BHP Group Ltd (ASX: BHP) shares will be on watch next week.

That’s because the mining giant will be releasing its hotly anticipated quarterly update.

Ahead of the release on Thursday 18 April, let’s take a look at what the market is expecting from the Big Australian.

What is expected from BHP?

According to a note out of Goldman Sachs, it is expecting BHP to have a reasonably solid quarter.

For example, copper production is expected to come in at 457kt for the three months. This is up 4.1% on the previous quarter and 12.5% year on year. It is also largely in line with the consensus estimate of 459kt.

Also expected to increase quarter on quarter is metallurgical coal production. Goldman expects BHP to report production of 7.3Mt for the three months. This would mean an increase of 27% on the previous quarter and 5.8% on the same period last year. Goldman’s estimate is also ahead of the consensus estimate of 6.8Mt.

For nickel, the broker is forecasting production of 17.6kt for the period. This will be down 10.2% on both the prior corresponding period and year on year. It is also well short of the consensus estimate. That is 19.8Mt, which implies modest growth on previous periods.

Finally, let’s now take a look at iron ore, which is of course the biggest contributor to BHP’s earnings.

Unfortunately, Goldman believes that the miner’s iron ore shipments will be short of expectations for the quarter. It has pencilled in shipments of 66.8Mt for the three months, which is down 5% from the previous quarter and largely flat year on year. The consensus estimate for iron ore shipments is 70.2Mt.

Are BHP shares in the buy zone?

Interestingly, despite predicting below consensus iron ore shipments and nickel production, Goldman Sachs is one of the more bullish brokers out there.

Its analysts currently have a buy rating and $49.20 price target on BHP’s shares. This implies potential upside of 8.3% for investors from current levels.

In addition, the broker is forecasting fully franked dividend yields of 4.8% and 4.2% in FY 2024 and FY 2025, respectively.

Combined, investors buying at current levels would generate a total return beyond 12% over the next 12 months if Goldman Sachs is on the money with its recommendation.

This means that a $20,000 investment could be in excess of $22,400 this time next year if all goes to plan.

The post Own BHP shares? Here’s your quarterly update preview appeared first on The Motley Fool Australia.

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More reading

• Here are the iron ore and lithium price forecasts through to 2027
• How BHP stock could unseat the world’s top copper producer
• Why top brokers say Rio Tinto stock is a better buy than BHP
• In this bull market, where are the bargain buys to be found?
• The BHP share price is down 12% in 2024. What’s next for the iron ore price?

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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The S&P/ASX 200 Index (ASX: XJO) stock IDP Education Ltd (ASX: IEL) has suffered significantly over the past year, dropping by 40%, as we can see in the chart below. Despite this significant fall, UBS thinks the education and language testing business can recover and deliver a 50% share price rise.

Of course, just because a share price is predicted to rise a large amount doesn’t mean it’s guaranteed to happen.

In this article, I’ll look at why UBS sees an opportunity with the IDP Education share price and how much it thinks profit can grow.

Potential headwinds

UBS acknowledged that changes in government policies in Canada — such as a tightening of spousal visas — created uncertainty for the education provider in FY24 and FY25.

We have previously covered some of the other issues in Canada, which the ECP Growth Companies Fund investment team explaining as follows:

IDP Education underperformed as the Canadian government opened up its SDS immigration visa requirements to 4 new English language tests, increasing competition for IDP’s IELTS [International English Language Testing System] business.

It is uncertain how much market share IELTS could lose over the next few years, however market estimates point to an 8% to 15% EPS impact.

UBS also pointed to UK news that suggests a “potential tightening of study work rights.”

In Australia, we’ve just heard that international student fees are going to increase, according to reporting by the Australian Financial Review. This comes after new measures were announced to stop non-genuine students.

UBS said these countries were “targeting the problem of non-genuine students”. However, the broker thinks IDP’s competitors are more exposed to these changes, which could result in some offsetting market share benefits for IDP, or potential “consolidation”.

The broker noted that the UK could implement further changes, though there has already been a tightening of restrictions on students’ ability to bring in independents.

Any tightening announcement should be the “last major piece of negative regulatory news”, though any US changes could “impact the growth angle”.

Despite these headwinds, UBS thinks the ASX 200 stock may generate net profit after tax (NPAT) of $162 million in FY24, $179 million in FY25 and $226 million in FY26.

Ongoing profit growth?

The broker has forecasted that the IDP Education net profit could continue to grow in FY27, with NPAT of $271 million, and then reach $312 million in FY28.

