Category: Stock Market

It’s a big day for owners of the iShares S&P 500 ETF (ASX: IVV) on the ASX today. Huge, in fact.

This popular exchange-traded fund (ETF) is one of the most widely-held international funds on the ASX. It gives ASX investors exposure to the most widely tracked index in the world, the American S&P 500 Index (INDEXSP: .INX). This index covers the largest 500 companies listed in the US markets.

It includes a plethora of quality companies, including Apple, Amazon, Berkshire Hathaway, Mastercard, Coca-Cola, Nike, Walt Disney, Caterpillar, Netflix, and dozens of additional household names.

So, it’s no surprise that many ASX investors employ this index fund to add some international diversification to their share portfolios.

As we’ve touched on, it’s a big day for this ETF and its owners.

That’s because we’ve just found out how much the next dividend distribution these investors are set to enjoy will be.

Unlike most ASX shares, the iShares S&P 500 ETF pays out quarterly dividend distributions. This means investors usually enjoy four payments every year rather than the typical two for holding this index fund.

iShares has just revealed that IVV’s latest ASX payment, covering the three months to 30 June, will be worth 14.06 cents per unit.

Latest ASX dividend revealed for IVV investors

This revelation comes at the same time as iShares has uncovered what the latest dividends will be from a number of popular ASX ETFs. These include the iShares Core S&P/ASX 200 ETF (ASX: IOZ), as well as the iShares MSCI Japan ETF (ASX: IJN) and the iShares S&P/ASX Dividend Opportunities ESG
Screened ETF (ASX: IHD).

This latest IVV dividend might come as something of a disappointment for investors on the ASX though. That 14.06 cents is an increase over the March quarter distribution, worth 13.98 cents per unit. But it’s a decrease from the 15.98 cents and 17.31 cents investors enjoyed for the first two quarters of the 2024 financial year.

It also represents a downgrade from the 18.92 cents per unit investors were gifted 12 months ago for the June quarter of 2023.

But it’s this dividend distribution that is probably responsible for the rough day that IVV units are currently enduring on the ASX boards. Last week, the iShares S&P 500 ETF closed at $55.43 per unit. But this morning, those same units opened at $55.01 and are currently down 1.32% at $54.70 each.

The payment is likely responsible for at least some of this weighty drop in value because IVV units have also just traded ex-dividend for this latest 14.06 cents per unit distribution today.

Yes, only investors who bought IVV units on the ASX up to last Friday will be eligible to receive this latest quarterly dividend distribution. Anyone buying the units from today onwards misses out.

Payment day for this latest dividend distribution will then roll around on 11 July next week.

At the current IVV unit price, this ASX ETF is trading on a dividend yield of 1.12%.

The post Own the iShares S&P 500 ETF (IVV)? Here’s your next ASX dividend appeared first on The Motley Fool Australia.

More reading

• The iShares S&P 500 ETF (IVV) is slowly becoming a dividend powerhouse. Here’s why
• 4 of the best ASX ETFs to buy and hold for a decade
• Looking to ‘get rich quick’? Use the Warren Buffett approach instead
• Can the iShares S&P 500 ETF (IVV) continue its strong run in FY25?
• Records tumble! Hot ASX ETFs smash all-time highs again on Friday

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Amazon, Apple, Berkshire Hathaway, Caterpillar, Coca-Cola, Mastercard, Nike, and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Apple, Berkshire Hathaway, Mastercard, Netflix, Nike, Walt Disney, and iShares S&P 500 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2025 $370 calls on Mastercard, long January 2025 $47.50 calls on Nike, and short January 2025 $380 calls on Mastercard. The Motley Fool Australia has recommended Amazon, Apple, Berkshire Hathaway, Mastercard, Netflix, Nike, Walt Disney, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you’ve been following me on social media, you’ll have noticed my feed take on a decidedly different flavour over the past few days.

See, it’s the middle of the year – school holidays – and we’re off on another family outback road trip.

This one is slightly more ambitious than even some of the more adventurous recent ones: on a whim a few months back, my wife said “We’ve always wanted to go to Broome… why don’t we just do it this year?”.

Now, I don’t need much of a push to plan a new adventure, so I was pretty quickly into organisation mode. And I’ve long wanted to drive the famed Gibb River Road (the rutted, car-shaking route from Kununurra in North-Eastern WA to Broome, on the coast). So… after double-checking she was serious, I threw myself into it.

