Category: Stock Market

If you’re looking to supercharge your returns, then there are a couple of ASX energy shares that analysts believe could do this.

Here’s what analysts are saying about these energy shares:

Beach Energy Ltd (ASX: BPT)

The team at Bell Potter reckons that Beach Energy is an ASX energy share to buy right now.

The broker is positive on Beach Energy due to its diversification and positive free cash flow outlook. The latter is due to expectations that its capital expenditure has now peaked. It explains:

BPT has a strong, fully funded production growth outlook, diversified across five energy basins and across four separate gas markets, including LNG. BPT is rolling-off peak capex into a step-change in production and free cash flow in FY24, has a strong balance sheet, and has a capital management framework with franked dividends a key component. With a positive view on Australian east coast gas and LNG markets, and BPT’s strong earnings growth outlook, we maintain a Buy recommendation.

Bell Potter has a buy rating and $2.18 price target on its shares. Based on the current Beach Energy share price of $1.42, this suggests potential upside of 53% for investors over the next 12 months.

Karoon Energy Ltd (ASX: KAR)

Morgans is very positive on this ASX energy share. So much so, it has the company on its best ideas list this month with a valuation significantly higher than current levels.

It likes Karoon Energy due to its production growth and strong balance sheet. The broker commented:

Unique as a reasonable scale pure conventional oil producer, benefitting directly from rising oil prices. Karoon has significant net cash and is fully funded through a doubling of production over the next 12 months. There are also potential catalysts just around the corner with Karoon flagging at its recent result that it plans to shortly update the market with more detail on its growth plans, Bauna’s outlook, and its ESG approach.

Morgans has an add rating and $3.65 price target on the ASX energy share. Based on its current share price of $2.01, this implies potential upside of 81% for investors.

The post Analysts say these ASX energy shares could supercharge your returns appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday
• 5 things to watch on the ASX 200 on Tuesday
• ASX 200 energy shares expected to jump after oil prices surge

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.

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The exchange-traded fund (ETF) Vanguard MSCI Index International Shares ETF (ASX: VGS) is one of the most popular choices for investors — the fund has net assets (and investor capital) of more than $5 billion. And the VGS ETF pays dividends, which I’ll talk about later.

For readers who haven’t heard of this investment option before, the idea is that it provides exposure to more than 1,400 businesses listed outside Australia, which is handy for Aussies looking for global diversification.

The dividend, or distribution, that an ETF pays is partly dictated by the dividends of the fund’s underlying holdings. If the ETF’s investments pay high-yielding dividends to the ETF, then the fund will end up paying a high yield to investors.

So, let’s first talk about what shares the VGS ETF is invested in.

Vanguard MSCI Index International Shares ETF holdings

At the end of March 2023, its biggest positions were some of the world’s largest and strongest technology businesses including Apple, Microsoft, Amazon.com, Nvidia, Alphabet, Tesla, and Meta Platforms.

These businesses have proven to be very strong competitors in their respective industries. However, none of them is known for having large dividend yields.

Some of the names I mentioned don’t pay a dividend at all for various reasons, such as having a focus on re-investing cash flow generated for growth.

A few of the names do pay dividends, such as Apple and Microsoft, but the dividend yields are currently low. That’s because the businesses don’t have a high dividend payout ratio and they also have a reasonably high price/earnings (p/e) ratio. The higher the p/e ratio, the lower the dividend yield. For example, Microsoft has a dividend yield of 0.9%, according to Google Finance.

It’s a similar story for many of the IT businesses in the portfolio, which is important because the IT industry accounts for around 21% of the VGS ETF’s weighted exposure.

Now let’s have a look at the actual dividend yield of the Vanguard MSCI Index International Shares ETF, according to Vanguard.

Dividend yield

Vanguard, the ETF provider, produces a set of statistics each month so that investors can get some insights into the valuation metrics of the portfolio.

The monthly stats for March 2023 show the dividend yield for the VGS ETF was 2%. Vanguard explains this is the weighted average dividend yield of the shares it holds.

It’s worth pointing out that sometimes the distribution from the ETF to investors can be larger than the dividend yield alone because the distribution can include crystallised/realised capital gains made by the fund on any share sales.

So, the ETF’s distributed income is a combination of both its dividend income and capital gains.

Is a 2% dividend yield big enough for VGS ETF investors?

