Plenty of ASX blue-chip shares are known for being generous ASX dividend shares.

In this article, we have two income-generating shares that most Australians will be familiar with: supermarket giant Coles Group Ltd (ASX: COL) and iron ore miner Fortescue Ltd (ASX: FMG).

Now, the market is always on the move and we typically don’t know exactly which way share prices will go. But dividends are much more predictable. A company’s payouts are decided by its board and paid for by profits the business has generated.

I’m going to look at a couple of key areas to help me decide which of the two passive income stocks are a better buy for dividends.

Dividend yield

Both Coles and Fortescue have solid dividend yields. A yield is influenced by two things, the dividend payout ratio and the price/earnings (P/E) ratio (which is the earnings multiple valuation).

If a company pays out more of its profit then it will have a higher dividend yield. A lower earnings multiple can push up the dividend yield, while a higher valuation pushes down on the dividend yield.

According to the estimates on Commsec, owning Coles shares could result in a grossed-up dividend yield of 5.8% in FY24, 6.2% in FY25 and 7% in FY26.  

Meanwhile, owning Fortescue shares could mean a yield of 11.2% in FY24, 8.3% in FY25 and 6% in FY26.

In the short-term, Fortescue may offer a bigger dividend yield, but by FY26, Coles could pay a larger dividend yield.  

Sustainability of the payout

This is the most important element to me. I think dividend projections are a sign of what conditions the companies are facing.

According to forecasts, dividend payouts by Coles and Fortescue are tipped to go in opposite directions.

The last few years have been very supportive for Fortescue’s shares and profit because of relatively high iron ore prices. But, the iron ore price has dropped back down to around US$100 per tonne – it was above US$140 per tonne in early 2024 and was above US$200 per tonne in 2021.

New supply, particularly from Africa, may be a significant headwind for the iron ore price in the next few years, depending on how much demand there is from China. Of course, Fortescue may have its own African project by then, plus it’s diversifying its operations by investing in green energy production.

Coles on the other hand is a very resilient business. As a supermarket business, it provides products that we all need, so the demand is very consistent. On top of that, Australia’s population is growing strongly, so the number of potential consumers keeps increasing.

The Coles dividend is much more sustainable, in my opinion. It has grown every financial year since listing on the ASX a few years ago, though past performance is not a guarantee of future performance.

At the current prices, I’d call Coles shares a better buy, particularly as the Fortescue share price is so high despite current weakness in the iron ore price.

The post Are Coles or Fortescue shares a better buy for dividend income? 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
• 3 ASX dividend shares everyone should own for the long haul
• How to earn $3,000 in passive income with less than $3,000 in savings
• Buy Coles and these ASX dividend stocks now
• ‘Share price looks cheap’: Fortescue & 1 other beaten-up ASX 200 share to buy now

Motley Fool contributor Tristan Harrison has positions in Fortescue. 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 Coles Group. 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 NextDc Ltd (ASX: NXT) share price isn’t doing anything just yet. Though early indications are that shares may open modestly lower.

Shares in the S&P/ASX 200 Index (ASX: XJO) tech stock closed yesterday trading for $16.71. In morning trade on Thursday, shares remain there, after the company requested a trading halt.

That halt is meant to lift following the company’s announcement of a major capital raising. That announcement has since been made. But as of now, we’re still waiting.

Here’s what we know.

NextDC share price one to watch following cap raise

The NextDC share price is in the spotlight after the company announced it is undertaking a $1.321 billion capital raising via a fully underwritten 1 for 6 pro-rata accelerated non-renounceable entitlement share offer.

New shares will be issued for $15.40, some 8% below where the NextDC share price closed.

The ASX 200 tech stock noted that it’s been experiencing record demand for its data centre services. In calendar year 2023, the company’s contracted utilisation increased by 77% to 149.0MW.

Looking at what could impact the NextDC share price ahead, the company expects that a record forward order book of 68.8MW will convert into billings across FY 2025 to FY 2029, which management said will drive future revenue and earnings growth.

With that growth in mind, the ASX 200 tech company intends to deploy the $1.321 billion to accelerate the development and fit out of its digital infrastructure platform in its core Sydney and Melbourne markets.

The company reported that once the capital raising is complete, it will have pro-forma tangible asset backing of approximately $5.1 billion and pro-forma liquidity of around $3.4 billion.

