Category: Stock Market

The ASX dividend stock Kelsian Group Ltd (ASX: KLS) has deviated significantly from its recent highs. The Kelsian share price is down around 50% from April 2021 and 25% over the last year, as shown in the chart below.

Kelsian describes itself as Australia’s largest integrated multi-modal transport provider and tourism operator. It has established bus operations in Australia, Singapore, the USA, London, and the Channel Islands. At 31 December 2023, it had 5,500 buses, 115 vessels, and 24 light rail vehicles.

The company has been operating for over 30 years. It claims to be a leader in sustainable public transport, with Australia’s largest zero-emission bus fleet and electrified bus depot.   

It may not be the most well-known ASX dividend stock, but I believe it could be a compelling option.

Passive income potential

Kelsian has impressively grown its annual dividend per share each year since 2021, which is pretty good considering all of the uncertainty and volatility of the last three years.

Looking at the last two declared dividends, it has a fully franked dividend yield of 3.3% and a grossed-up dividend yield of 4.8%.

The estimate on Commsec suggests the ASX dividend stock could pay an annual dividend per share of 22.7 cents in FY25, which would be a grossed-up dividend yield of 6.2%.

In the subsequent year of FY26, the transportation business is forecast to pay an annual dividend per share of 25 cents. This would represent a grossed-up dividend yield of 6.8% in the 2026 financial year.

So, the business is projected to see a pleasing level of dividend yield and passive income growth in the next couple of financial years.

Are the ASX dividend stock’s earnings going to grow?

I only want to consider investing in businesses whose earnings are likely to grow in the foreseeable future. Profit growth usually drives the share price higher and funds larger dividend payments.

In the FY24 first-half result, the business reported revenue grew by 44.9% to $982.7 million thanks to the acquisition of All Aboard America! and the new Sydney contracts from August 2023 and October 2023. It also reported underlying earnings before interest and tax (EBIT) growth of 29.4% to $58.1 million and statutory net profit after tax (NPAT) growth of 44.1% to $28.1 million.

Kelsian’s outlook commentary on the HY24 result said it’s “well-placed to continue to deliver growth underpinned by economies of scale, efficiencies and global procurement opportunities.”

The ASX dividend stock believes the longer-term list of growth opportunities is “significant”, with many markets “welcoming operational experts to support their decarbonisation agendas”.

Its new contracts in Western Sydney are “in the fastest population growth corridor in Sydney”, and this growth is expected to continue with the launch of a new international airport in 2026. The company is confident of more Sydney contracts, an expansion of routes and higher margins.

The All Aboard America! business provides “a multi-year runway that is both organic and inorganic.” Organic growth examples include “construction and technology sectors, employee shuttle and expansion to new cities.”

According to Commsec estimates, the Kelsian share price is valued at just 12x FY26’s estimated earnings. For a growing business, I believe that’s a very appealing valuation.

The post 1 ASX dividend stock down 50% to buy right now appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• 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 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.

Are you feeling wealthier these days? Or maybe you’re wondering how anyone is getting rich right now.

That may seem like a silly question in the midst of a cost-of-living crisis.

But according to the Australian Financial Review (AFR), the average wealth of Australian adults grew by nearly 10% in 2023. And that was more than twice the growth rate of 56 other countries.

These are the findings of the 2024 UBS Global Wealth Report.

Our wealth is building faster than other countries

On a median basis, our wealth grew by about 5% to US$261,805 per person. That translates to about $386,758 per person in Aussie currency, making us the second-wealthiest people on the planet.

We’ve moved up a spot this year and sit behind Luxembourg, which has the highest median wealth per person, at US$372,258 or AU$549,927.

Below us in third position is Belgium, with a median wealth per person of US$256,185 or AU$378,456.

According to UBS, 1.9 million Australians are currently officially millionaires in US dollar terms. Our country has the third-highest number of millionaires per capita, at 10% of the adult population.

UBS also predicts that this particular population cohort will grow by 21% over the next four years.