I don’t think that 2%, or even 3%, is likely to be enough for dividend investors these days. Investing in shares means taking on volatility and risk, and there are risk-free term deposits now offering an interest rate of more than 4%.

If I were looking at generating investment income, I’d want to look at ASX dividend shares that offered a dividend yield that was at least similar to what term deposits were offering.

The great thing about shares is that they can deliver growth. Good ASX dividend shares are capable of paying a good dividend yield and hopefully growing the payment to shareholders in the coming years.

The Vanguard MSCI Index International Shares ETF is not known for its dividend potential. However, I do believe in its ability to generate capital growth for investors over the long term. The fund has provided attractive total returns thanks to the rise in the value of its holdings as they achieve profit growth.

Over the three years to 31 March 2023, the VGS ETF returned an average of 12.9% per annum, with 10.8% per annum of that being capital growth. We can see that growth through the rise of the unit price.

The post I’m a dividend investor. Should I buy the Vanguard MSCI Index International Shares ETF (VGS)? appeared first on The Motley Fool Australia.

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More reading

• Was the Vanguard MSCI Index International Shares ETF (VGS) worth owning in April?
• 2 of the best ASX ETFs for global investing
• 3 top ASX ETFs hitting new 52-week highs on Friday
• I think this underrated reason is key to why ETFs can be great investments
• 3 reasons why the Vanguard MSCI Index International Shares ETF (VGS) could be an excellent investment for beginners

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. 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 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 Alphabet, Amazon.com, Apple, Meta Platforms, Microsoft, Nvidia, Tesla, and Vanguard Msci Index International Shares ETF. The Motley Fool Australia has recommended Alphabet, Amazon.com, Apple, Meta Platforms, Nvidia, and Vanguard Msci Index International Shares ETF. 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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It certainly has been a great time to be a shareholder of Latin Resources Ltd (ASX: LRS).

Since this time last month, the ASX lithium stock has risen by almost 30%.

Why is this ASX lithium stock on fire?

There are a number of reasons why this ASX lithium stock is on fire at the moment. Some are company specific, whereas others are industry related.

Let’s start with what Latin Resources has been doing and saying. Earlier this month, the company released an update on its flagship Salinas Lithium Project in the pro-mining district of Minas Gerais, Brazil.

Management revealed that its fully funded drilling campaign is now operating at full capacity, with eight diamond drilling rigs on site. This includes seven man-portable rigs and one track-mounted rig.

Pleasingly, drill production is at the budgeted rate and the company is well positioned to complete all of the planned in-fill and extension drilling on time. In addition, the intercepts so far have been very positive.

All in all, this means that Latin Resources is on target to release its all-important mineral resource estimate (MRE) update in June.

Latin Resources’ vice president of its Americas Operations, Tony Greenaway, commented:

We are very impressed with the consistent thick high-grade intercepts at Colina. These new results bode very well for our resource upgrade in June. We now have our full contingent of eight drilling rigs operating on site at Colina, including are larger track mounted machine.

What else?

Also giving this ASX lithium stock a boost has been recent highly positive industry news.

This includes lithium prices starting to rebound from recent lows and increased merger and acquisitions (M&A) activity.

The latter has seen Allkem Ltd (ASX: AKE) announce a merger with Livent Corp (NYSE: LTHM) and Liontown Resources Ltd (ASX: LTR) reject a takeover approach from Albemarle (NYSE: ALB).

This appears to be sparking hopes that other deals could be made in the near future. Perhaps even one for this ASX lithium stock.

The post Why has ASX lithium stock Latin Resources soared almost 30% in a month? appeared first on The Motley Fool Australia.

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More reading

• Why is ASX lithium share Latin Resources on ice today?

Motley Fool contributor James Mickleboro has positions in Allkem. 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.

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Have you ever wondered which ASX shares rich people have bought?

Maybe you’d like to emulate their portfolio? Surely if they’re wealthy then they must know what they’re doing?

Well, the cat need not be killed because this week investment platform Selfwealth Ltd (ASX: SWF) crunched the data to reveal the ASX-listed stocks that are most held by millionaires:

1. Fortescue Metals Group Ltd (ASX: FMG)
2. Vanguard Australian Shares Index ETF (ASX: VAS)
3. BHP Group Ltd (ASX: BHP)
4. Westpac Banking Corp (ASX: WBC)
5. CSL Limited (ASX: CSL)
6. ANZ Group Holdings Ltd (ASX: ANZ)
7. Commonwealth Bank of Australia (ASX: CBA)
8. Neuren Pharmaceuticals Ltd (ASX: NEU)
9. Macquarie Group Ltd (ASX: MQG)
10. A2 Milk Company Ltd (ASX: A2M)

The average size of the millionaire portfolio was $2.6 million. The largest one was a whopping $97 million.