We could have flown, and rented a 4WD. But then we’d also have to organise all of the camping gear, food and everything else. And the cost of the hire and flights was eye-wateringly high. Plus, we already have a perfectly good Hilux, set up for that very thing. 

So…

So, I decided to drive. 

The catch? School holidays are only three weeks long, and there was only so much time I could get off work.

The solution? I’d drive, over a few long days, to Alice Springs. My wife and 11yo would fly in, and I’d pick them up from the airport. Then, they’d fly home from Broome, and I’d drive back. (I’m going to drive back via our Queensland office, combining a little work and pleasure).

As I said, it’s… ambitious.

2,700km from home to Alice Springs, from where I’m writing this.

Another 1,700km to Kununurra.

A slow 1,100km to Broome.

Then, the family will fly home and I’ll do the 4,700km drive to the Gold Coast, then the ‘short’ 1,000km trip home.

That’s all of the Australian mainland states and one of the two mainland territories (I’m kicking myself for not setting a wheel in the ACT on the way through…).

Luckily, I like driving. And I have no doubt it’ll be well and truly worth it!

(I could have made the family drive the whole thing, but with more than a few 8-10 hour driving days back to back, this option is slightly… wiser.)

Why am I telling you all this? Well, a few reasons.

First, to explain my slightly less frequent missives in this space over the next 21 days or so.

Second, to tell you – again – that you really, really need to get out and see more of Australia.

And third, speaking of being a broken record, to let you know what I’ve done to prepare my portfolio for three weeks largely off-grid.

Nothing.

Literally nothing.

I haven’t sold everything.

I haven’t moved all of my money into an index ETF.

I haven’t entered a series of stop-loss orders. 

I haven’t done a thing.

Why? Well, because I’m a long term investor.

I have bought (and recommended – more on that later) companies that I expect will be long term winners.

There is not much that could be done, or announced, in the next three weeks that would meaningfully change my mind on any of them.

And – this is the kicker – even if there is (and it’s possible), there’s no opportunity for you or me to front-run whatever share price response will follow such an announcement.

If Woolworths Group Ltd (ASX: WOW) was to announce it was going to exit supermarkets and launch a new cryptocurrency – FreshCoin – the market response would be not just significant, but also swift.

The news would result in an all-but instant fall in the company’s share price. There would be no opportunity to sell the shares before the market had ‘priced in’ the new news.

There’s no magic time of suspended animation where you or I can sell at the old price before the rest of the market finds out.

The same would be true of some good news, sending a company’s share price soaring.

Yes, the market is wrong from time to time, but almost always in its assessment of long term prospects. It’s pretty bloody quick at reacting to new announcements.

So, if I was there… it couldn’t do anything about those short-term moves.

Does that sound negligent? Surprising? Like I’m not some omnipotent master of the investing universe?

Perhaps. But that’s good.

The finance industry too often sells itself as the answer to any problem – some all-powerful desk jockeys that can magically deliver your financial dreams from glass offices in the nation’s CBDs.

Which is… a lovely idea.

It’s just not true.

Indeed, remember that most managed funds actually fail to beat the market, after fees.

Oh, our marketers could probably sell more memberships if we pretended that we were the answer to all of your problems. ‘Certainty’ sells. So does allowing you to think we have some magical ability to make money, no matter the circumstances.

It wouldn’t be true, of course. But that doesn’t stop others who offer certainty and confirmation bias and the ‘comfort’ that comes from sharp suits and high fees (that must mean they know what they’re doing, right?).

So no, we don’t tell you what you want to hear, in an attempt to separate you from extortionately high fees (and, too often, sub-par performance).

We do it the other way around: telling you what we believe and how we work, and inviting you to join us if that feels right for you.

It’s our – my – firm belief that being long-term investors, focussed firmly on the multi-year prospects of the businesses we own and recommend, is the best way to earn long-term outperformance.

Why?

Well, because compounding works, but you need to give it time to do its thing.

And that a focus on the long term is, well, not very common, giving us an opportunity to fish where others aren’t.

You have the day-traders and chart-readers. Good luck to them, but we don’t think that’s likely to earn us market-beating returns.

Then you have the fund managers, measured on quarterly returns, trying desperately to keep their jobs… and their clients’ funds. That’s a brutal and devilishly difficult job.

And then, you have the long term. Where a focus on the business possibilities of Woolies, CSL Ltd (ASX: CSL), Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP) have generated huge long term returns for patient shareholders.