How to get rich in Australia?

Well, the bulk of it is ‘on paper’, so to speak.

Australians’ personal wealth is largely tied up in our properties and superannuation.

In fact, UBS says more than half of Australia’s wealth is held in non-financial assets, like real estate.

However, in our broader Asia-Pacific neighbourhood, 60% of people’s wealth is in financial assets like shares, bonds, and cash. In North America, 70% of people’s personal wealth is in these types of assets, too.

The relatively illiquid nature of our wealth is a bit of a problem in a cost-of-living crisis, right?

Our net worth is impressive, but there’s a problem…

We can’t get access to the equity in our homes unless we sell, or ratchet up our home loans, and we can’t access our superannuation until we reach the preservation age.

Home values have been moving higher across Australia for 17 consecutive months.

In June, the national median home value rose by another 0.7%, according to CoreLogic data. In FY24, Australian homeowners gained a median $59,000 in capital gains on paper.

Meantime, our superannuation balances are getting bigger thanks to share market gains in FY24.

The latest data from Chant West suggest the median growth superannuation fund will have risen in value by 9% over FY24.

The average superannuation balance among Australians aged 65 to 69 years (the cohort closest to the retirement age of 67) is $404,553. The median is $198,715.

Of course, all of this property and superannuation wealth sounds great, but it doesn’t help pay the next electricity bill, does it?

This is the problem with being asset-rich. If you’re also cash-poor, you don’t feel so wealthy when you’re struggling to pay for the essentials!

Particularly when you’re also trying to cover what the Reserve Bank estimates to be 30% to 60% higher mortgage repayments these days.

How the next generation is set to get rich

UBS values the coming global intergenerational wealth transfer from baby boomers to Gen Xers at US$83 trillion or AU$122.6 trillion.

And as we know, that money is already being distributed in Australia via the Bank of Mum and Dad.

Andrew McAuley, managing director at UBS Wealth Management Australia, said:

The inheritocracy, the bank of mum and dad, it’s real.

To be able to afford a house, young people are going to need help. The last of the Baby Boomers will have retired, and the oldest Baby Boomers will be starting to pass away.

There’s a real bulge of the population there, and … they’re the first big group who had super. Definitely, there’s going to be a transfer.

Wealth building via ASX shares

One of the great things about investing in ASX shares is the generous dividends many of our big companies pay.

ASX dividend shares can provide a reliable income stream as part of your investment portfolio. And there are big tax advantages if you stick to fully franked ASX shares.

Popular dividend stocks include BHP Group Ltd (ASX: BHP), Fortescue Ltd (ASX: FMG), Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB).

The post It’s official, Aussies are getting richer! Here’s how appeared first on The Motley Fool Australia.

More reading

• Top 10 most traded ASX shares and US stocks in June
• Own BHP shares? Here’s your Q4 preview
• ‘Defining trend this decade’: 6 tips for buying AI stocks
• Top 4 reasons why more Aussies are managing their own superannuation
• Investing in ASX shares? Why CEO pay DOES matter when misaligned

Motley Fool contributor Bronwyn Allen has positions in BHP 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 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.

Mega ASX 200 iron ore shares BHP Group Ltd (ASX: BHP) and Fortescue Ltd (ASX: FMG) were the top two most traded ASX stocks last month among investors using the SelfWealth trading platform.

Let’s review the top 10.

Top 10 most traded ASX shares in June

Here are the top 10 most traded ASX shares in June by volume (thus incorporating both buy and sell orders), according to Selfwealth Ltd (ASX: SWF).

We have also included the percentage of buy orders next to each ASX share.

