The Pentanet Ltd (ASX: 5GG) share price has been a sensational performer on Tuesday.

In early trade, the cloud gaming provider’s shares rocketed as much as 70% to 28 cents.

The Pentanet share price has pulled back a touch since then but remains up 42% at 23.5 cents today.

Why is this ASX share rocketing higher?

Investors have been scrambling to buy the company’s shares after it announced a collaboration agreement with Optus Mobile.

According to the release, the initial 12-month agreement will see Pentanet deliver the NVIDIA GeForce NOW cloud gaming service to Optus customers.

Management believes that this agreement marks a significant milestone towards its goal of commercialising GeForce NOW with the introduction of Pentanet’s first large-scale wholesale partner.

The two parties will work towards a program that enables enhanced experience for GeForce NOW users on Optus SubHub, with a specific focus on 5G and the GeForce NOW user management platform, CloudGG.

Solidifying its position

Pentanet’s managing director, Stephen Cornish, was pleased with the news and believes it will solidify its position in the market. He said:

This is a big step towards solidifying our position in the gaming market, being the wholesale digital distribution channel for GeForce NOW in our territories. I’m looking forward to working closely with Optus and putting this game changing platform into the hands of new users.

Optus’ managing director of marketing and revenue, Matt Williams, added:

Our mission is to break down the barriers to gaming and offer our customers the freedom to play anywhere and anytime. Cloud gaming is an ideal example for 5G in the home and on the go, given the need for high speed, low latency connectivity, and we are excited that we will be able to offer that to our customers very soon.

The post Guess which ASX share is skyrocketing 70% after securing a deal with Optus appeared first on The Motley Fool Australia.

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More reading

• Hoping to collect the latest CSL dividend? Here’s how
• ASX 200 stock InvoCare rallies 37% on takeover approach
• How I’d aim to replace an entire salary with passive income from ASX dividend shares
• Sayona Mining share price charges higher following $55m cap raise
• Mineral Resources share price slides as Norwest takeover bid heats up

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 recommended Pentanet. 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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Perhaps uniquely amongst the top shares of the S&P/ASX 200 Index (ASX: XJO), healthcare giant CSL Ltd (ASX: CSL) is not well known for its dividend payments.

That’s because, unlike the big four banks, and the likes of BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO), and Telstra Group Ltd (ASX: TLS), the CSL dividend yield doesn’t often get above 1%.

Yet CSL still has a long and proud history of paying dividends to its shareholders. In fact, it has upped its dividend quite substantially over the past few years. Back in 2019, investors enjoyed $2.66 in annual dividends per share. But in 2022, this had ratcheted up to $3.18 per share.

This trend seems to be continuing in 2023. CSL’s next interim dividend, and its first for the year, is due on 5 April next month and will come in at US$1.07 per share, unfranked. That’s a decent 2.88% increase over 2022’s interim dividend of US$1.04 cents per share.

You’d better be quick if you want the next CSL dividend

But if you wish to collect this latest dividend from the blood plasma and vaccine company, you’d better be quick. That’s because CSL is scheduled to trade ex-dividend for this next payment in just two days’ time. Yes, CSL will ‘go ex-div’ for its next interim dividend on 9 March – this Thursday.

When a company trades ex-dividend, it cuts off any new investors from receiving its latest dividend payment. So anyone who owns CSL shares by the close of tomorrow’s trading session will receive the company’s upcoming dividend payment. But anyone who buys CSL shares from Thursday onwards will not.

Because of this, we can expect to see a bit of a drop in the CSL share price on Thursday morning. This will reflect the fact that CSL shares will become slightly less viable on Thursday, seeing as the shares will no longer come with the right to receive this latest dividend.

This is what typically happens when an ASX divided share passes its ex-dividend date.

So, as you might have gathered, CSL denominates its dividend payments in US dollars.

The raw amount of US$1.07 per share has been fixed, but ASX investors will only find out exactly how much is coming their way in Australian dollar terms on 10 March, this Friday. On today’s exchange rates though, it will be around $1.59 per share.

Then, it’s less than a month until dividend payday on 5 April.

At today’s pricing, CSL shares are up 4.31% in 2023 so far:

At this share price, CSL shares now have a dividend yield of 0.96%.

The post Hoping to collect the latest CSL dividend? Here’s how appeared first on The Motley Fool Australia.