How the millionaire portfolio differs from the peasants

Selfwealth chief executive Cath Whitaker observed a common theme in the millionaire portfolios.

“Our millionaire portfolio investors hold strong companies in strong sectors,” she said.

“When it comes to ETFs they go for the biggest, and when it comes to non-traditional single stocks they’ve picked those that have seen very high returns.”

Indeed, most of the list is made of established industry leaders. The one outlier in the top 10 list seems to be Neuren Pharmaceuticals.

That stock has exploded 268% over the past 12 months.

In an endorsement for active stock picking, the major difference between the millionaire portfolios compared to the general population was that there was only one exchange-traded fund stock featuring in the wealthy top 10.

According to Selfwealth, the top 10 ASX shares among the wider investor community are “dominated” by ETFs.

Remarkably, the millionaires are patriotic. The only non-ASX stock in the top 20 is personal computing giant Apple Inc (NASDAQ: AAPL), which came in at 15th.

The wider investor population loves ASX lithium shares, with five featuring among the most popular 20.

But for the millionaires, only Pilbara Minerals Ltd (ASX: PLS) features, and that’s coming in at a lowly 17th.

The post The top 10 ASX shares held by millionaires appeared first on The Motley Fool Australia.

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More reading

• Want to score the boosted ANZ dividend? You better hurry!
• These ASX 200 dividend stocks are highly rated for a reason
• Here are the top 10 ASX 200 shares today
• 3 reasons the CBA share price is heading lower: Goldman Sachs
• Why Appen, CSR, Silver Lake, and Westpac shares are falling

Motley Fool contributor Tony Yoo has positions in CSL and Macquarie Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple and CSL. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended A2 Milk, Apple, and Westpac Banking Corporation. 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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The big news this week is that mergers and acquisitions (M&A) activity is heating up in the lithium industry with the proposed merger of Allkem Ltd (ASX: AKE) and Livent Corp (NYSE: LTHM).

The news went down well with investors on both sides of the Pacific Ocean, sending their shares hurtling higher.

But what about brokers? How have they responded to the Allkem-Livent merger? Let’s find out.

Allkem merger creates a ‘top 3 lithium producer’

Analysts at Goldman Sachs have responded positively to the news. The broker highlights that it will create a “top 3 lithium producer” globally if the transaction completes.

In addition, its analysts highlight that the combination of the two lithium miners will result in a stronger balance sheet that supports their growth opportunities. It said:

The merger would also imply a stronger/more defensive balance sheet to fund the proposed and possible growth pipeline, where management noted the current execution pipeline will continue without taking pause as both businesses are already fully funded to execute respective projects.

Goldman also suggested that the M&A activity may not stop at the Allkem merger, which will be music to the ears of ASX lithium shareholders. It commented:

On lithium sector M&A more broadly, as we have highlighted, those in a position for strategic consolidation with South American lithium brine producers (other developers/emerging operators) may also have synergies in these types of lithium projects, while global miners/commodities business likely remain interested in lithium assets.

Goldman has retained its buy rating. However, it hasn’t changed its price target, which still sits at $12.90.

Brine processing techniques could be key

Morgans is also very positive on the Allkem merger with Livent. As well as the potential synergies, it highlights that the latter’s advanced brine processing techniques could help driver a stronger performance from Allkem’s assets. It said:

It is possible that the accelerated take up of different brine processing techniques at AKE’s projects, that are used by LTHM, could unlock the large potential of those resources much faster than we and the market have allowed.

However, due to the jump in the Allkem share price yesterday, the broker has downgraded its shares to a hold rating with a $14.40 price target. It commented:

We reduce our rating to HOLD given the extremely strong share price reaction. We think the deal makes sense for AKE but there is limited fundamental upside given today’s rally.

Though, it concedes that there’s potential for a third-party to come in with a counteroffer that starts a bidding war. Keep an eye out for that!

The post Here’s what brokers are saying about the Allkem merger with Livent appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Why Allkem, Core Lithium, Graincorp, and Omni Bridgeway shares are racing higher
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• ASX lithium shares rocket higher amid Allkem merger news

Motley Fool contributor James Mickleboro has positions in Allkem. 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.