(As has the ASX as a whole, by the way!)

I won’t lie – I’m very glad that’s true. If I had to make my living (and grow my portfolio) by being glued to a computer screen, I’d find that far more stressful, less fulfilling… and my holidays would be shorter!

But also, it just is. 

The likes of Warren Buffett, and plenty more besides, are the evidence of the success of long-term investing. But also, as I said above, the ASX itself is, too. As I’ve mentioned a gazillion times before, according to Vanguard, a hypothetical $10,000 invested on the ASX in July of 1993 was worth $130,000 on June 30 last year.

I have always been – and remain – puzzled that, in the face of that stupendous opportunity, people try to be Aesop’s hare, rather than his tortoise.

Is it disbelief? Impatience? Ego? I have no idea.

I just know that, whatever my other failings, my analytical skills and temperament have led me to a view that, given the option of swimming with the tide, or against it, the choice is easy.

So, that’s what I do. And why I’m not even slightly concerned about what could happen in my absence.

A small point here, though: I mentioned above that I’d come back to ‘recommendations’. While I’m confident that there’s hardly anything that could require my immediate attention while I’m away, there’s no guarantee.

And while that doesn’t worry me, when it comes to my personal portfolio, it’s important that our members know I’m not leaving the shop unattended.

We have a wonderful team of investors at The Motley Fool, who will continue to read, research and analyse all of the goings-on at the companies we recommend – and those we might recommend next. 

And if anything did happen that might benefit from a near-term response, rest assured that they’ll let me know… and that if they can’t get hold of me, they’re fully empowered to make whatever decision they believe is in the best interest of our members.

Yes, the best of both worlds. 

The other benefit of a holiday? From experience, it gives my brain some downtime. To consciously reflect and to subconsciously do whatever our brains do when we’re just living in the moment.

I’m an investor in part because I’m fascinated by, and curious about business. (Over my morning coffee, I was absentmindedly considering the business model and presumed financial metrics of the motel I stayed at last night!). So it’s never far from my mind. But some time away is a good thing.

And now, if you’ll excuse me, I’ve got a bit more work to do (I arrived in Alice a day earlier than I expected), before rolling out the swag.

As to what sort of sleep I’ll get, I’m not sure… turns out I’ve arrived on Territory Day – the one day of the year fireworks are legal in the Territory.

It could be a long night… 

Fool on!

The post The secret to a worry-free holiday appeared first on The Motley Fool Australia.

More reading

• Leading brokers name 3 ASX shares to buy today
• Why Coronado Global, EML, Immutep, and Lendlease shares are storming higher
• Own the iShares S&P 500 ETF (IVV)? Here’s your next ASX dividend
• Why Guzman Y Gomez, MacMahon, Strike Energy, and WiseTech shares are sinking
• The Yancoal share price just rocketed to new 52-week highs. Here’s why

Motley Fool contributor Scott Phillips 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 CSL. The Motley Fool Australia has recommended CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the new financial year with a small decline. At the time of writing, the benchmark index is down 0.3% to 7,741.8 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are sinking:

Guzman Y Gomez Ltd (ASX: GYG)

The Guzman Y Gomez share price is down 8% to $25.20. This may have been driven by concerns over the quick service restaurant operator’s lofty valuation. Shortly after listing, the Mexican food chain had a $3 billion valuation. This meant that its shares were trading on a crazy multiple of 500x estimated FY 2025 earnings. This latest decline means that Guzman Y Gomez’s shares are now down almost 20% from their high. And with short sellers loading up on its shares, there could be further declines to come.

Macmahon Holdings Ltd (ASX: MAH)

The Macmahon share price is down almost 9% to 26.5 cents. This morning, this mining services company revealed that it had significant exposure to the collapse of gold miner Calidus Resources Ltd (ASX: CAI). It said: “Macmahon provides mining and drill and blast services to Calidus at their Warrawoona mine. Macmahon’s preliminary assessment of net current exposure under the contract is circa $33.9 million. Macmahon also holds an equity interest in Calidus listed shares with a value of $5.7 million at the close of trading on 28 June 2024.” Calidus called in administrators on Friday.

Strike Energy Ltd (ASX: STX)

The Strike Energy share price is down 13.5% to 24.2 cents. Investors have been hitting the sell button after the energy company released an update on the status of the gas supply agreement for West Erregulla with Wesfarmers Ltd (ASX: WES). Due to delays receiving environmental approvals, the firm gas supply agreement has reverted to back to an original agreement. This means that the fixed gas price that had been agreed under the firm gas supply agreement will revert to the option price as calculated under a gas sales option agreement.

