All eyes are on the Flight Centre Travel Group Ltd (ASX: FLT) share price this morning after the company dropped its earnings for the first half of financial year 2023.

Shares in the S&P/ASX 200 Index (ASX: XJO) travel agency last traded at $18.60.

Flight Centre share price in focus as revenue triples

Here are the major takeaways from the travel giant’s results:

• $2.4 million underlying post-tax loss – up from the prior comparable period’s (pcp) $188 million loss
• $1 billion of revenue – a 217% jump on that of the pcp
• $9.9 billion of total transaction value (TTV) – triple that of the pcp
• $95 million of underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) – up from a $184 million loss
• No dividend declared

Flight Centre posted a profitable period for both its corporate and leisure businesses, as well as all geographic segments aside from Asia.

Its global corporate travel business revealed a record $5 billion in TTV, while its leisure business posted $4.4 billion in TTV – up 150% and 441% respectively.

It ended the period with a $465 million net cash position.

What else happened last half?

But it wasn’t all easy for Flight Centre last half.

Whiles its costs were 70% of pre-COVID levels in the first half, its short-term profitability was dinted by recruitment and training, development, and sustainability.

The company’s revenue margin also lifted from 0.4% to 10.1% in the period. That’s lower than normal amid high airfares, more air-only sales, and heavier corporate weighting.

What did management say?

Flight Centre CEO Graham Turner commented on the news likely to drive the company’s share price today, saying:

Flight Centre Travel Group has delivered a solid start to FY23 in an improved, but not fully recovered, trading environment.

While we continue to monitor market conditions. we are not currently seeing evidence that the recovery is slowing with the leisure business currently trading at post-COVID highs and corporate travel activity escalating after the traditional holiday period.

While travel is a discretionary purchase, customers typically view it as essential and prioritise it above other discretionary items.

What’s next?

Flight Centre notes its first-half underlying EBITDA came in 19% higher than the mid-point of its initial financial year 2023 guidance.

It’s now expecting to post between $250 million and $280 million of underlying EBITDA this fiscal year, excluding the contribution of its recently acquired Scott Dunn business.

The company also points out that airline capacity is recovering, which is expected to lower the price of fares and allow for higher volumes. Its international capacity is tipped to reach 85% of pre-COVID levels by the end of June.

Flight Centre share price snapshot

The Flight Centre share price has been taking off in 2023.

The stock is currently up 29% year to date. Though, it’s 5% lower than it was this time last year.

For comparison, the ASX 200 has jumped 6% year to date and 2% over the last 12 months.

The post Flight Centre share price on watch as revenue triples, reaching $1b appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the 10 most shorted ASX shares this week
• Own Flight Centre shares? Here’s what the market expects from its half year results
• Are whales dipping in and out of this ASX 200 travel share?
• Someone just bought $22 million of Flight Centre shares. Here’s what we know
• Here are the 10 most shorted ASX shares

Motley Fool contributor Brooke Cooper 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 Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/uGs89tF

If you’re looking for a passive income boost, then it could be worth considering the ASX dividend shares listed below.

Both of these dividend shares have been tipped to provide big dividend yields and climb meaningfully higher from current levels. Here’s what you need to know about these high yield shares:

Adairs Ltd (ASX: ADH)

The first ASX dividend share that could be a top option is Adairs. It is the leading furniture and homewares retailer behind the eponymous Adairs brand, as well as the Focus on Furniture and Mocka brands.

Earlier this week, Adairs released its half-year results and reported a 34.1% increase in sales to a record of $324.2 million and a 23.9% jump in net profit after tax to $21.8 million.

And while trading conditions are expected to be tougher in the second half and FY 2024, UBS believes it is worth sticking with the company.

In response to its results, UBS put a buy rating and $2.95 price target on the company’s shares.

As for dividends, the broker is forecasting fully franked dividends per share of 16 cents per share in FY 2023 and FY 2024. Based on the current Adairs share price of $2.24, this will mean yields of 7.1%.

Dalrymple Bay Infrastructure Ltd (ASX: DBI)

Another ASX dividend share that has been named as a buy is Dalrymple Bay Infrastructure.

It is an infrastructure company that operates the Dalrymple Bay Coal Terminal (DBCT) on a long term agreement.

