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

Nvidia‘s (NASDAQ: NVDA) stock jumped 9% to a new all-time high on May 23, after the company posted its latest earnings report. In the first quarter of fiscal 2025, which ended on April 28, the chipmaker’s revenue surged 262% year over year to $26.0 billion and exceeded analysts’ estimates by $1.5 billion. Its adjusted earnings surged 461% to $6.12 per share and also cleared the consensus forecast by $0.54.

Those growth rates were explosive, but does Nvidia’s stock still have room to run after rallying about 2,720% over the past five years? Let’s review the four reasons to buy Nvidia’s stock — as well as the four reasons to sell it — to decide.

The key numbers

Back in fiscal 2023, which ended in January of that year, Nvidia’s revenue flatlined as its adjusted EPS fell 25%. Its sales of gaming GPUs cooled off as PC shipments declined in a post-pandemic market, and the macro headwinds curbed its sales of data center chips. But in fiscal 2024, its revenue and adjusted EPS surged 126% and 288%, respectively.

That abrupt acceleration was driven by the rapid expansion of the artificial intelligence (AI) market. Nvidia’s data center GPUs are used to process complex AI tasks, and the market’s demand for those chips quickly outstripped its available supply. Nvidia generated 87% of its revenue from its data center chips in the first quarter of fiscal 2025.

Nvidia also announced a 10-for-1 stock split that will take effect on June 7. The split won’t alter Nvidia’s valuations, but it might attract some interest from smaller retail investors while boosting the stock’s liquidity through more options trading.

The four reasons to buy Nvidia

The bulls still love Nvidia for four reasons. First, they believe it will continue to dominate the AI market with its data center GPUs. The global AI market could still expand at a compound annual growth rate (CAGR) of 37% from 2023 to 2030, according to Markets and Markets, and Nvidia could be the simplest way to profit from that secular boom.

Second, its first mover’s advantage in the AI space gives it tremendous pricing power. Its top-tier H100 GPUs cost more than $40,000, and it can keep raising those prices to boost its gross margin. Third, Nvidia’s gaming business, 10% of its first-quarter revenue, is gradually recovering as the PC market stabilizes.

Lastly, Nvidia’s stock still looks reasonably valued relative to its growth potential. From fiscal 2024 to fiscal 2027, analysts expect its revenue to grow at a CAGR of 43% as its EPS increases at a CAGR of 49%.

Based on those estimates, Nvidia’s stock trades at just 41 times forward earnings. Advanced Micro Devices (AMD -3.77%), which is growing at a much slower rate and has less exposure to the AI market, trades at 46 times forward earnings.

The four reasons to sell Nvidia

Meanwhile, the bears are skeptical about Nvidia for four reasons. First, they believe Nvidia will lose its first mover’s advantage in the data center GPU market as more competitors carve up the market. AMD’s new Instinct data center GPUs already cost less than Nvidia’s top-tier GPUs, and tech giants such as Microsoft, Alphabet‘s Google, and Meta Platforms have all been developing their own in-house AI chips to reduce their long-term dependence on Nvidia.

Second, U.S. regulators recently barred Nvidia from shipping its top-tier AI GPUs to China. That pressure could drive Chinese chipmakers to accelerate their development of comparable AI accelerators. If those efforts are successful, Chinese companies could eventually flood the global market with cheaper AI chips and crush Nvidia’s gross margins.

Third, Nvidia’s insiders sold about twice as many shares as they bought over the past 12 months. That cooling insider sentiment suggests that Nvidia could be running out of room to run as the market hovers near its all-time highs. Last but not least, the recent buying frenzy in AI chips could eventually lead to a supply glut if the market finally cools off.

The strengths still outweigh the weaknesses

Nvidia faces some long-term challenges, but I believe its strengths still clearly outweigh its weaknesses. Its business is still firing on all cylinders, its margin is expanding, and its stock still looks reasonably valued. Therefore, it’s not too late to accumulate more shares of Nvidia if you believe the AI market will continue flourishing over the next few decades.

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

The post Nvidia stock: 4 reasons to buy, 4 reasons to sell appeared first on The Motley Fool Australia.

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 Leo Sun has positions in Meta Platforms. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Advanced Micro Devices, Alphabet, Meta Platforms, Microsoft, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Alphabet, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Do you have room for some new additions to your income portfolio in June?