WiseTech Global Ltd (ASX: WTC)

The WiseTech Global share price is down 5% to $95.18. While the logistics solutions company announced more insider sales on Friday evening, this is generally seen as a positive by the market. That’s because the sales indicate that the company is (at least) performing in line with its guidance for FY 2024. The decline may have been driven by a broker note out of Goldman Sachs. It has slapped a neutral rating and $91.00 price target on its shares.

The post Why Guzman Y Gomez, MacMahon, Strike Energy, and WiseTech shares are sinking appeared first on The Motley Fool Australia.

More reading

• Guess which ASX tech share is sinking after $45 million founder sell-down
• ASX gold stock goes bust despite soaring precious metal price
• These are the 10 most shorted ASX shares
• Here’s how the ASX 200 market sectors stacked up last week
• These were the best performing ASX 200 shares in June

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, Wesfarmers, and WiseTech Global. The Motley Fool Australia has positions in and has recommended Wesfarmers and WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Yancoal Australia Ltd (ASX: YAL) share price is burning bright today.

Shares in the All Ordinaries Index (ASX: XAO) coal stock closed on Friday trading for $6.62. In early afternoon trade on Monday, those same shares are swapping hands for $6.90, up 4.2%.

For some context, the All Ords is down 0.4% at this same time.

As you can see on the chart above, today’s leap higher puts the coal mining stock up a whopping 46% over 12 months. and that doesn’t include the 69.5 cents a share in fully franked dividends paid out over the year.

This also marks a new 52-week high for the All Ords coal share, and puts it within a whisker of setting new all-time highs.

Here’s what’s spurring investor interest today.

Why is the Yancoal share price surging on Monday?

The Yancoal share price is joining in with the broader rally in ASX coal stocks today.

As we reported here earlier, investors are snapping up shares in the big Aussie coal producers after Anglo American (LSE: AAL) was forced to halt production at its Grosvenor coking coal mine in Queensland following an underground fire over the weekend.

ASX coal shares look to be benefiting after Anglo reported it would likely be several months before coal mining at Grosvenor could be resumed. Some industry insiders believe that estimate may be optimistic.

The mine was forecast to produce around 3.5 million tonnes of coal over the full 2024 calendar year. Second-half production now remains in doubt.

The post The Yancoal share price just rocketed to new 52-week highs. Here’s why appeared first on The Motley Fool Australia.

More reading

• Beat the ASX with these cash-gushing dividend stocks
• Is the 11% dividend yield from Yancoal shares too good to be true?
• How to earn $1,900 in passive income with just $10,000 in savings
• Guess which ASX All Ords stock has rocketed 37% in a year AND pays an 11% dividend yield!

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 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.

With the new financial year underway, many investors are wondering what ASX stocks to buy in the current market cycle.

The artificial intelligence (AI) theme dominated markets in FY 2024. Names like NVIDIA Corp (NASDAQ: NVDA) surged to record heights of over $1,000 per share before its 10-for-1 stock split.

Whereas AI frontrunner Microsoft Corporation (NASDAQ: MSFT) rallied 31% over the past year following its purchase of OpenAI, owner of the well-known “ChatGPT” language model, in 2023.

Various money managers are now sceptical about AI’s dominance moving forward. Global fund manager GQG Partners is one such entity. After a strong run riding the tech rally, the firm is reportedly rotating out of tech and into the consumer staples sector.

Two notable consumer staples stocks recently catching the attention of investors are Coles Group Ltd (ASX: COL) and Qantas Airways Ltd (ASX: QAN). Brokers currently recommend these two ASX stocks as buys. Here’s why.

Why GQG is shifting away from AI and tech

As to what ASX stocks to buy outside of tech, GQG Partners recently offered some insight. The global fund manager recently slashed its tech exposure, including AI-related stocks like Nvidia, according to The Australian Financial Review.

The GQG team reduced its tech holdings from 43% of the portfolio to just 21%, citing concerns over the sustainability of the AI-driven rally.

“From the semiconductor standpoint, things weren’t broadening out as much – spending was really isolated to that cluster around AI and data centres,” said portfolio manager Brian Kersmanc, per the AFR.

Additionally, GQG found that the market was pricing in some “blue sky scenarios” for these shares. This could impact what ASX stocks investors buy in FY 2025.

