Endeavour Group Ltd (ASX: EDV) shares have underperformed the market over the last 12 months.

During this time, the ASX 200 drinks giant’s shares have lost over 20% of their value. This leaves them trading within sight of their 52-week low.

While this is disappointing for shareholders, has it created a buying opportunity for others?

Is it time to buy this ASX 200 giant?

A number of brokers believe that the Dan Murphy’s and BWS owner’s shares could offer big returns over the next 12 months.

For example, Ord Minnett currently has an accumulate rating and $6.10 price target on its shares and UBS has a buy rating and $6.00 price target on them. This implies upside of 14% and 12%, respectively, for investors from current levels.

In addition, both brokers are forecasting 4%+ dividend yields in FY 2024 and FY 2025, boosting the total potential return further.

They are not alone with their buy ratings. The most bullish broker out there is Goldman Sachs, which has a buy rating and $6.20 price target on the ASX 200 giant.

This price target suggest that Endeavour’s shares could rise almost 16% over the next 12 months. And like the other brokers, Goldman is expecting attractive dividend yields from its shares in the coming years.

Goldman expects fully franked dividends per share of 22 cents in FY 2024 and FY 2025, and then 24 cents in FY 2026. This will mean yields of 4.1% for the next two years and then 4.5% the year after.

All in all, if the broker is on the money with its recommendation, you could expect to receive a 20% return on your investment over the next 12 months.

To put that into context, this would turn a $20,000 investment into $24,000.

Why buy Endeavour shares?

A few weeks ago, Goldman explained why it thinks this ASX 200 giant is a buy. It named two key reasons underpinning its buy rating. The broker explained:

Our Buy thesis on the stock is based on the following key drivers: 1) Market share gain (already 40% market share) in defensive alcohol retail from consumer data and loyalty advantages; 2) Organic reopening beneficiary with its hotels/pubs business back to pre-COVID sales/property. We believe EDV is trading at a relatively attractive valuation, with potential downside from EGM tax changes already fully priced in. We are Buy rated on EDV.

Overall, this could make it a top option for investors looking for high-quality options for their portfolio.

The post Should I rush to buy this ASX 200 giant currently near its 52-week low? appeared first on The Motley Fool Australia.

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More reading

• 5 excellent ASX dividend stocks to buy in April
• 3 ASX income shares to buy for a dividend boost
• 2 market-leading ASX dividend stocks to buy in April
• 1 ASX dividend stock down over 20% to buy right now
• 3 ASX dividend shares to buy for a passive income boost

Motley Fool contributor James Mickleboro has positions in Endeavour Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has 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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Investing in ASX shares can help investors achieve excellent wealth-building and enable people to retire early. What if someone started investing today – how long would it take for them to retire?

Everyone has different personal finances, with various levels of starting wealth and income. I’m going to try to work out what it would take for a 20-year-old, a 30-year-old, a 40-year-old and a 50-year-old to achieve retirement.

How much to aim for?

I used to think that $1 million was a good goal to work towards. However, inflation of various goods, services and housing has meant we may need a bit more than that. I’m going to talk about a goal of $1.25 million. That may sound like a lot, but I will show how compounding can do a lot of the work for us.

If we can reach $1.25 million, and we own a portfolio with a dividend yield of 5%, that could pay $62,500 of passive income. Other forms of income could make up any further required cash flow.

In each of the below scenarios, I’m not specifically talking about superannuation because I’m thinking about a scenario where we can retire before being able to fully access it. However, mandatory superannuation contributions and long-term growth can do a lot of the heavy financial lifting if someone doesn’t aim for early retirement.

50-year-old

Someone just starting out with $0 may not have a long time to build wealth, but it can work, particularly if we keep in mind that the age pension is available for people who don’t have a lot of wealth.

If we’re aiming for $1.25 million by 65, that’s 15 years away. The age pension starting point is currently set at 67, so we’re aiming to retire a couple of years early.  

Let’s assume the portfolio matches the long-term return of the share market of around 10% per annum.

To get to $1.25 million in 15 years, if the portfolio returns 10% per annum, that person would need to invest $2,650 per month.

40-year-old

Someone who has just turned 40 still has more than two and a half decades until they reach the right age for the pension.

Let’s say this person wants to retire by 60, which is seven years earlier than the pension age, it gives them 20 years to compound the wealth.

