It was a brutal year for ASX tech shares as concerns over soaring inflation and rising interest rates ran rampant in 2022.

The ASX tech sector felt the brunt of the impact, faring far worse than other sectors due to its sensitivity to interest rates.

The S&P/ASX 200 Index (ASX: XJO) slid 5.5% across the year to finish at 7,039 points. 

As I covered recently, the S&P/ASX 200 Health Care Index (ASX: XHJ) slightly lagged behind, dropping 8.4%.

But these falls pale in comparison to that of the ASX tech sector. The S&P/ASX All Technology Index (ASX: XTX), an index designed to be a comprehensive measure of technology-oriented companies on the ASX, suffered a painful 32.8% fall. 

As it stands, there are currently 47 companies in the ASX All Tech index. 

Of these, only 10 companies managed to outperform the ASX 200 index in 2022. You can see the performance of these shares in the table below.

Company	2022 share price performance
Silex Systems Ltd (ASX: SLX)	140.6%
Nearmap Ltd (ASX: NEA)	35.9%
Computershare Limited (ASX: CPU)	31.0%
Data#3 Limited (ASX: DTL)	15.1%
Weebit Nano Ltd (ASX: WBT)	13.6%
BrainChip Holdings Ltd (ASX: BRN)	10.3%
ELMO Software Ltd (ASX: ELO)	6.9%
TechnologyOne Ltd (ASX: TNE)	2.6%
Pushpay Holdings Ltd (ASX: PPH)	-1.6%
Hansen Technologies Limited (ASX: HSN)	-3.9%

Let’s take a closer look at the top three.

Fuelling up

In terms of annual share price performance, there was daylight between Silex and the rest of its ASX All Tech peers in 2022.

The Silex share price soared to lofty heights, propelled by a resurgence in nuclear energy during the year. 

There’s been a growing acceptance that nuclear energy will be a key pillar in the fight against climate change. What’s more, Russia’s invasion of Ukraine has added another catalyst to the mix as energy markets have gone into a tailspin.

So how does Silex fit into this? Well, it’s a company focused on commercialising its laser technology to enrich uranium, the fuel most widely used to produce nuclear energy.

The company believes it has the only third-generation laser-based uranium enrichment technology that is currently under commercial development.

According to Silex, uranium production and enrichment are the two largest value drivers of the nuclear fuel cycle, accounting for nearly 80% of the value of a reactor fuel bundle.

In August, Silex announced it had successfully completed extensive testing of its first full-scale laser system module. The company is aiming to complete the pilot demonstration program by 2025.

It’s also trying to commercialise its technology for silicon enrichment, which is currently in stage three testing.

Gliding off the ASX

After first joining the ASX ranks in 2008, Nearmap’s publicly-listed life reached the end of the road in 2022.

In August, software investment firm Thoma Bravo launched a takeover bid, proposing to acquire the aerial imagery company for $2.10 per share. At the time, this represented a 39% premium to Nearmap’s last closing price of $1.51.

Around 78% of shareholders voted in favour of the deal; enough to narrowly satisfy the 75% hurdle. After receiving all the ticks of approval, the takeover went through and Nearmap was delisted from the ASX last month.

Cashing in on higher interest rates

Last but not least, Computershare took out the bronze medal as the third best-performing company in the ASX All Tech index in 2022.

The Computershare share price defied the tech downturn, finishing the year 31% higher than where it started.

This is because Computershare is in a unique position of benefitting from higher interest rates, in a big way at that. 

Computershare’s core operations require it to hold large amounts of cash on behalf of its clients. For example, the cash for dividends before it’s divvied out to shareholders.

In FY22, total client balances averaged roughly US$34 billion. Computershare earns interest income – also known as margin income – on these balances, which effectively falls straight to the bottom line.

This income came in at US$187 million in FY22, reflecting a yield of 0.56% which was steady year on year. But on the back of recent interest rate hikes, FY23 is where the benefits will start to kick into gear.

The company was initially expecting its FY23 margin income to land at around US$520 million, representing growth of nearly 180%. 

But in November, on the back of global interest rate rises being faster and larger than expected, Computershare cranked up this guidance to a mighty US$800 million. The company is expecting to earn an average weighted yield of 2.19%.

While it’s still early days, as it stands, Computershare is forecasting its margin income in FY24 to reach the US$1 billion mark.

