The BetaShares Australia 200 ETF (ASX: A200) is one of the cheapest exchange-traded funds (ETFs) that Aussies can choose.

Being the cheapest doesn’t necessarily mean being the best, but it should be one factor that investors consider when choosing Australian shares.

Investing is all about making investment returns, after all. Net returns are more important than gross returns because investment costs, like management fees, need to be factored in. If two funds achieve identical gross returns, then fees may be the deciding factor.  

How cheap is the A200 ETF annual management fee?

BetaShares, the provider of the A200 ETF, charges just 0.04% per year.

According to Bloomberg, this is the world’s lowest-cost Australian shares index ETF.

In comparison, The Vanguard Australian Shares Index ETF (ASX: VAS) has an annual management fee of 0.07%. There’s only a three basis point (0.03%) difference between the two, but the VAS ETF fee is close to double what A200 charges.

On the cost side of things, the A200 ETF wins.

What about the returns?

Past performance is not a guarantee of future performance, but I think it can be useful to compare the VAS and A200 ETFs. Their portfolios are similar, but they also have differences.

They both own many of the same businesses, though Betashares A200 has 200 holdings and VAS has 300 holdings. In other words, A200 focuses on the 200 biggest businesses that make up the S&P/ASX 200 Index (ASX: XJO), while VAS owns the next 100 businesses after that as well.

Over the past three years, the A200 ETF has delivered an average annual return of 7.5%, which is more than the VAS ETF’s return of 7.06%.

In the last five years, the VAS ETF has delivered an average annual return of 8%, compared to 8.2% for the A200 ETF.

A200’s larger allocations to the bigger 200 businesses have helped deliver outperformance, though that’s not guaranteed to continue. Sometimes, smaller businesses can deliver outperformance.

Is the A200 a buy?

I think the A200 ETF is worth owning for investors who want exposure to the broad Australian share market or specifically to the largest ASX blue chip shares, such as Commonwealth Bank of Australia (ASX: CBA) and BHP Group Ltd (ASX: BHP).

The A200 ETF has the lowest costs and provides exposure to similar names as the VAS ETF.

Australia’s biggest companies have the financial firepower to deliver scale benefits, which could be why they have outperformed. However, the global share market also delivers strong overall performance thanks to names like Nvidia and Microsoft, so I’d want to ensure I had exposure to those stocks, too.

The post Should you buy the cheapest ASX share ETF? appeared first on The Motley Fool Australia.

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• Does Vanguard Australian Shares Index ETF (VAS) pay fully franked dividends?

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.

Aussies understandably love property – it is a large and growing asset class. As such, ASX property shares could be a strong pick for retirement.

Residential property is an expensive investment, with significant transaction costs to buy ( such as stamp duty) and sell (including agent fees). Houses usually don’t come with an appealing net income yield either.

Commercial property could provide the right mix of passive income and growth in value. However, not every property sector is generating good growth, so I’d be selective about office or physical retail opportunities right now.

Industrial property is one of the most exciting areas, which is why I like the two investment ideas below.

Centuria Industrial REIT (ASX: CIP)

Centuria Industrial is a real estate investment trust (REIT), which is a business that owns a portfolio of properties. It is the largest domestic pure-play industrial option, with high-quality assets situated in important urban locations throughout Australia.

The ASX property share is benefiting from its exposure to land-constrained ‘last mile’ locations, which, according to the business, is delivering “robust” rental growth. Tailwinds for industrial property include the continued adoption of e-commerce by Australians and the onshoring of supply chains by companies.

In the first nine months of FY24, the business achieved re-leasing spreads of approximately 50%. In other words, its properties are seeing huge increases in rental income when new leases are signed.

The REIT expects to pay a distribution per unit of 16 cents for FY24, which translates into a distribution yield of 5%.

Brickworks Limited (ASX: BKW)

Brickworks offers multiple ways to get exposure to Australian property, including an investments division that owns approximately a quarter of Washington H. Soul Pattinson and Co. Ltd (ASX: SOL). But I’m going to focus on the property aspects today.

Brickworks produces various building materials, including bricks, paving, masonry, stone, roofing, specialised building systems, cement, and timber battens.

While it doesn’t own residential property, the building materials division allows retired investors to gain exposure to the growing demand for Australian property due to population growth.