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More reading

• It’s time to buy Rio Tinto shares: Goldman Sachs
• Hoping to pocket the next Rio Tinto dividend? Read this
• Keen to bag the latest BHP dividend? You’ll need to be quick
• 5 things to watch on the ASX 200 on Tuesday
• Here are the 3 most heavily traded ASX 200 shares on Monday

Motley Fool contributor Sebastian Bowen has positions in Telstra Group. 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 has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The InvoCare Limited (ASX: IVC) share price is shooting higher on Tuesday morning.

At the time of writing, the funerals company’s shares are up 37% to $12.26.

Why is the InvoCare share price racing higher?

Investors have been bidding the InvoCare share price higher today after the company received a takeover approach.

This followed the release of notice of initial substantial holder which revealed that Singapore-based company Blue Eternal and private equity firm TPG Asia have snapped up a significant holding in the funerals company.

The two parties have acquired a combined relevant interest and economic interest of 17.81% in InvoCare shares.

Blue Eternal and TPG paid a total of $309,877,486.60 for the shares, which equates to an average of $12.65 per share. This represents a massive 41.3% premium to the InvoCare share price at the close of play on Monday.

InvoCare confirms offer

Just before the market open, InvoCare confirmed that it has received an unsolicited, preliminary, non-binding indicative offer from TPG to acquire 100% of the issued shares of InvoCare by way of scheme of arrangement.

Under the indicative proposal, InvoCare shareholders would receive $12.65 cash per InvoCare share, adjusted for any additional dividends or capital returns made prior to completion of the proposed transaction.

The offer is subject to conditions including the completion of satisfactory due diligence, final approval of TPG’s Investment Review Committee, regulatory approval, and execution of binding transaction documents on mutually acceptable terms.

It also stipulates that the InvoCare board cannot have any engagement with third parties on an alternative change of control transaction during the due diligence period and negotiation of binding transaction documents.

The InvoCare board has now commenced an assessment of the indicative proposal. It has advised that shareholders do not need to take any action at this stage and warned there is no certainty that the proposal will result in a transaction.

While this offer is a significant premium to the current InvoCare share price, it is worth highlighting that it hit a 52-week low on Monday and was down 20% in the space of a month. The offer is also only a fraction above InvoCare’s 52-week high, which arguably makes it somewhat opportunistic.

The post ASX 200 stock InvoCare rallies 37% on takeover approach appeared first on The Motley Fool Australia.

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More reading

• 2 ASX shares crumbling over 7% on results announcements
• Why Appen, Downer, Fortescue, and Invocare shares are crashing today

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 dividend shares could be the ticket for workers who want to replace their whole salary with passive income.

Businesses have great potential to be able to pay dividends and re-invest in their businesses, enabling income for investors as well as compounding profit.

Investors have more options for where to put their money these days. Some term deposits and savings accounts can offer investors a yield that starts with a 4%.

But, I don’t think those investments that offer a fixed return are the way to build wealth because they don’t produce any growth themselves.

That’s why I think ASX dividend shares can be the tool that we use to build wealth.

How I’d plan to replace a salary with passive income

Before we get to the investing side of things, I think investors need to figure out how much they’re able to save and what level of passive income they’re aiming for.

Costs are quite a lot higher for households these days, with more expensive food and energy. It’s okay if investors aren’t able to save much in the current environment. Keeping a roof over one’s head and putting food on the table is the most important thing.

I’d also suggest that each adult needs to ensure they’re not trying to save too much and hurting today’s enjoyment. What I mean by that is that people get older, circumstances change and so on – sometimes it’s better to pay for an experience this year than wait for a distant future.

Having said that, I’d figure out how much we can save and invest. It could be $500 a month, $1,000 a month, $2,000 a month or even more.

Next, I’d want to work out what the dividend passive income goal is. Every household’s expenditure is different. The desired expenditure could also be different.

The Association of Superannuation Funds of Australia’s Retirement Standard suggests that a couple that owns their own home will need an income of about $67,000, while a single person will need an annual passive income of more than $47,000.

Start saving and investing

I’d then get to work and start investing that $1,000 a month or $2,000 a month, perhaps more, into ASX shares. So, that would turn into $12,000 a year or $24,000 a year.

Of course, making an annual passive dividend income of $67,000 or more will take time to build.

Investing $1,000 a month, and if the portfolio grows at 10% a year, could achieve $1.18 million after 25 years.

Investing $2,000 a month, and if the portfolio grew by 10% per year, could rise to $1.37 million after 20 years.

Both of those totals may seem like a lot, but I think they’re very achievable thanks to compounding. In the first example, investing $1,000 a month, it only takes the investor to add $300,000 of their own money – while $880,000 comes from investment returns in that example.