Morgans is a fan of the company and believes it is well-placed to pay big dividends in the near term. This is thanks to the strong demand for coal and its position as the cheapest export route-to-market for users within the Bowen Basin catchment region.

The broker currently has an add rating and $2.67 price target on its shares.

As for dividends, its analysts are forecasting dividends per share of approximately 21 cents in FY 2022 and FY 2023. Based on the latest Dalrymple Bay Infrastructure share price of $2.45, this will mean massive yields of 8.6%.

The post Supercharge your passive income with these ASX shares: experts appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 2 ASX All Ords shares I think can make big returns by 2025
• ASX investors: 3 of the best Aussie dividend stocks to buy this year
• Top ASX small-cap shares to buy in 2023
• How a stock market crash could turbocharge my ASX share portfolio
• Adairs share price falls amid strong first half growth but guidance downgrade

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 Adairs. The Motley Fool Australia has positions in and has recommended Adairs. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/Nkv46oA

There are some All Ordinaries (ASX: XAO), or All Ords, ASX shares that have fallen heavily over the past year or so. I think that some of these beaten-up names could be some of the best opportunities to buy for a two-year or three-year timeframe.

The outlook for some ASX shares is looking a bit tougher than in 2021. However, I don’t believe that the poor conditions are going to last forever, which I think is how businesses are sometimes priced during a sell-off like the current period.

While retail is not the most defensive sector, I think there is the potential for investors to pick up shares at cyclical lows, and then ride the recovery back up again, though a turnaround could take a bit of time. That’s where being patient is a very useful trait. By 2025, I think both of these names can deliver share price growth of at least 30% as market sentiment returns and their growth plans are carried out.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is one of the leading online-only homewares and furniture retailers.

The Temple & Webster share price has fallen over 70% since mid-October 2021 and it’s down 37% in February 2023. I believe that the current level makes it an attractive time to invest.

Management point out that, over the longer-term, e-commerce in the Australian furniture and homewares category “remains highly under-penetrated” and that it has a “much larger addressable market to go after” with the categories of home improvement and trade and commercial.

The All Ords ASX share is seeing its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) improve over time as it scales. The FY23 second quarter saw EBITDA generation of $5.2 million, while the FY22 second quarter saw EBITDA of $4.6 million.

While the FY23 half-year revenue was down, the business is expecting to return to double-digit revenue growth in the shorter term. Over time, the company expects to grow its EBITDA margin from 3.8% in FY22 to more than 15% over the long-term thanks to scale benefits.

Adairs Ltd (ASX: ADH)

Adairs is a somewhat similar business – it also sells homewares and furniture, though the range is smaller.

The Adairs share price is down 53% from June 2021 and it’s down 22% in February 2023.

This All Ords ASX share just released its FY23 half-year result, showing sales growth of 34.1% to $324.1 million, while earnings per share (EPS) went up by 22.2% to 12.7 cents. It also revealed that Adairs store floor space increased by 2.4%.

Adairs’ new national distribution centre has been “below expectations”, which has affected customer experiences, as well as “significantly higher cost of operations”. However, there are “early signs that operational outcomes are improving”. A new pricing model started in January 2023, which “will see average variable costs per unit dispatched reduce by 20%” compared to the FY23 first half level. Warehousing costs added $5 million compared to the first half of FY22.

The All Ords ASX share is working on reducing costs, while group sales in the first seven weeks of the second half of FY23 were up 1.8% year over year. It’s still expecting to make between $70 million to $80 million of earnings before interest and tax (EBIT) in FY23.

I think that the supply chain and inflation issues will improve over 2023, while total sales could seem more resilient in a downturn thanks to ongoing store growth and expansion efforts.

The post 2 ASX All Ords shares I think can make big returns by 2025 appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• ASX investors: 3 of the best Aussie dividend stocks to buy this year
• Top ASX small-cap shares to buy in 2023
• How a stock market crash could turbocharge my ASX share portfolio
• Adairs share price falls amid strong first half growth but guidance downgrade
• Why term deposits can’t compete with these 5 ASX dividend machines

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 Adairs and Temple & Webster Group. The Motley Fool Australia has positions in and has recommended Adairs. 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.

from The Motley Fool Australia https://ift.tt/1a5eiq6

The Westpac Banking Corp (ASX: WBC) share price has seen plenty of volatility since the start of the COVID-19 pandemic. But, at the current valuation, the ASX bank share looks like a leading contender.