The post The 3 best-performing ASX tech shares of 2022 appeared first on The Motley Fool Australia.

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More reading

• These were the 5 top-performing ASX All Ords shares of 2022
• The top five ASX 200 shares in Macquarie’s model portfolio
• As 2 experts predict the stock market is yet to bottom, here are 4 things every investor can do now to prepare for the worst

Motley Fool contributor Cathryn Goh 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 Elmo Software, Hansen Technologies, and Pushpay. The Motley Fool Australia has positions in and has recommended Pushpay. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Are you looking for passive income options for 2023? If you are, then you may want to look at the quality ASX 200 dividend shares listed below.

Here’s why these shares could be top options this year:

Deterra Royalties Ltd (ASX: DRR)

The first ASX 200 dividend share for income investors to look at buying is Deterra Royalties.

It is a mining royalties company and the owner of a portfolio of royalty assets across a range of commodities. The key asset in the company’s portfolio is the Mining Area C (MAC) iron ore operation, which is part of Western Australia Iron Ore (WAIO), and operated by mining giant BHP Group Ltd (ASX: BHP).

In addition, Deterra will receive royalties from the massive Eneabba Project owned by Iluka Resources Limited (ASX: ILU) when it commences production in the near future.

The team at Citi is positive on the company and has a buy rating and $4.70 price target on its shares.

As for dividends, Citi is forecasting fully franked dividends per share of 26 cents in FY 2023 and 28 cents in FY 2024. Based on the current Deterra Royalties share price of $4.65, this will mean yields of 5.6% and 6%, respectively.

Transurban Group (ASX: TCL)

Another ASX 200 dividend share that could be a good option for a income investors is Transurban.

It is a leading toll road operator that owns a portfolio of roads in Australia and North America. It also has a significant project pipeline that could support its growth long into the future.

While its roads were quiet during the pandemic, traffic volumes are now booming again. Combined with its positive exposure to inflation, Transurban has been tipped to grow its earnings and dividends at a solid rate in the coming years.

Macquarie is a fan of the company and has an outperform rating and $14.19 price target on its shares.

In respect to dividends, the broker is forecasting dividends per share of 53 cents in FY 2023 and then 56.5 cents in FY 2024. Based on the current Transurban share price of $13.15, this will mean yields of 4% and 4.3%, respectively.

The post Experts name 2 quality ASX 200 dividend shares for income investors to buy appeared first on The Motley Fool Australia.

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• Buy NAB and this ASX 200 dividend share: analysts
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• Guess which ASX 200 share is trading ex-dividend tomorrow
• Building a retirement income portfolio? Buy these unstoppable ASX dividend shares – analysts

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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Qantas Airways Limited (ASX: QAN) stock was a strong outperformer in 2022.

Over the 12 months the S&P/ASX 200 Index (ASX: XJO) listed airline’s share gained 20%. And that came during a year when the ASX 200 itself lost 5%.

Dividend payouts remained off the table in 2022, however. Those were suspended in early 2020 as Qantas stock was ravaged by the fallouts from the global pandemic lockdowns, which saw air travel virtually eliminated.

Still, you’re unlikely to hear any investors complaining about a 20% annual share price gain.

The question for ASX 200 investors now is, will Qantas stock be a good investment in 2023 as well?

What’s the outlook for Qantas stock in 2023?

According to analysts at Morgans, Qantas stock could be in for some more significant outperformance in the year ahead.

In early December the broker initiated coverage on Qantas shares with an add rating and an $8.50 price target. Morgans is optimistic over the airline’s upgraded earnings expectations, released on 23 November. Its analysts also cited the positive tailwinds from continued pent-up travel demand as borders broadly reopen.

Another broker with a positive outlook for Qantas stock in 2023 is UBS. Its analysts have a buy rating on the airline with a price target of $7.60. The broker noted that shares are still trading at a considerably lower level than they were in the months before the pandemic.

Now over the past few weeks, the great China reopening has hit some snags. With COVID spreading rapidly through the population, this has seen many nations, Australia included, reintroduce mandatory virus testing for Chinese travellers.

How this plays out remains to be seen. If the virus continues to hamper travel into and out of the world’s most populous nation it could throw up some unwanted headwinds for Qantas stock.

