ASX uranium shares have soared over the past year as the commodity price skyrocketed 110% to a 17-year high.

The uranium price is currently US$106 per pound after breaching the US$100 mark earlier this month.

And broker Shaw and Partners reckons the commodity price will keep rising from here.

The broker has just raised its 12-month forecast for the uranium price by 76% from US$85 per pound to US$150 per pound.

Demand for uranium is skyrocketing as the world embraces nuclear energy as part of decarbonisation.

According to the Australian Financial Review (AFR), Shaw and Partners is urging ASX investors to buy uranium shares before “panic buying” sets in.

Andrew Hines, head of research at Shaw and Partners, said:

Panic buying could drive the uranium price materially higher.

There is a great saying in markets that ‘he who panics first, panics best’ and we recommend investors get ahead of potential panic buying.

Shaw and Partners recommend that investors go overweight on the uranium sector.

Which ASX uranium shares should you buy?

Shaw and Partners has named its five preferred ASX uranium shares.

In no particular order, the broker recommends Paladin Energy Ltd (ASX: PDN), which is the biggest ASX uranium share by market capitalisation.

The Paladin Energy share price is $1.22, up 1.67% today and up 56% over the past 12 months.

It also likes Silex Systems Ltd (ASX: SLX) shares, which are up 0.63% to $4.79 today and have risen 3.5% over the past 12 months.

Bannerman Energy Ltd (ASX: BMN) also makes the list. The Bannerman Energy share price is up 0.6% on Tuesday to $3.44 and up 80% over the past 12 months.

Shaw and Partners also likes Peninsula Energy Ltd (ASX: PEN) shares, which are up 1.82% today to 11 cents and down 30% over the past 12 months.

The broker’s final ASX uranium share tip is Lotus Resources Ltd (ASX: LOT). Lotus shares are down 3.17% to 31 cents on Tuesday but are up 27% over the past 12 months.

The post Buy ASX uranium shares now before ‘panic buying’ sets in, says expert appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• The shocking admission catapulting ASX uranium shares to record highs today
• These are the 10 most shorted ASX shares
• ASX uranium shares crack new highs AGAIN as spot price flies past US$100 per pound
• Why Avita Medical, Core Lithium, Silex, and South32 shares are storming higher today

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

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It’s been a grand old time for the Wesfarmers Ltd (ASX: WES) share price recently.

For one, Wesfarmers shares had a stonking 2023, rising around 25%. That easily beat out the broader market’s performance. The S&P/ASX 200 Index (ASX: XJO) ‘only’ managed a still-respectable 9% return.

But Wesfarmers shares seem to be continuing this tradition in 2024. Today, this ASX 200 industrial and retail conglomerate has celebrated the new year in style by minting a fresh new 52-week high.

Yep, the Wesfarmers share price closed at $58.10 yesterday. But this morning, the company opened at $58.31 before rising as high as $58.39. That’s Wesfarmers’ new 52-week high watermark.

It puts the company up a rosy 1.2% in 2024 to date, as well as up 18.85% over the past 12 months. Wesfarmers last hit a 52-week low of $46.64 a share in July last year. Since then, investors have enjoyed more than 25% in gains. Including dividend returns, those gains would extend up to around 28%.

Although today’s new 52-week high is just the latest in a recent run for the company, there have been no obvious catalysts we can point to for Wesfarmers’ run of good fortune.

The company hasn’t made any significant ASX announcements in over a month. Indeed, the only 2024 release out from Wesfarmers so far merely informs shareholders that the company’s latest half-year results will be released on 15 February next month.

ASX broker labels Wesfarmers share price as a buy

Wesfarmers was the recipient of some love from an ASX broker last month though. As we covered at the time, broker Morgans slapped Wesfarmers shares with an ‘add’ rating, alongside a $55.15 share price target. That target has already been exceeded, of course.

In justifying the opinion, Morgans stated:

WES possesses one of the highest quality retail portfolios in Australia with strong brands including Bunnings, Kmart and Officeworks. The company is run by a highly regarded management team and the balance sheet is healthy.

We believe WES’s businesses, which have a strong focus on value, remain well-placed for growth and market share gains in a softening macroeconomic environment.

Morgans forecast rising dividend yields from Wesfarmers too. The broker pencilled in $1.91 in dividends per share over FY2024, rising to $2.18 per share over FY2025.

It seems investors have also adopted this position, judging by the performance of the Wesfarmers’ share price in recent weeks and months.

