High interest rates have impacted demand for a number of companies. I’m going to write about three ASX shares that I think could see a recovery if and when the Reserve Bank of Australia (RBA) starts cutting interest rates.

Some ASX companies have done remarkably well despite the headwinds they’re facing. I think a fall in the interest rates may mean earnings are boosted and investors are willing to pay for a higher price/earnings (P/E) ratio.

Here’s why I’m optimistic about these three ASX shares.

Beacon Lighting Group Ltd (ASX: BLX)

Beacon Lighting describes itself as a leading national and international provider of innovative, technologically advanced and energy-efficient lighting and cooling solutions. It may be best known for lighting, but it also claims to have the largest range of fans in Australia. Many of the company’s product ranges are exclusive to Beacon.

I think lower interest rates could spur demand for household renovation and construction, which could flow into demand for Beacon products.

Beacon also has a sizeable and growing international division – this is exciting because of the scale of the markets in North America and Asia. If Australian rates fall, it could weaken the Australian dollar, which would increase the value of those international sales in Australian dollar terms.  

According to the forecast on Commsec, the Beacon Lighting share price is valued at 19x FY24’s estimated earnings.

Reece Ltd (ASX: REH)

Reece claims to be Australia’s largest plumbing and bathroom supplies business. It has an expansive network of showrooms in Australia, and it also has a growing presence in the United States after an acquisition a few years ago. Reece is also involved in irrigation, pools, HVAC and civil works in Australia.

The ASX share is another name that could benefit from a recovery in renovation and construction activity in Australia (and the US) if central bank interest rates fall.

Reece is planning to open between 10 to 15 branches per year in the US, which could be a useful tailwind for earnings (and be boosted by a weaker Australian dollar if rates fall). The company is working on non-plumbing network expansion in Australia and New Zealand.

From the outside, Reece appears to be well-managed, and in three to five years, I think the business could be making a lot more profit.

According to the forecast on Commsec, the Reece share price is valued at 42x FY24’s estimated earnings.

Metcash Limited (ASX: MTS)

Metcash is a diversified business with food, liquor and hardware earnings. It supplies independent retailers around the country including IGA supermarkets, Cellarbrations, The Bottle-O, IGA Liquor, Porters Liquor, Thirsty Camel, Big Bargain Bottleshop and Duncans.

What excites me most about this business is the hardware division, which includes Total Tools, Home Timber & Hardware and Total Tools. It also supports independent operators under the small format convenience banners Thrifty-Link Hardware and True Value Hardware. I believe this division can benefit substantially if interest rates are cut by the RBA.

While the hardware operations aren’t as strong as Bunnings, I think they are worthy competitors. The Metcash share price is only trading at 13x FY24’s estimated earnings, according to Commsec. I think this is a low P/E ratio for the quality of the business.

The ASX share also recently announced the acquisitions of Superior Food (a leading Australian foodservice distribution business), Bianco Construction Supplies (a business operating in SA and NT), and Alpine Truss (one of the largest frame and truss operators in Australia). These companies can help diversify and grow earnings.

The post 3 ASX shares that could soar thanks to the RBA appeared first on The Motley Fool Australia.

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More reading

• Why Champion Iron, Core Lithium, Metcash, and West African shares are sinking
• These 3 ASX 200 shares just got some big broker upgrades!
• Why are Metcash shares tumbling today?
• Metcash shares paused for $325m capital raising to fund Superior Food acquisition
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor Tristan Harrison has positions in Metcash. 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 Metcash. 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 a lot of options for investors to choose from in the Australian mining sector.

So much so, it can be hard to decide which ones to buy over others.

To narrow things down, I’ve picked out two ASX mining shares that are highly rated by brokers right now. Here’s what they are saying about them:

Chrysos Corporation Ltd (ASX: C79)

While Chrysos isn’t a miner, it works closely with mining giants as a provider of novel assay services.