Rank	Top ASX shares by trading volume	Percentage of buy orders
1	BHP Group Ltd (ASX: BHP)	66.5%
2	Fortescue Ltd (ASX: FMG)	67.8%
3	Pilbara Minerals Ltd (ASX: PLS)	62%
4	DroneShield Ltd (ASX: DRO)	57.8%
5	Woodside Energy Group Ltd (ASX: WDS)	53.5%
6	Mineral Resources Ltd (ASX: MIN)	63%
7	ANZ Group Holdings Ltd (ASX: ANZ)	47.2%
8	Summit Minerals Ltd (ASX: SUM)	52.4%
9	Rio Tinto Ltd (ASX: RIO)	58.8%
10	Dimerix Ltd (ASX: DXB)	59.6%

Which ASX shares attracted the most buyer interest?

As you can see, ASX 200 mining giant Fortescue received the most buy orders among the top 10 shares.

The Fortescue share price tumbled 13.46% during the month of June. Perhaps investors saw greater value in the stock as the price declined.

Fortescue shares are now trading on a price-to-earnings (P/E) ratio of 7.92x. The Fortescue share price closed on Friday at a nine-month low of $22.10.

Top broker Goldman Sachs has a sell rating on Fortescue with a 12-month share price target of $16.20. But Michael Gable from Fairmont Equities says Fortescue shares are a buy.

BHP shares had the second strongest buying activity during the month.

The BHP share price closed on Friday at $43.40. Goldman has a buy rating on BHP with a 12-month price target of $48.40.

The iron ore price has been falling, and one major bank forecasts that the commodity will weaken further over the next year or so.

On Friday, the S&P/ASX 200 Index (ASX: XJO) closed at 7,959.3 points. It reached a new record high during intraday trading at 7,969.1. This was driven by news out of the US that inflation is easing.

The S&P/ASX All Ordinaries Index (ASX: XAO) closed at 8,206.1 points. The All Ords also set a new record high during intraday trading at 8,212.6 points.

Top 10 most traded US stocks in June

Here are the top 10 most traded US stocks in June among SelfWealth traders.

Rank	Top US stocks by trading volume	Percentage of buy orders
1	NVIDIA Corp (NASDAQ: NVDA)	80.7%
2	GameStop Corp (NYSE: GME)	71%
3	Tesla Inc (NASDAQ: TSLA)	59.3%
4	Advanced Micro Devices, Inc. (NASDAQ: AMD)	58.6%
5	Apple Inc (NASDAQ: AAPL)	48.%
6	Marathon Digital Holdings Inc (NASDAQ: MARA)	58.2%
7	Amazon.com Inc (NASDAQ: AMZN)	59%
8	Microsoft Corp (NASDAQ: MSFT)	68.5%
9	GigaCloud Technology Inc (NASDAQ: GCT)	61.8%
10	Alphabet Inc Class A (NASDAQ: GOOGL)	57%

As shown, the quintessential artificial intelligence stock NVIDIA had the highest percentage of buy orders among the top 10 US shares.

The post Top 10 most traded ASX shares and US stocks in June appeared first on The Motley Fool Australia.

More reading

• It’s official, Aussies are getting richer! Here’s how
• Own BHP shares? Here’s your Q4 preview
• These are the 10 most shorted ASX shares
• 5 things to watch on the ASX 200 on Monday
• ‘Defining trend this decade’: 6 tips for buying AI stocks

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Bronwyn Allen has positions in Anz Group, BHP Group, and Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Advanced Micro Devices, Alphabet, Amazon, Apple, DroneShield, Goldman Sachs Group, Microsoft, Nvidia, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Advanced Micro Devices, Alphabet, Amazon, Apple, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Now could be the time to sell ASX Ltd (ASX: ASX) shares.

That’s the view of analysts at Goldman Sachs, which are feeling bearish about the ASX 100 stock.

What is the broker saying about this ASX 100 stock?

Goldman has been looking at the stock exchange operator ahead of its results next month.

It believes there are a number of key issues and trends for investors to look out for. The first is divisional trends. It said:

1) Divisional trends: a) Listings benign: Listed entities declined over 2H24 but fee increases could offset this pressure. Compared to 1H24, IPO volumes were benign and secondary raisings slightly softer. Any recovery here will be lagged as revenues are amortised. b) Derivatives/ Futures strong: over 2H24 v 1H24 benefiting from interest rate volatility. c) Cash market trading up on 1H24: with an improvement through late 2H24 – similar trend for CS.