“[A]lthough optically [they] looked cheap on a price-to-earnings basis”, Kermansc added, “to get to the estimates that were prevailing in the market, you had to get to some pretty aggressive assumptions”.

Instead, GQG is now focusing on consumer staples stocks. It believes these are more attractively priced. For instance, Coca-Cola Co (NYSE: KO) – now considered a defensive name – is a major holding. This is due to the combination of lower valuations and stable earnings.

“We’re seeing staples stocks trading at 52-week lows because they had a multiple de-rating, falling from around 29 times earnings as people realised they didn’t want to pay a premium for safety because a recession wasn’t happening,” Kermansc said.

Are these two ASX stocks to buy?

Coles shares are currently trading at around $17 apiece, equating to a price-to-earnings (P/E) ratio of 22 times. This represents a significant drop from its P/E of 33 times in January 2021.

Analysts at Morgans suggest that Coles remains an ASX stock to buy. According to my colleague James, the broker has an add rating on Coles with a price target of $18.95, suggesting a potential upside of 11.5% at the time of writing.

For FY 2024, Morgans also forecasts fully franked dividends of 66 cents per share, yielding approximately 3.8%, and 69 cents per share in FY 2025, yielding around 4%.

If an investor were to buy the ASX stock today, the total shareholder return could be around 15.5% over the coming 12–24 months if Morgans is right.

Qantas could be another ASX stock to buy according to Goldman Sachs. Shares in the airline are trading at a P/E ratio of 6.3 times at the time of writing. This is down from a P/E of 22 times in June 2023.

Despite its recent regulatory hurdles, Qantas has caught the eye of investors.

Goldman Sachs rates Qantas as an ASX stock to buy with a price target of $8.05. This indicates a potential upside of over 36% as I write. The brokers also notes that Qantas’ FY 2024/2025 earnings projections are ahead of pre-pandemic levels.

Consider ASX stocks to buy over AI?

AI stocks have enjoyed a massive rally, but the excitement may be waning. GQG Partners’ shift from tech underscores the risks of over-reliance on high-growth sectors with uncertain future prospects.

In contrast, experts say Coles and Qantas could offer stable earnings and dividends, making them potential ASX stocks to buy in economic turbulence.

The post Why these losing ASX stocks could be a better buy than AI right now appeared first on The Motley Fool Australia.

More reading

• Are Qantas or ANZ shares a better buy?
• Can Wesfarmers shares keep beating the ASX 200 index?
• Should Coles shares be in your shopping basket with its FY25 outlook?
• How much could $10,000 invested in Coles shares be worth in a year?
• Here are 3 ASX retirement shares to buy in July

Motley Fool contributor Zach Bristow 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 Microsoft. 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 positions in and has recommended Coles Group. The Motley Fool Australia has recommended Microsoft. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It’s been a rough start to the trading week for ASX shares so far this Monday. At the time of writing, the S&P/ASX 200 Index (ASX: XJO) has slumped by 0.35% and is back down to around 7,740 points. But let’s talk about one ASX tech share that is getting even more severely punished today.

That ASX tech share is none other than WiseTech Global Ltd (ASX: WTC). This logistics company closed at $100.30 a share last week. But this morning, those same shares opened at $98.54. They have since dropped a hefty 4.33% to $96.07 each.

It’s a hefty drop for this former WAAAX star. Wisetech shares have had a stellar showing over 2024 to date. Even after today’s plunge, the Wisetech share price remains up a sturdy 26% or so over 2024 to date. The company has also risen by 23.9% over the past 12 months.

But what’s going on this Monday that has elicited this awful drop?

Well, it looks as though a new ASX filing that was released last Friday after market close may be responsible.

This ASX filing revealed that Wisetech co-founders Richard White and Marie Isaacs have offloaded a significant chunk of this ASX tech share.

Should ASX tech share investors be worried about this massive founder sell-off?

Yep, the form reveals that White and Isaacs, through a holding company RealWise Holdings Pty Ltd, sold 478,415 shares of Wisetech between 21 June and 28 June in a series of on-market trades. Realwise received an average sell price of $95.19 per share for these sales, meaning that the holding company has bagged a whopping $45.54 million for these efforts.

Wisetech CEO Richard White owns 91.83% of RealWise Holdings, while Isaacs owns the remaining 8.17%. This means that White has benefitted to the tune of $41.82 million from these sales, while Isaacs has bagged $3.72 million.

