Category: Stock Market

There are plenty of ASX growth shares for investors to choose from on the local market.

But which ones could be top options for investors in May? Let’s take a look at a couple that are highly rated by analysts. Here’s what they are saying about them right now:

IDP Education Ltd (ASX: IEL)

Goldman Sachs remains very positive on this language testing and student placement company and sees it as an ASX growth share to buy.

Its analysts don’t appear overly concerned by the short term headwinds that IDP Education is facing. Instead, they are focusing on the long term, which the broker believes is extremely positive. Goldman explains:

With valuation near all-time lows (25x P/E vs 45x historically), and share px -17% in the last month, we would argue the market has priced these cuts already given VA Consensus is relatively flat. We are nearing the base for FY25E earnings and are now capitalising what we see as trough earnings/growth at a historically low multiple. IEL’s structural growth outlook and business quality remain unchanged in our view, and we reiterate Buy.

Goldman currently has a buy rating and $26.60 price target on IDP Education’s shares.

NextDC Ltd (ASX: NXT)

The data centre market certainly is a great place to be right now. That’s because the artificial intelligence (AI) boom is accelerating demand for data centre capacity.

A testament to this was NextDC’s recent capital raising. It raised $1.3 billion from investors in April to accelerate “the development and fit out of NEXTDC’s leading digital infrastructure platform in its core Sydney and Melbourne markets to meet unprecedented growth in customer demand and position itself to take advantage of ongoing market expansion over the medium term.”

It is thanks partly to this demand that Morgans thinks that the company is an ASX growth share to buy right now. It explains:

NXT should deliver another good set of results in FY24 with some upside risk to guidance, in our view. Structural demand for cloud and colocation remains incredibly strong. NXT’s new S3 and M3 data centres are now open. Consequently, we expect significant new customer wins over the next six-to-twelve months (including CSP options being exercised). Sales should drive the share price higher. NXT looks comfortably on-track to generate over $300m of EBITDA in the next three to five years.

Morgans currently has an add rating and $19.00 price target on NextDC’s shares.

The post 2 highly rated ASX growth shares to buy before it’s too late appeared first on The Motley Fool Australia.

More reading

• Why this smashed ASX 200 share is a fundie’s top value pick
• 5 stellar ASX growth shares to buy for strong returns
• Why IDP Education, JB Hi-Fi, PYC, and Renascor shares are falling today
• Here are the top 10 ASX 200 shares today
• 3 ASX All Ords shares going gangbusters on Wednesday

Motley Fool contributor James Mickleboro has positions in Nextdc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Idp Education. The Motley Fool Australia has recommended Idp Education. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

These two ASX dividend shares can provide excellent passive income and could be solid options for capital growth, too.

The high interest rate and inflationary environment has led to some stocks trading at a large discount to their underlying value.

I’m optimistic about the future of the below two ASX dividend shares.

Bailador Technology Investments Ltd (ASX: BTI)

Bailador is a company that invests in unlisted technology businesses. Software is an attractive industry to invest in because of the high margins that technology companies can generate on their intangible offerings. On top of that, software businesses can rapidly sell another (digital) subscription, they don’t need to open another store or make another car or table.

Typically, Bailador invests in companies that are run by their founders and have proven business models with attractive unit economics, international revenue generation, and a “huge market opportunity.”

Rosterfy is one of the most recent Bailador investments. This company provides volunteer and workforce management software to not-for-profit organisations, government volunteering bodies, and mass-scale sporting and other events.

Since Bailador’s investment, Rosterfy has seen strong annual recurring revenue (ARR) growth, driven by a combination of new customer wins and account expansion from existing customers.

Rosterfy generates more than 50% of its ARR outside of Australia, with customers including FIFA, EUFA, Tennis Australia, Golf Australia, Lifeline Australia, British Heart Foundation, Greater London Authority, Brisbane City, Auckland Council and Las Vegas Convention and Visitors Authority.