There is a lot of competition in the banking space, including Commonwealth Bank of Australia (ASX: CBA), ANZ Group Holdings Ltd (ASX: ANZ), National Australia Bank Ltd (ASX: NAB), Bank of Queensland Limited (ASX: BOQ) and Bendigo and Adelaide Bank Ltd (ASX: BEN).

The last 12 months have been an interesting time for the banking sector with how interest rates have rapidly shot higher.

ASX bank shares like Westpac have come under pressure for passing on interest rate hikes quickly to borrowers, but not being as generous to savers.

In the current environment, I think there are a couple of key reasons why the Westpac share price looks cheap:

Low price/earnings ratio

The bank has a very low price/earnings (P/E) ratio. What that means is that it’s trading at a low multiple of its earnings.

While an extremely low P/E ratio isn’t necessarily what investors need to find, it can be helpful to find ones that are at good value, and hopefully buying a lower P/E ratio for that same business is usually helpful.

According to Commsec, Westpac could generate $2.04 of earnings per share (EPS). At the current Westpac share price, that puts the forward P/E ratio at 11 times FY23’s estimated earnings.

That seems relatively cheap, particularly when compared to a peer like CBA which is currently trading at 17 times FY23’s estimated earnings, a significantly more expensive valuation.

The lower P/E ratio also has a pleasing bonus – the dividend yield is particularly high. Commsec numbers suggest that the Westpac dividend per share could be $1.38, with a grossed-up dividend yield of 8.6%.

Rapidly increasing return on equity (ROE)

One of the biggest bits of help for Westpac could be the improvement in profitability thanks to the higher lending profits. This can help the Westpac share price as well.

An increasing return on equity (ROE) can make the business a lot cheaper.

My colleague James Mickleboro recently reported on comments from Morgans about the compelling situation for Westpac:

We view WBC as having the greatest potential for return on equity improvement amongst the major banks if its business transformation initiatives prove successful. The sources of this improvement include improved loan origination and processing capability, cost reductions (including from divestments and cost-out), rapid leverage to higher rates environment, and reduced regulatory credit risk intensity of non-home loan book. Yield including franking is attractive for income-oriented investors, while the ROE improvement should deliver share price growth.

Westpac share price snapshot

Despite the interest rate environment looking more favourable for bank profitability, the Westpac share price is down 3% over the past year.

The post 2 reasons why the Westpac share price is cheap appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• These ASX 200 dividend shares are top of Macquarie’s income portfolio
• Expect big yields from these ASX 200 dividend shares in 2023 and 2024: brokers
• Did you buy $5,000 of Westpac shares 5 years ago? If so, here’s how much dividend income you’ve earned
• Should I buy Westpac shares following the ASX 200 bank’s latest earnings update?
• Westpac share price lower on mixed quarterly update

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 positions in and has recommended Bendigo And Adelaide Bank. The Motley Fool Australia has recommended Westpac Banking. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/9KDtx3V

The Woolworths Group Ltd (ASX: WOW) share price will be one to watch on Wednesday.

That’s because the supermarket giant has just released its half-year results and reported strong earnings growth.

Woolworths share price following results release

• Sales up 4% to $33,169 million
• Earnings before interest and tax (EBIT) up 18.4% to $1,637 million
• Net profit after tax up 14% to $907 million
• Fully franked interim dividend up 17.9% to 46 cents per share

What happened during the half?

For the six months ended 31 December, Woolworths reported a 4% increase in sales to $33,169 million.

This was driven by a 2.4% increase in Australian Food sales, a 17.4% jump in Metro Food sales, a 15.3% lift in Big W sales, and a 23% jump in Australian B2B sales, which offset weaker sales in New Zealand Food and the WooliesX online business.

Woolworths’ key Australian Food business benefited from food inflation. It continued to rise during the half due to industry-wide cost pressures, with Q2 average price growth of 7.7%, marginally higher than Q1 growth of 7.3%. Long Life prices continued to increase but some Fruit & Vegetable prices moderated as supply improved.

