Category: Stock Market

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:

• Flight Centre Travel Group Ltd (ASX: FLT) remains the Australian share market’s most shorted share after its short interest rose to 15.4%. Although there have been some encouraging updates out of the travel sector, short sellers appear to believe investors are expecting too much given how rising living costs are squeezing budgets. Particularly in Europe where energy prices have risen extraordinarily.
• Betmakers Technology Group Ltd (ASX: BET) has seen its short interest rise to 13.4%. Short sellers have been adding to their positions after this betting technology company posted a massive $89.2 million loss in FY 2022.
• De Grey Mining Limited (ASX: DEG) has short interest of 10.6%, which is down slightly week on week. There may be concerns that cost inflation could lead to the Mallina Gold Project costing more than expected.
• Block Inc (ASX: SQ2) has short interest of 10.4%, which is down slightly week on week once again. Concerns over a potential US recession and the market’s aversion to loss-making tech stocks have been weighing on Block’s shares.
• Nanosonics Ltd (ASX: NAN) has short interest of 10.3%, which is down a touch week on week. Rising costs, a disappointing full year result, and product launch delays have hit this infection prevention company’s shares.
• Lake Resources N.L. (ASX: LKE) has short interest of 9.9%, which is down week on week. This lithium developer’s shares have rallied very strongly recently but short sellers aren’t giving up on it.
• Zip Co Ltd (ASX: ZIP) has seen its short interest ease slightly to 9.5%. This buy now pay later provider’s shares have just been dealt a blow by being dumped out of the ASX 200 index at the next rebalance.
• City Chic Collective Ltd (ASX: CCX) has jumped into the top ten with short interest of 9.35%. Short sellers will have been pleased to see this plus sized fashion retailer’s shares crash after the release of a very disappointing full year result. City Chic’s shares have also just been kicked out of the ASX 200.
• Regis Resources Limited (ASX: RRL) has short interest of 8%, which is down week on week yet again. Short sellers appear to be closing positions slowly but surely. Production issues have been weighing on this gold miner’s shares.
• Inghams Group Ltd (ASX: ING) has short interest of 8%, which is down week on week. This poultry company may have been targeted due to concerns over higher input costs.

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

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why these 3 ASX shares could be in for a massive boost this month
• Zip shares on watch amid ASX 200 ousting
• 5 things to watch on the ASX 200 on Monday
• Zip and these shares have been kicked out of the ASX 200 index
• Here are the top 10 ASX 200 shares today

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 Betmakers Technology Group Ltd, Block, Inc., Nanosonics Limited, and ZIPCOLTD FPO. The Motley Fool Australia has positions in and has recommended Block, Inc. and Nanosonics Limited. The Motley Fool Australia has recommended Betmakers Technology Group Ltd and Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/I9p6aeC

Motley Fool Australia Chief Investment Officer Scott Phillips joined Peter Overton for Nine’s Late News on Sunday night to discuss the big week ahead for homeowners and investors alike, with the Reserve Bank of Australia likely to hike rates and GDP hopefully showing the economy continues to grow strongly.

[youtube https://www.youtube.com/watch?v=ePsPPYhtM3o?feature=oembed&w=500&h=281]

The post Rate rise on the agenda, and high hopes for GDP. Scott Phillips on Nine’s Late News appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why these 3 ASX shares could be in for a massive boost this month
• Why is the Fortescue share price sinking 6% today?
• Financial powerhouse: Why I think these stats make Xero shares irresistible
• Want to snare the next CSL dividend? Read this
• Down 19%, is it safe to invest in the stock market now?

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 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.

from The Motley Fool Australia https://ift.tt/jK6dbto

Outstanding company performance and favourable economic conditions are obviously fantastic for ASX shares.

But occasionally stocks might get a nice boost from an unexpected circumstance.

That’s exactly the great fortune Johns Lyng Group Ltd (ASX: JLG), Sayona Mining Ltd (ASX: SYA), and Lovisa Holdings Ltd (ASX: LOV) investors find themselves in this month.