The ASX dividend share pays a dividend yield equivalent to 4% of the pre-tax net tangible assets (NTA). The Bailador share price is trading at a 27% discount to its post-tax NTA and a 34% discount to the pre-tax NTA. The NTA is reported as the underlying value of Bailador’s portfolio of investment stakes, cash, and so on.

Due to the huge NTA discount, Bailador may actually have a current cash yield of 6%, or 8.6% when grossed up for franking credits.

Rural Funds Group (ASX: RFF)

This ASX dividend share is one of my favourite real estate investment trusts (REITs) on the ASX. It owns a large portfolio of farmland across almonds, macadamias, vineyards, cattle and cropping.

The business is currently investing many millions of dollars into new macadamia plantings, which, when completed, can unlock more rental income.

High interest rates are a short-term obstacle to distribution and rental profit growth. But, the business aims to grow its distribution by 4% every year. Rural Funds has grown or maintained its distribution yearly since it started paying distributions in 2014. That’s a pleasing level of stability.

Many Rural Funds’ contracts have rental indexation linked to inflation or a fixed annual increase, plus the occasional market review. This can help offset the ASX dividend share’s higher interest costs and help fund organic distribution growth in the future.

The current Rural Funds distribution yield works out to be 5.8%.

After its assets were recently independently valued, Rural Funds said in its FY24 half-year result that its adjusted net asset value (NAV) was $3.07. The Rural Funds share price closed on Friday at $2.03.

The post 2 cheap ASX dividend shares I’d buy for income appeared first on The Motley Fool Australia.

More reading

• Here are 3 reliable ASX shares I’d buy instead of the big four banks right now
• 3 ASX shares that look way too cheap to ignore right now
• Why I think this ASX 300 stock is a fantastic pick for dividend income
• Brokers say these high yield ASX 300 dividend shares are top buys
• Almost ready to retire? I’d buy cheap ASX dividend shares for income

Motley Fool contributor Tristan Harrison has positions in Bailador Technology Investments and Rural Funds Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bailador Technology Investments. The Motley Fool Australia has positions in and has recommended Rural Funds Group. The Motley Fool Australia has recommended Bailador Technology Investments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Friday, the S&P/ASX 200 Index (ASX: XJO) ended the week in the red. The benchmark index sank 0.85% to 7,814.4 points.

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

ASX 200 expected to rebound

The Australian share market looks set to rebound on Monday following a relatively positive finish on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 35 points or 0.45% higher. On Friday in the United States, the Dow Jones was up 0.3% and the S&P 500 rose 0.1%, but the Nasdaq fell 0.1%.

Oil prices rise

ASX 200 energy shares Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) could have a decent start to the week after oil prices rose on Friday. According to Bloomberg, the WTI crude oil price was up 1.05% to US$80.06 a barrel and the Brent crude oil price was up 0.85% to US$83.98 a barrel. Optimism over improving demand drove oil prices higher last week.

Elders half year results

Elders Ltd (ASX: ELD) shares will be on watch on Monday when the agribusiness company releases its half year results. The market won’t be expecting a strong result from Elders today. A trading update last month revealed that “first half trading for FY24 was significantly below expectations.” Investors will no doubt be hoping that management is able to at least reiterate its full year underlying EBIT guidance of between $120 million and $140 million.

Gold price races higher

ASX 200 gold mining shares including Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could have a very good start to the week after the gold price raced higher on Friday. According to CNBC, the spot gold price was up 1.45% to US$2,419.8 an ounce. This was driven by Chinese stimulus and US rate cuts bets.

Macquarie Technology downgraded

The Macquarie Technology Group Ltd (ASX: MAQ) share price could be fully valued according to analysts at Goldman Sachs. This morning, the broker has downgraded the data centre operator’s shares to a neutral rating with a trimmed price target of $90.20. Goldman explained: “MAQ has re-rated from 13x to 19x NTM EV/EBITDA over the last 12 months, now valuing MAQ in line with our SOTP and factoring in execution of IC3W (though trading at a stable discount vs NXT). We see MAQ as appropriately valued relative to peers and its earnings growth outlook, and downgrade to Neutral.”