Furthermore, Brickworks owns various commercial property assets, including a 50% stake in an industrial property trust. This trust is building huge warehouses on excess land that the ASX property share previously owned.

The completed warehouses are increasing the value of the real estate and unlocking significant rental cash flow for Brickworks.

It currently has a grossed-up dividend yield of 3.5% and hasn’t cut its dividend for almost 50 years. Although future dividends aren’t guaranteed, this could be appealing for investors in retirement.

The post 2 cheap ASX property shares I’d buy in retirement appeared first on The Motley Fool Australia.

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• Top ASX shares to buy in June and hold for retirement
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• Why this broker just upgraded Brickworks shares to a buy rating

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

The S&P/ASX 200 Index (ASX: XJO) offers a range of attractive passive income stocks that could help boost your retirement outlook.

In building a retirement income portfolio, I’d aim to invest in around 10 ASX dividend shares, with a preference for companies offering franking credits. Those credits should enable me to hold onto more of that passive income when it comes time to pay the ATO its annual dues.

I’d also be sure to buy a diversified mix of ASX 200 stocks operating in various sectors and, ideally, different geographic locations. That will help lower the overall risk to my portfolio.

Below, I look at two top companies I’d buy now in hopes of a wealthier retirement.

Both ASX 200 stocks have long track records of paying out two dividends a year. While their dividend payouts have declined recently, so too have their share prices. That leaves them trading at attractive trailing yields.

And I believe that following the 2024 sell-down, the shares in both companies are now trading at levels that will continue to see them offer market-beating passive income over the longer term.

With that said…

Two ASX 200 passive income stocks to sweeten my retirement

The first company I’d tap to help boost my retirement is ASX 200 funds manager Magellan Financial Group Ltd (ASX: MFG).

The Magellan share price is down by around 10% so far in 2024, having come under selling pressure amid fund outflows in April and May.

While it may be too early to call a bottom, the Magellan share price has orchestrated a solid turnaround in June. Shares closed at $8.46 apiece yesterday, putting the financial stock up 3.55% for the month so far.

I think that should represent an attractive longer-term entry point for passive income investors.

On that front, Magellan paid a final dividend of 69.8 cents a share, franked at 85%, on 7 September. The interim dividend of 29.4 cents a share, franked at 50%, was delivered on 6 March.

That equates to a full-year payout of 99.2 cents a share.

At yesterday’s closing price, Magellan shares trade on a partly franked trailing yield of 11.7%.

This brings us to the second ASX 200 passive income stock I’d buy now to boost my retirement prospects, mining giant Fortescue Ltd (ASX: FMG).

Excepting the bumper year of 2021, Fortescue’s past two dividends remain near historic highs.

And with the Fortescue share price down 19.7% in 2024, closing yesterday at $23.60 a share, I think the big Aussie miner is also now trading at an attractive long-term level.

As for that retirement-lifting passive income, Fortescue paid a fully franked final dividend of $1.00 a share on 28 September. The ASX 200 miner paid its interim dividend of $1.08 a share on 27 March.

That works out to a full-year payout of $2.08 a share.

At yesterday’s closing price, this sees Fortescue shares trading on a fully franked trailing yield of 8.8%.

If I were to invest an equal amount in each company, I’d be eyeing a trailing yield of 10.3%.

Or enough to produce $2,060 in annual passive income from a $20,000 investment portfolio.

The post 2 top ASX 200 passive income stocks I’d buy now to boost my retirement appeared first on The Motley Fool Australia.

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• Here’s the iron ore price forecast through to 2027
• If I buy 1,000 Fortescue shares, how much passive income will I receive?
• How to earn $1,900 in passive income with just $10,000 in savings
• Fortescue shares rally amid claims of green tech theft
• Should you buy the 3 highest-yielding dividend shares in the ASX 200?

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.

Income investors are a lucky bunch! The Australian share market is home to a large number of stocks that pay dividends every six months.

But which ASX income stocks could be in the buy zone for investors? Let’s take a look at a few that are forecast to have big dividend yields.

Healthco Healthcare and Wellness REIT (ASX: HCW)

Bell Potter thinks that this healthcare and wellness focused property company could be an ASX income stock to buy. It has previously highlighted its “significant scope for growth with an estimated $218 billion addressable market where an ageing and growing population should underpin long-term sector demand.”