And while Goldman expects improvements in collateral balances and fee changes, it sees corporate bonds as a drag. The broker adds:

2) Collateral balances expected to improve over 2H24: Albeit ASX flagged stability in the investment spread at 10bps but expected this to increase over time. 3) Corporate bonds: issuance likely to be a slight drag on interest income as deployed. 4) Fee changes: Listing fees generally up ~5% on average we think across Jul-24/Jan-25. We also note fee increases in Austraclear across holding and transaction fees.

Also worth looking out for are movements in its equity investments and regulatory risks. It commented:

5) Equity investment portfolio: a) Sympli: Implications for Sympli from ARNECC pausing the interoperability program and standing down their project team. We expect small losses from Sympli to persist. b) Grow Inc: Update on profitability and participation in latest funding round. 6) Other key issues: a) Progress on ASIC’s investigation into suspected contraventions of the ASIC Act 2001 and the Corporations Act 2001 in relation to the CHESS replacement program — see here — suggesting potential regulatory risks. b) Despite regulatory changes being implemented, we think the threat of competition is low, noting Capex requirements.

Sell rating retained

The note reveals that Goldman has held firm with its sell rating on the ASX 100 stock with an improved price target of $59.50.

Based on its current share price of $64.41, this implies potential downside of 7.6% for investors over the next 12 months.

The broker concludes:

We are Sell rated on ASX because: 1) Capex guidance remains elevated into FY25-FY27 from ongoing CHESS replacement project and technology revamp with risks on execution. 2) Risks arising from enhanced regulatory scrutiny on CHESS replacement and ASIC investigation. 3) Potential upside from a recovery in cyclical revenues is likely to be small with D&A drag to result in very muted earnings growth. 4) ASX’s Clearing and Settlement ROE is well below Group ROE target.

The post Sell this ASX 100 stock now: Goldman Sachs appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• Buy these quality ASX dividend shares for passive income
• 5 things to watch on the ASX 200 on Thursday

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 Goldman Sachs Group. 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.

BHP Group Ltd (ASX: BHP) shares will be on watch this week.

That’s because the mining giant is scheduled to release its fourth quarter update on Wednesday 17 July.

Ahead of the release of its update, let’s have a look at what the market is expecting from the Big Australian.

BHP Q4 preview

According to a note out of Goldman Sachs, it is expecting BHP to fall a touch short of the market’s expectations during the fourth quarter.

It is forecasting iron ore shipments of 74.1Mt for the three months. While this is up 6% quarter on quarter, it is lower than the consensus estimate of 74.9Mt. Goldman expects this to be achieved with a realised iron ore price of US$101 per tonne.

It is a similar story for copper, with the broker forecasting flat copper production of 467kt, which is just short of the consensus estimate of 470kt. A realised price of US$3.93 per pound is expected by Goldman, which is 12 cents lower than the consensus estimate of US$4.05 per tonne.

Metallurgical coal production could disappoint. It is expected to be down 24% quarter on quarter to 4.6Mt. This is lower than the consensus estimate of 4.9Mt.

Finally, nickel production is also forecast to come in lower than the market expects. Goldman has pencilled in production of 18.6kt versus the consensus estimate of 19.8kt.

BHP is also likely to provide the market with its guidance for FY 2025. And once again, the broker believes this could be lower than expectations. It commented:

BHP: we sit below on FY25 iron ore production vs. VA consensus; Pilbara iron ore 287Mt (100% basis) vs. VA cons at 293Mt and Qld met coal production of 18Mt (BHP share) vs. VA cons at 21Mt due to our view of ongoing catch-up on waste stripping and build-up of in-pit coal inventory.

Should you buy BHP shares?