The company’s EBIT grew at a much quicker pace of 18.4% to $1,637 million during the half. This reflects improvements in its cost of doing business (CODB) margin, which declined 29 basis points largely due to the non-recurrence of direct COVID costs of $239 million that were incurred in the prior corresponding period.

This ultimately led to Woolworths reporting a 14% jump in net profit after tax to $907 million, allowing the board to increase its dividend by 17.9% to 46 cents per share.

How does this compare to expectations?

The good news for the Woolworths share price today is that this result appears to have come in ahead of expectations.

According to a note out of Goldman Sachs, its analysts were expecting group sales growth of 3.5% and EBIT growth of 12%. The market was also expecting a fully franked interim dividend of 43.9 cents per share.

Woolworths has beaten on all metrics with 4% sales growth, 18.4% EBIT growth, and its 46 cents per share dividend.

Management commentary

Woolworths Group CEO, Brad Banducci, was pleased with the half. He commented:

Our first half result benefitted from a focus on improving our customer shopping experience, restoring our operating rhythm, the non-recurrence of material COVID costs in the prior year and strong seasonal trading. Despite continued supply chain challenges during the half, most customer metrics improved, with Customer Care a highlight and Group VOC NPS increasing on Q1 and the prior year.

Cost-of-living pressures are being felt by our customers due to industry-wide inflation and helping all our customers get their Woolies worth remains our number one priority. A focus on affordability and availability, and an inspirational Christmas resulted in Group H1 sales growth of 4.0% (3-yr CAGR: 7.5%) and EBIT growth of 18.4% (3-yr CAGR: 7.1%).

Outlook

More good news for the Woolworths share price today is that the company has had a strong start to the second half. During the first seven weeks of the half, the company has achieved the following sales growth:

• Australian Food sales up 6.5%
• New Zealand Food sales up 6.3%
• Big W sales up 9.7%

And while the company’s earnings are not expected to grow as strongly in the second half, a solid full year result appears to be on the cards. Mr Banducci concluded:

In summary, sales momentum has continued to be solid in the half to date and the operating rhythm of our business continues to improve. However, EBIT growth in H2 will be below H1 as we cycle a more normal second half. We will continue to balance the needs of all our stakeholders, including providing our customers with great value; treating our suppliers fairly; offering competitive pay and a positive working environment for our team; continuing to play our part in creating a better tomorrow; and delivering sustainable financial results for our shareholders.

The post Woolworths share price on watch amid first-half earnings beat appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Own Woolworths shares? Here’s what the market is expecting from its half year results
• Buy Woolworths shares today for 15% upside plus passive income: Goldman
• These ASX 200 shares are buys: experts
• With interest rates heading higher again, the risk is to the downside for these popular blue chip ASX shares

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.

from The Motley Fool Australia https://ift.tt/e7pX2GO

The Coles Group Ltd (ASX: COL) share price has risen strongly so far in 2023, up around 10%. With its dividend increasing significantly in the company’s FY23 half-year result, should it now be considered one of the best S&P/ASX 200 Index (ASX: XJO) dividend shares?

Although it’s early in 2023, we’ve already seen some large dividend cuts from some of the ASX’s biggest dividend payers.

In the Fortescue Metals Group Limited (ASX: FMG) FY23 half-year result, the dividend was cut by 13% to 75 AU cents per share.

The BHP Group Ltd (ASX: BHP) dividend just took a massive dive in the HY23 result, dropping by 40% to 90 US cents per share.

Certainly, Coles reported much better numbers for income-focused shareholders.

Coles shares to pay enlarged dividend

The supermarket business reported that its sales increased 3.9% to $20.8 billion and earnings per share (EPS) from continuing operations went up 11.6% to 46.3 cents.

This enabled the board to have the confidence to increase the interim dividend by 9.1% to 36 cents per share.

Added to the FY22 final dividend of 30 cents per share, that means the current annualised dividend is 66 cents per share.

At the current Coles share price, the business has a grossed-up dividend yield of 5.2%.

While that’s not the biggest dividend yield out there, the annual dividend per share has steadily grown since 2019.