To reach $1.25 million in 20 years, if the portfolio is returning 10% per annum, that person would need to invest $1,500 per year.

30-year-old

A 30-year-old has decades of time ahead of them before reaching typical retirement age.

More time until retirement could mean being able to target a retirement date of 55 years which is roughly a decade before being able to access the pension (under the current rules).

To reach $1.25 million in 25 years, assuming the portfolio returned 10% per annum, we’re talking about needing to invest around $850 per month.

20-year-old

People just starting their careers don’t really need to be thinking about retirement. But, any progress made in the 20s can make a big difference to how things turn out in the long term.

With so many years of potential compounding ahead, it can make a lot of sense to invest a bit now. Let’s say we’re aiming for $1.25 million by 50, which is in 30 years.

To reach $1.25 million in 30 years, and the portfolio makes 10% per annum, a 20-year-old would only need to invest $510 per month.

Foolish takeaway

Inflation will play a big part in how much passive income we need in future retirement. A $1.25 million balance will probably have a lot more purchasing power next year than in 30 years, so I’d suggest younger Aussies try to invest more than the above calculations if they want a very comfortable retirement.

It may also be possible to find investments that can deliver returns that are stronger than 10% per annum. I like quality-based exchange-traded ETFs (ETFs) such as VanEck Morningstar Wide Moat ETF (ASX: MOAT) and VanEck MSCI International Quality ETF (ASX: QUAL).

The right individual ASX shares may be able to produce the most appealing returns of all.

The post If you start investing today, when could you retire? appeared first on The Motley Fool Australia.

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More reading

• Why I’d buy VanEck Morningstar Wide Moat ETF (MOAT) for anyone in my family
• 3 excellent ASX ETFs for smart investors in April
• How to become a millionaire on a $70,000 salary
• Which ASX ETFs give Aussie investors access to US stocks?
• 3 star ASX shares to buy for the rest of 2024

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

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When it comes to investing in the mining sector, there are two names that come to mind immediately.

These are BHP Group Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO). But are their shares in the buy zone right now?

Let’s take a look and see what analysts at Goldman Sachs are saying about the two mining behemoths ahead of the release of their quarterly updates later this month.

Should I buy BHP and Rio Tinto shares?

The good news is that Goldman Sachs thinks that both miners are top options for investors right now.

And while the broker has a preference for Rio Tinto, it still feels that BHP shares offer a compelling risk/reward.

According to the note from this morning, the broker has retained its buy rating on the Big Australian’s shares with a slightly trimmed price target of $49.20. This implies almost 10% upside for investors from current levels.

In addition, the broker is forecasting fully franked dividend yields of 4.8% in FY 2024 and 4.3% in FY 2025. This stretches the total potential 12-month return beyond 14% if I were to buy BHP shares where they trade today.

Goldman likes BHP for four reasons. These include its attractive valuation and strong production growth opportunities. It explains:

Buy rated on: (1) Attractive valuation, but at a premium to RIO; (2) GS bullish copper and met coal; (3) Optionality with the +US$20bn copper pipeline and strong production growth over 24/25; (4) Robust FCF, but still below RIO. We continue to believe that BHP’s major opportunity is growing copper production in Chile at Escondida and Spence, and growing copper production and capturing synergies in South Australia between Olympic Dam and the previous OZL assets.

The top pick

Goldman’s preference remains with Rio Tinto shares. This morning, it has retained its buy rating on the miner’s shares with an improved price target of $140.20. This suggests potential upside of 14% for investors from current levels.

And with Goldman forecasting fully franked dividend yields of 5.4% in FY 2024 and 5.7% in FY 2025, I could get a total return of over 19% over the next 12 months if its analysts are on the money with their recommendation.

There are five reasons why the broker rates Rio Tinto shares as a buy. It explains:

Buy rated on: (1) compelling relative valuation vs. peers, (2) attractive FCF and Div yield, (3) strong production growth in 2024-2025E of ~5-6% CuEq driven by the ramp-up of the Oyu Tolgoi UG copper mine & a recovery at Escondida and Bingham, higher Pilbara Fe shipments with the ramp-up of new mines, (4) potential for FCF/t improvement in the Pilbara, and (5) high margin low emission aluminium business.