That’s because those three ASX shares have been named as new additions to the S&P/ASX 200 Index (ASX: XJO).

They will be welcomed into the flagship index before trading begins on Monday 19 September.

Not just prestige, but actual practical ramifications

So why is joining the ASX 200 such a boon for stocks?

That’s because passive funds that follow the index are forced to buy the shares, thereby pushing up demand.

And of course, the share price heads upward as demand increases.

This will be some relief for investors of insurance building repairer Johns Lyng. The price for that stock has dipped 15.5% over the last couple of weeks.

Shareholders for lithium producer Sayona Mining will be glad too, with that stock losing about a third of its value since 19 April.

Lovisa shares have gained a whopping 71% since mid-June, so the ASX 200 addition could light another fire under the rocket.

More to watch

Those three stocks aren’t the only ones entering the exclusive 200 club though.

Investors may keep an eye on these other companies to see how they might move as 19 September approaches:

• Capricorn Metals Ltd (ASX: CMM)
• Charter Hall Social Infrastructure REIT (ASX: CQE)
• Karoon Energy Ltd (ASX: KAR)
• Smartgroup Corporation Ltd (ASX: SIQ)
• Spark New Zealand Ltd (ASX: SPK)

Conversely, for each stock that’s added to the ASX 200, one gets removed.

And that’s potentially bad news for those companies, as passive funds that follow the index are forced to sell.

When supply increases, the share price dips.

So watch out if you’re holding any of these ASX shares, which will be kicked out of the ASX 200 on the morning of 19 September:

• Life360 Inc (ASX: 360)
• AVZ Minerals Limited (ASX: AVZ)
• City Chic Collective Ltd (ASX: CCX)
• Clinuvel Pharmaceuticals Limited (ASX: CUV)
• EML Payments Ltd (ASX: EML)
• Janus Henderson Group CDI (ASX: JHG)
• Pointsbet Holdings Ltd (ASX: PBH)
• Zip Co Ltd (ASX: ZIP)

The post Why these 3 ASX shares could be in for a massive boost this month appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Zip shares on watch amid ASX 200 ousting
• 5 things to watch on the ASX 200 on Monday
• Zip and these shares have been kicked out of the ASX 200 index
• Here are the top 10 ASX 200 shares today
• Why Core Lithium, Mineral Resources, PointsBet, and Strike Energy are dropping

Motley Fool contributor Tony Yoo has positions in Johns Lyng Group Limited and Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended EML Payments, Johns Lyng Group Limited, Life360, Inc., Pointsbet Holdings Ltd, and ZIPCOLTD FPO. The Motley Fool Australia has positions in and has recommended EML Payments and SMARTGROUP DEF SET. The Motley Fool Australia has recommended Johns Lyng Group Limited, Lovisa Holdings Ltd, and Pointsbet Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/3NT9L7o

The Fortescue Metals Group Limited (ASX: FMG) share price is starting the week deep in the red.

In morning trade, the iron ore giant’s shares are down 6% to $16.21.

This means the Fortescue share price is now down by 19% since the start of the year.

Why is the Fortescue share price crashing lower today?

Firstly, before you panic about the iron ore price, I can confirm that it has not collapsed. According to Metal Bulletin, it was down approximately 0.6% to US$95.00 a tonne on Friday night.

And while there are admittedly a number of bearish brokers out there, today’s decline by the Fortescue share price has nothing to do with them either.

Today’s weakness has been driven entirely by the company’s shares trading ex-dividend for its upcoming final dividend.

When a share goes ex-dividend it means that the rights to that dividend are now staying with the seller and will not transfer to the buyer. As a result, a company’s shares will usually fall in line with the dividend amount to reflect this.

The Fortescue dividend

A week ago, Fortescue released its full year results and reported record iron ore shipments of 189 million tonnes. However, due to a significant pullback in the price of the steel making ingredient and rising costs, the company’s revenue fell 22% to US$17,390 million and its net profit after tax dropped 40% to US$6,197 million.

In light of this and its Fortescue Future Industries expenditure plans, the company slashed its final dividend by 43% to a fully franked $1.21 per share.