The post Breaking: Wesfarmers share price hits new 52-week high appeared first on The Motley Fool Australia.

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More reading

• I’m buying cheap ASX shares to build my wealth in 2024 and beyond
• Which had the better year in 2023: Telstra, Woodside or Wesfarmers shares?
• The pros and cons of buying Wesfarmers shares right now
• This was my best ASX dividend share of 2023
• How much would I need to invest in Wesfarmers shares for $5,000 a year in passive income?

Motley Fool contributor Sebastian Bowen has positions in Wesfarmers. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Wesfarmers. The Motley Fool Australia has positions in and has recommended Wesfarmers. 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 300 shares are higher on Tuesday, with the S&P/ASX 300 Index (ASX: XKO) rising 0.65%.

Here are three ASX 300 companies charging higher after releasing their quarterly results.

Cooper Energy Ltd (ASX: COE)

The Cooper Energy share price is up 9.09% to 12 cents after the company reported a 3% boost to production in the December quarter and a 12% annual lift. Cooper Energy said it was achieving positive outcomes from its Orbost Improvement Project. This led to a substantial impact on revenue, which lifted 8% over the quarter. The ASX 300 energy share is down 40% over the past 12 months.

Iluka Resources Limited (ASX: ILU)

The Iluka Resources share price is up 4.85% to $6.81 on news of 105kt of production in 4Q FY23 and total annual output of 639kt. Iluka sold 134kt in 4Q with full-year sales of 494kt. The ASX 300 mineral sands miner said lower zircon sales reflect subdued economic activity in Europe and China. However, pricing remained relatively strong. The ASX 300 share is down 36% over the past year.

Coronado Global Resources Inc (ASX: CRN)

The Coronado Resources share price is up 4.6% to $1.71. This follows news of the second-highest full-year revenue ever at $2.9 billion. December quarter group revenue was $680 million. The coal miner dug up 6.1 Mt in December, up 3.3%, with saleable production of 3.9 Mt, up 6.4%. Coal availability was greater at Curragh following waste movement works. The ASX 300 coal share is down 20% over the past 12 months.

The post Miners among the ASX 300 shares surging on quarterly reports appeared first on The Motley Fool Australia.

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• Why Boss Energy, Cooper Energy, Judo Capital, and Polynovo shares are racing higher
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• Here are the top 10 ASX 200 shares today

Motley Fool contributor Bronwyn Allen 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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If you want some decent dividend yields then look no further than the two ASX dividend stocks named below.

That’s because brokers expect these buy-rated shares to provide investors with growing (and attractive) yields over the next couple of years. Here’s what analysts are forecasting:

Coles Group Ltd (ASX: COL)

The first ASX dividend stock that could be a buy is supermarket giant Coles.

Citi is feeling positive about the company’s outlook and is predicting meaningful margin expansion in the second half as the company rolls out new technology to combat theft. In addition, with the company focusing on making its operations more efficient through automation, there could be more of this in the future.

It is partly for this reason that Citi is forecasting fully franked dividends per share of 64 cents in FY 2024 and 70 cents in FY 2025. Based on the current Coles share price of $15.83, this implies yields of 4% and 4.4%, respectively.

The broker has a buy rating and $17.50 price target on its shares.

Dexus Industria REIT (ASX: DXI)

Another ASX dividend stock that has been tipped as a buy is Dexus Industria.

Morgans is a fan of the industrial property company. It likes the company due to its attractive yield and “solid underlying portfolio metrics and near/medium term growth opportunities via the development pipeline.”

Its analysts are expecting the latter to support the payment of dividends per share of 16.4 cents in FY 2024 and 17 cents in FY 2025. Based on the current Dexus Industria share price of $2.68, this will mean dividend yields of 6.1% and 6.3%, respectively.

Morgans has an add rating and $3.19 price target on its shares.

The post Boost your second income with these buy-rated ASX dividend stocks appeared first on The Motley Fool Australia.

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• How I’d build a backup superannuation fund with $10,000 and 5 ASX shares
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Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Coles Group. 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 concept of ‘cheap’ ASX shares can be misinterpreted. Whether a company’s shares are 5 cents or $5 is almost irrelevant. What matters is whether the company presents value. In other words, could it provide an attractive return?

Growth and market capitalisation are functions of value. If I can buy a laundromat for $10,000 and it produces $2,000 per annum with no expectation of future growth, that equates to a price-to-earnings (P/E) ratio of 5 — not a bad proposition.