Based on UBS’ profit estimates, the IDP Education share price is valued at 28x FY24’s estimated earnings, 26x FY25’s estimated earnings, 20x FY26’s estimated earnings, 17x FY27’s estimated earnings and 15x FY28’s estimated earnings.

Despite the challenges IDP Education is facing, it’s pleasing to see the business predicted to see steadily growing profit, which is usually a very supportive driver of pushing the share price higher.

According to the projections, the dividend could also increase each year between FY24 and FY28, but I’m not going to focus on that because the IDP Education share price performance could be the key factor in total shareholder returns.

IDP Education share price target

UBS currently has a share price target of $25.30 on the company. A price target tells us where the broker thinks the share price will be in 12 months.

At the current IDP Education share price, the price target implies it could rise 54%. That would be a big return – even half that would probably outperform the ASX share market quite nicely.

The post Top broker tips one of the ASX 200’s worst performers of the past year to surge 50% appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Friday
• Why I’d buy this ASX 200 stock (even if we’re heading for a market crash)
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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 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.

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NextDc Ltd (ASX: NXT) shares have gotten plenty of attention this week.

The S&P/ASX 200 Index (ASX: XJO) tech stock entered a trading halt yesterday, after closing on Wednesday at $16.71 a share. Shares are expected to resume trading on Monday.

The trading halt preceded NextDC’s announcement of a massive $1.32 billion capital raising.

The funds will be raised via a 1 for 6 entitlement share offer. New shares will be issued for $15.40 apiece. Or almost 8% below where NextDC shares closed on Wednesday.

The $1.32 billion will help NextDC expand its operations to meet the record demand it’s experiencing for its data centre services.

CEO Craig Scroggie said, “NextDC continues to see significant growth in demand for its data centre services underpinned by powerful structural tailwinds.”

Scroggie said that amid this strong demand growth, “We have decided to bring forward the development and fitout of key assets in Sydney and Melbourne to ensure we are able to meet this growth in demand.”

Which brings us to nuclear power.

NextDC shares need power

The rapid rise of artificial intelligence (AI) looks set to match or even dwarf the impact of the internet in the 1990s and 2000s.

But AI doesn’t live in a real cloud. Instead, it requires an ever growing amount of computing power, which is increasingly housed in massive data centres.

And in a world intent on weening itself off of fossil fuels while still struggling to provide reliable baseload power with renewables, that poses a potential growth obstacle for NextDC shares.

Which has Scroggie casting his eye on nuclear energy.

“We need power, we need transmission networks, we need green energy, we need more solar, we need more wind and, frankly, we need nuclear,” he said (quoted by The Australian Financial Review).

Scroggie added:

We have to find net zero power options that are capable of supporting energy needs when the sun is not shining and the wind is not blowing and batteries [are] not going to cut it.

And the new generation of data centres required to support our AI co-pilots (or soon-to-be pilots) requires a lot more juice.

According to Scroggie, the new data centres NextDC is planning to support AI will use 10 times as much energy as current facilities.

“We’re going from general purpose computing to high-performance computing. That will see a generational change both in the scale and the density of computers,” he said.

Indeed, having the right ESG credentials on its data centres could offer NextDC shares a significant boost.

As JP Morgan analyst Bob Chen pointed out (quoted by The AFR):

One thing that is also important here is the customers of these data centres, typically your global cloud service providers like Microsoft, Amazon, Google, also have an ESG mandate and are increasingly preferring operators that can source green energy.

The post Own NextDC shares? Here’s why the company is spruiking nuclear power appeared first on The Motley Fool Australia.

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• Up 16% in 2024! Are ASX tech shares now overvalued?
• What’s happening with the NextDC share price following today’s $1.3 billion announcement?
• The best ASX shares to buy with $1,000 right now
• 5 ASX 200 shares for trying to build wealth after 50
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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Woodside Energy Group Ltd (ASX: WDS) share price is under pressure again on Friday.

In morning trade, the energy producer’s shares are down 1.5% to $30.12. This latest decline means that its shares are down 16% over the last six months.

As a comparison, the ASX 200 index is up approximately 10% over the same period.

This means that the Woodside share price is underperforming the benchmark index by a sizeable 26%.

While this is disappointing, one leading broker believes this could be a buying opportunity. Especially after the oil price hit US$90 a barrel this month.

What is the broker saying?