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

More reading

• Here’s how the ASX 200 market sectors stacked up last week
• Why this smashed ASX 200 share is a fundie’s top value pick
• Here are the top 10 ASX 200 shares today
• 5 things to watch on the ASX 200 on Friday
• How much could a $10,000 investment in Woodside shares be worth in 12 months?

Motley Fool contributor James Mickleboro has positions in Nextdc and Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has recommended Elders. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you want to diversify your portfolio, then having some exposure to the mining sector could be one way to do it.

But which ASX mining stocks could be good options for investors right now?

Let’s take a look at a couple that have been named as best buys by brokers this month. They are as follows:

Regis Resources Ltd (ASX: RRL)

The first ASX mining stock to look at buying is Western Australia-based gold miner Regis Resources.

The team at Bell Potter is feeling very positive about the company’s outlook and sees a lot of value in its shares at current levels. Especially given its all-Australian operations and takeover appeal. It currently has a buy rating and $2.80 price target on its shares. The broker commented:

RRL is an established multi-mine gold producer with all its operating mines located in Western Australia. The Duketon Gold Project (located in the Laverton region 350km north, north-east of Kalgoorlie in WA) is RRL’s flagship project and comprises the Duketon North Operations (DNO) and the Duketon South Operations (DSO) which produce a combined ~300kozpa. As one of the largest ASX listed gold producers, we are attracted to its all- Australian asset portfolio and organic growth options which are unique at this scale. Furthermore, we see key opportunities in the fundamental, medium-term outlook and, in our view, these may also make RRL an appealing corporate target in the current conducive M&A environment.

South32 Ltd (ASX: S32)

Another ASX mining stock that could be a buy according to analysts is South32. It is a diversified miner with operations across a number of future-facing metals. This includes aluminium, copper, nickel, and zinc.

Morgans is a fan of the company due partly to the transformation of its portfolio and favourable commodity prices. It currently has South32 on its best ideas list with an add rating and $4.10 price target. The broker commented:

S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32’s risk and ESG profile. Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.

The post 2 of the best ASX mining stocks to buy now appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Top brokers name 3 ASX shares to buy today
• This ASX 200 gold stock can rise 30% and could be a takeover target
• Expert reveals the best and worst months for ASX shares
• 5 things to watch on the ASX 200 on Tuesday

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.

The ASX growth stock Close The Loop Ltd (ASX: CLG) has excellent potential for returns, in my opinion. I’ve bought multiple parcels of shares for my portfolio, and I’m going to explain why I’m bullish about the business.

With the Close The Loop share price down significantly from its former heights – see below – I think it’s a good time to invest.

The business collects and repurposes products through takeback programs and also provides sustainable packaging products. Its goal is for zero waste to go to landfills by recovering a wide range of electronic products, print consumables, cosmetics, plastics, paper, and cartons. It’s also involved in reusing toner and post-consumer soft plastics for asphalt additives.

The ASX growth stock wants to be a global leader in the fast-growing ‘circular economy’, with an intention for global growth.

It currently operates in four places – Australia, the USA, Europe and South Africa. A large majority of its revenue comes from the US and Australia.

Growth of the circular economy

Close The Loop says the world has a circularity problem, with only a small percentage of consumer electronics being reused.

But, it has already reached a sizeable scale. It re-manufactures over 500,000 electronic consumables annually, as well as processing over 25 million print consumables each year. What can’t be re-used is recycled.

The company notes that major original equipment manufacturers (OEMs), like HP, have ambitious ESG targets to increase circularity in the economy. Close The Loop suggests those OEMs need to partner with providers to achieve those goals.

HP is a partner of the ASX growth stock, with a three-year revenue-sharing contract. HP wants to reach 75% circularity for products and packaging by 2030 – it has reached 40% circularity by weight. HP also wants to use 30% postconsumer recycled content across HP’s personal systems and print product portfolio by 2025 – in 2022 it achieved 15%.

HP is just one business, there’s a lot of potential value for Close The Loop to provide and capture across the world.