However, another laundromat selling for $15,000, generating $2,500 in the past year — a P/E of 6 — expects to grow 10% per annum over the next five years. While slightly more ‘expensive’, this laundromat presents greater value based on future earnings.

I look at ASX shares the same way. Here are three companies I believe could be cheap buys right now.

Where I’m finding deals among ASX shares

Trawling through hundreds of publicly listed Australian companies, a few have pinged my value-finding radar. These are businesses that I believe are currently experiencing an underestimation of their growth potential.

Nick Scali Limited (ASX: NCK)

At 10.2 times earnings, the designer furniture retailer trades at a discount to the wider Australian specialty retail industry. Part of the reduced multiple could be attributable to forecasts of revenue and earnings decline as interest rates bite.

Helmed by Anthony Scali, son of the founder, this company has an impressive track record of growth. Total revenue has grown at a compound annual growth rate (CAGR) of 15.2%, accompanied by increasing net margins.

Looking forward, the sofa seller is targeting a further 64% to 74% increase in store count over time. So, while the near term might present some softness, I believe it could be an opportunity to buy shares on the cheap ahead of solid growth on a longer timescale.

Lindsay Australia Ltd (ASX: LAU)

Possibly the most attractive ASX share on my list, Lindsay Australia is an integrated transport company that trades far below its peers. Despite growing its top line by a CAGR of 13.4% over the last five years, the $333 million business is valued at 9.4 times FY2023 earnings.

What’s more perplexing is this meagre multiple prevails even though analysts forecast growth. In FY23, Lindsay trucked in $34.5 million of net profits after tax (NPAT). This figure is expected to increase to $50.1 million in FY26, equating to a 13.2% CAGR in earnings over the next three years.

Layering in the company’s sturdy balance sheet and quality management, it seems to me this ASX share could be a cheap deal.

Accent Group Ltd (ASX: AX1)

This sneaker seller looks to be out of fashion in the market. Distributing footwear and apparel, Accent Group is a leader within its industry in Australia and New Zealand. Yet, the P/E ratio for this company has been compressed to 13.4 times, down from 33.1 in December 2021.

The current multiple is more or less in line without peers. However, I tend to think Accent is a cut above the rest. Namely, its exceptional ability to expand into new distributed brands and grow store count. In four years, the company grew its stores to 821 from 429 (71%).

In my opinion, the current earnings multiple does not fully reflect Accent’s room for further growth. The company has executed attractive acquisitions in the past. The tightening in consumer spending could favour Accent as weaker peers look to consolidate.

This ASX share is sitting atop my own buy list.

The post Cheap and growing: The best bang for buck ASX shares I’d buy appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Lindsay Australia. The Motley Fool Australia has recommended Accent Group, Lindsay Australia, and Nick Scali. 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 Woodside Energy Group Ltd (ASX: WDS) share price doesn’t seem to be enjoying the gains of the broader market so far this Wednesday.

While the S&P/ASX 200 Index (ASX: XJO) is up a decent 0.65% so far this session, Woodside shares have gone the other way. The ASX 200 energy stock is currently nursing a loss of 0.66%, putting the company at $30.95 a share.

This latest drop is just the latest bad day in what has become a rough few months for the oil and gas giant.

It was only back in August that the Woodside share price was riding high at over $39 each (a new 52-week high at the time). But as global oil prices have taken a dive in the subsequent months, so too have Woodsie shares. At today’s pricing, the company has lost more than 20% since those August highs.

With that in mind, some investors might be tempted to go out and buy Woodside shares today. After all, we’re all told to ‘buy low’ when it comes to investing. Plus, picking up shares of energy companies like Woodside during oil price slumps has often been a lucrative strategy in the past.

So should you be rushing to pick up Woodside shares at under $31 each today?

Is the Woodside share price a buy under $31 a share?

One ASX expert thinks the answer is a definitive ‘yes’. As reported by The Bull recently, Michael Gable of Fairmont Equities has named the company as a buy, citing “a bright outlook for crude oil” as the primary reason:

We continue to retain a bright outlook for crude oil. Supply constraints and increasing global demand should elevate energy prices. Woodside shares are attractive at these levels. The share price chart also indicates strong support at current prices. The shares have fallen from $36.88 on October 18, 2023, to trade at $30.43 on January 18, 2024.

But Gable isn’t the only expert who is seeing value in Woodside.