The post Should I buy BHP or Rio Tinto shares in April? appeared first on The Motley Fool Australia.

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More reading

• 5 excellent ASX dividend stocks to buy in April
• 5 things to watch on the ASX 200 on Thursday
• Are your big ASX 200 mining dividends in for a chop?
• Why are Rio Tinto shares outperforming the market on Wednesday?
• 3 ASX shares I think will lead the next bull market charge

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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As well as being able to invest in companies like Telstra Group Ltd (ASX: TLS) and Woolworths Group Ltd (ASX: WOW), the Australian share market also allows you to invest in the property market.

This is achieved through real estate investment trusts (REIT), which are companies that own and operate property assets. They also usually offer investors a nice source of passive income.

Three ASX REITS that have been rated as buys recently are listed below. Here’s what you need to know about them:

Centuria Industrial REIT (ASX: CIP)

The first ASX REIT to look at Centuria Industrial.

It is Australia’s largest domestic pure play industrial property investment vehicle with a portfolio of 88 high-quality, fit-for-purpose industrial assets worth a collective $3.8 billion. The assets are situated in key in-fill locations and close to key infrastructure.

UBS is positive on the company and recently retained its buy rating and $3.71 price target on its shares. The broker was pleased with the company’s performance during the first half, noting that it outperformed expectations and upgraded its funds from operations full-year guidance thanks to strong like-for-like rental growth.

Its analysts are expecting some attractive dividend yields from its shares in the near term. They are forecasting the company to pay dividends per share of 16 cents in both FY 2024 and in FY 2025. Based on the current Centuria Industrial share price of $3.44, this represents dividend yields of 4.65% in both years.

Dexus Convenience Retail REIT (ASX: DXC)

Another top ASX REIT for investors to look at is the Dexus Convenience Retail REIT.

It owns a portfolio of service station and convenience retail assets located across Australia concentrated on the eastern seaboard. Its tenant include Chevron, 7-Eleven, EG Australia, Coles Express, United, and Ampol.

The team at Morgans is positive on this REIT and has an add rating and $3.23 price target on its shares.

As for income, the broker is forecasting dividends per share of 21 cents in both FY 2024 and FY 2025. Based on its current share price of $2.75, this implies very large yields of 7.6%.

Healthco Healthcare and Wellness REIT (ASX: HCW)

Finally, analysts at Bell Potter thinks that the Healthco Healthcare and Wellness REIT could be an ASX REIT to buy.

It has a mandate to invest in hospitals, aged care, childcare, government, life sciences and research, and primary care and wellness property assets, as well as other healthcare and wellness property adjacencies.

Bell Potter currently has a buy rating and $1.70 price target on its shares.

In respect to income, its analysts are forecasting dividends of 8 cents per share in FY 2024 and 8.3 cents per share in FY 2025. Based on its current share price of $1.24, this will mean yields of 6.45% and 6.7%, respectively, for investors.

The post 3 top ASX REITs to buy in April 2024 appeared first on The Motley Fool Australia.

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More reading

• 3 ASX dividend stocks with good yields to buy now
• 2 ASX dividend shares with 5%+ yields to buy next week
• Buy ANZ and this ASX dividend share now
• Buy these ASX dividend stocks for an income boost
• 5 things to watch on the ASX 200 on Wednesday

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 Coles Group and Telstra 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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Changes to government legislation can impact Aussie businesses. That’s why staying abreast of proposed changes can be vitally important. Depending on the policy, it can quickly create opportunities and adversities for ASX stocks.

In saying that, I wouldn’t pick companies to invest in purely based on government policies. There also needs to be a quality business underneath.

It’s akin to surfing. A beach with great waves is a good start — these are the industry tailwinds — but if you’re a hopeless surfer (company), you’ll still struggle to make the most of the conditions. Good surf matched with talent, though, is a dangerously good combo.

Why this ASX stock could be a winner

AUSactive, an exercise and active health industry association, is pushing for some inclusions in the 2024-2025 Federal Budget.

In its submission, AUSactive calls for the government to:

1. Provide an exemption under the Fringe Benefits Tax (FBT) legislation
2. Make all Australian gym and active health memberships tax-deductible
3. Educate Australians on the importance of physical activity

Current legislation only allows a tax deduction if the person’s profession requires high fitness. However, AUSactive argues that the country would benefit from removing this stipulation. The association justifies this by pointing out an estimated $1.7 billion of costs directly from physical inactivity.