Which ASX shares to buy?

There are some ASX shares that I think can provide a solid amount of growth for investors and help compound a portfolio’s value, such as Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), VanEck Morningstar Wide Moat ETF (ASX: MOAT), Wesfarmers Ltd (ASX: WES), VanEck MSCI International Quality ETF (ASX: QUAL), Lovisa Holdings Ltd (ASX: LOV) and Betashares Nasdaq 100 ETF (ASX: NDQ).

When investors get closer to the age or figures they’re aiming for, I’d also want to consider some ASX dividend shares that pay good yields like Soul Pattinson, Wesfarmers, Rural Funds Group (ASX: RFF), Premier Investments Limited (ASX: PMV), Charter Hall Long WALE REIT (ASX: CLW) and Metcash Limited (ASX: MTS).

A $1.2 million portfolio with a 5% dividend yield would produce an annual passive income of $60,000. That sounds great to me.

The post How I’d aim to replace an entire salary with passive income from ASX dividend shares appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Tuesday
• Top ASX ETFs to buy in March 2023
• I think value investors would love to buy these 2 cheap ASX shares
• Making the first $1,000 in passive income: These are the ASX shares I would buy first
• 2 explosive ASX growth shares to buy this month: analysts

Motley Fool contributor Tristan Harrison has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. 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 Sayona Mining Ltd (ASX: SYA) share price has returned from its trading halt and is pushing higher.

In morning trade, the lithium developer’s shares are up 4% to 25 cents.

Why is the Sayona Mining share price rising?

Investors have been buying the company’s shares this morning after it announced the completion of a capital raising.

While a capital raising would usually have the opposite effect on a share price, things are different this time because Sayona Mining managed to raise the funds at a premium.

According to the release, the company has entered into a subscription agreement with PearTree Securities for the issue of 174,459,177 flow-through shares at a price of 31.5 cents per share for aggregate gross proceeds of $54.9 million.

The issue price of 31.5 cents per share represents a 34% premium to the Sayona Mining share price at Friday’s close.

Management notes that the funding will help advance exploration efforts while the company continues to progress the restart of its North American Lithium (NAL) operation, together with Sayona’s other growth projects in Quebec, including its emerging northern lithium hub.

How did the company manage to raise funds at a premium?

Firstly, all is not quite what it seems with this capital raising. This is because the shares that PearTree have subscribed to are Canadian flow-through shares (FTS).

The Canadian government explained their usage. It says:

Junior resource corporations often have difficulty raising capital to finance their exploration and development activities. Moreover, many are in a non-taxable position and do not need to deduct their resource expenses. The FTS mechanism allows the issuer corporation to transfer the resource expenses to the investor.

The FTS program provides tax incentives to investors who acquire FTSs by allowing: deductions for resource expenses renounced by eligible corporations; and investment tax credits for individuals (excluding trusts) on resource expenses in the mining sector that qualify as flow-through mining expenditures.

Nevertheless, Sayona’s Managing Director, Brett Lynch, believes this is a good outcome for shareholders. He commented:

Sayona has made significant progress in developing the leading hard rock lithium resource base in North America, with the pending restart of production at NAL set to mark our progression from explorer to producer. This funding will provide an added boost to our expansion plans, with the FTS provisions allowing us to raise capital at a premium to the current share price, thereby minimising dilution for the benefit of our shareholders.

The post Sayona Mining share price charges higher following $55m cap raise appeared first on The Motley Fool Australia.

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More reading

• Here are the 10 most shorted ASX shares this week
• Why has the Sayona Mining share price just been halted?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• Here are the 3 most heavily traded ASX 200 shares on Tuesday

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

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The Mineral Resources Ltd (ASX: MIN) share price is down 1.86% in early morning trading.

Shares in the S&P/ASX 200 Index (ASX: XJO) resources producer closed yesterday at $89.11 each. They are currently changing hands for $87.45 apiece.

This comes as Mineral Resources’ takeover of Norwest Energy NL (ASX: NWE) looks to be entering the final lap.

What’s happening with the Norwest takeover?

Mineral Resources first announced its plans for an off-market takeover bid of Norwest –  its minority joint venture partner in the Lockyer Deep gas project in the Perth Basin – on 16 December.

On the day of the announcement, the Mineral Resources share price retreated, pressured by broader market weakness.

Commenting on the takeover at the time, MinRes managing director Chris Ellison highlighted the massive potential of Lockyer Deep.