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It has been a high-flying 12 months for Qantas Airways Limited (ASX: QAN) shares. After climbing 19% in the past year, the airline operator is a business that’s hard to ignore.

Qantas has been a famous Australian brand for over a century, but does it make a great investment?

Here are the arguments for and against buying shares in the Flying Kangaroo right now: 

Listen to Warren Buffett, please

By Tony Yoo: The world’s most famous investor, Warren Buffett, explained the futility of investing in the aviation industry perfectly in his 2007 letter to Berkshire Hathaway Inc (NYSE: BRK.A) (NYSE: BRK.B) shareholders.

“The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money,” he said.

“Think airlines.”

Ever since the Wright brothers invented the plane, “a durable competitive advantage has proven elusive” for every carrier, Buffett added.

“The airline industry’s demand for capital ever since that first flight has been insatiable. Investors have poured money into a bottomless pit, attracted by growth when they should have been repelled by it.”

That’s not to say he and Berkshire Hathaway haven’t invested in aviation over the decades. But he has, more often than not, lost money in doing so.

But not our Qantas, I hear you say! It operates as the dominant player in a duopoly in Australia – how can you go wrong?

Remembering Buffett’s advice about how much capital is required to maintain an airline business, it’s worth noting that Qantas has a ridiculously ageing fleet.

Aircraft	Number that Qantas flies	Average age (years)	Qantas’ rank
Airbus A330	25	15.9	121 of 141 airlines
Airbus A380	8	13.4	9 of 10
Boeing 737 NG/Max	75	14.9	179 of 294
Boeing 787	11	4.4	23 of 73

According to airfleets.net, the average Qantas plane is 14 years old now. 

Looking specifically at the Boeing Co (NYSE: BA) 737 NG/Max and the Airbus SE (EPA: AIR) A330 that dominate its fleet, they average 14.9 and 15.9 years old respectively.

Out of 141 airlines that fly the A330, it ranks 121 for age. Of the 294 airlines that use the 737 NG/Max, Qantas operates the 179th oldest fleet.

This is horrifying stuff. 

New chief executive Vanessa Hudson will have to spend enormous amounts of capital expenditure in the coming years to bring the fleet back into shape.

This is something that seems to be glossed over in the Qantas board’s canonisation of the outgoing chief Alan Joyce. He has inflated profits by not spending enough on maintaining a modern fleet of planes.

I am not buying Qantas shares as a part of any long-term investment plan.

Motley Fool contributor Tony Yoo does not own shares in Qantas Airways Limited.

Qantas shares could be the ticket for returns

By Tristan Harrison: The Qantas share price has outperformed the S&P/ASX 200 Index (ASX: XJO) in 2023 to date and I think that can continue.

The ASX airline share has dipped since the start of May, making it cheaper for investors to buy. This decline may have coincided with the news that the CEO, Alan Joyce, is leaving and the reins are being taken over by the chief financial officer, Vanessa Hudson. I think there could be a lot of continuity with the new leader coming from within the Qantas ranks.

It’s been a few months since the last trading update, but when the company announced its FY23 half-year result it said that travel demand is expected to “remain strong throughout FY23 and into FY24”.

I think the return of tourists and Australia’s growing population will translate into more people using planes, which would be promising for Qantas earnings and the Qantas share price.

The valuation seems very reasonable to me. According to Commsec, it’s priced at just 7 times FY23’s estimated earnings and 6 times FY24’s estimated earnings. I think the Qantas share price could easily be valued 20% higher than it is today and it would still be on a single-digit price-to-earnings (P/E) ratio.

The improving balance sheet situation, as demonstrated above, could enable the business to start paying dividends in FY24 or FY25. Remember, Qantas already launched a share buyback.

By FY25, Commsec numbers suggest the ASX airline share could be paying an annual dividend per share of 21 cents. That’s a 3.3% dividend yield excluding any franking credits. 

Motley Fool contributor Tristan Harrison does not own shares in Qantas Airways Limited.

The post Qantas shares: High-flying potential or grounded expectations? appeared first on The Motley Fool Australia.

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More reading

• Rio Tinto and this ASX 200 share are strong buys: analysts
• Morgans names the best ASX 200 blue chip shares to buy in May
• Is the Qantas share price at risk over the airline’s $12 billion renewal plans?
• Why did the Qantas share price struggle in April?
• Here’s what this broker is saying about the Qantas share price

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway. The Motley Fool Australia has recommended Berkshire Hathaway. 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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Looking to get in on the boosted Australia and New Zealand Banking Group Ltd (ASX: ANZ) dividend?