Indeed, the Coles dividend grew faster than inflation at its supermarkets. FY23 half-year inflation was 7.4% at its supermarkets, with an inflation rate of 7.7% in the second quarter.

Is it one of the best ASX 200 dividend shares around?

The Coles share price has generally trended higher over the past five years, along with earnings steadily rising.

When looking at other major ASX 200 dividend shares, such as Commonwealth Bank of Australia (ASX: CBA) and BHP, both of those big names have seen a dividend cut since the start of the COVID-19 pandemic.

As I mentioned, Coles kept increasing its dividends during that time.

So, the supermarket business has achieved an impressive level of consistency, even if the major ASX 200 dividend shares like mining shares and bank shares started with higher dividend yields.

I think that Coles is doing all the right things to improve its financials and grow the business.

The banks and miners are capable of producing good returns, but I think it only makes sense to buy such big businesses when they are going through a weak point in the economic or commodity cycle, rather than at their current position of strength.

While there are a few other ASX 200 dividend shares that could make an even stronger case, I believe Coles has cemented itself as one of the leaders when it comes to generating passive income.

The post Is Coles now one of the best ASX 200 dividend shares? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• 3 ASX 200 stocks falling hard on results announcements
• 2 ASX 200 consumer shares tumbling lower on earnings updates

Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Coles Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/K32CUoM

Macquarie Group Ltd (ASX: MQG) has an income portfolio that it believes represents a starting point to form a portfolio with income characteristics.

It also highlights that this portfolio is created with a focus on a higher degree of earnings certainty, backed by strong cash flows, and highly tax effective dividend income.

Among its top ASX 200 dividend share picks right now are the shares listed below:

Telstra Group Ltd (ASX: TLS)

The largest holding in Macquarie’s income portfolio is this telco giant. It takes top spot with a weighting of 8.8%. The broker has an outperform rating and $4.64 price target on Telstra’s shares and is forecasting a fully franked 17 cents per share dividend in FY 2023. Based on the current Telstra share price of $4.16, this represents a 4.1% dividend yield. It is also worth noting that its price target implies almost 12% upside from current levels.

National Australia Bank Ltd (ASX: NAB)

The next largest holding in the portfolio with a weighting of 8.4% is this ASX 200 banking share. However, the broker still only has a neutral rating and $31.00 price target on its shares. This compares to the current NAB share price of $30.10. In respect to dividends, Macquarie is forecasting a $1.61 per share fully franked dividend in FY 2023. This provides investors with a 5.3% yield at current levels.

Westpac Banking Corp (ASX: WBC)

The third largest holding its income portfolio is Westpac with a 7.4% weighting. Interestingly, that’s despite the broker having an underperform rating on its shares. Though, Macquarie’s price target of $23.50 is still approximately 3% higher than where Australia’s oldest bank’s shares currently trade. As for dividends, the broker is forecasting an 131 cents per share fully franked dividend in FY 2023. This represents a 5.7% dividend yield for investors.

The post These ASX 200 dividend shares are top of Macquarie’s income portfolio appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Expect big yields from these ASX 200 dividend shares in 2023 and 2024: brokers
• How much do you need in ASX shares to give up work and live only off dividend income?
• Did you buy $5,000 of Westpac shares 5 years ago? If so, here’s how much dividend income you’ve earned
• Should I buy Westpac shares following the ASX 200 bank’s latest earnings update?
• Why I think the Telstra share price is now an unmissable buy

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 positions in and has recommended Macquarie Group and Telstra Group. The Motley Fool Australia has recommended Westpac Banking. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/IK9HOXt

The ASX share market has produced good returns for investors over time. We don’t have to use shares just for building wealth towards retirement, they can also be used to help our children. ASX exchange-traded funds (ETFs) could be the way to do it.

Whether that’s helping fund a house deposit, helping pay for university education, or something else in the future, investing could help build the funds.

If we were hoping to help with $10,000 or $20,000, it would be ideal if compounding could do a lot of the heavy lifting, rather than having to save all of that amount ourselves.

For example, if I invested $500 a year for 15 years, and that money made average annual returns per annum of 10%, it would grow to almost $16,000 in that time. But, I’d only have to contribute $7,500 of that, with investment returns being responsible for the rest.