What did management say?

Commenting on the capital raising that could move the NextDC share price today, CEO Craig Scroggie said:

NextDC continues to see significant growth in demand for its data centre services underpinned by powerful structural tailwinds.

Amid this backdrop, 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, continue to support our customers, and ensure the company is well positioned to take advantage of the diverse range of opportunities expected to present over the medium term.

NextDC maintains guidance

The NextDC share price could get a boost after the company maintained the FY 2024 guidance it initially offered on 27 February.

That guidance is as follows:

• Total revenue in the range of $400 million to $415 million
• Net revenue in the range of $296 million to $304 million
• Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) in the range of $190 million to $200 million
• Capital expenditure in the range of $850 million to $900 million

The NextDC share price is up 51% over the past 12 months.

The post What’s happening with the NextDC share price following today’s $1.3 billion announcement? appeared first on The Motley Fool Australia.

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More reading

• The best ASX shares to buy with $1,000 right now
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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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S&P/ASX 200 Index (ASX: XJO) tech stock Netwealth Group Ltd (ASX: NWL) is sliding today.

Shares in the investment platform provider closed yesterday trading for $20.28. In morning trade on Thursday, shares are swapping hands for $19.68 apiece, down 3.0%.

For some context, the ASX 200 is down 0.8% at this same time.

Here’s what investors are mulling over today.

ASX 200 tech stock falls despite record 12-month fund inflows

The Netwealth share price is in the red following the release of the company’s quarterly update for the three months to 31 March.

Among the highlights, the ASX 200 tech stock reported $84.7 billion of Funds Under Administration (FUA) as at 31 March.

Over the three months, FUA increased by $6.7 billion. That was achieved via net fund inflows of $2.7 billion along with positive market movement of $4.0 billion.

Impressively, management noted that quarterly FUA gross inflows of $5.2 billion were up 40.7% year on year. And FUA net inflows of $2.7 billion were up 62.2%.

Over the 12 months to 31 March FUA were up by 28.5% or $18.8 billion. That comprised FUA net inflows of $10.6 billion and positive market movement of $8.2 billion.

The strong results were driven by a new record 12-month FUA inflow of $21.2 billion.

As for Funds Under Management (FUM), those were up by $1.6 billion for the quarter to $19.7 billion. Netwealth reported FUM net inflows of $600 million for the three months.

Meanwhile, the ASX 200 tech stock’s managed account balance increased by $1.4 billion to $17.0 billion, including net inflows of $600 million, a 62.1% year on year increase.

The number of accounts were up as well, increasing by 11.6% compared to the prior corresponding quarter. The company cited “strong momentum in the March quarter”, adding 5,132 new accounts, 3.7% higher than the December quarter.

The Netwealth share price could be under some selling pressure with the company noting that the structure of its tiered administration fees, fee caps and most ancillaries, when combined with the lower cash percentage, “has resulted in a reduction in average revenue bps in the March quarter”.

Looking ahead

Looking at what could impact the Netwealth share price in the months ahead, the ASX 200 tech stock said:

In addition to strong account growth in the quarter, we expanded and strengthened our new adviser and licensee relationships. Our new business pipeline including conversion rates, is very strong across all segments.

Management forecasts June quarter FUA inflows “to be very strong with several new large transitions commencing, in addition to higher seasonal flows and increased market activity”.

On the AI front, the ASX 200 tech stock noted the rapid changes encompassing the tech world. As such, management said, “Innovations in generative artificial intelligence are being actively explored and implemented to improve efficiency, productivity, client engagement and service.”

The Netwealth share price is up 60% over 12 months.

The post ASX 200 tech stock slides despite record $21.2 billion results appeared first on The Motley Fool Australia.

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More reading

• Why is the Core Lithium share price jumping 10% today?
• Why it’s a good day to own Woolworths shares
• Northern Star share price tumbles on difficult quarter
• 1 ASX penny stock I’d buy in April while it is still only 21 cents
• The best passive income streams to help fund your retirement

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 positions in and has recommended Netwealth Group. The Motley Fool Australia has positions in and has recommended Netwealth Group. 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 Core Lithium Ltd (ASX: CXO) share price is catching the eye with a strong gain on Thursday morning.