Earlier this month, my Fool colleague James covered the views of ASX broker Goldman Sachs on Woodside. Goldman has rated Woodside as a buy, giving the company a 12-month share price target of $36.30.

The broker stated that it sees “long-term value in WDS” and also expects rising dividends from the company.

As such, it seems that two ASX brokers are seeing significant value in the Woodside share price at under $31. But only time will tell if they’re on the money here.

The post At under $31, should I be rushing to buy Woodside shares? appeared first on The Motley Fool Australia.

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• Down 31%: Buy the dip on these ‘attractive’ ASX 200 dividend shares
• 5 things to watch on the ASX 200 on Monday
• Which had the better year in 2023: Telstra, Woodside or Wesfarmers shares?
• 5 things to watch on the ASX 200 on Thursday
• Why Santos shares could face headwinds despite $5.7 billion Barossa win

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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Commonwealth Bank of Australia (ASX: CBA) shares hit a new 52-week high of $115.98 in early trading on Tuesday.

The CBA share price is currently up 0.72% to $115.69, while the S&P/ASX 200 Index (ASX: XJO) is up 0.7%.

CBA shares have been rising strongly since early November, as the chart below shows.

The 52-week high comes amid Australia’s biggest home loan lender releasing its 2024 economic outlook.

The outlook includes CBA’s forecasts for the property market over the new year.

CBA shares hit new 52-week high

Senior CBA economist, Belinda Allen said the Australian housing market is likely to moderate in the first half of the year before rebounding in the second half following interest rate cuts.

CBA’s economics team predicts the Reserve Bank will start cutting interest rates in September and will reduce the official cash rate by 75 basis points by Christmas.

Strong demand, driven by an anticipated 2.3% in final population growth for 2023, coupled with an ongoing housing shortage, pushed property prices higher in 2023 despite rising interest rates.

This tight supply/demand dynamic will remain in 2024, with population growth of 1.8% anticipated this year amid only a small lift in the number of new home commencements, Allen said.

Many of the same factors that drove prices higher are set to be in place in 2024, albeit with less intensity.

However we expect affordability constraints and rising advertised supply to put a handbrake on home price growth over the first half or so of 2024.

Overall we expect a lift of 5% in home prices across the 8 capital cities this year.

Property price predictions for 2024

Here are CBA’s forecasts for home values growth over 2024.

Capital city	Growth prediction
Perth	9%
Adelaide	9%
Brisbane	8%
Sydney	3%
Melbourne	2%

In 2023, Perth and Adelaide led the capital cities in terms of price growth at 15.2% and 13.1%, respectively, according to CoreLogic data. (View our article ASX 200 shares vs. property: Which delivered the best growth in 2023?)

While the CBA team expects prices to grow overall in 2024, there would be a “considerable divergence” in market activity between the capital cities over the new year.

Allen explained:

We expect a distinct period of moderation, including small monthly falls in Sydney and Melbourne over the first half or so of 2024.

We also expect the other major capital cities of Brisbane, Perth and Adelaide to experience slower monthly growth than in 2023.

Interest rate cuts beginning in September are then expected to spur a period of faster monthly home price growth to finish the calendar year.

Allen said affordability would be a factor slowing down market activity in Sydney and Melbourne.

High rents push young people into ownership

Ms Allen noted that Australia’s extremely tight rental market is propelling more people into home ownership.

She said:

Rents rose by just under 10%/ yr to November and we don’t expect a material change in the near term. Vacancy rates sit at, or close to record lows.

Lending for housing rose in the back half of 2023.

Lending to first home buyers led the charge, with annual growth sitting at 25.8%/yr to November 2023. Total lending excluding refinancing has been rising since August.

CoreLogic data released today shows the median weekly rent in Australia has surpassed $600 per week for the first time.

Head of research at CoreLogic, Eliza Owen, said rapid population growth, reduced household sizes, lower investor buying, and a spike in landlords selling had reduced rental stock and pushed up weekly rents.

How do rising home values impact CBA shares?

CBA is Australia’s biggest home mortgage lender, so a strong property market is a tailwind for its shares.

According to CBA’s FY23 report, the bank had $577 billion in home loans on its books as of 30 June FY23.

That’s up from $562 billion as of 31 December 2022 and $546 billion as of 30 June 2022.

Just over 70% of CBA’s home loans are on a variable rate. This is up from 66% in December 2022 and 62% in June 2022.