So should investors be worried about this Wisetech founder sell-off?

Well, that’s up to them. No investor likes to see the management team of their companies sell down their stakes in the business they are being handsomely paid to manage. After all, it decreases any financial alignment that management has with shareholders.

But founders, CEOs and members of a company’s management have their own financial obligations to tend to. Perhaps they have a large tax bill to pay or a new house they want to buy. Perhaps they just want to diversify their wealth away from one single investment.

Even after these significant sales, White and Isaacs retain massive stakes in Wisetech. White still indirectly owns 117,837,565 shares of this ASX tech share, valued at $11.32 billion at today’s prices. So this sale is something of a drop in the ocean for him.

Meanwhile, Isaacs retains 10,479,200 shares, worth just over $1 billion.

So again, it’s up to Wisetech investors to decide if they approve or disapprove of White and Isaacs’ recent moves regarding this ASX tech share. But judging by today’s share price sell-off, it has put at least some investors offside.

The post Guess which ASX tech share is sinking after $45 million founder sell-down appeared first on The Motley Fool Australia.

More reading

• Here’s how the ASX 200 market sectors stacked up last week
• These 3 ASX shares have unstoppable dividend growth
• Here are the top 10 ASX 200 shares today
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• 7 excellent ASX growth shares to buy next week

Motley Fool contributor Sebastian Bowen 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 WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

S&P/ASX 200 Index (ASX: XJO) coal shares are smoking hot today.

How hot?

Well, at the time of writing, the ASX 200 is down 0.46%.

But don’t blame the big Aussie coal shares for that retrace.

Here’s how these three leading coal stocks are performing at this same time as we head into the Monday lunch hour:

• Whitehaven Coal Ltd (ASX: WHC) shares are up 6.8%
• New Hope Corp Ltd (ASX: NHC) shares are up 3.8%
• Coronado Global Resources Inc (ASX: CRN) up 10.1%

Now, none of these companies have released any price-sensitive information.

So, what’s spurring investor interest?

ASX 200 coal shares lift on Anglo’s woes

Investors look to be snapping up ASX 200 coal shares today after Anglo American (LSE: AAL) reported that it has suspended production at its Grosvenor metallurgical coal mine in Queensland.

Metallurgical, or coking coal, is primarily used for steel making, as opposed to thermal coal, which is mostly used to generate electricity.

The global miner, the subject of a recently rejected takeover offer from BHP Group Ltd (ASX: BHP), said it is halting work after an underground coal gas ignition hit the mine on Saturday.

Anglo American’s workers were all safely evacuated from the mine without injury.

Its mine team is now working with specialist teams from the Queensland Mines Rescue Service and the regulatory authorities to extinguish the underground fire.

Once that’s out, management will assess the steps towards a safe re-entry into the mine. Due to the likely damage underground, it is expected these procedures will take several months.

But some industry insiders fear that may be optimistic. Fears which look to be benefiting ASX 200 coal shares today.

As ABC News reports, Mining and Energy Union industry safety and health representative Jason Hill said workers were being sent home indefinitely, with some fearing the Grosvenor coal mine might never reopen. The mine has previously recorded high gas levels during routine monitoring.

What’s at stake?

As for what’s at stake for the ASX 200 coal shares, Anglo American’s steelmaking coal business is forecast to produce around 8 million tonnes of product in the first half of 2024. The Grosvenor mine is expected to contribute some 2.3 million tonnes of that total.

Looking at the full 2024 calendar year, Anglo’s production guidance for its steelmaking coal business is 15 to 17 million tonnes, of which Grosvenor was expected to contribute around 3.5 million tonnes. That Grosvenor guidance already represented lower production in the second half of 2024 due to a planned longwall move.

Still, the Grosvenor fire means that 1.2 million tonnes of Aussie coal now might not hit the markets in the second half of the year. And the outlook for 2025 remains uncertain.

Anglo American said it would update the market on its steelmaking coal production guidance once more information is available.

As for today, investors appear confident that the ASX 200 coal shares could benefit from the Anglo’s production hit.

The post Why are ASX 200 coal shares smashing the market today? appeared first on The Motley Fool Australia.

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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 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.

ASX growth shares that are growing revenue at a relatively fast pace could achieve good returns for investors.

Smaller businesses can have much more return potential because they are typically much earlier on in their growth journeys than stocks like BHP Group Ltd (ASX: BHP) or Westpac Banking Corp (ASX: WBC).