Based on the Fortescue share price at the end of last week, this final dividend alone equated to a 7% dividend yield.

Is this a buying opportunity?

Unfortunately, as popular as Fortescue is with investors, I have only bad news in respect to broker recommendations.

The general consensus is that the Fortescue share price is overvalued and heading lower from here. Not a single broker in my circle has a buy rating on its shares.

Goldman Sachs, which has a sell rating on its shares, has suggested that fair value is all the way down at $12.10.

The post Why is the Fortescue share price sinking 6% today? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 things to watch on the ASX 200 on Monday
• What’s the outlook for Fortescue shares amid a struggling Chinese economy?
• Why are ASX 200 mining shares getting hammered on Friday?
• These ASX 200 shares are going ex-dividend on Monday
• ASX 200 shares declared $42b of dividends in August. Here’s how you can get a slice

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.

from The Motley Fool Australia https://ift.tt/WxSDaBO

Xero Limited (ASX: XRO) shares have performed strongly over the long term. In fact, in the past five years, the Xero share price has seen a 250% rise.

However, it has dropped 43% since the start of 2022. Still, I think there are a number of financial statistics that show why this drop in the Xero share price could be an attractive buying opportunity for the long term.

For readers who haven’t heard of Xero before, it’s an ASX tech share that provides accounting software for business owners, financial advisers, bookkeepers, and accountants.

Strong Xero financial stats

The company’s FY22 result, reported in May 2022, showed a number of impressive metrics.

For me, one of the key figures is the gross profit margin of 87.3% (which was up from 86% in FY21). Such a high margin means that a large majority of new revenue can turn into gross profit, which can then be used to spend on further growth initiatives like marketing or software development.

With revenue growing quickly, it also means the scale and gross profit of the business are growing strongly. FY22 operating revenue went up 29% to NZ$1.1 billion.

Not only is the number of subscribers increasing around the world – with a 19% rise in FY22 to 3.27 million – but the average revenue per user (ARPU) is increasing as well. FY22 ARPU went up 7% to NZ$31.36. Price increases in key markets can help Xero’s organic growth.

The total lifetime value of subscribers continues to increase. In FY22, it soared 43% to NZ$10.9 billion. This is being helped in a number of ways including new subscribers, higher ARPU, and increasing customer loyalty. The average customer lifetime is now 9.3 years. There is seemingly a lot of future revenue already signed up.

I think the extremely low churn rate is one of the best measures of the quality of Xero shares and also the quality software offering for its subscribers. In the second half of FY20, churn was just 1.13% of subscribers, which dropped to 1.01% in the second half of FY21 and 0.9% in the second half of FY22.

Management confident about the future

Xero says that it’s going to continue to reinvest its cash flow generated to drive long-term shareholder value.

The Xero CEO Steve Vamos said:

The value Xero brings to our small business customers and the trust they place in us is illustrated by this result. Our strong revenue and subscriber growth gives us confidence to continue to invest for growth consistent with our long-term strategy.

Our performance reflects the quality of our customer and partner relationships as more people realise the benefits that cloud accounting and digital tools provide.

We are committed to delivering the world’s most insightful and trusted small business platform by focusing on driving cloud accounting adoption, growing the small business platform and building for global scale and innovation. We continue to prioritise investment in building products and growing partnerships by investing cash generated to help deliver our strategy, drive long-term growth and meet customer needs.

Xero share price snapshot

Over the last month, Xero shares have fallen 14%.

The post Financial powerhouse: Why I think these stats make Xero shares irresistible appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• ASX 200 tech shares are getting hammered on Monday. Here’s why
• Up 20% in 2 months, is the Xero share price a buy today?
• Here’s what Goldman Sachs thinks of the Xero share price
• 5 things to watch on the ASX 200 on Friday
• Why Blackmores, Codan, Lake Resources, and Xero shares are falling 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 positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/0LnvaqZ

Despite achieving the top end of its guidance for the 2022 financial year, the CSL Limited (ASX: CSL) share price has remained flat since the release of the results.