If you do, then it could be worth checking out the highly rated ASX dividend stocks listed below that analysts rate as buys. Here’s what you need to know about them:

Dexus Industria REIT (ASX: DXI)

The first ASX dividend stock that could be a top buy in June is Dexus Industria. It is a real estate investment trust with a portfolio of high quality industrial warehouses located across capital cities such as Sydney, Melbourne, and Adelaide.

Morgans currently has the company on its best ideas list with an add rating and $3.18 price target. It commented:

The portfolio is valued at $1.6bn across +90 properties with 89% of the portfolio weighted towards industrial assets (WACR 5.38%). The portfolio’s WALE is around 6 years and occupancy 97.5%. Across the portfolio 50% of leases are linked to CPI with the balance on fixed increases between 3-3.5%. While we expect cap rates to expand further in the near term, DXI’s industrial portfolio remains robust with the outlook positive for rental growth. The development pipeline also provides near and medium-term upside potential and post asset sales there is balance sheet capacity to execute.

As for income, Morgans expects the company to pay dividends per share of 16.4 cents in FY 2024 and then 16.6 cents in FY 2025. Based on the current Dexus Industria share price of $2.93, this will mean dividend yields of 5.6% and 5.65%, respectively.

Rural Funds Group (ASX: RFF)

Another ASX dividend stock that is highly rated is Rural Funds. It is an agricultural REIT with a diversified farmland portfolio across five core sectors. Its properties, which are focused on almond orchards, vineyards, cattle, cotton and macadamias, are predominantly leased to corporate agricultural operators on long leases.

Bell Potter thinks income investors should be buying the company’s shares and has named it on its Australian equities panel this month with a buy rating and $2.40 price target. It commented:

RFF trades at a historical high discount to its market NAV per unit ($2.78 pu) at ~28%. While we are in general seeing large discounts to NAV in ASX listed farming and water assets to market NAV, the discount that RFF is trading appears excessive and we are seeing a value opportunity in RFF. While the timing of that value discount closing is difficult to call, investors are likely to be rewarded with a ~6% yield to hold the position until such a time as the asset class rerates. Furthermore, RFF aims to achieve income growth through productivity improvements, conversion of assets to higher and better use along with rental indexation which is built into all of its contracts with its tenants.

The broker expects Rural Funds to pay dividends per share of 11.7 cents in both FY 2024 and FY 2025. Based on its current share price of $2.01, this would mean dividend yields of 5.8%.

The post 2 of the best ASX dividend stocks for income investors to buy in June appeared first on The Motley Fool Australia.

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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 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.

Life360 Inc (ASX: 360) shares have been soaring over the last couple of years.

Thanks to its explosive revenue and earnings growth, the ASX tech stock has risen approximately 300% since this time in 2022.

This means that if you had been lucky enough to have invested $10,000 into the location technology company’s shares two years ago, your investment would have grown to be worth $40,000 today.

But if you thought this ASX stock was now peaking, think again. That’s the view of analysts at Bell Potter, which believe Life360 shares can keep rising from current levels.

What is the broker saying about this high-flying ASX stock?

According to a recent note, the broker has responded to Life360’s first quarter update by reiterating its buy rating with a price target of $17.75.

Based on its current share price of $14.80, this implies potential upside of 20% for this ASX stock over the next 12 months. If this proves accurate, it would turn a $10,000 investment into approximately $12,000.

Bell Potter likes Life360 due to the resilience of its business and potential to continue growing strongly in the future. It said:

Life360 has c.1.9m paying circles – the best measure of subscriber numbers – and managed to grow this base by 39% in 2021, 23% in 2022 and 21% in 2023 despite the disruptions associated with COVID-19. This growth shows resilience in the subscriber base and, furthermore, the potential for continued strong growth in the base with market conditions now back to normal.

In addition, the broker highlights that the ASX stock has the potential to enter and disrupt other markets. It adds:

Life360 has the potential to leverage its large and growing user base to enter new markets and disrupt the legacy incumbents. An example is roadside assistance where Life360 launched a subscription-based product called Driver Protect which disrupted the market and helped enable monetisation of its user base. Other markets Life360 could potentially enter include insurance, item & pet tracking, senior monitoring, home security and/or identity theft.