Bell Potter is very positive about its technology, PhotonAssay, highlighting its competitive advantage over traditional assaying techniques. The broker has a buy rating and $8.50 price target on its shares. It commented:

We believe C79’s disruptive PhotonAssay technology will command a significant foothold within the large gold assaying market (BPe 25% market penetration by FY30), with current lease agreements providing good near-term deployment visibility. These lease agreements with some of the largest gold miners and international laboratory businesses provide third-party technical and commercial validation for PhotonAssay technology adoption, which we expect to support further industry take-up.

South32 Ltd (ASX: S32)

This diversified miner could be a top option for investors according to analysts at Morgans.

Its analysts see major upside potential for the ASX mining share over the next 12 months with their add rating and $4.75 price target. The broker commented:

S32 has transformed its portfolio by divesting South African thermal coal and acquiring an interest in Chile copper, substantially boosting group earnings quality, as well as S32’s risk and ESG profile. Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.

The post Brokers say these ASX mining shares are strong buys in February appeared first on The Motley Fool Australia.

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More reading

• ‘Start building a position’: 3 ASX shares to pounce on right now
• Why did this ASX All Ords stock sink 6% after a high growth quarter?
• Why Adriatic Metals, Chrysos, Coronado, and Nanosonics shares sinking today
• Here are the top 10 ASX 200 shares today
• Goldman Sachs says these ASX 200 mining shares can rise 20%+

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 Chrysos. The Motley Fool Australia has positions in and has recommended Chrysos. 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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Australia is blessed with many quality dividend stocks, with a bunch of shares on the ASX right now paying up more than 10% yield.

That’s some pretty handy passive income.

However, investors do need to do their research and be careful about stock selection.

IG Australia market analyst Hebe Chen warned that a high dividend yield doesn’t automatically make a stock a worthy investment.

“A ‘yield trap’ to avoid is parking your money in a stock that offers a seemingly attractive yield despite having weak financial fundamentals, which can erode the total value of your capital,” Chen told The Motley Fool.

“When a company either increases its dividend beyond the norm or experiences a rapid decline in share price, it can create the illusion of a high yield.”

Keeping this in mind, Chen named three dividend stocks on the ASX that she would be tempted to buy at the moment:

The geese laying golden dividends

Helia Group Ltd (ASX: HLI) is a finance company that provides lenders’ mortgage insurance.

The business has been going well, with the half-year ending last June showing a 32% improvement in the underlying net profit after tax (NPAT).

And it shows in the stock performance.

“Helia offers a 16% gross dividend yield, while its stock prices have delivered a 72% one-year return and a remarkable 223% three-year return,” said Chen.

Helia’s 2023 full-year results will be revealed on 27 February.

Fortescue Ltd (ASX: FMG) has been making hay with the global iron ore price surprisingly buoyant over the past year.

“Fortescue offers an 8.91% gross dividend yield, with its stock prices recently reaching an all-time high,” Chen said.

“FMG’s share price [has] increased by 27% in the past 52 weeks and an astonishing 600% since 2019.”

BSP Financial Group Ltd (ASX: BFL) is a name rarely discussed, but it is a $3 billion player on the ASX.

The business is, in fact, the largest bank in Papua New Guinea, and the dividend stock has been very rewarding to its investors in recent times.

“BSP Financial’s gross dividend yield was 9.75% in the past financial year, with its stock price jumping 32% from early last year and 51% over the past two years.”

Chen reminded investors that harvesting high dividends is “a balancing act”. 

“For investors seeking sustainable passive income and a stress-free investment journey, it’s crucial not only to check the dividend yield but also to consider the stock’s past performance as the essential criteria.”

The post 16% gross yield: The 3 hottest high-dividend ASX stocks to buy right now appeared first on The Motley Fool Australia.

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More reading

• How to build a bulletproof ASX 200 passive income portfolio with just $10,000
• Shares vs. property: Beginner investors choosing Aussie shares, ASX ETFs and rentvesting
• Which major ASX mining share will pay the biggest dividend this year?
• Are investors underestimating ASX iron ore big-wigs this earnings season?
• Up by 55%, is it too late to buy Fortescue shares?