One of the main elements that I like to look for is businesses with operating leverage where they can grow profit margins as revenue rises, enabling profit to grow even faster than the fast-growing revenue.

Below are two stocks that have global growth ambitions that I’m bullish about.

Siteminder Ltd (ASX: SDR)

This ASX growth share provides software called Siteminder that aims to unlock the full revenue potential of hotels. It also has Little Hotelier, an all-in-one hotel management software that “makes the lives of small accommodation providers easier.”

Siteminder is an important part of the travel sector. It has the largest partner ecosystem in the global hotel industry, generating more than 115 million reservations worth over $70 billion in revenue for its hotel customers each year.

It’s worth noting that Siteminder’s management team includes Trent Innes, who serves as the company’s chief growth officer. Innes previously held the position of managing director at Xero Australia and Asia, where he played a key role in helping the software company achieve 1 million subscribers. It’s evident that Siteminder has a strong team with high-quality individuals.

The company is also growing rapidly – in the third quarter of FY24, revenue rose by 23.3% year over year to $46 million. The contribution from Siteminder’s ‘metasearch’ offering, called Demand Plus, was especially strong, driven by accelerated adoption and strong booking activity. Annualised recurring revenue (ARR) increased 24.8% year over year to $187.6 million.

Profit margins are rising quickly – it reported underlying operating cash flow of $5.1 million for the FY24 third quarter, an improvement from a $3 million loss in the prior corresponding period, which the company attributed to sustained organic growth and operating leverage.

The business is targeting an organic revenue growth rate of 30% In the medium term, which suggests to me that profit could significantly rise from here. It looks good value, in my opinion, after falling around 10% in the past three months.

Corporate Travel Management Ltd (ASX: CTD)

This ASX growth share is one of the world-leading businesses that provides corporate travel management services.

The company has dropped more than 35% since 29 January 2024, making it significantly cheaper. That’s despite the business having a much stronger market position than it did before COVID-19.

Corporate Travel is aiming to grow its earnings before interest, tax, depreciation and amortisation (EBITDA) at a compound annual growth rate (CAGR) of 15% over the next five years through new client wins, a high retention rate and project execution.

The company is aiming for revenue growth of at least 10% per annum over the next five years, with a target of winning $1 billion of new clients in FY25, with this rising to $1.6 billion per annum by FY29.

Corporate Travel also believes it can limit its cost growth to 5% per annum through productivity and innovation projects. This can help grow its market share and increase the usage of automation.

According to the profit estimates on Commsec, the Corporate Travel Management share price is valued at 15x FY25’s estimated earnings and 12x FY26’s estimated earnings. If the ASX growth share achieves those projected profit numbers, it could seem very cheap today.

The post I’d buy these 2 top ASX growth shares in a heartbeat appeared first on The Motley Fool Australia.

More reading

• Top ASX shares to buy in July 2024
• 2 ASX shares that would pass Peter Lynch’s favourite valuation metric
• What’s ahead for ASX 200 travel shares in FY 2025?
• Here are the top 10 ASX 200 shares today
• Near its 52-week low, this ASX growth stock could be the bargain of the year!

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 positions in and has recommended Corporate Travel Management and SiteMinder. The Motley Fool Australia has positions in and has recommended Corporate Travel Management and SiteMinder. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX dividend shares with big dividend yields could be what some investors are looking for in FY25.

The new 2025 financial year has just started (for most businesses) and this could be a good time to consider which stocks may deliver the biggest payouts.

Of course, dividends are not guaranteed and the highest yields of FY25 may not be sustainable in FY26, depending on what happens with their profitability.  

For a business to have a dividend yield of at least 10%, it’s likely that the company has a relatively high dividend payout ratio and a fairly low price/earnings (P/E) ratio.

Big yields from these ASX dividend shares

Forecast dividends are not guaranteed to occur, but analysts expect the upcoming payouts from the below selected stocks for FY25.

ASX coal share New Hope Corporation Ltd (ASX: NHC) is expected to pay a grossed-up dividend yield of 10.4% according to Commsec.

ASX retail share Shaver Shop Group Ltd (ASX: SSG) is projected to pay a grossed-up dividend yield of 11.9% according to Marketscreener.

Retailer Adairs Ltd (ASX: ADH) is forecast to pay a grossed-up dividend yield of 11.25%, according to Commsec.