Then time’s running short.

The S&P/ASX 200 Index (ASX: XJO) bank stock trades ex-dividend on Monday.

Meaning if you want to grab the ANZ dividend, you need to own shares at market close today.

What kind of payout is the big four bank making?

ANZ reported its half-year results last Friday.

Among the highlights, the big four bank reported cash earnings of $3.8 billion, an increase of 12% from the corresponding six-month period.

That saw the board increase the ANZ interim dividend by 9.5% from the prior year to 81 cents per share, fully franked.

At yesterday’s closing price of $24.24, that equates to an instant yield of 3.3% from the single payout.

If you own shares when the closing bell rings today, you can expect the ANZ dividend to land in your bank account on 3 July.

The bank’s Dividend Reinvestment Plan (DRP) will be active for investors who prefer not to receive the cash payment. And there’s no limit on the number of shares that can participate in the DRP.

ANZ will neutralise the impact of the DRP by purchasing shares on market.

With CEO Shayne Elliot offering an optimistic outlook – citing “a robust capital position” and “a strong and diverse deposit base” – investors will be looking forward to the next round of ANZ dividends.

Though Elliot did caution on a potentially harder half-year ahead.

“The next six months will be more difficult than the last,” he said.

What is the ANZ dividend yield?

Atop the 81 cents per share interim dividend, ANZ shares also delivered a final dividend of 74 cents per share. That was paid out on December 15.

At yesterday’s closing price that works out to a trailing yield of 6.4%, with potential tax benefits from the franking credits.

The post Want to score the boosted ANZ dividend? You better hurry! appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 dividend shares to buy following recent updates: brokers
• Leading brokers name 3 ASX shares to buy today
• If you invest $10,000 in ANZ shares here’s how much passive income you’ll earn
• 5 things to watch on the ASX 200 on Monday
• Is it time to buy ANZ shares after its strong results?

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.

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On Thursday, the S&P/ASX 200 Index (ASX: XJO) fought hard but fell jus short of positive territory. The benchmark index ended the day down just 3.8 points to 7,251.9 points.

Will the market be able to bounce back from this on Friday? Here are five things to watch:

ASX 200 expected to fall

The Australian share market looks set to end the week in a subdued fashion following a mixed night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 8 points or 0.1% lower this morning. In the United States, the Dow Jones was down 0.65% and the S&P 500 fell 0.2%, but the NASDAQ rose 0.2%.

REA third-quarter update

The REA Group Ltd (ASX: REA) share price will be one to watch today when the real estate listings company releases its third-quarter update. Expectations are high for the realestate.com.au operator. Commenting on the second half, Citi said: “[We] expect REA to deliver double digit yield growth in 2H23e/FY24e and flex its cost base if conditions are weaker than expected.”

Oil prices fall

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a poor finish to the week after oil prices fell overnight. According to Bloomberg, the WTI crude oil price is down 1.6% to US$71.39 a barrel and the Brent crude oil price is down 1.3% to US$75.38 a barrel. Concerns over the potential for an unprecedented US debt default weighed on sentiment.

Gold price drops

Gold shares Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) could also have a poor finish to the week after the gold price dropped overnight. According to CNBC, the spot gold price is down 0.8% to US$2,021 an ounce. A stronger US dollar weighed on the gold price.

Allkem shares downgraded to hold

Allkem Ltd (ASX: AKE) shares may be fully valued now after yesterday’s stunning gain. That’s the view of analysts at Morgans, which have downgraded the lithium miner’s shares to a hold rating with a $14.40 price target. The broker said: “We reduce our rating to HOLD given the extremely strong share price reaction. We think the deal makes sense for AKE but there is limited fundamental upside given today’s rally.”

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

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More reading

• Here are the top 10 ASX 200 shares today
• Why Allkem, Core Lithium, Graincorp, and Omni Bridgeway shares are racing higher
• Why Appen, CSR, Silver Lake, and Westpac shares are falling
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• 3 reasons this top broker just upgraded the Woodside share price

Motley Fool contributor James Mickleboro has positions in Allkem. 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 recommended REA Group. 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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Thankfully for income investors, there are a good number of ASX 200 dividend stocks to choose from on the Australian share market.