Motley Fool contributor Tony Yoo 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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Are you an income investor looking for ASX 200 dividend shares to buy? If you are, then you might want to read on.

That’s because listed below are three top income shares that analysts are recommending as buys.

Here’s what you need to know about them:

ANZ Group Holdings Ltd (ASX: ANZ)

If you’re wanting exposure to the banking sector then ANZ could be a top ASX 200 dividend share to buy.

Goldman Sachs is very positive on ANZ due to its strong-performing institutional operations. It currently has a buy rating and $27.85 price target on its shares.

As for dividends, the broker is forecasting fully franked dividends per share of $1.62 in both FY 2024 and FY 2025. Based on the current ANZ share price of $27.68, this will mean dividend yields of 5.9%.

Centuria Industrial REIT (ASX: CIP)

Another ASX 200 dividend share that has been given the seal of approval by analysts is Centuria Industrial.

It is Australia’s largest domestic pure play industrial property investment vehicle with a portfolio of high-quality industrial assets.

UBS is positive on the company and last week retained its buy rating and $3.71 price target on its shares.

In respect to income, the broker is expecting Centuria Industrial 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 $3.35, this represents yields of 4.8% in both years.

Telstra Group Ltd (ASX: TLS)

A final ASX 200 dividend share that analysts are bullish on is telco giant Telstra.

Goldman Sachs has a buy and $4.65 price target on its shares. It likes the company’s low risk earnings and dividend growth over the coming years.

Speaking of the latter, Goldman is forecasting fully franked dividends of 18 cents per share in FY 2024 and then 19 cents per share in FY 2025. Based on the current Telstra share price of $3.98, this equates to fully franked yields of 4.5% and 5%, respectively.

The post 3 ASX 200 dividend shares to buy with great yields appeared first on The Motley Fool Australia.

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More reading

• 3 things ASX investors should watch this week
• How to build a bulletproof ASX 200 passive income portfolio with just $10,000
• 10 time-wasters that could destroy your ASX investments
• 5 ASX shares to buy and hold forever in your investment portfolio
• This tiny ASX tech share is leaping 25% after striking a deal with Telstra

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended 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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High growth and high yield? Who doesn’t want a piece of action like that!

Moomoo market strategist Jessica Amir this week named two S&P/ASX 200 Index (ASX: XJO) stocks her team is bullish on that are both displaying some impressive numbers:

Chicken run

There is a theory that in times of economic distress, consumers turn to cheaper sources of dietary protein.

So after 13 interest rate rises, Australians could be eating less red meat and turning to more poultry.

Perhaps this is why Inghams Group Ltd (ASX: ING) is going gangbusters, rocketing 53% over the past 12 months.

“The old chicken stock is doing well and shareholders are being rewarded… and, likely, more green pastures are ahead,” said Amir.

“The biggest cost for chicken businesses is wheat — which is at an all-time low. Given that 70% of the cost of growing a bird is food, this is a huge benefit to farmers.”

Inghams also produces turkey, which is also cheap to produce at the moment.

“The biggest cost for turkeys is soybeans, which is down 31% at four-year lows. Revenues for Inghams; turkeys are going strong at the moment.”

The financial outlook is pretty bright, with earnings forecast to rise.

“Ingham’s forward earnings have been strong with a forward dividend yield of 3.3%. 

“The market expectation is 95.7% earnings per share growth this year — more than last year’s 73% EPS growth.”

Qualitatively, Amir noted that Ingham is shifting from renting real estate to buying, which is a sign of “low debt and a strong outlook”.

‘High potential growth’ ASX 200 stock paying 10.5% yield

Now that a merger with Santos Ltd (ASX: STO) has been ruled out, Amir admits the Woodside Energy Group Ltd (ASX: WDS) could see some volatility in the near term.

But she cannot resist the latter’s incredible 10.5% dividend yield.

“In the long-term, Woodside shows signs of high potential growth.”

The caveat is the rise of nuclear-generated power.

“Nuclear energy will be the talk of the town in the coming years, led by the US, Canada and Japan. 

“Woodside is looking to be more primed to pivot into the global LNG sector.”