“The significant conventional gas discovery we made at Lockyer Deep last year, which we believe may be the largest onshore gas find in Australia, is driving us to develop and commercialise this high-quality energy source as quickly as possible,” Ellison said.

In today’s announcement (released after market close yesterday), the company reported that as at 2 March, it had voting power in Norwest of approximately 70%.

Adding some pressure on shareholders who’ve yet to accept the offer, Mineral Resources noted that if it acquires 80% of Norwest shares, shareholders “may be eligible for rollover tax relief”.

Norwest shareholders who take up the deal will receive one MinRes share for every 1,300 Norwest shares held. At the current Mineral Resources share price, that represents a premium of just under 1% to the current Norwest share price (down 1.47% at the time of writing).

The company stressed the offer was final and would not be increased.

It added that if it’s entitled to proceed to compulsory acquisition, Norwest shareholders not accepting the offer will receive the same consideration, but at a later date than if they’d accepted.

Mineral Resources said if it is not entitled to proceed to compulsory acquisition, it may apply to de-list Norwest from the ASX, “in which case it may become more difficult for Norwest shareholders to sell their Norwest shares”.

Commenting on the final stages of the takeover, Ellison said:

I’m encouraged that so many Norwest shareholders have accepted our Offer and now have exposure to MinRes’ world-class portfolio of diversified assets. Norwest shareholders will receive extraordinary value by accepting our offer and joining us in one of Australia’s fastest growing companies.

In a separate release this morning that was marked as potentially having an impact on the Mineral Resources share price, the company provided a detailed report on its JP Morgan, Global High Yield Conference presentation.

Mineral Resources share price snapshot

Despite today’s dip, the Mineral Resources share price remains a strong outperformer, up an impressive 85% since this time last year.

The post Mineral Resources share price slides as Norwest takeover bid heats up appeared first on The Motley Fool Australia.

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More reading

• Which ASX All Ords shares would be on my watchlist for generating massive dividends?
• Want passive income? These are the ASX dividend shares to buy according to experts
• What’s happening with ASX 200 lithium stocks this week?
• Why Block, Liontown, MMA, and Norwest Energy shares are charging higher today
• Buy Minerals Resources shares for 21% upside: broker

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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Rio Tinto Limited (ASX: RIO) shares are a leading opportunity, according to top broker Goldman Sachs.

The large ASX mining share has seen quite a lot of volatility over the past year, and the broker thinks that the business could rise from here.

A large part of Rio Tinto’s net profit comes from iron ore, so changes in the iron ore price can have a big impact on the rest of the underlying short-term value of the business and its profitability.

Rio Tinto has received backing from Goldman Sachs, suggesting it could have another good year.

Iron ore prices to go higher?

Goldman Sachs’ commodity team recently increased its iron ore price forecast to US$120 per tonne for 2023, up from US$100 per tonne, with a three-month target of US$150 per tonne, compared to the current price of around US$125 per tonne.

The broker has an expectation that the seaborne market should swing into a “significant deficit” of 43 million tonnes in the first half of 2023 because of “lower seasonal supply from Australia and Brazil and an expected recovery in Chinese steel volumes.”

Goldman Sachs pointed out that recently there is an ongoing recovery in Chinese property sales and an uptick in Chinese blast furnace utilisation, steel production and rebar prices. It noted that, generally, property lead starts driving higher steel demand.

Another factor that could help the iron ore price is that all of the above is happening while Chinese steel mills have their lowest inventories since 2016, with mills starting to restock in recent weeks.

Goldman Sachs finished its positive commentary for the iron ore market with this:

An improvement in Chinese steel prices and mill margins should also be positive for high grade iron ore.

Will this boost Rio Tinto shares?

The broker noted that Rio Tinto’s Pilbara iron ore business produced 324 mt in 2022, and Goldman Sachs thinks it will produce 335 mt in 2023 because of the ramp-up of the new 45mt Gudai-Darri mine by mid-year and the strong start with shipments.

Developing Rhodes Ridge “has the potential to be significant” for its Pilbara businesses as it could lift the mine system capacity by more than 10% to more than 360 mt per annum, utilise spare rail and port infrastructure, and help close the more than US$10 free cash flow per tonne gap with BHP Group Ltd (ASX: BHP) by US$6 to US$8 by the end of the decade.

Goldman Sachs said that Rio Tinto shares have a compelling valuation compared to peers. It could generate “strong” free cash flow and dividends, with the broker having a bullish view on iron, aluminium and copper prices. The broker is also expecting strong production growth of iron and copper. The high-margin, low-emission aluminium business could also be a positive.