Despite expecting BHP to fall short of the market’s expectations in both the fourth quarter and FY 2025, Goldman remains very positive on the miner’s shares.

It currently has a buy rating and $48.40 price target on its shares. Based on its current share price of $43.40, this implies potential upside of 11.5% for investors over the next 12 months.

Goldman also expects a 4.2% dividend yield in FY 2025, which boosts the total potential return to almost 16%.

Commenting on its bullish view, the broker said:

We rate BHP a Buy based on: (1) Attractive valuation, but at a premium to RIO: Although we believe this premium can be partly maintained due to ongoing superior margins and operating performance (particularly in Pilbara iron ore where BHP maintains superior FCF/t vs. peers), (2) Robust FCF, but still below RIO, (3) We remain bullish on copper and met coal, (4) Optionality with +US$20bn copper pipeline, but growth below RIO.

The post Own BHP shares? Here’s your Q4 preview appeared first on The Motley Fool Australia.

More reading

• Top 4 reasons why more Aussies are managing their own superannuation
• Investing in ASX shares? Why CEO pay DOES matter when misaligned
• Will the BHP share price keep falling?
• CBA share price rallies to become the new top dog on the block
• ASX 200 re-writes history. Which companies are leading the charge?

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 Goldman Sachs Group. 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.

If you’re fortunate enough to have $10,000 available to invest into the share market, then you may be on the lookout for options.

In order to narrow things down for you, let’s take a look at three ASX 200 shares that are highly rated by analysts and could be good options for those funds. They are as follows:

Capricorn Metals Ltd (ASX: CMM)

Capricorn Metals could be a top option if you would like to add some gold exposure to your portfolio with that $10,000.

It is a gold exploration, development, and mining company whose primary asset its 100%-owned Karlawinda Gold Project (KGP) in Western Australia. Bell Potter is very positive on the company due to the quality of its KGP operation and management’s strong track record. It said:

CMM’s management team has a track record of capital efficient project funding, development, commissioning and operation. In our view, FY25 and FY26 should benefit from higher revenue and EPS increases by 32% and 6% respectively. CMM is a sector leading gold producer with a strong balance sheet, a management team with an excellent track record of delivery and clear organic growth options to lift group production to 270kozpa.

The broker has a buy rating and $6.53 price target on its shares.

Flight Centre Travel Group Ltd (ASX: FLT)

Another ASX 200 share for investors to consider buying is travel agent giant Flight Centre.

Morgans is a big fan of the company and sees a lot of value in its shares at current levels. Particularly given the transformation of its business model. It said:

FLT has the greatest risk, reward profile of our travel stocks under coverage. The risk is centred around execution given its changed business model, while the reward is material if FLT delivers on its 2% margin target. If achieved, this would result in material upside to consensus estimates and valuations. FLT is targeting to achieve this margin in FY25. With greater confidence in the travel recovery and the benefits of Flight Centre’s transformed business model already emerging, we think the company is well placed over coming years.

The broker has an add rating and $27.27 price target on its shares.

Light & Wonder Inc. (ASX: LNW)

Analysts at Goldman Sachs think that Light & Wonder could be an ASX 200 share to buy. It is a cross-platform global games company that provides gambling products and services.

The broker likes Light & Wonder due to its belief that it can continue to win market share in Australia and North America and deliver strong profit growth. It explains:

LNW is well-placed to continue winning market share in ANZ and North America gaming operations, driving earnings growth of +12% (2-year CAGR) to achieve its FY25 AEBITDA target of US$1.4bn, which we believe has not been factored into market expectations (GSe +3% above VA consensus). Additionally, we believe SciPlay is out indexing the social casino segment driven by higher monetisation rates and modest user growth, despite headwinds in the broader social gaming industry.

Goldman has a buy rating and $190.00 price target on its shares.