Many other professional investors are also bullish on Woodside. According to CMC Invest, eight out of 13 analysts currently rate the energy stock as a buy.

The post Up 53% and 10.5% yield: 2 ASX 200 shares with signs of ‘high potential growth’ appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Monday
• How to build a bulletproof ASX 200 passive income portfolio with just $10,000
• What this Warren Buffett-linked CEO’s prediction could mean for Woodside shares
• ASX dividend shares: What’s better, growth or consistency?
• Why the Santos share price could surge in 2024 without Woodside

Motley Fool contributor Tony Yoo 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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On Friday, the S&P/ASX 200 Index (ASX: XJO) ended the week with a modest gain. The benchmark index rose slightly to 7,644.8 points.

Will the market be able to build on this on Monday? Here are five things to watch:

ASX 200 expected to open flat

The Australian share market looks set for a subdued start to the week despite a reasonably positive finish on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day flat. On Friday on Wall Street, the Dow Jones was down 0.15%, but the S&P 500 rose 0.6% and the Nasdaq jumped 1.25%.

Oil prices rise

ASX 200 energy shares including Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) could start the week positively after oil prices rose on Friday night. According to Bloomberg, the WTI crude oil price was up 0.8% to US$76.84 a barrel and the Brent crude oil price was up 0.7% to US$82.19 a barrel. Oil prices rose amid rising tensions in the Middle East.

JB Hi-Fi results

JB Hi-Fi Limited (ASX: JBH) shares will be on watch today when the retail giant releases its half year results. Morgans sees scope for JB Hi-Fi to surprise to the upside. It said: “We think there’s a good chance JB Hi-Fi could surprise positively in its 1H24 result. We forecast EBIT of $371.0m, 4% above consensus of $358.2m.”

Gold price falls

ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could trade lower after the gold price fell on Friday. According to CNBC, the spot gold price was down 0.45% to US$2,038.70 an ounce. Rising bond yields reduced the appeal of the precious metal.

Boral rated as a sell

Boral Ltd (ASX: BLD) shares are overvalued according to analysts at Goldman Sachs. According to a note, the broker has reiterated its sell rating on the building materials company’s shares with a $5.40 price target. Goldman said: “Although the turnaround has gained momentum, the upside appears to be substantially priced into the stock suggesting near flawless execution is required.”

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

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More reading

• How to build a bulletproof ASX 200 passive income portfolio with just $10,000
• Top brokers name 3 ASX shares to buy next week
• What this Warren Buffett-linked CEO’s prediction could mean for Woodside shares
• ASX dividend shares: What’s better, growth or consistency?
• Here’s how the ASX 200 market sectors stacked up this week

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 recommended Jb Hi-Fi. 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 reporting season continues in earnest, if you are invested in ASX shares you need to pay attention.

Fortunately for The Motley Fool readers, eToro market analyst Josh Gilbert has pointed out the three biggest events to monitor this week:

1. Australia unemployment

The financial markets, the Reserve Bank of Australia (RBA), and the general public will all be watching for the latest unemployment figures on Thursday.

Gilbert pointed out that December’s rise to 3.9% exceeded expectations.

“December’s uptick was perceived as a sign that the labour market could be loosening up, with job advertisement figures dipping and population growth remaining robust, suggesting that we might see a further rise in unemployment this week.”

Similar to the rate hikes over 2022 and 2023, Gilbert reckons the RBA will again fall behind compared to its peers.

“It’s likely to be one of the last major central banks to introduce rate cuts this year.”

2. CSL half-year results

Biotech giant CSL Ltd (ASX: CSL) has enjoyed a 32% rise in its share price since late October.

But it recently saw a setback that could have longer term implications.

“The company’s share price faced a decline [last week] following news of a UK investigation into alleged anti-competitive behaviour from CSL Vifor. 

“If found guilty, CSL faces potential fines and reputational damage, which may impact the company’s FY24 results.”

The last reporting season was positive for the ASX healthcare company.