To narrow things down, I have picked out two that have been named as buys by brokers recently. Here’s what they are saying about them:

Telstra Group Ltd (ASX: TLS)

The first ASX 200 dividend stock for income investors to look at is telco giant, Telstra.

A recent note out of Morgans reveals that its analysts are very positive on the banking giant. So much so, they have the company on their best ideas list. The broker believes Telstra’s outlook is much-improved and sees opportunities to unlock value through asset sales.

In addition, the broker is forecasting 17 cents per share fully franked dividends in both FY 2023 and FY 2024. Based on the current Telstra share price of $4.32, this will mean yields of 3.9% for investors.

Morgans also sees value in the company’s shares. It currently has an add rating and $4.70 price target on them.

Westpac Banking Corp (ASX: WBC)

Another ASX 200 dividend stock that has been named as a buy is big four bank Westpac.

In response to its half-year results this week, Goldman Sachs has retained its conviction buy rating with a $24.67 price target.

The broker was pleased with the results, noting that “WBC’s 1H23 cash earnings (GS basis ex-notables) from continued operations were up significantly hoh and +8% above GSe.”

And while Westpac has stepped back from its cost cutting targets, the broker still expects costs to be broadly flat in the coming years. This is a big positive in the current inflationary environment.

All in all, the broker expects this to lead to fully franked dividends of 140 cents per share in both FY 2023 and FY 2024. Based on the current Westpac share price of $21.13, this equates to yields of 6.6% in both years.

The post These ASX 200 dividend stocks are highly rated for a reason appeared first on The Motley Fool Australia.

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More reading

• Why Appen, CSR, Silver Lake, and Westpac shares are falling
• Why is the Westpac share price sinking today?
• Top broker says Telstra shares could benefit from 2023 federal budget
• 5 things to watch on the ASX 200 on Thursday
• Top brokers name 3 ASX shares to buy today

Motley Fool contributor James Mickleboro has positions in Westpac Banking. 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 positions in and has recommended Telstra Group. The Motley Fool Australia has recommended Westpac Banking. 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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If you’re looking for an easy way to diversify your investment portfolio, then exchange traded funds (ETFs) could be the way to do it.

But which ETFs should you look at? Listed below are three excellent ETFs that could be worth considering in May. Here’s what you need to know about them:

BetaShares Global Cybersecurity ETF (ASX: HACK)

The first ASX ETF you might want to look at is the BetaShares Global Cybersecurity ETF. As you might have guessed from its name, this ETF provides investors with access to the growing cybersecurity sector. This means you’ll be owning cybersecurity companies such as Accenture, Cisco, Cloudflare, Fortinet, Okta, Splunk, Zscaler, Crowdstrike. As we have seen over the last 18 months, cybersecurity is becoming increasingly important and a failure to protect data can lead to significant brand damage and financial loss. This bodes well for companies in this ETF.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

Another ETF for investors to look at in May is the VanEck Vectors Morningstar Wide Moat ETF. This ETF provides investors with an easy way to invest in the type of companies that Warren Buffett buys. The ETF generally contains ~50 attractively priced companies with sustainable competitive advantages or moats. These include the likes of Alphabet (Google), Adobe, Boeing, Meta (Facebook), Kellogg Co, and Walt Disney.

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

A final ETF for ASX investors to look at this month is the VanEck Vectors Video Gaming and eSports ETF. This ETF gives investors easy access to a global video game market estimated to comprise almost 3 billion active gamers. Among the companies included in the fund are AMD, Electronic Arts, Nintendo, Nvidia, Roblox, and Take-Two. The fund manager, VanEck, points out that these companies are well-placed to benefit from the increasing popularity of video games and eSports.

The post 3 of the best ETFs for ASX investors to buy this month appeared first on The Motley Fool Australia.

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More reading

• Why these 2 ASX ETFs could be great options to buy for growth
• Invest like Warren Buffett with this ASX share to grow your wealth enormously
• 2 top ASX ETFs I’d buy with the goal of long-term capital growth
• 3 fantastic ETFs for ASX investors to buy in May
• 3 top quality ETFs for ASX investors to buy and hold for 10 years

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 BetaShares Global Cybersecurity ETF. The Motley Fool Australia has positions in and has recommended BetaShares Global Cybersecurity ETF. The Motley Fool Australia has recommended VanEck Vectors Video Gaming And eSports ETF and VanEck Morningstar Wide Moat ETF. 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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