The post Where to invest $10,000 into ASX 200 shares appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• Here’s how the ASX 200 market sectors stacked up last week
• Goldman Sachs names 1 ASX 200 stock to buy and 2 to hold
• 5 things to watch on the ASX 200 on Thursday
• Bell Potter says these ASX 200 shares can deliver ~30% returns

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 Goldman Sachs Group and Light & Wonder. The Motley Fool Australia has recommended Flight Centre Travel Group and Light & Wonder. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

At the start of each week, I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Pilbara Minerals Ltd (ASX: PLS) remains the most shorted ASX share with flat short interest of 21.3%. With analysts forecasting lithium prices to remain under pressure for some time, short sellers appear to believe this will weigh on this lithium miner’s profits.
• IDP Education Ltd (ASX: IEL) has 13.1% of its shares held short, which is up slightly since last week. This language testing and student placement company is being impacted negatively by student visa changes in a number of key markets.
• Liontown Resources Ltd (ASX: LTR) has 11.1% of its share held short, which is also flat week on week. Liontown will soon be adding more lithium supply to the market, with the Kathleen Valley Project commencing production in the coming weeks.
• Chalice Mining Ltd (ASX: CHN) has short interest of 11%, which is up significantly week on week. Short sellers aren’t giving up on this mineral exploration company’s shares despite them losing almost 80% of their value over the last 12 months.
• Flight Centre Travel Group Ltd (ASX: FLT) has seen its short interest increase to 10.8%. Short sellers continue to target this travel agent giant’s shares amid concerns over weak consumer spending and revenue margin headwinds.
• Syrah Resources Ltd (ASX: SYR) has short interest of 10.5%, which is up week on week. This graphite miner’s shares have fallen heavily due to weak battery material prices, production suspensions, and ongoing cash burn.
• Australian Clinical Labs Ltd (ASX: ACL) has short interest of 10%, which is up since last week again. This health imaging company has warned that is expecting to report another significant profit decline in FY 2024. Short sellers don’t appear to believe improvements are coming any time soon.
• Westgold Resources Ltd (ASX: WGX) has short interest of 9.5%, which is up week on week. Short sellers don’t appear supportive of the gold miner’s proposed merger with Canada-based Karoa Resources.
• Sayona Mining Ltd (ASX: SYA) has short interest of 9.4%, which is up since last week. At present, Sayona Mining is burning through cash due to its unit costs being higher than its unit sale price.
• Lynas Rare Earths Ltd (ASX: LYC) has seen its short interest rise again to 9.1%. This appears to have been driven by ongoing rare earths price weakness.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

More reading

• Where to invest $10,000 into ASX 200 shares
• Here’s how the ASX 200 market sectors stacked up last week
• Top 5 investment themes exciting ASX shares investors in FY25
• Here 3 ASX lithium shares to watch for FY25
• Are Liontown Resources shares a buy after surging 9% this week?

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 Idp Education. The Motley Fool Australia has recommended Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Friday, the S&P/ASX 200 Index (ASX: XJO) finished the week with a strong gain. The benchmark index rose 0.9% to 7,959.3 points.

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

ASX 200 expected to rise again

The Australian share market looks set to rise again on Monday following a strong finish on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 51 points or 0.6% higher. In the United States, the Dow Jones was up 0.6%, the S&P 500 was 0.55% higher, and the Nasdaq rose 0.6%.

Oil prices soften

ASX 200 energy shares including Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) could have a subdued start to the week after oil prices softened on Friday. According to Bloomberg, the WTI crude oil price was down 0.5% to US$82.21 a barrel and the Brent crude oil price was down 0.4% to US$85.03 a barrel. This meant oil prices snapped their four-week winning streak.

Sell ASX Ltd shares

Goldman Sachs thinks that ASX Ltd (ASX: ASX) shares are overvalued. This morning, the broker has reiterated its sell rating with an improved price target of $59.50. Goldman commented: “We maintain Sell on ASX relative to our coverage with a revised PT of $59.50 (earnings upgrades to reflect recent operational trends). ASX trades at 25x FY25 EPS – on the higher side vs global peers with D&A drag to result in muted medium-term profit growth.”