At last week’s market close, shares in the biotherapeutics giant finished at $295.99. This compares to the $296.40 they were trading at before reporting the company’s FY 2022 scorecard.

CSL CEO and managing director Paul Perreault acknowledged the resilient performance against the ongoing challenges of COVID-19, saying it was a ‘good result’.

Nonetheless, the board opted to maintain its final dividend of US$1.18 (AU$1.68) per share. Due to favourable currency movements, this translates to a lift of 9 cents or 5.6% over the prior corresponding period.

Investors were quick to react to the results, sending CSL shares to a monthly low of $278.89. But as the day went on, the share price mostly recovered to end at $292.50 – down 1.32%.

Let’s look at the details you need to know about the upcoming dividend.

Time is running out for the CSL dividend

Investors will have until the end of today to secure the CSL dividend.

The ex-dividend date falls on Tuesday 6 September.

This means if you buy the company’s shares before market close today and hold them until tomorrow morning, you’ll be eligible for the final dividend.

The dividend is also franked at 10% which equates to US 11.8 cents (AU 18 cents) per share.

Keep in mind though, when a company’s shares trade ex-dividend, the share price tends to fall in proportion to the dividend paid out. However, this can vary depending on how the market is tracking for the day, as well as investor sentiment.

If you do manage to scoop up some CSL shares, a dividend payment of roughly AU$1.68 per share will land in your bank account on 5 October.

The details of the exact payment currency equivalent will be released on 9 September.

How has the CSL share price performed in 2022?

At the start of 2022, the CSL share price nosedived 17% to hit a 52-week low of $240.10 in mid-February.

However, the share quickly rebounded and traded around $270 for several months.

When the new financial year kicked off, CSL shares rose and have been hovering under the $300 mark.

For the calendar year, the biotech’s share price is up 2%.

In comparison, the S&P/ASX 200 Health Care (ASX: XHJ) sector is down 5% over the same period.

CSL commands a market capitalisation of approximately $142.58 billion and has a dividend yield of 1.02%.

The post Want to snare the next CSL dividend? Read this appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 ASX 200 shares turning ex-dividend tomorrow
• Why is the CSL share price outperforming the ASX 200 on Friday?
• ASX 200 shares declared $42b of dividends in August. Here’s how you can get a slice
• How do CSL shares stack up against Cochlear following earnings season?
• Top ASX shares to buy in September 2022

Motley Fool contributor Aaron Teboneras 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 Ltd. 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.

from The Motley Fool Australia https://ift.tt/Y39Px4n

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

As measured by Vanguard’s Total Stock Market Index ETF, the U.S .stock market currently sits around 19.4% below its recent highs. That’s still in the neighborhood of a bear market, and there are plenty of reasons to remain nervous. In particular, with the Federal Reserve making it clear it won’t stop raising interest rates until inflation is under control, the downward pressure on stocks may very well continue.

That raises a key question: Is it safe to invest in the stock market right now? Well, the direct answer to that question is no. Of course, it is never safe to invest in the stock market. Your money is always at risk in the market. As a result, a better question to ask is whether the falling market has opened up opportunities where the potential rewards are worth the risks you’re taking. Through that lens, there just might be a path to where it might make sense to consider investing again.

Look where the fear is palpable

In a rising rate environment, some of the industries that get hardest hit are the ones that rely heavily on customers that need to borrow money to make their purchases. For instance, the S&P Homebuilders Index is down far worse than the market as a whole as people worry that rising rates and a tougher economy will keep people from buying new homes.

While it is absolutely true that rising rates make it tougher for people to buy homes, it’s also true that permits to build new homes remain slightly stronger than they were this time last year. While homebuilding and home buying is decelerating, we’re also coming off what had been an incredible housing boom, and one where demand far outpaced supply.

There’s a wide gap between a tremendous boom and a complete collapse, and contrary to popular belief, people are still buying houses. It’s just not at as fast a rate as it was during the peak of the low-interest rate fueled real estate mania. The question you should really be asking yourself is whether the market’s palpable fear surrounding homebuilders has made at least some of them available at a bargain price.