Strong financial performance

The business is delivering good growth, helped by the acquisition of ISP Tek Services. In the FY24 first-half result, revenue increased 76% to $103.1 million, gross profit increased 94% to $37.3 million, underlying net profit before tax (NPBT) jumped 204% to $15.2 million and operating cash flow increased 105% to $12.3 million.

Close The Loop used a lot of the cash generated to improve its balance sheet – HY24 net debt (debt minus cash) decreased by $11.8 million, with a $4.2 million repayment of borrowings.

It’s very pleasing to see the company’s profit margins are rising at the various profit levels, as it means net profit can grow much quicker than revenue. And the revenue outlook is very positive, in my opinion.

Cheap valuation

The forecast on Commsec suggests the ASX growth stock could achieve 4.2 cents of earnings per share (EPS) in FY24, which would put the Close The Loop share price at 8x FY24’s estimated earnings. EPS could rise by 38% over the next two years to 5.8 cents, which would mean it’s trading at just 5.6x FY26’s estimated earnings.

In my opinion, it would be very reasonable for this business to trade in 2026 at say 12x FY26’s earnings, which would mean the Close The Loop share price could double in two years if that happened.

I expect the business to have a long growth runway, not just two years. I’m excited about what it can achieve over the rest of this decade.

The post 1 overlooked ASX growth stock I’m chasing for multibagger potential appeared first on The Motley Fool Australia.

More reading

• Why I’m bullish about this ASX stock and recently bought more!
• 2 ASX shares to buy for strong diversification

Motley Fool contributor Tristan Harrison has positions in Close The Loop. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Close The Loop. The Motley Fool Australia has recommended Close The Loop. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

While the yields on offer from term deposits are a lot more attractive than they were a couple of years ago, they still don’t match up to some of the dividend yields available on the Australian share market.

So, if your risk tolerance allows for it, it could pay to invest in shares rather than term deposits. But which ASX dividend shares?

Three buy-rated ASX dividend shares that are tipped to provide investors with 5%+ yields are listed below. Here’s why they could be worth considering:

Accent Group Ltd (ASX: AX1)

The team at Bell Potter is expecting some big yields and major upside from Accent Group’s shares. It is a footwear focused retailer with over 800 stores across a large number of brands. This includes Sneaker Lab, Platypus, Stylerunner, and The Athlete’s Foot.

Bell Potter currently has a buy rating and $2.50 price target on its shares.

As for that all-important income, the broker is expecting fully franked dividends per share of 13 cents in FY 2024 and then 14.6 cents in FY 2025. Based on the latest Accent share price of $1.80, this represents dividend yields of 7.2% and 8.1%, respectively.

Stockland Corporation Ltd (ASX: SGP)

The team at Citi thinks that Stockland could be an ASX dividend share to buy.

It is a property company that develops, owns, and manages retail centres, business parks, logistics centres, office buildings, residential communities, and retirement living villages.

Much like Accent, the broker expects some very attractive and term deposit-busting yields from its shares in the near term. The broker is forecasting dividends per share of 26.2 cents in FY 2024 and then 26.6 cents in FY 2025. Based on the current Stockland share price of $4.65, this will mean yields of 5.6% and 5.7% yields, respectively.

Citi currently has a buy rating and $5.20 price target on its shares.

Transurban Group (ASX: TCL)

A third ASX dividend share that is tipped to provide better yields than term deposits is Transurban.

It is a toll road giant with a growing number of important roads across both Australia and North America. This includes the Cross City Tunnel and Eastern Distributor in Sydney, and CityLink and the West Gate Tunnel Project in Melbourne.

Citi is a fan of the company and is forecasting dividends per share of 63 cents in FY 2024 and 65 cents in FY 2025. Based on the current Transurban share price of $12.43, this will mean yields of 5.1% and 5.2%, respectively.

Citi has a buy rating and $15.50 price target on its shares.

The post Forget term deposits and buy these ASX dividend shares appeared first on The Motley Fool Australia.