At the time of writing, the lithium miner’s shares are up almost 10% to 17 cents.

This compares favourably to a 1.2% decline by the ASX 200 index.

Why is the Core Lithium share price jumping?

Investors have been buying the company’s shares this morning after it announced an update to the mineral resource estimate of its 100% owned Finniss Lithium Project in the Northern Territory.

According to the release, Core Lithium has delivered a 58% increase in the Finniss Lithium Project mineral resource estimate to 48.2Mt at 1.26% Li2O. This reflects the culmination of all drilling undertaken by the company’s exploration team in 2023.

Management notes that the reverse circulation and diamond drilling program was the largest program undertaken by the company to date. The program was conducted at both known deposits and at new prospects within the Bynoe Pegmatite Field.

It also highlights that the measured and indicated resource categories have increased to 27.9Mt @ 1.32% Li2O. Approximately 58% of the mineral resource estimate is in the higher confidence measured and indicated categories.

But the lithium miner isn’t finished with its drilling. It notes that the Lees and Booths deposits represent a continuous series of dipping pegmatite sheets that are located midway between the existing Carlton and BP33 mineral resources. It believes the location of these resources, together with further nearby targets that will be tested throughout 2024, adds to the possibility of future shared development opportunities.

‘Excellent outcome’

Core Lithium’s interim CEO, Doug Warden, was pleased with the news. He said:

This significant increase to the Finniss Mineral Resource is an excellent outcome for Core and our shareholders. The 2023 exploration program was the largest in Core’s history and these outstanding results justify the continued exploration of the Finniss region.

In particular, the 429% increase in the combined Mineral Resource at Lees & Booths to 14.4Mt, supports our view that the Finniss region has the potential to host large clusters of lithium deposits. At Lees, the pegmatites remain open in multiple directions with the high chance that further pegmatite sheets exist within the system. Our 2024 exploration program will target both larger standalone deposits, as well as clusters of smaller deposits that have the potential to be mined with shared infrastructure.

The Core Lithium share price remains down 80% over the last 12 months.

The post Why is the Core Lithium share price jumping 10% today? 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
• Here’s the profit forecast to 2028 for Core Lithium shares
• Is there any hope for Core Lithium shares?
• Sell these ASX lithium stocks and buy this one instead
• The ASX 200 lithium stock this fundie is backing for the global lithium comeback

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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Today is a good day to have Woolworths Group Ltd (ASX: WOW) shares in your investment portfolio.

While its share price may have been caught up in the market weakness today, there’s still reason to smile.

That’s because today is payday for its shareholders.

Payday for Woolies shareholders

As a reminder, in February, Woolworths released its half year results.

For the six months ended 31 December, the supermarket giant reported a 4.4% increase in revenue to $34.64 billion and a 2.5% increase in profit before significant items to $929 million. This was driven by strong growth from its Australian Food business, which helped offset a poor performance from the Big W and New Zealand businesses.

This allowed the Woolworths board to increase its fully franked interim dividend by 2.2% to 47 cents per share.

Woolworths’ shares went ex-dividend for this payout at the end of February. So, if you owned its shares when that happened, today is payday for you.

What’s next for the Woolworths dividend?

According to a note out of Goldman Sachs, its analysts expect another increase to the Woolworths dividend in August.

The broker is forecasting a fully franked final dividend of 62 cents per share, bringing its full year dividend to $1.09 per share. This represents a 4.8% increase year on year.

But its growth won’t stop there according to the broker. It is forecasting a 7.3% increase to $1.17 per share in FY 2025 and then a further 8.5% increase to $1.27 per share in FY 2026.

Are Woolworths shares good value?

Goldman Sachs thinks that the supermarket giant’s shares are undervalued at current levels.

The broker has a buy rating and $40.40 price target on them, which implies potential upside of approximately 25% for investors over the next 12 months. It commented:

WOW is the largest supermarket chain in Australia with an additional presence in NZ, as well as selling general merchandise retail via Big W. We are Buy rated on the stock as we believe the business has among the highest consumer stickiness and loyalty among peers, and hence has strong ability to drive market share gains via its omni-channel advantage, as well as its ability to pass through any cost inflation to protect its margins, beyond market expectations. The stock is trading below its historical average (since 2018), and we see this as a value entry level for a high-quality and defensive stock.