Potential re-rating

In light of the above and given the valuation of a peer, the broker believes that this ASX stock deserves to trade on higher multiples. Particularly given its plan to list on Wall Street in the near future. It concludes:

We have increased the multiple we apply in the EV/Revenue valuation from 5.5x to 6.5x given the proposed US listing and potential re-rating of the stock given the higher multiples of comps like Reddit (NYSE: RDDT). There is, however, no change in the 9.3% WACC we apply in the DCF. The net result is a 9% increase in our PT to $17.75 which is >15% premium to the share price so we maintain our BUY recommendation. Key potential catalysts for the stock include another strong quarter of paying circle growth in Q2 (April was another good month), a potential upgrade to the 2024 guidance sometime in H2 and a US listing at some stage in the next 12 months.

The post Check out this soaring ASX stock, up 300% in 2 years, with more gains likely to come appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360. 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.

Coles Group Ltd (ASX: COL) shares have been a popular option for income investors since landing on the ASX boards in 2018 following a divestment by Wesfarmers Ltd (ASX: WES).

It isn’t hard to see why the supermarket giant features in countless income portfolios and superannuation funds across the country.

Given the nature of its business, Coles has defensive earnings. This means that its earnings are resilient and often grow even in the toughest economic environments.

For example, the Coles dividend was one of only a handful that continued to grow during the COVID pandemic.

It has continued to grow since then, with the Coles board declaring a 66 cents per share fully franked dividend in FY 2023.

This represents an 80% payout ratio, which was in line with its dividend policy of paying out 80% to 90% of earnings. Management notes that this policy allows Coles to reward its shareholders while also enabling it to retain strategic flexibility.

But that dividend has been paid now. So, what’s next for the Coles dividend? Let’s see what analysts are forecasting for the supermarket giant.

Coles dividend forecast

Interestingly, analysts actually expect the Coles dividend to be lower year on year in FY 2024 for the first time since its listing.

For example, Goldman Sachs is forecasting a fully franked dividend of 65 cents per share for the financial year.

Based on the current Coles share price of $16.07, this will mean a 4% dividend yield for investors.

Goldman then expects another dividend cut to 64 cents per share in FY 2025 due to softening profit margins. This would mean a dividend yield of just under 4% for investors that year.

The good news is that the broker believes that a return to growth will take place in FY 2026 thanks to a rebound in its profit margins.

Goldman is expecting the Coles dividend to come in at a fully franked 72 cents per share. This represents a 12.5% increase year on year and equates to an attractive 4.5% dividend yield.

Should you buy Coles shares?

Goldman is currently sitting on the fence when it comes to Coles shares.

The broker recently upgraded the retailer’s shares to a neutral rating with a $16.30 price target. This is a touch higher than where they trade today.

The broker feels that the Coles share price is fairly valued at current levels. It said:

In our opinion, whilst COL has under-invested in its digital transformation and omni-channel strategy, we believe 1) COL has made encouraging steps to address under-investment with key Witron facilities now operating 2) whilst Ocado facilties have been delayed, risks of further delay are more limited. We expect COL to report lower comps sales and EBIT margin growth in FY25/26 vs key competitor WOW, though execution under new CEO has been increasingly positive. COL is trading below long term 12m forward P/E but with double running cost associated with Witron/Ocado facilities alongside existing infrastructure, we believe this is fair value. We are Neutral rated on COL.

The post Here’s the Coles dividend forecast through to 2026 appeared first on The Motley Fool Australia.

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

If we invest in the right places, we can unlock a high level of future income. Hence, I’m a fan of buying cheap ASX dividend shares with solid yields.

When a business’ share price trades at a lower level than its underlying net asset value (NAV), it can mean the dividend yield is appealing because the market may be undervaluing the cash flow the businesses are distributing to shareholders.

In a world where interest rates are still very high, I’d want to see the stocks I’m investing in for passive future income have a good dividend yield. With that in mind, below are two that tick my investment boxes.

Centuria Industrial REIT (ASX: CIP)

This is a real estate investment trust (REIT) that’s invested in an exciting area of the commercial property market: industrial property.

According to Centuria, businesses are reportedly expanding their supply chains and capabilities in Australia following the disruptions since the onset of COVID-19. That requires large warehouses, which the REIT provides.