More reading

• Buy Rio Tinto and these ASX 200 dividend shares
• Will the ‘resurgence in demand’ for shopping centres boost ASX REITs?
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• Brokers name 4 ASX 200 dividend shares to buy
• Why is the Transurban share price lagging the market today?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 Transurban Group. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There’s nothing quite like the sound of passive income from S&P/ASX 200 Index (ASX: XJO) dividend stocks landing in your bank account to put a smile on your face.

Okay, there’s no sound.

But I’m sure you know what I mean!

Aussie investors are a bit spoiled for choice when it comes to passive income stocks, especially with many offering full franking credits.

But I want to drill down to just one glorious ASX dividend stock today.

Namely, ASX 200 miner Rio Tinto Ltd (ASX: RIO).

We’ll dig into the numbers in a tick. But first…

Trailing yields and future yields

Before we look at the passive income potential of Rio Tinto shares, bear in mind that the yields you generally see quoted are trailing yields. Future yields may be higher or lower depending on a range of company-specific and macroeconomic factors.

In the case of Rio Tinto, the dividend payouts have come down from the heady years of 2021 and 2022 when the iron ore price was rocketing to all-time highs.

However, the final dividend paid in April this year was up 20% on the final dividend paid in April 2023.

And with the iron ore price up 16% since 4 April, proving more resilient than many analysts have been forecasting, I believe the passive income outlook for Rio Tinto shares remains quite strong.

With that said…

Mining Rio Tinto for annual passive income

Atop offering a juicy yield, Rio Tinto has a track record of delivering two fully franked dividends a year for more than a decade.

As for the past year, the ASX 200 miner paid a fully franked interim dividend of $2.61 a share on 21 September.

And Rio Tinto gave passive income a pleasant surprise when it reported its full-year results on 21 February.

Although revenue slipped 3% from 2022 to US$54.04 billion, and underlying earnings before interest, taxes, depreciation and amortisation EBITDA declined 9% year on year to US$23.89 billion, management declared a fully franked final dividend of $3.93 a share.

All told then, this glorious ASX 200 dividend paid out a total of $6.54 a share in fully franked dividends over the past 12 months.

Or $1,962 in passive income from just 300 shares.

Rio Tinto share price snapshot

Atop that very handy passive income (which we’ve established makes no sound when you receive it), Rio Tinto shares also offer the potential for capital gains.

Over the past year, the Rio Tinto share price has increased more than 21.9%, closing on Friday at $132.20 a share.

The post Buy 300 shares in this glorious ASX 200 dividend stock and create almost $2,000 in passive income appeared first on The Motley Fool Australia.

More reading

• ASX 200 mining shares charging higher amid China’s $210 billion cash injection
• Buy Rio Tinto and these ASX 200 dividend shares
• What’s the outlook for ASX iron ore shares after the federal budget?
• How ASX growth shares can become top dividend stocks
• How to choose ASX shares for passive income

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.

It has been another busy week for Australia’s top brokers. This has led to the release of a number of broker notes.

Three broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

Aristocrat Leisure Limited (ASX: ALL)

According to a note out of Citi, its analysts have retained their buy rating and $51.00 price target on this gaming technology company’s shares. This followed the release of the poker machine manufacturer’s half year results last week. Citi notes that those results were well ahead of both the market’s and its own expectations thanks largely to lower than expected costs. A strong performance from its Rest of World segment also helped to offset a slightly softer than expected half in the United States. The broker also notes that the Aristocrat Leisure will consider selling its digital assets. It is supportive of the move, given how their growth has slowed. However, the price it receives for these assets will be key. The Aristocrat Leisure share price ended last week trading at $46.28.

CSL Ltd (ASX: CSL)

A note out of UBS reveals that its analysts have retained their buy rating and $330.00 price target on this biotherapeutics giant’s shares. UBS notes that the company’s collections partner, Terumo, has just released its latest quarterly update and it believes there are positives for CSL in there. This because Terumo’s update revealed that it has ramped up the rollout of CSL’s new Rika collection platform to more centres in the United States. So much so, Terumo’s Rika ramp up appears to be ahead of schedule, with the FY 2024 target already reached. This will be good news for CSL given the benefits of the very efficient new technology on plasma yields. The CSL share price was fetching $280.00 at Friday’s close.