As for income, the broker is forecasting dividends per share of 8 cents in FY 2024 and 8.3 cents in FY 2025. Based on its current share price of $1.13, this equates to yields of 7% and 7.3%, respectively.

Bell Potter has a buy rating and $1.50 price target on its shares.

Rural Funds Group (ASX: RFF)

Bell Potter also thinks that Rural Funds could be an ASX income stock to buy. It is an agricultural property company that leases almond orchards, macadamia orchards, poultry property and infrastructure, vineyards, cattle properties, cropping properties, cattle and water rights.

The broker believes these assets will generate enough cash flow to pay dividends per share of 11.7 cents in both FY 2024 and FY 2025. Based on the current Rural Funds share price of $2.02, this will mean yields of 5.8% in both years for investors.

Bell Potter has a buy rating and $2.40 price target on its shares.

Stockland Corporation Ltd (ASX: SGP)

A third ASX income stock that could be a buy is Stockland. It is Australia’s largest community creator.

Citi is positive on the company and expects some attractive dividend yields from its shares. It is forecasting dividends per share of 26.2 cents in FY 2024 and 26.6 cents in FY 2025. Based on the current Stockland share price of $4.47, this will mean yields of 5.9% and 6% yields, respectively.

The broker has a buy rating and $5.10 price target on its shares.

Suncorp Group Ltd (ASX: SUN)

Finally, Goldman Sachs thinks that insurance giant Suncorp could be an ASX income stock to buy right now. This is largely due to “the tailwinds that exist in the general insurance market.”

The broker expects this to support the payment of fully franked dividends per share of 78 cents in FY 2024 and 83 cents in FY 2025. Based on the Suncorp share price of $16.46, this will mean yields of 4.7% and 5%, respectively.

Goldman has a buy rating and $17.54 price target on its shares.

The post 4 ASX income stocks with big dividend yields to buy now appeared first on The Motley Fool Australia.

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

Investing is all about delivering positive results over the longer term, and ASX growth shares can produce strong returns due to their rise in underlying value and earnings compounding.

In five years from now, investors want their portfolios to be worth substantially more than they are today. Here are two ASX growth shares that I believe can produce excellent returns in the coming years.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is a leading online retailer of homewares, furniture and home improvement products.

The Temple & Webster share price has fallen by around 25% since 27 March 2024, as shown in the chart below. However, its ongoing business progress indicates that this is a much more compelling time to buy than a few months ago.

At a time when many Aussie households are struggling amid a high cost of living and elevated interest rates, the business has been growing its market share.

In a recent trading update, Temple & Webster revealed total sales were up 30% from 1 January 2024 to 5 May 2024. The company said the overall furniture and homewares market was down 4% in the half-year to date.

Products exclusive to Temple & Webster are now generating more than 40% of revenue which helps entrench its market position. Its trade and commercial and home improvement segments have both seen growth of over 30% in the half to date.

The ASX growth share has also been tapping into AI to improve efficiencies and margins. AI has helped boost the conversion rate by more than 10% and is now handling around 40% of all customer interactions.

As Temple & Webster grows, I think it can achieve greater profit margins, particularly as its fixed costs as a percentage of revenue reduce. I’m excited by the company’s ongoing expansion into other areas, such as home improvement, because that’s a big market category (including paint, plumbing fixtures, flooring, window furnishings and so on).

I’m a shareholder today in this ASX growth share because I believe in the company’s long-term future.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This exchange-traded fund (ETF) focuses on some of the leading businesses in the United States, and I think it has the potential to deliver good returns.

While many companies are listed in the US, their underlying earnings usually come from around the world. This gives the VanEck Morningstar Wide Moat ETF more geographic diversification than it appears.

For this portfolio, Morningstar analysts only choose stocks whose share prices they believe are trading at an attractive level compared to their fair value. In other words, they rate a business as being materially undervalued.

In addition, the MOAT ETF only includes businesses that Morningstar believes have economic moats that are almost certainly going to endure for the next decade and, more likely than not, persist for the next two decades.

I’m calling it an ASX growth share because of its ability to deliver strong returns. From the ETF’s start date to 31 May 2024, it has delivered an average annual return of 15.3%, though past performance is not indicative of future returns.

The post Looking for ASX growth shares? I rate these 2 as buys appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster Group 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.

With a population of just around 26 million, Australia boasts a surprising number of companies making big waves on the global stage.

In this article, I’ll explore the success stories of two Australian companies that have surpassed expectations in their respective niches.