Safest airline in the world

Qantas stockholders will be pleased to know that the airline has regained its safest in the world credentials. Qantas was awarded the world’s safest airline for 2023 by AirlineRatings.com.

“Our Top Twenty Safest Airlines are all standouts in the industry and are at the forefront of safety, innovation, and launching of new aircraft,” said AirlineRatings.com Editor-in-Chief Geoffrey Thomas.

How has Qantas stock been tracking?

After gaining 20% last year, as you can see below, Qantas stock remains down 16% from its January 2020 levels, before most of the world had heard of the coronavirus.

But if UBS and Morgans have it right, the airline could retest and indeed exceed those levels in 2023.

The post Qantas stock: Is it a good ASX 200 investment for 2023? appeared first on The Motley Fool Australia.

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• Top brokers name 3 ASX shares to buy
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• Can these 2 ASX 200 shares crush the market again in 2023?
• 23 ASX shares to buy in 2023 – brokers

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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The Woodside Energy Group Ltd (ASX: WDS) share price was one of the strongest performers within the S&P/ASX 200 Index (ASX: XJO) in 2022, rising by around 60%.

It was an eventful year for the ASX energy share, with things largely going the company’s way. Let’s compare that large rise to the ASX 200 itself – the index dropped by around 7%, so there was a huge outperformance by the company.

Higher energy prices

After the massive disruption to oil prices at the start of COVID, the oil price steadily recovered. It was a steady climb during 2021 and then the Russian invasion of Ukraine put a rocket under energy prices as the world looked for other sources of supply away from Russia.

In the second quarter of 2022, it achieved an average realised price of $95 per barrel of oil equivalent. When revenue for the same amount of production increases, it largely adds to net profit.

Then, in the third quarter of 2022, the business reported that the average portfolio realised price rose by 7% to $102 per barrel of oil equivalent.

Investors typically like to evaluate the Woodside share price by thinking about its profitability, so it wasn’t a surprise that investors were excited by the business.

Merger

Investors may also have focused on the fact that Woodside was able to merge with BHP Group Ltd’s (ASX: BHP) petroleum business. This transformed Woodside into a “top 10 global independent energy producer by hydrocarbon production.”

Woodside explained that the merger will strengthen cash generation, improve its growth profile and unlock at least $400 million of annual pre-tax synergies.

By becoming a bigger business, Woodside will be able to help each shareholder because of scale advantages.

Bigger dividend

Woodside has revealed that its dividend policy will be based on its net profit after tax (NPAT), with a minimum dividend payout ratio of 50%.

The company also said that “additional opportunities to provide returns through special dividends and share buy-backs.”

Some investors may be attracted to the prospect of a larger dividend from the company and investing, pushing up the Woodside share price to get it.

Another big annual dividend is expected in 2023. According to Commsec, it could pay a dividend per share of $3.23. This would be a grossed-up dividend yield of 13.6%.

The post 3 key factors that helped propel the Woodside share price 60% higher in 2022 appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Friday
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• Bigger profits risk bigger target: The Woodside share price conundrum
• The 3 best performing ASX 200 dividend shares of 2022
• Why Audio Pixels, Bowen Coking Coal, Pantoro, and Woodside shares are dropping

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 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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Woolworths Group Ltd (ASX: WOW) shares have dropped so much that the supermarket business is now lower than it was compared to just before COVID panic smashed the ASX share market.

The company has seen its share price drop around 15% from mid-August. It’s down around 20% since August 2021.

That’s quite a lot of volatility for an ASX share that is typically defensive and doesn’t see much change in sales over time.

After such a hefty drop for the company, is it now time to buy?

Latest business update

I think it’s a good idea for investors to pay attention to whether conditions are worsening for the business. If a sell-off occurs but the company’s performance isn’t dropping, then it could be an oversold opportunity.

The latest update was the first quarter of FY23. Woolworths said group sales increased 1.8% to $16.36 billion. Within the divisions, there was a mixed performance.

Australian food sales were down 0.5% year over year to $12.2 billion, despite a 7.3% increase in average prices. Australian businesses-to-business sales grew by 26% to $1.2 billion, New Zealand food sales dropped 8.1% to $1.8 billion and Big W sales grew by 30.1% to $1.2 billion.