On a related note, rising interest rates mean that companies that are in the business of lending money have the opportunity to earn more on their lending. For instance, even as consumers cost to borrow has gone up, the interest rates banks pay on savings remain stubbornly low. Even so-called “High yielding” savings accounts are barely paying above 2%, even as 30-year mortgage rates have climbed to around 5.66%. 

One key way that banks make their money is off the spread between the rate they pay to depositors and the rate they lend out to borrowers. The higher interest rates are, the larger the potential room in that spread, which could ultimately translate to higher earnings for them.

Of course, the risk is that if too many people default on their loans, banks won’t be able to collect enough from their lending to fully cover their costs. If the economy stays soft and job losses start to mount, that risk can become magnified. So while bank stocks are down, at least some of the worry is justified by the potential of things to go from bad to worse.

Are the risks and potential rewards in balance?

Neither homebuilders nor banks are risk-free investments, but both have generally seen their share prices fall as the market has started to recognize the risks that both industries face. As a result, investors buying today actually have a better potential reward profile for the risks they’re taking than those who bought earlier when prices are higher.

Has the balance tilted enough in investors favor to where they may be worth buying? That’s a little tougher to answer, but you can usually get in the ballpark. One great approach to do that is to use the discounted cash flow model to help you value any stocks you’re considering buying. With that model, you can get a good handle on both the cash you expect a company to generate and what that cash is worth to you.

If the stock price looks cheap relative to value suggested by the company’s cash-generating abilities, then the risk-reward balance may very well be in your favor. Even better, since you’ve built a model based on projections of the cash the company is expected to generate in the future, you can use that model to check up on the company as time progresses. That can help you keep an eye on any stocks you do buy to see if their businesses are truly worth holding on to.

Get started now

While down markets often provide chances to buy great companies at bargain prices, the market’s panic likely won’t last forever. Make today the day you start looking for bargains. Once you find them and buy them, have the patience to let the market work through the rest of its worries. Do that successfully, and you just might discover that while it’s not safe to invest in the stock market now, it may very well turn out to be profitable.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Down 19%, is it safe to invest in the stock market now? appeared first on The Motley Fool Australia.

(function() { function setButtonColorDefaults(param, property, defaultValue) { if( !param || !param.includes(‘#’)) { var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0]; button.style[property] = defaultValue; } } setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’); setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’); setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’); })()

More reading

• Financial powerhouse: Why I think these stats make Xero shares irresistible
• Want to snare the next CSL dividend? Read this
• Why is this top broker tipping 27% upside for the ANZ share price?
• Why did the BHP share price smash the ASX 200 in August?
• 5 ASX 200 shares turning ex-dividend tomorrow

Chuck Saletta 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.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

from The Motley Fool Australia https://ift.tt/K6QDSxb

The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price is trading in the bargain bin right now, according to one top broker.

Citi has tipped shares in the smallest of the ‘big four’ banking giants to surge 27%, as my colleague James reports. It’s also slapped the stock with a buy rating.

The ANZ share price closed Friday’s trade at $22.75.

Let’s take a closer look at why Citi believes now is a good time to jump on board the bank.

Citi slaps ANZ shares with $29 price target

Broker Citi tips the ANZ share price to add another quarter – and then some – after the bank announced its plan to snap up Suncorp Group Ltd (ASX: SUN)’s banking operations.

The two S&P/ASX 200 Index (ASX: XJO) financial giants announced the planned acquisition in July.

ANZ is expected to buy Suncorp’s banking business for $4.9 billion. It will also likely pay Suncorp a baseline of $50 million to continue using its brand for at least five years following the acquisition.

The ANZ share price rose 2.1% when it returned to trade following a $1.7 billion capital raise to help fund the purchase.

On announcing the acquisition, ANZ CEO Shayne Elliott said it represents “a cornerstone investment for ANZ”. And it will provide a decent boost to the bank’s loan book.

Suncorp Bank will come with $47 billion of home loans, $45 billion of deposits, and $11 billion of commercial loans, my Fool colleague Tristan reported at the time.