The submission highlights that 75% of Australian adults are not meeting recommended activity levels. By making memberships tax deductible and introducing an FBT exemption for employers, AUSactive believes Australia can improve its disease incidence, reduce absenteeism, and increase productivity.

One ASX stock that could arguably benefit if the government adopts this recommendation is Viva Leisure Ltd (ASX: VVA).

Operating across 345 locations (168 owned), Viva Leisure has built a considerable presence in the Australian health club industry. The company operates through several brands, including Club Lime, HIIT Republic, Plus Fitness, and GroundUp.

Viva’s half-year results show the company served 180,071, generating $79.1 million in revenue. That roughly works out to be $16.90 per member per week.

The upshot

If AUSactive’s submission goes ahead, we could see an increased push for gym signups. More employers may see fitness memberships as a good way of retaining employees, helping boost nationwide gym numbers.

Furthermore, if memberships become tax deductible, people might be inclined to upgrade and pay extra for the ‘next tier’.

Both situations would increase revenue and likely profits for an ASX stock such as Viva Leisure.

The post The tiny ASX stock that could surge on this pending government decision appeared first on The Motley Fool Australia.

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More reading

• 5 excellent ASX dividend stocks to buy in April
• 5 things to watch on the ASX 200 on Thursday
• 3 Australian shares quietly crushing the ASX this year
• 2 ASX shares I’d buy to quickly add diversification
• Is the Betashares Global Cybersecurity ETF (HACK) a good long-term investment?

Motley Fool contributor Mitchell Lawler 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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Fortunately for Australian income investors, there are plenty of ASX dividend stocks to choose from on the local share market.

But which ones could be top options for investors this month?

Let’s take a look at five excellent ASX dividend stocks that analysts are tipping as buys. They are as follows:

Endeavour Group Ltd (ASX: EDV)

Goldman Sachs thinks that the owner of BWS and Dan Murphy’s could be a top option for income investors right now. The broker currently has a buy rating and $6.20 price target on the drinks giant’s shares.

As for income, the broker is forecasting fully franked dividends of approximately 22 cents per share in FY 2024 and FY 2025. Based on the current Endeavour share price of $5.35, this will mean dividend yields of 4.1% for both years.

Rio Tinto Ltd (ASX: RIO)

The team at Goldman Sachs also thinks that this mining giant could be an ASX dividend stock to buy now. It has a buy rating and $140.20 price target on the miner’s shares.

In respect to dividends, the broker is forecasting fully franked dividends per share of US$4.38 (A$6.67) in FY 2024 and then US$4.63 (A$7.06) in FY 2025. Based on the latest Rio Tinto share price of $123.06, this will mean yields of approximately 5.4% and 5.7%, respectively.

Rural Funds Group (ASX: RFF)

Over at Bell Potter, its analysts think that this agricultural property company is an ASX dividend stock to buy. The broker currently has a buy rating and $2.40 price target on its shares.

As well as plenty of upside, the broker expects above-average dividend yields from its shares. It is forecasting dividends per share of 11.7 cents in both FY 2024 and FY 2025. Based on the current Rural Funds share price of $2.06, this will mean yields of 5.7% in both years for investors.

Transurban Group (ASX: TCL)

Citi thinks that Transurban could be an ASX dividend stock to buy. It is a leading toll road developer and operator. The broker has a buy rating and $15.60 price target on its shares.

As for income, it is expecting dividends per share of 63 cents in FY 2024 and 65 cents in FY 2025. Based on the current Transurban share price of $13.20, this will mean yields of 4.8% and 4.9%, respectively.

Universal Store Holdings Ltd (ASX: UNI)

Finally, the team at Morgans believes that youth fashion retailer Universal Store could be an ASX dividend stock to buy. It has an add rating and $5.65 price target on its shares.

In respect to income, the broker is forecasting dividends per share of 26 cents in FY 2024 and 29 cents in FY 2025. Based on the current Universal Store share price of $5.32, this will mean yields of 4.9% and 5.5%, respectively.

The post 5 excellent ASX dividend stocks to buy in April appeared first on The Motley Fool Australia.