The team at Wilsons believes the underperformance in the its share price is largely due to lower prices of liquid natural gas. It notes:

Australian energy stocks have lagged behind the price of Brent crude oil (in Australian dollars) and global oil majors so far this year (2024). This underperformance is likely due to lower prices for liquid natural gas (LNG) from Japan and Korea (JKM), which have fallen ~15% year-to-date. […] WDS has a larger share of its LNG production uncontracted. This exposes WDS more to gas price swings than STO, which has a higher proportion of contracts indexed to the rising oil price. This difference in contracting strategies explains WDS’s recent underperformance.

However, Wilsons remains positive on LNG demand over the medium term. This is thanks largely to the Asian energy transition. It explains:

From a bigger picture perspective, the LNG supply-demand dynamic remains attractive over the medium term. Gas demand in non-OECD Asia is expected to almost quadruple by 2040, driven by the combination of population growth, economic progress and industrialisation in the Asian markets. LNG is set to be a key component of the energy transition across Asia.

And with LNG supply growth expected to be limited in the coming years, this bodes well for prices moving forward. The broker adds:

Meanwhile, supply growth will be relatively limited over the next few years and Russian gas supplies will likely remain to some extent excluded from the European market. […] Therefore, the softness in the global gas market is seasonal rather than structural and the outlook is still positive.

Woodside share price undervalued

Overall, Wilsons believes that the current Woodside share price is undervalued based on current oil prices. So much so, it has named the company as its preferred pick in the Australian energy sector. It named five reasons for its bullish view:

1. Australian oil and gas stocks are an opportunity at current levels. 2. Earnings upgrades will flow through if the oil price continues to remain elevated. For example, WDS should see 15% FY24 earnings per share (EPS) upside at spot oil. 3. The LNG market will recover, boosted by demand coming from Asia over the next few years. 4. WDS is now trading at implied oil prices from ~$70/bbl. This is attractive considering our base case that the oil market will remain tight over this decade. 5. WDS trades well below global peers on an earning-to-value/ earnings before interest, taxes, depreciation and amortization (EV/EBITDA) basis.

The post Broker says Woodside share price weakness is a buy opportunity appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Star Entertainment Group Ltd (ASX: SGR) share price is sliding today.

Shares in the S&P/ASX 200 Index (ASX: XJO) casino operator closed yesterday trading for 55 cents. In morning trade on Friday, shares are swapping hands for 53 cents apiece, down 2.4%.

For some context, the ASX 200 is down 0.5% at this same time.

This comes following the release of Star’s third quarter trading update for the three months ending 31 March (Q3 FY24).

Read on for the highlights.

What happened during the quarter?

The Star Entertainment share price is dropping after the company reported a 4.6% year on year decline in net revenue. Net revenue for the quarter came in at $419.2 million, down from $439.5 in Q3 FY 2023.

Management said that revenue from Star’s Premium Gaming Rooms (PGRs) slid across all of its properties during the quarter. The Star Sydney PGR revenue was down 19.3%; the Star Gold Coast PGR revenue was down 20.0%; and Treasury Brisbane PGR revenue was down 28% from Q3 FY 2023.

The revenue slide was softened by strong performance across the company’s Main Gaming Floor (MGF) segment, which increased at all Star’s properties. MGF revenue increased 5.4% at the Star Sydney; revenue was up 4.6% at the Star Gold Coast; and revenue increased by 6.4% at Treasury Brisbane compared to Q3 FY 2023.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) of 37.9 million were down 11.5% from $42.9 million reported in the prior corresponding period.

And while losses improved year on year, the Star Entertainment share price is still under pressure with the company reporting a net loss after tax of $6.8 million for the three months. That compares to a net loss after tax of $49.7 million in Q3 FY 2023.

On the cost front, operating expenses dropped 4.2% year on year.

However, Star has been increasing investment in its risk, controls and transformation teams to strengthen the control environment. This sees operating expenses up $1.8 million on the monthly run-rate from the first half of FY 2024.

Operating expenses in the first half of FY 2024 average $90.3 million per month. In Q3 FY 2024 this increased to a monthly average of $92.1 million.

Management said they “will continue to exercise cost control with a focus on making the appropriate investment in improving the control environment”.

Looking ahead, Star said that negotiations for the sale of assets including the Treasury Casino, Hotel and car park “are progressing well”.

The company also reported that the phased opening of Queen’s Wharf Brisbane in August 2024 remains on track.

Star Entertainment share price snapshot

The Star Entertainment share price is down 55% over 12 months. The past month showed some signs of recovery, with shares up 1% over the month.