So, while total sales did go up, the key division (Australian supermarkets) saw sales go slightly backwards despite inflation. Is the Woolworths share price worth a high price-to-earnings (P/E) ratio if supermarket sales are going backwards? Probably not as much.

However, the company did say that in October, year over year “sales growth trends in Australian food have improved” as it’s no longer cycling against lockdowns in NSW and Victoria.

Earnings diversification play

Last month, the business announced it was selling a significant portion of its Endeavour Group Ltd (ASX: EDV) shares (5.5% of the business) to buy 55% of Petspiration Group.

The acquisition cost of the majority stake of the PETstock owner is $586 million. It has 276 stores, online websites, a 2.4 million member program, and own-brand ranges.

There are a number of areas where Woolworths thinks it can help PETstock grow including digital and e-commerce, the supply chain, advanced analytics, and its balance sheet.

Woolworths believes this investment can achieve an internal rate of return (IRR) in the “mid-teens”.

In the 12 months to September 2022, Petspiration generated earnings before interest, tax, depreciation and amortisation (EBITDA) of $158 million, meaning the acquisition price puts the enterprise value at 11x the EBITDA.

I think this is a smart move by the company.

Is the Woolworths share price a buy?

Woolworths is getting closer to its 52-week low. While it’s impossible to say how low the company’s share price is going to go, I believe it could be fruitful to look at the business while investor confidence is low.

As the saying goes, it’s good to be greedy when other investors are fearful. Even so, the Commsec profit projection puts the Woolworths share price at 24x FY23’s estimated earnings.

Woolworths shares would not be at the top of my own shopping list, but for investors interested in the company it seems like an opportunistic time to invest.

The post Woolworths shares have fallen to pre-pandemic levels. Time to buy? appeared first on The Motley Fool Australia.

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More reading

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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• 5 things to watch on the ASX 200 on Friday
• Experts says these ASX 200 mining shares can rocket higher in 2023
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On Thursday, the S&P/ASX 200 Index (ASX: XJO) fought hard to record the smallest of gains. The benchmark index rose slightly to 7,063.6 points.

Will the market be able to build on this on Friday and end the week on a high? Here are five things to watch:

ASX 200 expected to edge higher

The Australian share market looks set to end the week with a modest gain despite a poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 8 points or 0.1% higher this morning. In late trade in the United States, the Dow Jones is down 0.9%, the S&P 500 has dropped 0.9%, and the Nasdaq has fallen 1.1%. This was driven by the release of US jobs data.

Oil prices recover

Energy producers Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a decent finish to the week after oil prices recovered overnight. According to Bloomberg, the WTI crude oil price is up 1.4% to US$73.93 a barrel and the Brent crude oil price is up 1.35% to US$78.85 a barrel. Lower US stockpiles boosted prices.

Tech shares under pressure

It looks set to be a tough finish to the week for ASX 200 tech shares on Friday following a poor night on the NASDAQ index. This could spell bad news for tech shares such as Altium Limited (ASX: ALU) and Xero Limited (ASX: XRO). It is also worth noting that Block Inc (ASX: SQ2) has seen its shares on the NYSE fall 2% overnight. This tech weakness was driven by the release of strong US jobs data, which supported the case for higher interest rates.

Gold price tumbles

Gold shares Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) could have a tough finish to the week after the gold price fell overnight. According to CNBC, the spot gold price is down 1.1% to US$1,838 an ounce. Once again, the prospect of higher interest rates weighed on the precious metal.

Brickworks named as a buy

The Brickworks Limited (ASX: BKW) share price could be good value according to analysts at Morgans. Its analysts have retained their add rating with an improved price target of $24.50. The broker said: “[T]he stock continues to screen cheap given the current discount to inferred NTA and the pipeline of value accretive projects to be potentially realised over coming years.”

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

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Motley Fool contributor James Mickleboro has positions in Altium and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Block, Brickworks, and Xero. The Motley Fool Australia has positions in and has recommended Block, Brickworks, and Xero. 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 looking for some exposure to the mining sector, then read on!

Listed below are two ASX 200 mining shares to buy now according to experts. Here’s what they are saying about them:

Allkem Ltd (ASX: AKE)

The first ASX 200 mining share to consider is Allkem. It is one of the world’s largest lithium miners with projects in Argentina, Australia, and North America.

Allkem has bold production expansion plans from these projects. In fact, it is aiming to grow its production four-fold in the coming years in order to maintain a 10% share of global lithium supply over the long term.