With a long-term time horizon, I think we can look at ASX ETFs that have a capital growth focus, while paying a little bit of dividend income too.

Betashares Nasdaq 100 ETF (ASX: NDQ)

This ETF is about investing in 100 of the largest businesses listed on the NASDAQ, which is a US stock exchange where many of the American tech businesses are listed.

Looking at the biggest holdings, there are some names like Apple, Microsoft, Amazon.com, Nvidia, Tesla, Alphabet (Google), Meta Platforms (Facebook and Instagram), Costco, PayPal, and Moderna.

Typically, the companies that are changing the world in some way and unlocking new earnings streams are the ones that are growing at a good pace over time. Many of the world’s leading businesses are listed in the US, though they do make earnings from across the world.

I like that with this investment, we can get good diversification with 100 holdings, but they are also among the leaders in what they do nationally or even globally.

Over the past five years, the ASX ETF has returned an average of 15.2% per annum, though past performance is not a reliable indicator of future performance, particularly in the short term.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This ASX ETF is very interesting to me. The holdings are not just based on market capitalisation or industry, but the portfolio is constructed by a high-performing analyst team, for an annual management fee of just 0.49%.

The idea is that this ETF is focused on quality US companies that have wide economic moats, or strong competitive advantages. Those advantages can be in the form of brand power, intellectual property, cost advantages, and so on.

Morningstar analysts only consider businesses that are expected to almost certainly maintain their competitive advantages for the next decade and probably for two decades.

That method creates a watchlist. But, the ETF only invests in a US share if they are viewed as good value compared to what the underlying value of the share is calculated to be.

On February 2023, these were the biggest positions: Meta Platforms, Boeing, MercadoLibre, Teradyne, Salesforce.com, Fortinet, and LAM Research.

Over the past five years, the VanEck Morningstar Wide Moat ETF has returned an average of 14.5%, though past performance is not a guarantee of future results.

Of the two ETFs I’ve mentioned, this would be my preferred ASX ETF to invest in for my child. I think it could be more consistent.

The post 2 ASX ETFs I’d buy for my child for the long term appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 3 ASX shares that could create lasting generational wealth
• 3 top tech ETFs for ASX investors to buy right now
• Hedged or unhedged: Which ASX ETF do I buy?
• Here are 3 quality ETFs for ASX investors to buy right now
• Does the BetaShares Nasdaq 100 ETF share price fall make it a no-brainer buy?

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. 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 Alphabet, Amazon.com, Apple, BetaShares Nasdaq 100 ETF, Costco Wholesale, Fortinet, Lam Research, MercadoLibre, Meta Platforms, Microsoft, Nvidia, PayPal, Salesforce, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Moderna and Teradyne and has recommended the following options: long March 2023 $120 calls on Apple, short April 2023 $70 puts on PayPal, and short March 2023 $130 calls on Apple. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Alphabet, Amazon.com, Apple, Meta Platforms, Nvidia, PayPal, Salesforce, and 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.

from The Motley Fool Australia https://ift.tt/2JRwFUQ

While most investors rightly focus on business performance or structural tailwinds in picking ASX shares to buy, there is another factor that could materially boost the fortunes of a stock.

That is takeovers.

“Identifying companies that will make suitable takeover targets can make for very lucrative investments,” Wilsons equities strategist Rob Crookston said in a memo to clients.

“Normally, companies are acquired at a significant premium to their latest share price, and any hint of a possible acquisition can trigger positive momentum even before a bid is announced.”

After 2022 saw many non-mining S&P/ASX 200 Index (ASX: XJO) shares fall in value, big institutional investors like superannuation funds and private equity firms are “still on the hunt for high-quality assets at a fair price”.

Growth stocks slashed to clear

One set of companies that are “vulnerable” to acquisitions are growth stocks.

It’s because they are going for cheap at the moment.

“These stocks have underperformed during periods of rising bond yields and outperformed when bond yields have fallen,” said Crookston.

“2022 was no different. The quick-fire rise in bond yields was a significant headwind for growth stocks in 2022.”

To demonstrate, the S&P/ASX All Technology Index (ASX: XTX) is still more than 33% lower than November 2021, despite a 10% revival this year.