The post Star Entertainment share price tumbles alongside sinking revenues appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Origin Energy Ltd (ASX: ORG) shares are on the slice on Friday morning.

In early trade, the energy giant’s shares are down almost 1% to $9.47.

Why are Origin shares falling?

Investors have been selling the company’s shares on Friday after broad market weakness offset the announcement of a strategic acquisition.

According to the release, Origin has entered into an agreement with Virya Energy to acquire its Yanco Delta Wind Farm.

The Yanco Delta Wind Farm is one of the largest and most advanced wind and energy storage projects in New South Wales. It is in the State Government-designated South West Renewable Energy Zone (REZ), and consists of a 1.5 GW wind farm and a 800 MWh battery. The project is strategically located next to key transmission infrastructure.

Origin notes that the acquisition will accelerate its strategy to expand renewable energy and storage in its portfolio.

‘Highly strategic’

Origin’s CEO, Frank Calabria, highlights that the acquisition is highly strategic and represents a big step forward in the journey to transition Origin’s portfolio to cleaner energy. He commented:

Yanco Delta is a large-scale, advanced and therefore highly strategic wind development project. With the key planning and regulatory approvals secured, and with significant plans for supporting infrastructure and transmission in place, the acquisition of Yanco Delta represents a major step forward in our journey to transition Origin’s portfolio to cleaner energy.

Origin has made rapid progress in building out a portfolio of renewable and storage projects at varying stages of development, and Yanco Delta represents a unique opportunity to bring a material volume of renewable energy supply into the market relatively quickly, to help meet the needs of our customers.

How much is Origin paying?

Origin is paying a total of up to $300 million for the Yanco Delta Wind Farm. This consideration consists of an upfront payment of $125 million and an additional variable payment of up to $175 million conditional on the project achieving certain development milestones.

The purchase price and development expenditure prior to commencement of construction will be funded from Origin’s corporate debt facilities. Completion of the acquisition remains subject to conditions which are typical for transactions of this nature.

Mr Calabria concludes:

Strategically located in the South West REZ, Yanco Delta is a quality wind resource that provides benefits of scale. We look forward to working closely with the local community and other stakeholders and bringing Origin’s expertise and track record in developing large scale energy projects to progress this project to construction.

Origin shares are up 14% over the last 12 months.

The post Origin shares fall despite ‘highly strategic’ $300m renewable energy acquisition appeared first on The Motley Fool Australia.

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• Here’s how the ASX 200 market sectors stacked up last week
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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.

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The Cettire Ltd (ASX: CTT) share price is ending the week with a bang.

In morning trade, the online luxury products retailer’s shares are up 13% to $3.79.

Why is the Cettire share price jumping?

Investors have been fighting to get hold of the company’s shares on Friday after it released another impressive quarterly update.

According to the release, for the three months ended 31 March, Cettire’s gross revenue increased 95% over the prior corresponding period to $256.7 million.

Also growing strongly was its sales revenue, which increased 88% over the same period last year to $191 million.

This strong top line growth was underpinned by an 84% increase in active customers ~644,000 and a continued strong gross revenue contribution from repeat customers. A 12% increase in average order value to $832 also supported its sales growth.

Management highlights that its US business continues to demonstrate excellent momentum. Its year with year-on-year gross revenue growth accelerated in third quarter compared with the year-on-year growth rate achieved during the first half.

Furthermore, since the implementation of the company’s updated checkout on 19 March, Cettire has observed stable conversion rates in the key market.

In addition, it has experienced continued strong growth in its available inventory, with the total database of unique products and seller stock value observing a noticeable step-up during the period.

Commenting on the quarter, Cettire’s founder and CEO, Dean Mintz, said:

This result reflects continued strength in Cettire’s quarterly performance, with ongoing momentum in sales revenue, active customer growth and conversion to profit. Cettire continues to rapidly drive market penetration across its global footprint.

Market conditions remain constructive and we have supplemented our strong customer proposition with marketing investment. Further, our increased focus on traffic quality has driven significant year-on-year improvement in conversion rate and an uplift in average order values.

What about earnings?

Failing to hold back the Cettire share price today is somewhat underwhelming earnings update.

Cettire revealed that its unaudited adjusted EBITDA came in at $6 million for the three months on a delivered margin greater than 20%.

This compares unfavourably to first half adjusted EBITDA of $26.1 million on a delivered margin of 23.2%.