$15 million fine

It was announced this morning that the ASX mining share has resolved an investigation by the US Securities and Exchange Commission (SEC) into some contract payments made to a former consultant in 2021, relating to the Simandou project in the Republic of Guinea.

Without admitting to or denying the SEC’s findings, Rio Tinto has agreed to pay a $15 million civil penalty for violations of the books and records and internal control provisions of the law.

The miner said it has taken “significant actions” to enhance its compliance programme. Dominic Barton, Chairman of Rio Tinto said:

We are glad to have resolved this matter related to events that occurred over a decade ago on appropriate and reasonable terms.

When Rio became aware of the issue, an internal investigation was immediately launched, and we
proactively notified the appropriate authorities.

Since becoming aware, Rio Tinto has taken significant actions to enhance our compliance
programme based on best practices. Under current leadership we are taking action to build a culture
guided by our values of care, courage and curiosity; an environment where every team member
feels comfortable to speak up if something is not right. We remain committed to conducting business
to the highest standards of integrity, and ensuring that our projects benefit communities, host
governments, shareholders, and customers.

Rio Tinto share price target

Goldman Sachs lifted its price target by 7% to $140.40. That implies a possible rise of more than 10% over the next 12 months.

The post It’s time to buy Rio Tinto shares: Goldman Sachs appeared first on The Motley Fool Australia.

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More reading

• Hoping to pocket the next Rio Tinto dividend? Read this
• Leading brokers name 3 ASX shares to buy today
• Strong buy: Why Goldman Sachs just added Rio Tinto shares to its conviction list
• 5 things to watch on the ASX 200 on Monday
• Have BHP shares always paid better dividends than Rio Tinto?

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 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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Ask A Fund Manager

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, Red Leaf Securities chief executive John Athanasiou reveals how he’s in favour of picking up bargains in one particular sector.

Investment style

The Motley Fool: How would you describe your services to a potential client?

John Athanasiou: My name’s John Athanasiou from Red Leaf Securities. I’m the CEO of the organisation. We’re an investment firm. 

Now, we don’t have a fund. We manage, we give advice on our clients’ stock — stock-specific advice. We specialise in finding undervalued Australian-listed companies that we believe will outperform the market. 

Typically, we find these opportunities in the small-cap space. They’re very under-researched, which provides you the opportunity to generate alpha returns.

MF: The past 12 months haven’t been pleasant for small caps. How do you see the market moving from here?

JA: I’m actually relatively bullish. I think the worst of the inflation scare is behind us. 

Not many people have realised all the positive things that’ll come out now in relation to inflation easing. Recently we saw inflation easing and China’s reopening their economy, which is quite positive for equities. In terms of all the negative news, i.e. high inflation, I think that’s starting to come under control. 

We’re very bullish in the technology sector. I think a lot of people haven’t realised that the S&P/ASX All Technology Index (ASX: XTX) is up circa 9.87% for the year, while the S&P/ASX 200 Index (ASX: XJO) is up 4.5%. So we’re very bullish on equities, particularly technology stocks that were severely beaten last year.

Hottest ASX shares

MF: What are the two best stock buys right now?

JA: My first pick is BlueBet Holdings Ltd (ASX: BBT). They’ve got a cash position of circa $30 million, [with] the market cap at $60 million. 

Now the reason why we like it is that it’s severely undervalued in our opinion. It’s been unfairly tarnished with the other tech stocks from last year. 

Management has bought stock, so they’re putting their money where their mouth is. And we’re really excited about their opportunities in America. In America, they’re growing in a very conservative capital-like fashion. What I mean by that is they build relationships with existing bricks-and-mortar operators and casino gambling operations over there, and they supply their technology. 

Because in the States, each state’s different in terms of their gambling laws. That’s a better way of doing it as opposed to its competitors that are just spending cash hand-over-fist to buy customers, essentially. 

So we’re very bullish on BlueBet. We think that’s probably a very solid recovery story going forward.

My second pick, it’s outside of the tech space, is Northern Star Resources Ltd (ASX: NST). 

This gold producer announced an interim dividend payment despite their EBITDA declining by 12% to $633 million. It declined essentially because of inflationary pressures like everyone else is facing. Now we see inflation easing, so those cost pressures will decrease as a result. 

On top of that, gold actually performs well when things deflate, people kind of forget that. Because there’s an opportunity cost of owning gold. If you own gold, you’re giving up the opportunity to earn interest or get paid a dividend. 