Goldman Sachs is positive on Allkem due to the aforementioned production growth and its exposure to several lithium types. This includes moving downstream from spodumene into lithium chemicals, which it sees as a margin accretive opportunity. Goldman commented:

Of our covered Australian lithium companies, Allkem has the best LCE growth outlook with production growing >4x to FY27E with further downstream optionality on carbonate production

Goldman has a buy rating and $15.20 price target on Allkem’s shares. This implies potential upside of 34% for investors over the next 12 months.

South32 Ltd (ASX: S32)

Morgans is a big fan of South32 and feels it is one of the best options in the resources sector.

The broker is positive on the diversified miner due to the successful transformation of its portfolio and its positive long term outlook. It advised:

Unlike its peers amongst ASX-listed large-cap miners, S32 is not exposed to iron ore. Instead offering a highly diversified portfolio of base metals and metallurgical coal (with most of these metals enjoying solid price strength). We see attractive long-term value potential in S32 from de-risking of its growth portfolio, the potential for further portfolio changes, and an earnings-linked dividend policy.

The broker currently has an add rating and $5.40 price target on the diversified mining company’s shares. Based on the latest South32 share price, this suggests potential upside of over 30% for investors this year.

The post Experts says these ASX 200 mining shares can rocket higher in 2023 appeared first on The Motley Fool Australia.

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More reading

• Top ASX shares to buy in January 2023
• Why are ASX 200 lithium shares running on empty today?
• Morgans names 2 ASX 200 dividend shares to buy with 5%+ yields
• 23 ASX shares to buy in 2023 – brokers
• Should I buy ASX 200 lithium shares for my portfolio in 2023?

Motley Fool contributor James Mickleboro has positions in Allkem. 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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S&P/ASX 200 Index (ASX: XJO) energy shares shot the lights out through most of 2022 as energy prices went through the roof.

Here’s how the top Aussie oil and gas stocks performed in 2022 through to market close on 11 November:

• Santos Ltd (ASX: STO) shares gained 19%
• Beach Energy Ltd (ASX: BPT) shares gained 40%
• Woodside Energy Group Ltd (ASX: WDS) shares soared 76%

On 11 November the Brent crude oil price stood at US$99 per barrel.

Since then, oil and gas prices have tumbled lower, with that same barrel of Brent crude selling for US$79 today.

As you’d expect, that’s put some selling pressure on these ASX 200 energy shares.

Since 11 November’s closing bell, Santos shares are down 8%, Beach Energy shares have dropped 13%, and the Woodside share price is down 12%.

Below you can see how the three ASX 200 energy shares have tracked over the past 12 months.

Yet with Brent crude oil prices down 38% since peaking at US$122 per barrel in early March last year, there could be more pain to come for the big oil and gas stocks in 2023.

Warm weather and COVID stymie ASX 200 energy shares

On the gas front, ASX 200 energy shares won’t receive a leg up from a warm snap in Europe and windy weather to drive turbines. The combination has slashed demand for gas-powered electric generation.

This has driven gas prices in the war-weary continent down to levels not seen since November 2021, before Russia’s invasion of Ukraine.

According to data from Bloomberg, benchmark futures for gas slid 11% overnight.

As mentioned up top, oil prices have also been retracing.

Much of that looks to be spurred by investors reanalysing the near-term demand out of China.

Until recently, China’s reopening from its multi-year zero COVID policies had been expected to see an uptick an oil demand, which would have been welcomed by the ASX 200 energy shares.

However, all has not gone as planned. The Middle Kingdom is struggling with surging infections, delaying any big lift in energy demand brought on by the grand reopening.

According to Rebecca Babin, a senior energy trader at CIBC Private Wealth Management (quoted by Bloomberg):

The disconnect between how forward-looking assets like energy equities anticipated a China recovery does not translate to immediate crude strength as there is a lot of near-term risk to demand before we see recovery take hold.

That’s not to say ASX 200 energy shares might not regain their momentum down the road.

In fact, the energy market could turn around in a matter of weeks, according to Amrita Sen, chief oil analyst at consultant Energy Aspects.

“There’s a few more weeks of softness I would think,” she said.

The post Is the party over for these ASX 200 energy shares in 2023? appeared first on The Motley Fool Australia.

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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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