The post Why it’s a good day to own Woolworths shares appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Have Woolworths and Coles shares been spared a break-up?
• 3 ‘forever’ ASX dividend shares to build your wealth
• 2 ASX 200 retirement shares to buy now
• 3 things about Woolworths stock every smart investor knows

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 Northern Star Resources Ltd (ASX: NST) share price is under pressure on Thursday.

In morning trade, the gold miner’s shares are down 2.5% to $14.62.

Despite this, the company’s shares are up 30% over the last six months.

Why is the Northern Star share price falling?

Investors have been selling the gold giant’s shares this morning following a pullback in the gold price overnight and the release of preliminary production results for the three months ended 31 March 2024.

In respect to the latter, according to the release, Northern Star reported 401,000 ounces of gold sold during the March quarter. This is down from 412,000 ounces during the previous quarter.

Management advised that this reflects the impact of significant weather events across the Northern Goldfields.

The good news is that the company appears to have moved on from these disruptions. It advised that the June quarter has started with strong operational momentum. This includes at the Kalgoorlie Production Centre with increased access to high-grade Golden Pike North material, early access to first ore at Wonder underground in the Yandal Production Centre, and grade improvements at Pogo Production Centre.

Importantly, with gold sold totalling 1.18 million ounces over the first three quarters, management believes Northern Star remains on track to deliver on its FY 2024 group gold sold guidance of 1.6 million ounces to 1.75 million ounces. This is based on positive momentum leading into an expected strong June quarter, driven predominantly by increased grade and mill utilisation rates.

Northern Star’s cash balance softened during the quarter. It ended the period with cash and bullion totalling $1,076 million, down from $1,089 million at the end of December. However, it is worth noting that the gold miner paid out its $169 million interim dividend during the quarter. Excluding this, its cash balance would have lifted over the three months.

In addition, management advised that major organic growth projects continued to advance during the quarter. The includes the key KCGM Mill expansion, which remains both on track and on budget.

Commenting on the company’s third-quarter performance, Northern Star’s managing director, Stuart Tonkin, said:

The resilience of our team and assets was demonstrated during the quarter with operations further challenged due to adverse weather. Our profitable growth strategy coupled with elevated gold prices is expected to deliver significant cashflow generation, and in turn, superior shareholder returns.

Northern Star intends to release its full quarterly update on Tuesday 23 April.

The post Northern Star share price tumbles on difficult quarter appeared first on The Motley Fool Australia.

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• Is it too late to get on board the ASX gold train?
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• Buying ASX 200 gold stocks? Here’s why the record gold price could keep charging higher
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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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ASX penny stocks come with the potential for explosive share price growth, along with considerable added risks.

Those risks include a bigger chance the company could run into financial stress that could pressure its share price. And small-cap stocks tend to have higher volatility, meaning investors should be prepared for some sizable share price moves in both directions.

With that in mind, one ASX penny stock I believe is poised for a strong run in April and through 2024 is Aeris Resources Ltd (ASX: AIS).

The ASX copper miner closed yesterday trading for 21 cents per share, giving it a market cap of $197 million.

Here’s why I think it could charge higher from here.

Why this ASX penny stock could surge

Aeris Resources looks to be in a strong turnaround stage.

As you can see in the chart above, the Aeris Resources share price plunged a gut-wrenching 85% from this time last year through to 22 February, when it closed at just 9 cents a share.

Then the ASX penny stock went ballistic, with shares rocketing more than 135% since then.

The most recent uplift came this Tuesday when the ASX miner reported on the potential to significantly expand its copper resource growth at its Canbelego copper project, located in New South Wales.

Canbelego is a joint venture project between Aeris Resources and Helix Resources Ltd (ASX: HLX).

Commenting on the potential copper resource growth, Helix executive technical director Kylie Prendergast said:

The new geophysical survey results show there are significant new copper targets in close proximity to known, high-grade copper mineralisation at the Canbelego deposit.

This is generating a lot of excitement in the Helix team on our ability to expand our Canbelego Copper Mineral Resources with drilling scheduled to start in May.

The Aeris Resources share price closed up 14.3% on the news, trading for 20 cents apiece.

And with drilling kicking off in May, this ASX penny stock could surge on any strong results.