Office property owner Centuria Office REIT (ASX: COF) could pay a distribution yield of 10.5% according to Commsec.

Salary packaging and fleet management business McMillan Shakespeare Ltd (ASX: MMS) is projected to pay a grossed-up dividend yield of 11.75%, according to Commsec.

Shoe retailer Accent Group Ltd (ASX: AX1) is forecast to pay a grossed-up dividend yield of 10.5%, according to Commsec.

Would I buy these stocks?

I’d be attracted to considering the retailers as ASX dividend share because they could be cyclical opportunities.

Discretionary spending isn’t always going to be consistent – weaker economic conditions can lead to less household spending in the short-term, which hurts retailers. But I believe that things could start improving in the medium-term as wages keep rising and eventually interest rates come down. I think the lower share prices are opportunities with these retailers.

I don’t know enough about McMillan or the salary packaging industry to feel confident about investing in the stock for dividends, or whether the business will be able to achieve long-term earnings growth.

Energy is integral to our western and emerging market economies, so New Hope could continue paying good dividends. However, many countries are talking about moving away from coal in the longer-term, so there could be lower demand for coal in the foreseeable future. I’d be wary of investing with that apparent dynamic to play out in the coming decade or two.

The post Which ASX dividend shares are predicted to have the highest yields in FY25? appeared first on The Motley Fool Australia.

More reading

• Why are ASX 200 coal shares smashing the market today?
• 2 high-yield ASX shares predicted to pay huge dividends in FY26
• 1 ASX dividend stock to buy that’s down 60%
• Forget term deposits and buy these ASX dividend shares
• 3 ASX dividend stocks to buy with 5% to 7% yields

Motley Fool contributor Tristan Harrison has positions in Accent Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adairs. The Motley Fool Australia has positions in and has recommended Adairs. The Motley Fool Australia has recommended Accent Group, McMillan Shakespeare, and Shaver Shop Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you didn’t have Commonwealth Bank of Australia (ASX: CBA) shares in your portfolio in FY 2024 then you missed out.

During the 12 months, Australia’s largest bank’s shares thumped the market with a gain of 27%.

As a comparison, the ASX 200 index rose 7.8% over the same period. Both figures don’t include dividends.

Why did CBA shares thump the market?

It is worth noting that CBA was not alone when it comes to strong gains in the banking sector.

In fact, as covered here, it was only the fourth best-performing ASX bank share during the period despite its mouth-watering return.

Investors were piling into the sector after a series of results and updates that were in line with expectations boosted sentiment. In addition, the Australian economy held up nicely despite rising interest rates.

In fact, there were no meaningful increases in bad debts in the sector. And with the market believing that the rate cycle is coming to an end and rates will fall from here (maybe after one more hike), the outlook for the sector was looking positive. Particularly given that mortgage competition is expected to ease.

How did CBA perform financially?

During the first half, CBA’s profits held up nicely in the tough economic environment.

The bank’s operating income was up slightly to $13,649 million. This was supported by volume growth and higher volume-based fee income, offset by margin compression.

CBA’s operating expenses increased 4% to $6,011 million due to inflationary pressures and additional spending on technology to support the delivery of strategic priorities.

While this led to cash net profit after tax falling 3% to $5,019 million, it didn’t stop the CBA board from lifting its fully franked interim dividend by 2.4% to $2.15 per share.

Since then, it was more of the same for the bank. During the third quarter, CBA reported a 1% decline in operating income for the three months ended 31 March. Management advised that this reflects one less day in the quarter and slightly lower net interest margins due to continued competitive pressures and customers switching to higher yielding deposits.

CBA reported a quarterly unaudited statutory net profit after tax of $2.4 billion, which was down 3% on the first half average and 5% on the prior corresponding period.

What’s next?

All the major brokers believe that CBA shares are overvalued at current levels.

But it is worth remembering that they were saying the exact same thing 12 months ago.

So, while it seems somewhat unlikely that the bank’s shares will deliver big returns in FY25, it certainly isn’t impossible.

The post Why did CBA shares jump 27% in FY24? appeared first on The Motley Fool Australia.

More reading

• These were the five best ASX bank shares to own in FY24
• Retirement planning guide: 710,000 Aussies to retire over next 5 years
• Want the latest Vanguard Australian Shares Index ETF dividend? Here’s what to do
• The CBA share price trounced the benchmark again in June! Here’s how
• Which ASX shares to buy if interest rates rise (and which to avoid)

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.