Crookston noted that takeover bids have already been seen for technology shares such as Nitro Software Ltd (ASX: NTO), Tyro Payments Ltd (ASX: TYR), and ELMO Software Ltd (ASX: ELO).

The next great takeover targets?

So Wilsons analysts set out to find the ASX 200 shares that might become the next takeover targets.

“Our search is looking for more of these opportunities at the larger end,” said Crookston.

“We have looked for stocks that have derated significantly over 2022 that offer substantial growth potential.”

These are the seven ASX companies that Crookston’s team came up with:

• Xero Limited (ASX: XRO)
• Domain Holdings Australia Ltd (ASX: DHG)
• PEXA Group Ltd (ASX: PXA)
• Netwealth Group Ltd (ASX: NWL)
• Iress Ltd (ASX: IRE)
• Altium Limited (ASX: ALU)
• NEXTDC Ltd (ASX: NXT)

The analysts said that Domain is attractive for acquisition because of its “strong market position” that’s effectively a duopoly.

“Looks oversold on negative housing sentiment, but likely to grow earnings over the cycle.”

Cloud accounting software provider Xero has seen its share price halve since November 2021.

“High multiple might deter but has de-rated heavily over the year,” read the Wilsons memo.

“SaaS [software as a service] business with recurring revenue. Strong growth with the potential for substantial cost out.”

Another software company, Altium, is undergoing some pain at the moment but will be tempting for savvy institutional investors seeking growth in the medium term.

“Transition to SaaS business causing slight disruption (margins contraction) but should be short-term,” read the memo.

“High quality business that is taking market share.”

The post 7 ASX 200 growth shares to buy for possible takeovers: expert appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• These ASX tech shares are buys with 30%+ upside: brokers
• Why A2 Milk, Altium, Cogstate, and Ingenia shares are sinking today
• Why is the Altium share price sinking 6% today?
• 5 things to watch on the ASX 200 on Tuesday
• Altium share price on watch following strong first half growth

Motley Fool contributor Tony Yoo has positions in Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Elmo Software, Netwealth Group, PEXA Group, Tyro Payments, and Xero. The Motley Fool Australia has positions in and has recommended Netwealth Group and Xero. The Motley Fool Australia has recommended Tyro Payments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/17HBLwM

On Tuesday, the S&P/ASX 200 Index (ASX: XJO) was out of form and dropped into the red. The benchmark fell 0.2% to 7,336.3 points.

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

ASX 200 expected to sink

The Australian share market looks set to fall again on Wednesday following a selloff on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 45 points or 0.6% lower this morning. In late trade on Wall Street, the Dow Jones is down 2%, the S&P 500 is down 2%, and the Nasdaq has sunk 2.3%. Higher trreasury yields and soft retail earnings have spooked investors.

Oil prices slide

ASX 200 energy producers Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a subdued days after oil prices fell overnight. According to Bloomberg, the WTI crude oil price is down 0.3% to US$76.12 a barrel and the Brent crude oil price has fallen 1.4% to US$82.85 a barrel. Recession fears appear to be weighing on prices.

Santos full-year results

Santos Ltd (ASX: STO) is another energy share that will be on watch on Wednesday. That’s because this morning the company is releasing its full-year results and is expected to report a profit after tax of US$2.6 billion. Citi expects this to lead to a partially franked full year dividend of 30 cents per share.

Gold price falls

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a tough session after the gold price tumbled overnight. According to CNBC, the spot gold price is down 0.5% to US$1,841.5 an ounce. Rate hike concerns weghed on the precious metal.

Woolworths half-year results

The Woolworths Group Ltd (ASX: WOW) share price will be in focus today when the retail giant releases its half year results. According to a note out of Goldman Sachs, its analysts expect group sales growth of 3.5% but earnings before interest and tax (EBIT) growth of 12% on higher EBIT margins. The market is expecting a fully franked interim dividend of 43.9 cents per share.

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

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• 3 ASX 200 stocks falling hard on results announcements
• Own Woodside shares? Here’s what the market is expecting from its full-year results
• 2 ASX 200 consumer shares tumbling lower on earnings updates

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.

from The Motley Fool Australia https://ift.tt/X5DLvTQ