Gold price edges lower

It could be a soft start to the week for ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) after the gold price edged lower on Friday. According to CNBC, the spot gold price was down slightly to US$2,420.7 an ounce. This couldn’t stop the gold price from recording its third consecutive weekly gain on interest rate cut hopes.

Zip returns to the ASX 200 index

Zip Co Ltd (ASX: ZIP) shares will be on watch today after S&P Dow Jones Indices announced that the buy now pay later provider will be added to the S&P/ASX 200 Index this month. Zip returns to the benchmark index in response to the removal of electronic design software provider Altium Limited (ASX: ALU), which is being acquired by Renesas Electronics Corporation. The change is expected to take place on 22 July.

The post 5 things to watch on the ASX 200 on Monday appeared first on The Motley Fool Australia.

More reading

• Here’s how the ASX 200 market sectors stacked up last week
• Top 4 reasons why more Aussies are managing their own superannuation
• Top 5 investment themes exciting ASX shares investors in FY25
• Xero shares doubled the ASX 200 return in FY24. What’s next in FY25?
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Goldman Sachs Group, and Zip Co. 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.

The good news for income investors is that there are lots of dividend stocks to choose from on the benchmark ASX 200 index.

But which ones could be in the buy zone this month? Two that analysts are tipping as top buys are listed below. Here’s what they are saying about them:

Elders Ltd (ASX: ELD)

Analysts at Morgans think that agribusiness company Elders could be a quality option for income investors.

While it is having a reasonably tough time this year, the broker believes it will bounce back strongly in FY 2025. After which, it thinks it will be onwards and upwards for the company. It explains:

ELD is one of Australia’s leading agribusinesses. It has an iconic brand, 185 years of history and a national distribution network throughout Australia. With the outlook for FY25 looking more positive and many growth projects in place to drive strong earnings growth over the next few years, ELD is a key pick for us. It is also trading on undemanding multiples and offers an attractive dividend yield.

Morgans is forecasting partially franked dividends of 26 cents per share in FY 2024 and then 38 cents per share in FY 2025. Based on the current Elders share price of $8.86, this will mean dividend yields of 3% and 4.3%, respectively.

The broker has an add rating and $9.00 price target on its shares.

Super Retail Group Ltd (ASX: SUL)

Over at Goldman Sachs, its analysts think that Super Retail could be an ASX 200 dividend stock to buy right now. It is the owner of popular store brands BCF, Supercheap Auto, Macpac, and Rebel.

Goldman likes the company due to its belief that it is positioned to handle the tough economic environment. This is thanks partly to its huge loyalty program. The broker explains:

We believe SUL will display resilience in a softer economic environment that is built upon its competitive advantage of high loyalty (~11.0m active members accounting for >75% of sales) and this will be further bolstered as the company launches the Rebel loyalty program and continues to build personalisation capabilities. Hence, we are Buy-rated on SUL.

Its analysts expect Super Retail to be in a position to pay fully franked dividends per share of 67 cents in FY 2024 and then 73 cents in FY 2025. Based on its current share price of $14.23, this will mean yields of 4.7% and 5.1%, respectively.

The broker has a buy rating and $17.80 price target on its shares.

The post Analysts say these ASX 200 dividend stocks are top buys this month appeared first on The Motley Fool Australia.

More reading

• 3 top ASX 200 income stocks to buy now
• 5 ASX dividend shares to buy next week
• Morgans names the best ASX stocks to buy in July
• Is this the best dividend share in the ASX 200?
• 3 cheap ASX passive income shares I’d buy to target $1,000 a month

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 Goldman Sachs Group and Super Retail Group. The Motley Fool Australia has positions in and has recommended Super Retail Group. The Motley Fool Australia has recommended Elders. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

AI stocks, otherwise known as shares exposed to the mega artificial intelligence tailwind, are currently attracting the attention of ASX investors.