However, Mr Mintz highlights that the quarter is its seasonal low point. He explains:

Our business is execution focused. We continue to operate the business to maximise revenue growth, whilst also delivering profitability and cash generation. Whilst Q3 is traditionally a seasonal low point, we observed a strong improvement in year-on-year profit trends.

The post Cettire share price jumps 13% on explosive Q3 sales growth 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 recommended Cettire. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It is fair to say that the Life360 Inc (ASX: 360) share price has been on fire in 2024.

Since the start of the year, the location technology company’s shares are up 81%.

This means that a $20,000 investment at the end of last year would now be worth just over $36,000.

Investors have been scrambling to buy Life360’s shares for a number of reasons. This includes a stellar full-year result in March, the launch of an advertising business, and a trading update last week which revealed a record first-quarter performance.

In light of these strong gains, investors may think that the Life360 share price is overvalued now. But could it actually be the opposite? Let’s now see what one leading broker is saying about the tech stock.

Is the Life360 share price undervalued?

According to a note out of Bell Potter, its analysts still see plenty of value in the company’s shares following its trading update this month. Commenting on the update, the broker said:

Life360 provided a positive and unexpected market update with two key metrics in 1Q2024 materially exceeding both our and market expectations: 1. Global monthly active users increased 4.9m to 66.4m (vs BPe 2.6m increase to 64.0m); and 2. Global paying circles increased 96k to 1.897m (vs BPe 66k increase to 1.867m). No explanation or commentary was provided as to what drove the strong growth and the company said it was too early to determine whether these metrics will have a material positive impact on revenue, earnings or any other financial results for 1Q2024.

Both metrics are clearly very strong but in our view the growth in paying circles is key as this metric disappointed somewhat in 4Q2023 with an increase of only 55k – albeit after very strong growth in 3Q2023 – so growth of 96k in 1Q2024 signals a strong rebound.

In response, the broker retained its buy rating with an improved price target of $16.25.

Based on the current Life360 share price, this suggests that its shares could rise almost 20% over the next 12 months. It concludes:

We have updated each valuation used in the determination of our price target for the forecast changes and also increased the multiple we apply in the EV/Revenue valuation from 4.75x to 5.5x due to the positive update and also successful IPO of Reddit on the NYSE. The net result is a 12% increase in our PT to $16.25.

The post Is Life360’s soaring share price still 20% undervalued? 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.

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Targeting $1,000 of dividend income now from ASX shares with an initial $5,000 investment would require a 20% yield.

While a few ASX stocks have delivered that kind of outsized yield on rare occasions, we’re not going to shoot for the moon here.

Instead, we’ll look at three top ASX dividend shares paying market-beating passive income where I’d invest that $5,000 now to achieve that $1,000 of dividend income.

Before we dive into that, though, a few important points.

First, an ideal investment portfolio should hold 10 or more ASX shares, ideally operating in different sectors and geographic locations. That kind of diversity will lower the risks of our passive income taking an unexpectedly large hit if a particular company or sector comes under pressure.

Second, the yields we generally see quoted are trailing yields. Future yields may be higher or lower depending on a range of company-specific and macroeconomic factors.

With that in mind…

Three ASX shares to buy now for dividend income

The first stock I’d buy now for dividend income is S&P/ASX 200 Index (ASX: XJO) iron ore miner Fortescue Ltd (ASX: FMG).

Fortescue paid out a final fully franked dividend of $1.00 per share on 28 September. Following a strong six-month period through to the end of 2023, the ASX 200 miner’s net profit after tax (NPAT) soared 41% year on year to US$3.3 billion for the six months.

With profits up, Fortescue paid an interim dividend of $1.08 per share, up 44%, on 27 March. Which brings the full-year payout to $2.08 per share.

The Fortescue share price has also gained an impressive 17% over the past 12 months, closing yesterday at $25.78 per share. That sees the ASX 200 miner trading on a fully franked trailing yield of 8.1%.

The second company I’d buy for dividend income today is ASX coal stock Yancoal Australia Ltd (ASX: YAL).

Well-known for its market-smashing yields, Yancoal’s dividends have come down from their heights of 2022 and early 2023. But its share price has held up well and amid resilient global coal demand I expect this stock will remain a favourite among passive income investors.

Yancoal paid a fully franked interim dividend of 37 cents per share on 20 September. The ASX coal miner will deliver its final dividend of 32.5 cents per share on 30 April for a 12-month payout of 69.5 cents per share.