Why now could be a great time to buy Aeris Resources

Sure, it would be nice to jump back to 22 February and load up on Aeris Resources when shares were trading for just 9 cents apiece.

But with copper prices leaping 10% year to date, with many analysts forecasting further gains in 2024, this ASX penny stock could continue to handsomely reward investors.

‘Dr Copper’, as the metal is called for its correlation to global economic performance, is noncorrosive and highly conductive. This sees it used in pipes and wiring, with demand growth outpacing supply as the world moves towards decarbonisation.

The rapid growth of AI, and the requisite copper-hungry data centres to support the technology, are also forecast to see a sustained uptick in demand for the red metal.

And this ASX penny stock looks well-placed to make the most of it.

The post 1 ASX penny stock I’d buy in April while it is still only 21 cents 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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It goes without saying that almost all of us would relish the opportunity of establishing a stream of passive income (or two) that could help supplement our day jobs, and, when the time comes, fund our retirement.

But doing so is definitely easier said than done. Many sources of passive income can be risky, or require an inordinate amount of upfront effort.

So unless you’re about to finish the next one-hit wonder, here are some streams of passive income that anyone can set up for a comfortable retirement today.

Some top ideas for a passive income stream

Find a high-interest savings account

This one might seem simple, but you’d be surprised how many Australians don’t have their savings sitting in an account or term deposit paying a competitive interest rate. This is one of the easiest fixes anyone can do in order to set up a stream of passive income.

Right now, interest rates are at a decade-high. Whilst this might be painful for mortgage holders, it’s a blessing for those with a pile of cash at the bank. It’s not uncommon today to see savings accounts and term deposits offering interest rates of 5% or even higher.

That means that you can bank as much as $1,000 per annum in work-free income for every $20,000 you have invested in a high-interest savings account or term deposit.

This requires almost no work on your part, just 10 minutes of research and paperwork. If you have a significant amount of cash in the bank sitting in a chequing or ‘everyday’ account paying little or no interest, it’s easy money you’re just throwing away.

Make your hobby profitable

Most of us have hobbies – activities that we enjoy outside of work for our own leisure. Most of us are happy to pursue these hobbies as passion projects. But today’s modern world also gives us a chance to turn these hobbies into a profitable side hustle.

Like playing video games? Perhaps you should consider streaming your playthroughs. Enjoy bushwalks, sewing, cooking, fishing, camping, metal work or carpentry? You can set up a blog or vlog and document your latest finds, travels or projects.

The internet is awash with these sorts of endeavours. But with a little dedication, you might find yourself at the helm of a new source of passive income. Who wouldn’t like to spend their retirement doing what they love, and getting paid for it?

ASX dividend shares for passive income

But of course, we have to talk about ASX dividend shares. After all, they are quite possibly the best source of passive income for all Australians.

Dividend shares can give us everything we need in a source of passive income: No active labour required, inflation-resistance, and income that should rise over time. Like any ASX share investment, one needs to be judicious in selecting which ASX dividend shares will make the cut for a passive income portfolio.

But I think taking the easy way and choosing an exchange-traded fund (ETF) like the Vanguard Australian Shares High Yield ETF (ASX: VHY) is a great option for most Australians. Dividend payments normally get doled out every six months on the ASX, and often come with franking credits attached too. These can help us boost our passive income even further.

Investing in ASX divided shares for passive income is something we can all do today. The only downside with this stream is that it does require a substantial investment of cash to get the ball rolling.

The post The best passive income streams to help fund your retirement appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen 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 Vanguard Australian Shares High Yield ETF. 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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With the gold price hitting record highs this week, investors may be looking for ways to gain exposure to the precious metal.

One way could be through ASX 200 gold stock Capricorn Metals Ltd (ASX: CMM).

That’s the view of analysts at Bell Potter, which believe investors should be snapping up its shares at current levels.

Why is it an ASX 200 gold stock to buy?

Bell Potter notes that Capricorn Metals recently released an update for the 100% owned Karlawinda Gold Project (KGP).

Unfortunately, the project was impacted by a major rainfall event late in the third quarter, which means that gold production fell a touch short of expectations.

In addition, as open-pit mining material movements are still recovering from the rainfall, gold production for the current quarter will now be softer than expected. This inevitably means that production for FY 2024 will be short of its guidance.