Life360 Inc (ASX: 360)

Analysts at Morgan Stanley have retained their overweight rating on this location technology company’s shares with an improved price target of $17.50. This follows the release of the market darling’s recent quarterly update. Morgan Stanley highlights that Life360’s update, which was largely pre-released, revealed that its strong growth not only continued in the quarter but also at the start of the current quarter. This has led to the broker boosting its earnings estimates and valuation accordingly. The Life360 share price ended the week trading at $15.47.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

More reading

• Here’s how the ASX 200 market sectors stacked up last week
• Brokers name 3 ASX shares to buy now
• Buy, hold or sell these 3 ASX 200 healthcare shares: Experts
• Here are the top 10 ASX 200 shares today
• Why Aristocrat Leisure, Graincorp, Incitec Pivot, and Patriot Battery Metals shares are rising today

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in CSL and Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL and Life360. 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.

ASX consumer discretionary shares led the ASX 200 market sectors last week with a 3.23% gain over the five trading days.

Meantime, the S&P/ASX 200 Index (ASX: XJO) lifted 1.11% to finish the week at 7,814.4 points.

On Thursday, the ASX 200 went close to its all-time high set in April after the S&P 500 hit a new record on encouraging US inflation numbers that stoked hopes of an earlier rate cut.

The Dow Jones index also crossed the 40,000-point mark for the first time ever on Thursday.

Seven of the 11 market sectors finished the week in the green.

Let’s review the week.

Consumer discretionary shares led the ASX sectors last week

It’s interesting to see ASX consumer discretionary shares at the top despite the obvious challenges for the sector today.

Consumers are starting to reduce their spending more and more as pandemic savings run low, and many economists think interest rates won’t be cut until very late in the year, or they could even go up again.

The latest Westpac Consumer Sentiment data is bleak, with sentiment at persistently pessimistic levels for the past two years and “showing few signs of lifting”, according to senior economist Matthew Hassan.

Hassan commented:

Indeed, outside of the deep recession of the early 1990s, this is easily the second most protracted period of deep consumer pessimism since we began surveying in the mid-1970s, with all other sentiment slumps lasting nine months or less.

The latest retail figures from the Australian Bureau of Statistics revealed the “weakest growth on record” outside the pandemic and the introduction of the GST.

Turnover rose just 0.8% for the year to 31 March. This is despite massive population growth driven by high immigration. More than half a million migrants (net) moved here in FY23.

Despite all of this, consumer stocks won the week. Perhaps the cost-of-living measures announced in the Federal Budget on Tuesday prompted investors to buy discretionary stocks?

As my colleague Seb mused: “… more money in pockets from both the tax cuts and the energy rebates will probably disproportionately flow through to consumer discretionary shares.”

Let’s take a look at some of the best performers within the consumer discretionary sector this week.

Which discretionary retail stocks outperformed this week?

The most obvious one to highlight is Aristocrat Leisure Limited (ASX: ALL) shares.

The gaming technology company smashed it out of the park this week. The Aristocrat share price skyrocketed a whopping 17.5% to close at $46.28 on Friday.

The bulk of that gain occurred on Wednesday when the company released its half-year results.

Aristocrat reported a 16.8% jump in net profit after tax (NPAT) to $723.3 million. Other positives were the fully franked interim dividend of 36 cents per share, up 20%, and an extra $350 million in share buybacks.

Among the other discretionary heavyweights, Lottery Corporation Ltd (ASX: TLC) shares rose 1.27% over the five days to finish at $5.19 on Friday.

Harvey Norman Holdings Limited (ASX: HVN) shares gained 1.29% to close at $4.32 on Friday. JB Hi-Fi Ltd (ASX: JBH) shares rose 0.94% to finish at $57.15.

Among the small-cap discretionary stocks, Supply Network Ltd (ASC: SNL) moved 6.38% higher over the week to finish at $22.

By the way, if you’re interested in buying ASX retail shares, top broker Goldman Sachs has just released its latest buying recommendations and 12-month share price targets for each of its favourite retail stocks.