“Shareholders were pleased with the healthcare giant’s FY23 results, where revenue growth went up 31% year-over-year to US$13.31 billion, and the company’s FY24 guidance continued to hold firm.”

On Tuesday morning, the market will be watching carefully how CSL is progressing in its underlying profit guidance of US$2.9 billion to US$3 billion for FY24.

“[Investors] are keen to ascertain whether CSL has sustained its course toward recovery following the turbulence its share price experienced in 2023.”

3. Telstra half-year results

Another portfolio staple, Telstra Group Ltd (ASX: TLS) is reporting on Thursday.

According to Gilbert, the telco stock has been disappointing in recent times.

“It’s been a lacklustre couple of years for Telstra, with shares falling by around 2% in that time, despite a 14% jump in profitability last year.

“This week’s half-year results will be a key insight as to how cost-cutting has aided the businesses bottom line.”

Gilbert is optimistic about the coming results, though.

“Telstra’s profits look set to continue growing. 

“In August, the business forecasted an EBITDA of $8.2 billion to $8.4 billion in FY24, well ahead of FY23’s $7.86 billion.”

The post 3 things ASX investors should watch this week appeared first on The Motley Fool Australia.

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More reading

• Own CSL shares? What to expect from its half-year results
• 10 time-wasters that could destroy your ASX investments
• 5 ASX shares to buy and hold forever in your investment portfolio
• Here’s how the ASX 200 market sectors stacked up this week
• This tiny ASX tech share is leaping 25% after striking a deal with Telstra

Motley Fool contributor Tony Yoo has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended CSL. 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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Even for longtime readers of The Motley Fool, the question of how much one should invest persists.

Like anything in life, that depends on your personal goals.

How does a passive income of $1,000 each month sound?

If that’s about the level you wouldn’t mind achieving, let’s work backwards to see how much you need to invest.

How to grab $12,000 a year for doing nothing

A monthly income of $1,000 would require an annual payout of $12,000.

For ease of calculation, if you’re maintaining a 12% compound annual growth rate (CAGR), you need a stock portfolio of $100,000 to receive that level of passive income.

Is 12% realistic? I think it is.

Check out popular ASX growth stocks like Johns Lyng Group Ltd (ASX: JLG) or Xero Ltd (ASX: XRO).

Over the past five years, through such trauma as the COVID-19 crash and the inflation selloff, they have returned 480% and 130% respectively.

That equates to a CAGR of 42% and 18%.

Even looking at dividend stocks, if you had the foresight to own Whitehaven Coal Ltd (ASX: WHC) over the past half-decade, you would have gained almost 70% while raking in a yield of 9.7%.

I’m not suggesting you will consistently pick spectacular winners like Johns Lyng, Xero and Whitehaven.

If you did, you would be some sort of stock-picking savant who would be working for an investment bank.

No, the point is that if you have some such winners, they can absorb the losses from your flops and then some.

It’s all about diversification.

The short answer and the long answer

That’s the short answer — $100,000 is how much you need to produce $1,000 of monthly passive income.

But what if you don’t have that sort of cash just laying around?

If you just have $20,000 to invest, but you can afford to chip in an extra $200 each month, the power of compounding will take you to the promised land in 10 years.

From then on it’s all gravy as you rake in a grand every month for doing nothing.

Sweet as.

The post ASX passive income: How much should you invest to earn $1,000 every month? appeared first on The Motley Fool Australia.

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More reading

• If I’d invested $10,000 in this ASX 200 share 3 years ago I’d have $58,538 today!
• 3 ASX shares predicted to enjoy ‘strong growth’ in 2024 earnings
• These ASX tech shares could rise 18% to 30% this year
• $20,000 in savings? Here’s how I’d try to turn that into $1,463 a month of passive income
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Tony Yoo has positions in Johns Lyng Group and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Johns Lyng Group and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool Australia has recommended Johns Lyng 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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Recent years have been volatile for ASX healthcare shares.

The past eight months have seen the S&P/ASX 200 Health Care Index (ASX: XHJ) swing 23% from peak to trough, then another 27% back the other way.

