.

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