Elliott also told a media conference:

We’re acquiring a 1.2 million customer base, 700,000 of whom live here in Queensland, 400,000 of whom consider Suncorp Bank their main bank. That’s a very, very valuable franchise … Since March 2020, Queensland has recorded better economic growth, better workforce participation, and more interstate migration than any other state or territory in Australia. It contributes 18% to Australia’s GDP and we believe we can use the resources at our disposal to further contribute to its continued success.

Citi says the deal makes strategic sense and offers a reasonable price tag. The broker slapped ANZ shares with a $29 price target following its announcement.

It also tips the big four bank to offer $1.44 per share in dividends for financial year 2022 (ending 30 September) and $1.65 per share for financial year 2023.

The post Why is this top broker tipping 27% upside for the ANZ share price? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Is this why the Macquarie share price was ‘steaming ahead’ on Friday?
• Why did the ANZ share price go backwards in August?
• Brokers name 2 ASX dividend shares to buy this month
• What’s the outlook for ASX 200 bank shares in September?
• Why this analyst ranks ANZ shares at the bottom of the big-four-bank pile

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper 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.

from The Motley Fool Australia https://ift.tt/YptCzc1

The BHP Group Ltd (ASX: BHP) share price went up by around 5% in August. That handily outperformed the return of the S&P/ASX 200 Index (ASX: XJO), which only rose by 0.6%.

As the biggest business on the ASX, any movement of the BHP share price can have an outsized impact on the ASX 200 itself.

In the middle of the month, BHP announced its result for the 12 months to 30 June 2022. So, let’s start by looking at what BHP reported.

FY22 earnings recap

BHP revealed two sets of numbers.

The continuing operations numbers exclude the divested BHP petroleum business. That is, they show the performance of the businesses that the company’s still holding onto.

Profit from continuing operations grew 34% to US$34.1 billion and underlying attributable profitable went up 26% to US$21.3 billion. Net operating cash flow increased by 13% to US$29.3 billion. Continuing operations’ underlying earnings per share (EPS) went up 25% to US$4.21.

The company also improved its net debt position by 92% to US$333 million.

BHP boasted that the strong result was due to its “safe and reliable operations, project delivery and capital discipline” which allowed it to capture the value of strong commodity prices. Certainly, resource prices can be a key driver of the BHP share price.

Dividend

Investors may have liked to see that BHP declared a big dividend. Indeed, it could have been the dividend that encouraged investors to buy up BHP shares before they went ex-dividend on 1 September 2022. Between the end of July and now, the BHP share price has fallen by 5%.

The BHP board decided to pay a final dividend of US$1.75 per share, or US$8.9 billion. That brought the full year dividend to US$3.25 per share – an increase of 8% – and represented a payout ratio of around 77%.

That final dividend of US$1.75 per share is currently equivalent to a payment of A$2.57 per share. This translates into a grossed-up dividend yield of 10% at the current BHP share price, or 7% if excluding the franking credits.

What do experts think of the BHP share price?

Macquarie has an outperform rating on BHP but recently cut its price target after reducing its profit expectations over the next few years because of the lower demand and price for copper. The price target is $40, which implies a rise of around 10%.

UBS is less optimistic. It has a price target of $35.50, which represents a small drop in the BHP share price. The broker thinks that lower commodity prices will impact BHP’s profit over the next couple of years.

Morgans rates it as add with a price target of $48.40, implying a possible rise of more than 30%. The broker is confident based on the outlook for the potash project Jansen, and the strong earnings from coal.

The post Why did the BHP share price smash the ASX 200 in August? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 27% of ASX 200 shares cut dividends during earnings season. What’s next?
• Why are ASX 200 mining shares getting hammered on Friday?
• Is the BHP share price 7% cheaper after trading ex-dividend? 
• What’s the outlook for ASX 200 copper shares in September?
• Why is the BHP share price tumbling again on Friday?

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.

from The Motley Fool Australia https://ift.tt/omAdW8B

With ASX reporting season now in the rearview mirror, a horde of companies in the S&P/ASX 200 Index (ASX: XJO) will soon be returning some of their profits to shareholders in the form of dividends.