Bell Potter thinks management will be very disappointed with this news given its impressive track record of delivering on promises for the last three years. It said:

This will be disappointing for CMM, which has built a metronomic track record of guidance delivery since commencing production at the KGP in June 2021. March quarter 2024 gold production of 26.0koz is the lowest since the ramp-up quarter of September 2021 and comes at a time when CMM will have been aiming to maximise unhedged gold sales before hedge book deliveries re-commence in September 2024.

But the broker thinks investors should look beyond this rainfall event. It adds:

However, the quality of the KGP and its operational management are evidenced by the strong quarterly cash addition to the balance sheet of A$680/oz. Low costs, a strong balance sheet and free cash flow mitigates CMM’s single mine risk and explains in part why it carries a premium rating when compared with peers.

Buy this sector leading gold miner

Overall, the broker believes that this ASX 200 gold stock is a great option for investors. It said:

Our NPVbased valuation is up 3% to $6.15/sh as we roll forward past the March 2024 quarter, update for CMM’s increased cash position and pick up FY25 earnings upgrades. CMM is a sector leading gold producer with a strong balance sheet, clear organic growth options and a management team with an excellent track record of delivery.

As it says above, Bell Potter has reiterated its buy rating this morning with an improved price target of $6.15. Based on where the ASX 200 gold stock currently trades, this implies potential upside of 15% for investors over the next 12 months.

The post Buy this ‘sector leading’ ASX 200 gold stock for big returns 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.

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There are two commodities that get a lot of attention from Australian investors – iron ore and lithium.

Hundreds of billions of dollars are invested in companies with exposure to these metals. As a result, their prices can have a big impact on the wealth of the nation.

But where are iron ore and lithium prices heading from here? Let’s take a look and see what analysts at Goldman Sachs are forecasting for the coming years.

Iron ore price forecast

If you own BHP Group Ltd (ASX: BHP), Fortescue Ltd (ASX: FMG), or Rio Tinto Ltd (ASX: RIO) shares, you will no doubt be interested in knowing what analysts are predicting for the iron ore price.

Firstly, according to CommSec, iron ore futures fell by 31 US cents or 0.3% overnight to US$104.02 a tonne amid investor caution over the scale of China’s demand recovery.

Looking ahead, Goldman Sachs believes the benchmark iron ore price will average US$111 a tonne in 2024.

After which, the broker is forecasting weaker prices the following year. It expects an average benchmark iron ore price of US$95 a tonne in 2025.

This trend is expected to continue in 2026, with Goldman pencilling in an average benchmark iron ore price of US$93 a tonne for the year.

Finally, in 2027, the broker believes the steel-making ingredient will soften slightly again. It is forecasting an average benchmark iron ore price of US$92 a tonne for the year.

In summary, Goldman expects the following for iron ore:

• 2024: US$111 a tonne
• 2025: US$95 a tonne
• 2026: US$93 a tonne
• 2027: US$92 a tonne

Lithium price forecast

It certainly has been a tough 12 months for owners of lithium stocks such as Core Lithium Ltd (ASX: CXO), Liontown Resources Ltd (ASX: LTR), and Pilbara Minerals Ltd (ASX: PLS). They have underperformed due to significant weakness in the lithium price.

But will this weakness soon ease or are things going to stay the same way? Let’s now take a look at what Goldman Sachs expects.

As a reminder, the current spot price of lithium carbonate in China is US$13,547 a tonne. This is down from the 2022 average of US$63,232 and 2023 average of US$32,694 a tonne.

Goldman expects the following for lithium carbonate:

• 2024: US$11,106 a tonne
• 2025: US$11,000 a tonne
• 2026: US$13,323 a tonne
• 2027: US$15,646 a tonne

There are of course multiple types of lithium, so now let’s take a look at the price of spodumene.

The current spot price of lithium spodumene is US$1,210 a tonne. This is down from the 2022 average of US$4,368 and 2023 average of US$3,712 a tonne.

Goldman expects the following for lithium spodumene:

• 2024: US$928 a tonne
• 2025: US$800 a tonne
• 2026: US$978 a tonne
• 2027: US$1,155 a tonne

As you can see above, it seems that Australian lithium miners are going to have to get used to lithium prices trading around current levels for the foreseeable future.

The post Here are the iron ore and lithium price forecasts through to 2027 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. 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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