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More reading

• Are your big ASX 200 mining dividends in for a chop?
• Why are Rio Tinto shares outperforming the market on Wednesday?
• Where I’d instantly invest $10,000 in ASX shares for passive income
• 3 ASX income shares to buy for a dividend boost
• 1 ASX dividend stock down over 34% to buy right now

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in Endeavour Group and Universal Store. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Transurban Group. The Motley Fool Australia has positions in and has recommended Rural Funds Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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On Wednesday, the S&P/ASX 200 Index (ASX: XJO) had a day to forget and tumbled deep into the red. The benchmark index sank a disappointing 1.3% to 7,782.5 points.

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

ASX 200 expected to rebound

The Australian share market looks set for a better session on Thursday following an improved night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 23 points or 0.3% higher this morning. In late trade on Wall Street, the Dow Jones is down 0.1%, but the S&P 500 has risen 0.15% and the Nasdaq is 0.2% higher.

Oil prices rise again

ASX 200 energy shares including Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a decent session after oil prices rose again overnight. According to Bloomberg, the WTI crude oil price is up 0.4% to US$85.47 a barrel and the Brent crude oil price is up 0.5% to US$89.38 a barrel. Rising geopolitical tensions have given oil prices a lift.

Dividend payday

Today is another big day for dividends with a number of ASX 200 shares distributing their latest payouts to their lucky shareholders. Among the companies that are paying dividends today are financial services company AMP Ltd (ASX: AMP), diversified food company Bega Cheese Ltd (ASX: BGA), mining giant South32 Ltd (ASX: S32), and energy behemoth Woodside. The latter is paying out a fully franked final dividend of 91.7 cents per share this morning.

Gold price jumps

It looks set to be a very good session for ASX 200 gold shares such as Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) after the gold price jumped overnight. According to CNBC, the spot gold price is up 1.5% to US$2,315.3 an ounce. The precious metal climbed to a new record high after demand for safe haven assets increased due to geopolitical risks.

Buy BHP shares

The BHP Group Ltd (ASX: BHP) share price is good value according to analysts at Goldman Sachs. This morning, the broker has retained its buy rating and $49.20 price target on the mining giant’s shares. Goldman named four reasons why it rates BHP as a buy. It said: “(1) Attractive valuation, but at a premium to RIO; (2) GS bullish copper and met coal; (3) Optionality with the +US$20bn copper pipeline and strong production growth over 24/25; (4) Robust FCF, but still below RIO.”

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

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More reading

• Here are the top 10 ASX 200 shares today
• Are your big ASX 200 mining dividends in for a chop?
• After a tepid March can the Woodside share price reignite in April?
• Is now the time to invest in these ASX 200 energy shares?
• Got $5,000? 5 ASX shares to buy for lasting wealth

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has 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 All Ordinaries (ASX: XAO) has risen a pleasing amount over the past six months, up more than 12%. However, when you zoom in for a closer look at the year to date, the All Ords has lifted only 2% in 2024.

There are a few Australian shares that have completely smashed the ASX’s return this year. Here are three of the top performers.

Life360 Inc (ASX: 360)

The Life360 share price has risen by almost 70% since the start of 2024.

This ASX tech share provides an app to families that helps track where people are via location sharing. The app has communication abilities, it delivers ‘safe driver reports’ and has crash detection with emergency dispatch.

A month ago, the company reported strong growth in its 2023 annual result. Revenue lifted 33% year-over-year to $305 million, and the company saw a 26% year-over-year increase in global monthly users to 61.4 million.

Profitability is now flowing through the business, too. Life360 delivered positive adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) of $20.6 million (beating guidance of between $12 million to $16 million). It also achieved a positive operating cash flow of $7.5 million, an improvement of $64.6 million year over year.

Life36 expects revenue of between $365 million to $375 million in 2024, with adjusted EBITDA of between $30 million to $35 million.

Step One Clothing Ltd (ASX: STP)

The Step One share price has risen by more than 60% since the start of 2024.

The Australian company describes itself as a leading direct-to-consumer online retailer of innerwear. It offers an exclusive range of high-quality, organically grown and certified, sustainable and ethically manufactured innerwear.

The company’s HY24 result released I February showed a lot of positive numbers. Revenue rose by 25.5% to $45.1 million, EBITDA grew 35.6% to $10.1 million, the gross profit margin improved from 80.7% to 81.2% and the average order value went up 4.7% to $94.47.