Its top pick is Super Retail Group Ltd (ASX: SUL), owner of Rebel and Supercheap Auto.

ASX 200 market sector snapshot

Here’s how the 11 market sectors stacked up last week, according to CommSec data.

Over the five trading days:

S&P/ASX 200 market sector	Change last week
Consumer Discretionary (ASX: XDJ)	3.23%
Materials (ASX: XMJ)	2.49%
Consumer Staples (ASX: XSJ)	1.42%
A-REIT (ASX: XPJ)	1.13%
Financials (ASX: XFJ)	0.63%
Healthcare (ASX: XHJ)	0.61%
Communication (ASX: XTJ)	0.17%
Utilities (ASX: XUJ)	(0.33%)
Information Technology (ASX: XIJ)	(0.77%)
Industrials (ASX: XNJ)	(1.82%)
Energy (ASX: XEJ)	(3.59%)

The post Here’s how the ASX 200 market sectors stacked up last week appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• Why this smashed ASX 200 share is a fundie’s top value pick
• Top ASX dividend shares to buy in May 2024
• Here are the top 10 ASX 200 shares today
• Brokers name 3 ASX shares to buy now

Motley Fool contributor Bronwyn Allen has positions in Harvey Norman. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Lottery. The Motley Fool Australia has positions in and has recommended Harvey Norman and Super Retail Group. The Motley Fool Australia has recommended Jb Hi-Fi. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Investors that are on the lookout for some big returns might want to check out these ASX 200 shares listed below.

That’s because analysts are tipping their shares to deliver returns of between 15% and 50% for investors over the next 12 months.

Here’s what you need to know about them:

GUD Holdings Limited (ASX: GUD)

Analysts at Morgans see plenty of value in this ASX 200 share at current levels.

GUD Holdings owns a portfolio of companies in the automotive aftermarket and accessories sector. Its brands hold market leadership positions in all categories in which they operate. These brands include Ryco Filters, Wesfil, Narva, Projecta, DBA, and Xtreme Clutch.

Morgans was pleased with the company’s recent investor update, noting that management is guiding to earnings growth in FY 2024 despite the tough economic environment.

As a result, it has put an add rating and $13.71 price target on its shares. This implies potential upside of 24% for investors over the next 12 months.

Karoon Energy Ltd (ASX: KAR)

Another ASX 200 share that could rise strongly from current levels according to Morgans is Karoon Energy. It is an international oil and gas exploration and production company with assets in Brazil.

Morgans likes the company due to its production growth potential, strong balance sheet, and attractive valuation. It also highlights “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.”

The broker currently has an add rating and $2.80 price target on its shares. This suggests that they could rise by a sizeable 52% between now and this time next year.

TechnologyOne Ltd (ASX: TNE)

Finally, Goldman Sachs thinks that TechnologyOne could be an ASX 200 share with the potential to generate big returns. It is an enterprise software company providing a global SaaS ERP solution that transforms business and makes life simple for users.

Goldman highlights that “despite TNE’s improving underlying growth and above-trend PBT outlook, the stock has de-rated from 25.5x to 23.5x NTM EV/EBITDA over the last 12 months while tech peers have re-rated.”

In light of this, the broker thinks now is the time for investors to pounce on its shares. Particularly given that its analysts “forecast a mid-to-high teens (~16%) FY23-26E PBT CAGR (vs low-to-mid teens historically) with potential upside on achievement of TNE’s 115% NRR target (vs ~110% GSe) or UK success.”

The broker has a buy rating and $18.10 price target on its shares. This implies approximately 15% upside for investors.

The post These ASX 200 shares could rise 15% to 50% appeared first on The Motley Fool Australia.

More reading

• 5 stellar ASX growth shares to buy for strong returns
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares today
• Why Credit Corp, GUD, Race Oncology, and Spartan Resources shares are rising
• Why this $1.5 billion ASX 200 stock just surged 10%

Motley Fool contributor James Mickleboro has positions in Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Technology One. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.