These companies not only command significant market share but also showcase remarkable innovation and resilience in competitive environments.

From ground-breaking technologies to rock-solid business models, they’ve proven themselves as top performers, presenting investors with enticing opportunities for long-term growth.

Join me as I delve into the journeys of two ASX-listed companies that have firmly cemented their positions as industry leaders.

Audinate Group Ltd (ASX: AD8)

Audinate is an Australian technology company, specialising in digital audio networking solutions, also known as audiovisual (AV) technology. Founded in 2006, Audinate has become a global leader in the industry with its innovative ‘Dante’ networking technology.

Dante technology revolutionises the way audio is transmitted and managed in various applications, including live sound, broadcast, education, and commercial uses. Dante replaces old-school analogue cable AV connections with a digital computer network.

The company operates in 13 countries, including Australia, the US, the UK, and Japan.

In the audio devices market, there are currently over 4,000 Dante-enabled products from more than 600 manufacturers, being used in 5 million devices worldwide. On the video side, more than 50 manufacturers have licensed Dante AV, with over 75 products available on the market.

The company reported a strong 1H FY24 report, with revenues soaring approximately 48% to US$30.4 million. Its net profit after tax improved to US$4.7 million in 1H FY24 after recording a net loss of US$0.4 million in 1H FY23.

The Audinate share price continued to strengthen for about a month after the half-year results. However, from there, it has dropped by around 29% to $16.49 as of today.

A number of brokers hold bullish views on Audinate shares. Morgan Stanley maintains its overweight rating and $22.00 price target, while UBS has a buy rating and a $22.80 price target for Audinate shares.

Pro Medicus Ltd (ASX: PME)

Regarding international triumphs, another standout is Pro Medicus, an Australian med-tech company, making waves worldwide, particularly in the US market.

Established in 1983, Pro Medicus has grown to become a key player in the global healthcare sector. It provides cutting-edge software platforms that streamline medical imaging processes and improve patient care.

Pro Medicus’ flagship product, Visage Imaging, helps medical professionals improve the efficiency and accuracy of medical imaging interpretation. By leveraging cloud-based technology and artificial intelligence (AI), Pro Medicus continues to set new standards in medical imaging.

The company is doing very well, adding new contracts every month, but the story might get even better with its AI angle according to Goldman Sachs. As my colleague James covered, the analyst highlighted in a recent report:

PME is generating revenue from its Visage breast density AI algorithm (developed via a partnership with Yale) today, and we see the potential value for AI to be significant with adoption driven by improved accuracy and clinical outcomes. We forecast AI to comprise 9% of PME’s revenue by FY30E (from <1% in FY25E), with upside if PME achieves faster AI attach penetration, higher price per scan, and a greater proportion of algorithms developed in-house where no royalties are paid to a partner.

High quality often comes with an expensive price tag. At the time of writing, Pro Medicus shares are trading close to all-time highs at $128.06.

Foolish takeaway

Here I’ve reviewed two ASX companies excelling in their respective niches. With innovative technologies, they could offer enticing opportunities for long-term growth, in my opinion.

The post 2 ASX companies dominating their niches appeared first on The Motley Fool Australia.

More reading

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• Here are the top 10 ASX 200 shares today

Motley Fool contributor Kate Lee 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 Audinate Group and Pro Medicus. The Motley Fool Australia has positions in and has recommended Audinate Group. The Motley Fool Australia has recommended Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Are you on the lookout for ASX shares with the potential to rise strongly over the next 12 months and generate big returns for your portfolio? If you are, then read on.

That’s because the two ASX shares in this article have been named as buys by analysts and tipped to rise very strongly from current levels.

Let’s see what they are saying about these shares and just how big the returns could be if you buy at current levels.

Karoon Energy Ltd (ASX: KAR)

Morgans thinks that this ASX energy share could be undervalued by the market.

The broker currently has an add rating and $2.80 price target on its shares. This suggests that its shares could rise by a massive 66% over the next 12 months.

Its analysts think investors should be investing due to Karoon Energy’s growth plans and the potential for rising oil prices. It said:

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.

Universal Store Holdings Ltd (ASX: UNI)

The team at Bell Potter sees significant value in this ASX youth fashion retailer’s shares. The broker currently a buy rating and $6.15 price target on them. This implies potential upside of almost 23% for investors over the next 12 months. In addition, it is forecasting a fully franked 6%+ dividend yield from its shares in FY 2025.