The Yancoal share price is just about flat over the past year, closing yesterday at $5.73. That equates to a fully franked trailing yield of 12.1%.

Which brings us to the third stock I’d buy for dividend income today, Ampol Ltd (ASX: ALD).

Ampol supplies Australia’s largest branded petrol and convenience network. The company also refines, imports and markets fuels and lubricants.

And in a sign I like to see, both Ampol’s share price and dividends have been soaring.

On the dividend front, Ampol paid a fully franked interim dividend of 95 cents per share on 27 September. The ASX energy stock’s final dividend came out at $1.80 per share, up 16%, for a full-year payout of $2.75 per share.

The Ampol share price has rocketed 26% over the past 12 months, closing yesterday at $39.09. That equates to a fully franked trailing yield of 7.0%.

The road to $1,000

Assuming we invest the same amount in each of these three ASX shares we’d earn an average yield of 9.1%.

Meaning our $5,000 investment today should see us earning $455 in annual dividend income, plus further potential share price gains.

As mentioned up top, we won’t reach our $1,000 dividend income goal from these ASX shares immediately. But by tapping into the magic of compounding, a little patience can pay off handsomely.

If we reinvest those dividends, and the average share price of these three stocks continues to move higher, I believe we could realistically achieve annual returns of 12%.

In seven years, at that rate of return, we should see our $5,000 grow to $11,534. At a 9.1% yield, this would see us earning a fully franked dividend income of $1,050 a year.

As always, if you’re not sure how or where to invest your hard-earned money, simply reach out for some expert advice.

The post Where I’d invest $5,000 in ASX shares now for $1,000 of dividend income appeared first on The Motley Fool Australia.

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More reading

• Are Coles or Fortescue shares a better buy for dividend income?
• Here are the iron ore and lithium price forecasts through to 2027
• How to earn $3,000 in passive income with less than $3,000 in savings
• ‘Share price looks cheap’: Fortescue & 1 other beaten-up ASX 200 share to buy now
• In this bull market, where are the bargain buys to be found?

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re looking for income ideas then you may want to listen to what Bell Potter is saying about the ASX 300 dividend shares listed below.

That’s because the broker currently has them on its preferred list and is forecasting attractive dividend yields from their shares. Here’s what the broker is saying about them:

Healthco Healthcare and Wellness REIT (ASX: HCW)

Bell Potter thinks that this health and wellness property company could be an ASX 300 dividend share to buy. Particularly given recent weakness, which means that its shares are trading at a significant discount to its net tangible assets (NTA). It said:

HCW has underperformed the REIT sector last 3 months (-10% vs. +22% XPJ) following bond yield reversion and is attractively priced at 20% discount to NTA (but only REIT to record flat to positive valuation movement at 1H24) with double digit 3 year EPS CAGR given high relative sector debt hedging and ability to grow its $1bn development pipeline via attractive YoC spread to marginal cost of debt. Longer term, HCW has significant scope for growth with an estimated $218 billion addressable market where an ageing and growing population should underpin long-term sector demand.

The broker has a buy rating and $1.70 price target on the company’s shares.

As for dividends, the broker is forecasting dividends per share of 8 cents in FY 2024 and 8.3 cents in FY 2025. This equates to yields of 6.7% and 6.9%, respectively.

GUD Holdings Limited (ASX: GUD)

Another ASX 300 dividend share that could be a buy according to Bell Potter is GUD. It is a diversified products company with a focus on the automotive market through brands including Ryco, Wesfil and Goss.

The broker believes the company is well-positioned in the current environment thanks to the resilience of its automotive business. It said:

We see GUD as well-placed to benefit from the ongoing improvement in OEM supply constraints into FY24. Overall, our Buy rating for GUD is predicated on the relative resilience of the legacy auto business and improving momentum in new car sales, which should be favourable for APG’s earnings.

Bell Potter currently has a buy rating and $12.80 price target on its shares.

In respect to dividends, the broker is forecasting fully franked dividends per share of 38.5 cents in FY 2024 and 40.4 cents in FY 2025. This will mean yields of 3.5% and 3.7%, respectively.

The post Bell Potter names the best ASX 300 dividend shares to buy appeared first on The Motley Fool Australia.

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More reading

• Buy these ASX 300 dividend stocks for a passive income boost
• 3 top ASX REITs to buy in April 2024
• 2 ASX dividend shares with 5%+ yields to buy next week
• 5 things to watch on the ASX 200 on Wednesday
• Where I’d invest $30,000 in ASX shares for passive income

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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