The ASX dividend share is seeing enormous organic revenue growth. In the three months to 31 March 2024, the business reported positive re-leasing spreads of 50% in the year to date. In other words, for its newly signed contracts, the business is receiving 50% more rent for the same properties than it was before on the previous contract.

That level of rental growth isn’t guaranteed to continue forever, but it shows the high demand for this type of property in Australia’s cities.

At 31 December 2023, the business had a NAV per unit of $3.89, which means the current share price is at a discount of around 20% to the NTA. I think that makes it a cheap ASX dividend share.

It expects to pay a distribution of 16 cents per unit in FY24, which would be a distribution yield of approximately 5%.

Bailador Technology Investments Ltd (ASX: BTI)

Bailador is a technology company that aims to invest in some of the most promising private software and technology businesses.

The technology investment business usually invests in businesses that are run by the founders, have a proven business model with attractive unit economics, and generate international revenue as well as repeat revenue.

Bailador aims to pay a dividend yield equivalent to 4% of its pre-tax NTA. This translates to a targeted yield of 5.7%, grossed-up for franking credits.

The business is at a 34% discount to its pre-tax NTA, it looks like a very cheap ASX dividend share to me. That means the actual cash yield, based on the April 2024 pre-tax NTA, could be 6% with a grossed-up dividend yield of 8.6% due to that large NTA discount.

Bailador recently expanded its portfolio and announced a $20 million investment in Venture Startups International, which operates Updoc, a digital healthcare platform that connects consumers who need medical services with registered health practitioners via a telehealth offering. It offers advice, online prescriptions, specialist referrals, pathology referrals and medical letters.

Since its inception, Updoc has served over 200,000 consumers, so it has a sizeable scale. Updoc will use the $20 million to accelerate the development of its products and support continued expansion.

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

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Motley Fool contributor Tristan Harrison has positions in Bailador Technology Investments. 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 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.

Much to the relief of its shareholders, Sayona Mining Ltd (ASX: SYA) shares have been on fire in recent weeks.

So much so, the lithium miner’s shares have risen 43% since this time last month.

To put that into context, a $10,000 investment at the end of April would now be worth over $14,000.

Why are Sayona Mining shares racing higher this month?

There may be a couple of reasons for this strong gain.

The first could be some investors believing that the ASX lithium stock has been oversold over the last 12 months.

For example, even after rising 43% over the last 30 days, Sayona Mining shares are down almost 80% since the end of May 2023.

What else?

In addition, there have been a couple of positive announcements out of the company this month that have got investors excited.

The first was the announcement of the discovery and expansion of new mineralised zones at Sayona Mining’s North American Lithium (NAL) operation in Canada.

Management notes that the newly discovered zones are poised to become a focal point for NAL’s assessment of future mining options.

Initial assessments indicate the presence of high-grade lithium mineralisation outside the mineral resources estimate (MRE) pit shell. The company believes this could represent a substantial addition to NAL’s resource portfolio and may contribute to extending NAL’s life of mine.

Sayona’s interim CEO, James Brown, commented:

We are very excited by these new discoveries at North American Lithium which highlights the potential of this asset with high-grade mineralisation defined to the north-west, north-east, south-east and below the existing MRE. The team at NAL will now be working to update the Mineral Resource incorporating these significant results. We look forward to continue testing the mineralisation at NAL with further drilling underway.

Moblan update

Another announcement that may have caught the eye of investors relates to the company’s Moblan Lithium Project, which is also in Canada.

Earlier this week, the company announced the results of 94 new drillholes. Management believes the results reinforce the project’s status as the centrepiece of Sayona’s Eeyou-Istchee James Bay hub in northern Quebec. In addition, management feels the results highlight its potential to expand the existing mineral resource base at Moblan.

Brown commented:

We are delighted with the thick, high-grade drilling results at Moblan confirming it is one of the premier hard rock lithium deposits in North America. Most excitingly, it is clear there remains considerable potential for further expansion of the deposit which is open in all direction.

Moblan forms the centrepiece of our James Bay lithium hub and has an extremely bright future supplying Quebec-produced lithium derivatives into the expanding North American battery and EV sector.

All in all, it has been a great month for Sayona Mining shares and its shareholders. Here’s hoping the company can build on this in June and beyond.

The post Why are Sayona Mining shares up 43% in a month? appeared first on The Motley Fool Australia.

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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.