Bell Potter likes the company due to its positive growth outlook, which is being underpinned by its store rollout and private label sales. It commented:

Management execution remains a key strength for UNI and we see good growth trajectory for the name given the building of core brands while growing its store rollout. In our view, the higher margin sales from the majority of private label sales should become a major driver of margin improvement and earnings growth, in an expanded store footprint. While we remain cautious on the overall consumer sentiment, given the return to positive comps while cycling elevated pcp through Jan-Feb, we think UNI is well placed as comps become supportive through the 2H.

The post These ASX shares could rise 25% to 65% appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Universal Store. 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.

In a volatile market, arguably cash is king.

Companies with strong cash reserves not only have the flexibility to weather economic downturns but also the ability to seize growth opportunities when they arise.

For retail investors, identifying cash-rich companies can potentially provide a safer and more rewarding investment path.

In this article, I will spotlight two ASX shares with robust cash positions, which I think are attractive investments for those looking to add both stability and growth potential to their portfolios.

There are many ways to measure the strength of a company’s cash position. However, here, I will mainly use the companies’ reported net cash balance as a percentage of their market capitalisations as my guide.

Before jumping in, it’s worth noting that this is my initial screening only and you should always do your own research or consult a financial advisor before making investment decisions.

With that said, here are two ASX shares I like based on their cash holdings relative to their market caps.

A2 Milk Company (ASX: A2M)

First up is A2 Milk Company. It is encouraging to see A2 Milk Company significantly recovering from its downturn in terms of its share price. The New Zealand infant formula business has managed to stage a substantial comeback from the hardships caused by the decline in its daigou market.

Daigou is the term used to describe individuals engaging in cross-border exporting. Many Chinese students in Australia sell premium Australian products back to China, including A2 Milk’s formula, but this market was severely impacted by the reduction of international students in Australia during the pandemic.

As the share price chart below illustrates, the A2 Milk share price declined from a high of approximately $20 in July 2020 to a low of around $4 in May 2022. Then, from there, the share price has recovered by around 28% to over $7 today. While this is a remarkable recovery from the bottom price, the share price still remains at below half its peak price.

According to its FY24 half-year result, the company has gained a “significant” market share in the Chinese label infant formula over the prior few years, which supported its revenue and earnings before interest, tax, depreciation and amortisation (EBITDA) growth.

A2 Milk has cash and short-term investments of NZ$792 million and a small debt position of NZ$57 million, including lease liabilities as of 31 December 2023. Its net cash balance of NZ$735 million accounts for approximately 13% of its current market capitalisation.

GR Engineering Services Ltd (ASX: GNG)

GR Engineering is a small Australian engineering and consulting firm that provides services to the mining and mineral processing industries.

The company specialises in designing, building, and managing mining projects, ensuring they run smoothly and efficiently. Known for its expertise and reliability, GR Engineering helps bring mining projects to life both in Australia and around the world.

GR Engineering shares have hovered around $1.80 to $2.40 per share since 2022 after surging from less than $1 in June 2019.

In February 2024, the mining services company had a total cash and short-term investments balance of $58 million. Thanks to its asset-light business model, GR Engineering doesn’t hold much debt. Adjusting for that, the company had a net cash position of $48 million, equivalent to 13% of its current market capitalisation.

Recently, however, management cut its revenue guidance. It now expects FY2024 revenue in the range of $415 million to $430 million, down from its previous guidance of between $500 million and $530 million. While this is disappointing, the good news is that the company still expects its EBITDA to be between $50 million and $51 million, which indicates year-over-year growth in profit.

Foolish takeaway

A company’s cash holding can be one factor to consider when looking for safety and potential returns. Here, I’ve reviewed two ASX-listed companies with strong cash reserves, which could help them to deliver stable growth through the thick and thin of business cycles.

The post 2 cash-rich ASX companies to buy now appeared first on The Motley Fool Australia.

More reading

• Here is the earnings forecast out to 2026 for A2 Milk shares
• My ASX share portfolio has two giant weeds in it. Should I pull them out?
• How ASX shares vs. property performed in May
• Why BHP, GR Engineering, Novonix, and Pointerra shares are dropping today
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Kate Lee 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 recommended A2 Milk and Gr Engineering Services. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.