Now that inflation’s easing, we see central banks around the world will start calming down with their cash rate rises. We see [it’s] very positive for gold going forward.

MF: The Northern Star share price dipped 17.4% in February. Was that just the gold price cooling off?

JA: It was just the gold price, just natural fluctuations in the market. People got a little bit ahead of themselves. There were scares of inflation not coming down as quickly as anticipated… There was a bit of fluctuation in gold prices.

The post I’m bullish on this sector and 2 ASX shares right now: expert 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 recommended BlueBet. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re aiming to retire rich, then the Australian share market could be the place to do it.

But how would you go about achieving this goal? One way could be to search for dividend-paying ASX shares to buy and hold for the long term.

That’s because if you can find ASX shares that have the potential to increase their dividends each year, by the time it comes to retirement, you could be getting some very big dividend payments.

Growing dividends

A good example of this is Treasury Wine Estates Ltd (ASX: TWE). Over the last 12 months, the wine giant has paid out fully franked dividends totalling 34 cents per share. While this only offers a 2.5% dividend yield if you buy its shares today, it is a very different situation for longer-term shareholders.

If you had bought Treasury Wine shares a little over a decade ago when they were trading at $3.11, you would be receiving a yield on cost of 10.9%.

This means that a $50,000 investment back then would be providing you with an income of approximately $5,500 now. Whereas if you invested $50,000 at today’s price you would only receive $1,250 in dividends.

And let’s not forget the capital gains! Despite some tough times in recent years, the wine giant’s shares have generated strong returns for investors over the last decade. This means that your $50,000 investment would have grown to become almost $220,000 today.

So, not only are you getting a very welcome paycheck each year, but you’re also sitting on a sizeable portfolio.

Switch to income?

The latter provides investors with a couple of options. One is that they can keep doing what they’re doing and let compounding work its magic. The other is switching your portfolio to a focus on income.

For example, according to a note out of Goldman Sachs, its analysts expect a $1.47 per share dividend from Westpac Banking Corp (ASX: WBC) this year. This equates to a 6.65% fully franked dividend yield at current prices.

If investors were to put that $220,000 into this big four bank’s shares, they would boost their income to almost $15,000. And with Goldman then expecting Westpac to increase its dividend to $1.56 per share in FY 2024, another paycheck worth $15,500 potentially awaits a year later.

That’s $30,000 in dividends from an original $50,000 investment in under 15 years.

And while past performance is no guarantee of future returns, Treasury Wine’s returns are largely in line with historical market averages. So, it certainly is achievable for investors if they can identify the right ASX shares to buy.

The post How I would invest in ASX shares to retire rich appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Westpac Banking. 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 Treasury Wine Estates and Westpac Banking. 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 dividends, there are few larger than the Rio Tinto Ltd (ASX: RIO) dividend.

In light of this, it is no surprise that the mining giant is a big favourite of income investors.

But if you want to receive its next dividend payment, you will have to get a wriggle on.

Rio Tinto’s FY 2022 results

Last month, the mining giant released its full-year results for FY 2022.

In case you missed it, for the 12 months ended 31 December, the miner reported a 13% decline in revenue to US$55,554 million and a 41% reduction in net profit after tax to US$12,420 million.

This reflects the unfavourable movement in commodity prices, the impact of higher energy and raw materials prices on its operations, and higher rates of inflation on operating costs and closure liabilities.

The Rio Tinto dividend

Unfortunately, with Rio Tinto’s profits under pressure, the miner was forced to slash its dividend.

The Rio Tinto board elected to cut its fully franked final dividend by 46% to US$2.25 per share, bringing its full-year dividend to a total of US$4.92 per share in FY 2022.

Rio Tinto’s full-year dividend is a 38% reduction on what was paid a year earlier and equates to a total payout of US$8 billion. This represents a payout ratio of 60% of underlying earnings.

While the miner’s interim dividend has been and gone, it isn’t too late to receive its final dividend, which currently equates to a ~2.7% yield.

Rio Tinto’s shares will trade ex-dividend on Thursday 9 March. This means that investors have today and tomorrow’s session to buy shares if they want to be eligible to receive it on the payment date of 20 April.

Goldman Sachs would approve of buying Rio Tinto’s shares. As covered here, yesterday the broker added Rio Tinto to its conviction list with a buy rating and $140.40 price target.

The post Hoping to pocket the next Rio Tinto dividend? Read this 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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