But before these dividends are paid out, companies must first determine which investors are eligible for the payment.

To do so, they set a cut-off date, which is also known as the ex-dividend date. This is the date that a company’s shares no longer trade with the upcoming dividend payment attached to it.

In other words, any shares you buy on or after the ex-dividend date won’t come with the recently-announced dividend.

With that in mind, the dividends on offer from the following five ASX 200 shares won’t be around for much longer.

Today is the last day to lock in dividends from these ASX 200 shares before they turn ex-dividend tomorrow. 

CSL Limited (ASX: CSL)

CSL is the highest profile name turning ex-dividend on Tuesday. The ASX 200 biotech giant will be trading without a final dividend of US$1.18, which is 10% franked. 

Investors holding CSL shares by the time the market closes today can pencil in a payment date of 5 October. 

Across the financial year, CSL’s net profit after tax (NPAT) slipped 6% to $2.3 billion. However, the company still maintained full-year dividends of US$2.22 per share.

This puts CSL shares on a trailing dividend yield of 1.1%.

Looking ahead, broker Goldman Sachs is forecasting FY23 dividends of US$2.52. This represents a prospective forward dividend yield of 1.3%.

BlueScope Steel Limited (ASX: BSL)

BlueScope shares currently come with an unfranked final dividend of 25 cents per share, which will be off the table tomorrow. The payment date has been set for 12 October.

Despite more than doubling its NPAT in FY22, the ASX 200 steel producer kept full-year dividends steady at 50 cents. 

But the company has been delivering shareholder returns through other means, repurchasing $638 million of shares in FY22 via on-market share buybacks.

After exhausting Australian tax losses in FY22, BlueScope expects to be able to begin franking dividends in FY23. 

BlueScope shares are currently printing a trailing dividend yield of 3.1%.

Origin Energy Ltd (ASX: ORG)

Today will be the last day to lock in Origin Energy’s partially franked final dividend of 16.5 cents, which will be paid on 30 September.

The ASX 200 energy share delivered a 30% increase in underlying profit in FY22. But full-year dividends exceeded profit growth, jumping 45% to 29 cents as the company lifted its dividend payout ratio.

Origin shares are currently trading on a trailing dividend yield of 4.8%.

Sonic Healthcare Limited (ASX: SHL)

ASX 200 healthcare share Sonic will be trading tomorrow without a fully franked final dividend of 60 cents.

Investors who own Sonic shares by today’s closing bell should see this payment arrive on 21 September.

Across the financial year, Sonic raised its total dividends by 10%, largely mimicking profit growth.

Sonic shares are currently sitting on a trailing dividend yield of 3.0%. This yield cranks up to 4.3% with the benefit of franking credits.

Super Retail Group Ltd (ASX: SUL)

Last but not least, Super Retail’s fully franked final dividend of 43 cents won’t be up for grabs for much longer.

Super Retail shares will trade ex-dividend tomorrow, with the payment date for this dividend pencilled in for 17 October. Shareholders have the option to participate in the company’s dividend reinvestment plan (DRP).

Sales were relatively flat in FY22 but normalised profit fell by 20% on the back of supply chain challenges and increased investments in various strategic initiatives.

As a result, the ASX 200 retail share cut its total dividends by 20%. 

Even still, Super Retail shares are flashing a notable trailing dividend yield of 6.9%. Including franking credits boosts this yield to 9.8%.

The post 5 ASX 200 shares turning ex-dividend tomorrow appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why is the CSL share price outperforming the ASX 200 on Friday?
• ASX 200 shares declared $42b of dividends in August. Here’s how you can get a slice
• Analysts name 2 blue chip ASX 200 shares to buy now
• How do CSL shares stack up against Cochlear following earnings season?
• Top ASX shares to buy in September 2022

Motley Fool contributor Cathryn Goh 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 Ltd. and Super Retail Group Limited. The Motley Fool Australia has positions in and has recommended Super Retail Group Limited. The Motley Fool Australia has recommended Sonic Healthcare Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/ByNgxa5