Borrowers experiencing negative equity increased to 1% as of 30 June 2023. This is a rise from 0.5% in December 2022 and 0.4% in June 2022.

Mortgagee-in-possession loans held at 2% of CBA’s home lending portfolio over this 12-month period.

The post CBA shares smash new record amid 5% home price boost prediction appeared first on The Motley Fool Australia.

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• Why I think CBA is one of the best ASX bank shares
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Motley Fool contributor Bronwyn Allen has positions in Commonwealth Bank Of Australia. 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 S&P/ASX 200 Index (ASX: XJO) has continued its positive run on Tuesday. In afternoon trade, the benchmark index is up 0.5% to 7,515.5 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are falling:

IDP Education Ltd (ASX: IEL)

The IDP Education share price is down 8% to $20.27. Investors have been selling this language testing and student placement company’s shares today after Canada announced plans to limit foreign student visas in response to housing shortages. Student numbers will be down by approximately a third in 2024, which could be a blow to IDP Education’s operations in the country.

Karoon Energy Ltd (ASX: KAR)

The Karoon Energy share price is down almost 5% to $1.77. This has been driven by the release of a production update and the revision of its full year guidance. In respect to the latter, total production will be in a range of 11.2 million to 13.5 million barrels of oil equivalent (MMboe) in 2024. This compares to the previous range of 12 million to 14.5 MMboe. Operational issues at the Bauna Project are to blame.

Liontown Resources Ltd (ASX: LTR)

The Liontown share price is down a further 2% to 92.2 cents. This lithium developer’s shares have been sold off this week following the release of a disappointing update on the Kathleen Valley Lithium Project. Due to weak lithium prices, the company has commenced a review aiming to preserve capital and reduce the near-term funding requirements. In addition, a recently announced $760 million debt funding package has been terminated by lenders.

Zip Co Ltd (ASX: ZIP)

The Zip share price is down almost 7% to 69 cents. This is likely to have been driven by profit taking from some investors after a very strong gain by the buy now pay later provider’s shares on Monday. Investors were buying its shares yesterday in response to a strong trading update.

The post Why IDP Education, Karoon Energy, Liontown, and Zip shares are falling today appeared first on The Motley Fool Australia.

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• The Zip share price has soared 147% in 3 months, can it keep going?
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Idp Education and Zip Co. The Motley Fool Australia has recommended Idp Education. 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 S&P/ASX 200 Index (ASX: XJO) is having another positive session on Tuesday. At the time of writing, the benchmark index is up 0.6% to 7,521.2 points.

Four ASX shares that are rising more than most today are listed below. Here’s why they are climbing:

Boss Energy Ltd (ASX: BOE)

The Boss Energy share price is up 1.5% to $5.37. Investors have been buying this uranium developer’s shares following the release of drilling results from the Honeymoon Project. Management notes that more strong drilling results highlight scope for growth in production, mine life, and cashflow.

Cooper Energy Ltd (ASX: COE)

The Cooper Energy share price is up 9% to 12 cents. This morning, analysts at Macquarie upgraded the energy company’s shares to an outperform rating with an 18 cents price target. The broker believes a selloff on Monday relating to a cost blowout has created a buying opportunity for investors. The broker feels that other positive news also released offset the cost blowout news.

Judo Capital Holdings Ltd (ASX: JDO)

The Judo Capital share price is up almost 18% to $1.10. Investors have been snapping up this small business lender’s shares after it revealed strong profit growth in the first half of FY 2024. Unaudited profit before tax (PBT) is expected to be $67 million for the first half, which is up 24% on the prior corresponding period.

Polynovo Ltd (ASX: PNV)

The Polynovo share price is up 8% to $1.88. This appears to have also been driven by a bullish broker note out of Macquarie. In response to the medical device company’s first half sales update on Monday, the broker has retained its outperform rating with an improved price target of $2.90. Polynovo’s first half sales were comfortably ahead of the broker’s expectations.

The post Why Boss Energy, Cooper Energy, Judo Capital, and Polynovo shares are racing higher appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX All Ords stock is surging 14% on soaring profit
• Here are the top 10 ASX 200 shares today
• Why Appen, Baby Bunting, Cooper Energy, and Liontown shares are sinking today
• If I’d invested $20,000 in Boss Energy shares one month ago here’s what I’d have today
• Would I be crazy to buy Boss Energy shares at $5.50?