Step One Clothing also declared a dividend per share of 4 cents.

Temple & Webster Group Ltd (ASX: TPW)

Since the start of 2024, the Temple & Webster share price has risen around 40%.

Temple & Webster is an online retailer of homewares and furniture. It sells more than 200,000 products, with a large proportion from its hundreds of suppliers who ship directly to the customer. This process reduces the need for the ASX share to hold inventory. It also has a private label range.

The Australian share has a growing trade and commercial division, as well as a large range of home improvement products such as bathroom items, kitchen items, tiles, curtains, blinds, lighting and so on.

Temple & Webster’s HY24 result was impressive, considering the challenging economic conditions impacting household spending. Revenue rose by 23% to $254 million, and it achieved EBITDA of $7.5 million for the FY24 first half.

For the period of 1 January 2024 to 11 February 2024, revenue increased by 35%, thanks to both first-time and repeat customers. It finished with $114 million of cash and no debt.

The post 3 Australian shares quietly crushing the ASX this year appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360 and Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster 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 Betashares Global Cybersecurity ETF (ASX: HACK) is a leading exchange-traded fund (ETF) that gives us sector-specific exposure. In this article, I’m going to explore why it might be a strong investment to consider.

The HACK ETF aims to track the performance of leading companies in the global cybersecurity space. At the moment there are a total of 30 businesses within the portfolio.

Strong tailwinds

One of the main things about the cybersecurity sector that I’m attracted to is that it seems to have both defensive and growth characteristics.

There is a growing amount of transactions, communications and other connections done online. The government needs to protect the important information of its citizens. Banks need to protect the online banking activity of businesses and households. Retailers need to protect customers’ details and bank card details.

I’d suggest businesses and governments need to continue to maintain good cybersecurity even in a recession.

With people spending more time online, there is more potential for cyber criminals to trick or hack people.

Australia is one of the more digitalised nations, so our cyber trends could be a useful indicator of what the world might see when it comes to cybercrime and hint at what growth the rest of the world may see in the coming years.

The latest Australian Cyber Security Centre (ACSC) report released in 2023 showed that the average cost per cybercrime report increased by 14%. The average small business cybercrime cost per report was $46,000. There were almost 94,000 cybercrime reports, which was an increase of 23% year over year.

The top three cybercrime types for individuals were identity fraud, online banking fraud and online shopping fraud. The top three cybercrime types for business were ’email compromise’, ‘business email compromise (BEC) fraud’ and online banking fraud.

The HACK ETF businesses are the ones trying to limit the damage as much as possible.

Leading businesses

The idea of investing in the HACK ETF isn’t about any particular business within the portfolio, but many of the businesses in the portfolio are large and recognisable companies that have compelling positions in the market.

Within the portfolio are businesses like Cisco Systems, Broadcom, Crowdstrike, Palo Alto Networks, Infosys, Darktrace, Thales, Gen Digital, Tenable and Leidos.

As a group, these companies provide compelling exposure to the cybersecurity sector. If any particular business manages to make significant gains, then the ETF can benefit if the share price of that business increases. Collectively, those companies have done very well for investors in terms of capital growth.

Great returns

First, let me remind you that past performance is not a reliable indicator of future returns for shares.

Having said that, the HACK ETF’s return has been very good. As at 29 February 2024, the HACK ETF had returned an average of 17.9% per annum over the past three years, 18.1% per annum over the past five years and 18.6% per annum since inception in August 2016.

Foolish takeaway

It’s not as cheap as it was 12 months ago, but I think it still has a promising long-term future because of the tailwinds of cybercrime. Hopefully the good guys can stay ahead of the bad buys, while earning bigger profits.

The post Is the Betashares Global Cybersecurity ETF (HACK) a good long-term investment? appeared first on The Motley Fool Australia.

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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 BetaShares Global Cybersecurity ETF, Cisco Systems, CrowdStrike, and Palo Alto Networks. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Broadcom. The Motley Fool Australia has positions in and has recommended BetaShares Global Cybersecurity ETF. The Motley Fool Australia has recommended CrowdStrike. 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 post Here are the top 10 ASX 200 shares today 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 Ansell. 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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