The big ones aren’t in Australia — they’re mostly listed on the NASDAQ-100 Index (NASDAQ: NDX) in the United States, and several are constituents of the much-lauded Magnificent Seven, such as NVIDIA Corp and Microsoft Corp.

AI is certainly the next big thing in technology, but more than that, it’s also seen as a potential answer to the longstanding issue of poor productivity growth in Western economies.

Henry Fisher of CMC Invest says demand for AI technology “could be a defining trend this decade”.

In a blog on asx.com.au, Fisher outlines some tips for investors interested in AI stocks to consider.

We summarise a few of them here.

6 tips for buying AI stocks

1. Understanding the AI ecosystem

AI comes in many forms — generative AI, cloud computing, robotics, AI chips (graphics processing units), data centres, and more. “Given the range of investment options, it’s important for investors to deepen their understanding of the AI landscape, as there isn’t a one-size-fits-all approach,” Fisher says.

2. It’s early days for AI stocks

Fisher says investing early in new technologies can be risky. He points out that only 48% of dot-com companies survived past 2004, and many that did suffered significant share price falls.

He comments:

Today’s AI landscape may have long-term winners and failures, and new AI companies may emerge down the line. Balancing these risks involves considering the uncertain timeline ahead and managing fears of missing out.

3. But AI is going to evolve quickly

The speed of AI’s development and adoption is a key factor to consider, says Fisher.

The internet and mobile phones pave the way for AI tools to reach people even faster and become more integrated into everyday life. Grasping the exponential qualities of the AI trend is essential, as is evaluating the potential risks and rewards associated with the pace of its proliferation.

4. Picks and shovels AI stocks

Picks and shovels shares are companies that provide the tools and services an industry needs. Fisher reminds investors that AI stocks will include picks and shovels businesses.

For AI, this could mean businesses like chip makers and data centres. These investments can be strategic, as they could benefit from the broader trend while maintaining diversified revenue streams. 

However, just as computers have shrunk from the size of a room to the size of our hand, AI hardware could also evolve over time. The tools powering AI in five or 10 years may differ from today’s.

As we recently reported, Australia’s biggest real estate investment trust (REIT) Goodman Group (ASX: GMG) is leaning into the AI trend by building the data centres required to make it work.

AI was a significant tailwind for Goodman in FY24, with the share price rising 73.1%, partly due to AI hype.

5. ETFs provide diversification

Fisher says AI-focused exchange-traded funds (ETFs) could be a strategic way to tap into the trend but warns:

Investors should be aware that holdings and strategies can vary widely among ETFs: some may include big tech names, where AI is just one component of a diversified business, while others may combine AI with other technology themes.

6. Competitive landscape

Fisher says the AI landscape is crowded, comprising approximately 75,700 companies. He questions what a ‘competitive advantage’ may look like in such a new world.

Start-ups with disruptive ideas can do more with less, with AI taking on a range of tasks and freeing up employees.

Meanwhile, big tech players could leverage their network effects and economies of scale to integrate AI into their existing platforms.

Competition is pivotal because, in the world of AI, one company’s software update can put another company out of business.

Foolish takeaway on AI stocks

Fisher says AI is rapidly changing by nature. This means investors must be on top of evolving trends and willing and able to switch investment strategies quickly.

He recommends undertaking thoughtful research before selecting which AI stocks to invest in.

“A long-term, diversified approach to AI through ETFs is a consideration,” he said.

The post ‘Defining trend this decade’: 6 tips for buying AI stocks appeared first on The Motley Fool Australia.

More reading

• Investing in ASX shares? Why CEO pay DOES matter when misaligned
• Could investing $10,000 in ASX shares make you a millionaire?
• Top 5 investment themes exciting ASX shares investors in FY25
• These ASX 200 stocks turned $20,000 into $100,000+ in 10 years
• Why did the Nasdaq Index take a dive on promising US inflation data?

Motley Fool contributor Bronwyn Allen has positions in Goodman Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goodman Group, Microsoft, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Goodman Group, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.