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 Judo Capital, Macquarie Group, and PolyNovo. The Motley Fool Australia has positions in and has recommended Macquarie 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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All Australians deserve a comfortable and stress-free retirement. But unfortunately, many of us are increasingly pessimistic that our superannuation system will be able to provide this for us.

As most readers would know, superannuation is designed to deliver a nest egg that is large enough to at least partially self-fund a comfortable retirement. However, a recent survey from State Street Global Advisers found that confidence in superannuation is falling.

The survey asked a group of Australian savers whether they “expect they will have saved up enough to retire.” Tellingly, only 25% of those surveyed in 2022 agreed. But in 2023, that number had fallen to 20%.

Further, the proportion of those asked whether they “are not confident they will be able to retire when they plan to” rose from 40% in 2022 to 50% in 2023.

Our superannuation system is great in my view. However, the results of this survey show that it is probably a good idea for most of us to build up a backup superannuation fund outside the retirement system. We can do this by putting together a portfolio of ASX shares outside our super fund.

After all, our super is mostly invested in ASX and international shares anyway. So making a backup super fund is only an extension of our super fund’s original purpose. The upside of investing outside super is that our money isn’t locked away until retirement age. We can start using the passive income from the dividends our ASX shares produce to start paying bills straight away.

But how would one build this second superannuation fund exactly? Well, here are five ASX dividend shares I would be comfortable starting with if I had $10,000 to spare.

5 ASX shares I would use in a backup superannuation fund

I would start with an ASX index fund, such as the Vanguard Australian Shares Index ETF (ASX: VAS). A fund of this nature holds all of the top 300 shares on the ASX. As such, it provides instant diversification as well as an immediate stream of dividend income.

An index fund like VAS also gives us the benefit of getting the return of the broader Australian share market, in case our stock-picking skills aren’t up to scratch.

But then I’d turn to some individual shares. Telstra Group Ltd (ASX: TLS) seems like a good pick as well. Telstra is of course the largest telco on the ASX and in Australia. A huge swathe of the country uses Telstra’s services for mobile access, NBN broadband connections or both.

Given how important these services are in the modern world, customers won’t be easily persuaded to give them up, even if there is a recession. That makes Telstra shares, and the 4.5% fully-franked dividend yield they come with, a great pick for a backup superannuation fund.

Next, I’d turn to Transurban Group (ASX: TCL). This toll-road operator is another defensive company, thanks to its vast network of arterial roads across our capital cities.

Transurban has the right to periodically increase its tolls in line with inflation. That makes this company a highly defensive income payer too. You can expect a dividend yield of around 4.7% from Transurban shares today.

Looking for fully-franked income in retirement

The next stock I’d choose for a backup superannuation fund is Coles Group Ltd (ASX: COL). Coles is another business we’d all know. But again, I like this company for its inherent defensive nature.

We all need to eat, drink and restock our households regularly, regardless of the economic weather. So as long as Coles is one of the cheapest places to do so, it will be a successful company, and thus investment in my view.

Coles has caught my attention as a retirement stock thanks to its impressive run of dividend increases. Since its ASX listing in late 2018, Coles has been able to ratchet up its dividend income every single year. Today, you can look forward to a fully-franked 4.17% dividend yield from Coles shares.

The final share I’d place in a backup superannuation fund is Washington H. Soul Pattinson and Co Ltd (ASX: SOL). This investment house is another stock that instantly brings diversification to the table. It owns a vast portfolio of other assets, including major stakes in several ASX shares like TPG Telecom Ltd (ASX: TPG).

I love this company for its long track record of delivering impressive returns to investors. Its fully-franked dividend yield of 2.62% today might not look too impressive. However, consider that Soul Patts has managed to raise its annual dividend every single year since 2000. That’s 23 years and counting.

Because of this impressive streak, I think this company makes for a phenomenal candidate for a backup retirement share portfolio.

The post How I’d build a backup superannuation fund with $10,000 and 5 ASX shares appeared first on The Motley Fool Australia.

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More reading

• I’m buying cheap ASX shares to build my wealth in 2024 and beyond
• How I’d create investment cash flow in retirement from ASX ETFs
• The pros and cons of buying Telstra shares right now
• Buy Endeavour and these ASX dividend stocks
• Top ASX shares to buy in 2024 instead of investing in a term deposit

Motley Fool contributor Sebastian Bowen has positions in Telstra Group, Vanguard Australian Shares Index ETF, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Coles Group, Telstra Group, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Tpg Telecom. 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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