It seems the market can’t decide whether the health sector is valuable as a defensive investment or the rapid rise in interest rates is harming future earnings.

But amid this to-ing and fro-ing, there have been some gems strong enough to keep swimming in one direction.

One of these is Clarity Pharmaceuticals Ltd (ASX: CU6).

‘The most exciting company I’ve come across in Australia’

Clarity, which is developing treatments for prostate cancer, saw its shares languish at 41 cents in May 2022.

Let’s imagine you bought $20,000 at that time.

Since then, the business has hit home run after home run, sending the market into a frenzy.

In fact, Frazis Capital portfolio manager Michael Frazis was full of praise for the biotech last month.

“This is the most exciting company I’ve come across in Australia lately,” he said in an update to clients.

“Clarity has been steadily releasing data from patients treated with their copper therapies with late-stage prostate cancer.”

On Thursday morning, the Clarity share price hit a new 52-week high of $2.87.

That $20,000 you invested only 21 months ago would now be worth a stunning $140,000.

That’s a seven-bagger in less than two years, thank you very much.

The bulls are still bullish on this healthcare stock

As well as Clarity’s own wins with favourable test results and regulatory approvals, there is a potential structural tailwind for prostate cancer therapies.

Currently, new treatments, such as the one Clarity is working on, are given only to “heavily pretreated patients” who have already had more traditional therapies applied to them.

But this could change, according to Frazis.

“The trend is towards increased monitoring and — where possible — fewer surgeries and hormone therapy, which involves the unwelcome side effects of incontinence, impotence, low testosterone and depression.

“The hope is that these targeted treatments, with their milder side effects, will move further up the treatment timeline, which could double or even triple industry revenues.”

Admittedly this cultural change will take time, but Frazis reckons the shift is “looking more likely than ever today”.

This is why, despite a 237% rocket in the share price over the past 12 months, many professionals are still bullish on Clarity.

Broking platform CMC Invest currently shows all three of Bell Potter, Jefferies, and Wilsons rating the healthcare stock as a buy.

The post This ASX healthcare stock turned $20k into $140,000 in less than 2 years appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo 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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Next week will be a big one for CSL Ltd (ASX: CSL) shares and shareholders.

That’s because the biotechnology company is scheduled to release its half year results on Tuesday.

Ahead of the release, let’s now take a look to see what the market is expecting from the company.

Half-year results preview

There are likely to be two key things to look out for when CSL releases its results next.

The first is its profit growth and whether it is on course to achieve its guidance in FY 2024. Morgans is expecting a solid first half performance. It said:

FY24 guidance suggests solid 1H. FY24 constant currency guidance calls for NPATA US$2.9-3bn (13-17%) on 9-11% revenue growth, with operating efficiency improving, B/S leverage declining (2x ND/EBITDA) and ROIC “steadily improving” over time.

Elsehwere, the team at Citi is forecasting 17.6% earnings per share growth in FY 2024. So, its analysts will no doubt be looking for similar growth during the first half.

What else?

Another metric to keep an eye on is the gross margin of the key CSL Behring business. This arguably has the biggest impact on the company’s profitability. So, if this margin shows signs of improvement, it could go down well with the market.

According to a note out of UBS, the consensus estimate for CSL Behring’s gross margin is 50.3%. This is slightly ahead of the broker’s estimate of 49.8%.

Should you buy CSL shares?

Citi, Morgans, and UBS are all bullish on CSL and currently have the equivalent of buy ratings on its shares.

The notes reveal that Citi has a buy rating and $325 price target, Morgans has an add rating and $328.20 price target, and UBS has a buy rating and price target of $350.

The post Own CSL shares? What to expect from its half-year results appeared first on The Motley Fool Australia.

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More reading

• Here’s how the ASX 200 market sectors stacked up this week
• Morgans says these ASX 50 shares are strong buys
• Up 28% since October, why are CSL shares attracting regulator scrutiny?
• 3 ASX blue-chip stocks I think every Aussie should own
• Brokers name 3 ASX shares to buy now

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in CSL. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has recommended CSL. 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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