The All Ordinaries (ASX: XAO) index may be rising strongly but the same cannot be said for the Symbio Holdings Ltd (ASX: SYM) share price on Wednesday.

At the time of writing, the voice communications software provider’s shares are down a massive 33% to a 52-week low of $1.72.

This means the Symbio share price is now down a very disappointing 75% in 2022, as you can see below.

Why is this All Ords share being hammered?

Investors have been hitting the sell button today in response to the release of a trading update after the market close on Tuesday.

Unfortunately for Symbio, it appears that demand during the COVID pandemic is unravelling somewhat right now, which is weighing on its performance.

According to the release, the company now expects FY 2023 EBITDA to be between $26 million and $30 million. This compares to its previous guidance of between $36 million and $39 million, which represents a 25% downgrade based on the mid-point of the ranges.

What’s going on?

Management advised that the company’s Communications Platform-as-a-Service (CPaaS) division has been impacted by returns and slow sales progress.

In respect to the former, it notes that several US-based global software companies have returned unused phone number inventory in the second quarter following COVID-related bulk orders.

As for the latter, management highlights that new deals are taking longer to finalise. It revealed that there are approximately 400,000 Australian phone numbers that have been in the final stages of the contract process since 30 June. Positively, Symbio remains confident they will materialise.

The All Ordinaries share also advised that other business divisions, TaaS and UCaaS, are performing in line with previous expectations, albeit at a slightly slower pace due to some areas of softness in the economy.

In response, Symbio has reduced its capital expenditure plans, cut discretionary spending on travel and marketing, and suspended recruiting. It is also exploring additional measures and opportunities to reduce its cost base.

Symbio co-founder and CEO, Rene Sugo, commented:

Despite a positive Q1’23, which tracked in line with our expectations, some unexpected customer activity during Q2’23 has impacted trading. As a result, we have revised our expected FY23 EBITDA guidance to $26 million to $30 million.

Symbio has acted quickly in response, reducing capex and opex to preserve our strong balance sheet. We are continuing to efficiently execute our strategy and remain committed to our APAC expansion plans. Singapore is performing well and at this stage, our focus is now on launching operations in Malaysia and Taiwan. Once we are cash flow positive in all three countries, we will then expand further into the APAC region as outlined in our 2030 vision.

The post Why did this ASX All Ordinaries share just crash 33%? appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX lithium share is rocketing 22% on a deal with BMW
• The worst investment decision I ever made (and what I learned from it)
• Guess which ASX tech billionaire just bought a million of their company’s shares
• Is there something strange going on with ANZ shares today?
• Why is the Fortescue dividend yield so high?

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. owns and has recommended Symbio Holdings Limited. The Motley Fool Australia owns and has recommended Symbio Holdings Limited. . The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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A whopping insider buy just went down with shares in technology-focused listed investment company (LIC) Thorney Technologies Ltd (ASX: TEK). Perhaps more excitingly, the purchase was made by a rich lister who boasts a billion-dollar fortune built through investing.

Right now, the Thorney Technologies share price is 21 cents. It has fallen 51% year to date. That leaves the LIC with an $89 million market capitalisation.

For comparison, the benchmark All Ordinaries Index (ASX: XAO) has dropped 8% since the start of 2022.

So, which Aussie billionaire seemingly thinks now is a good time to buy into the ASX tech-focused share? Let’s take a look.

This insider just bought a million shares in their tech-focused LIC

Famous investor Peter Lynch is widely quoted as having said:

Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.

Thus, it might be a good sign that billionaire investor and Thorney Technologies chair Alex Waislitz snapped up another million shares in the LIC yesterday.

Waislitz, who has previously been dubbed ‘Australia’s Warren Buffett’ by some, now boasts a 23% stake in the ASX-listed tech-focused investment company.

He paid 20.92 cents per share for his latest buy, forking out a total of $209,200.

Waislitz sits at number 91 on the Australian Financial Review’s 2022 Rich List, commanding a $1.5 billion fortune.

He is also the person behind Thorney Investment Group, which is in turn the manager of the Thorney Technologies LIC. The group is Waislitz’s private investment vehicle.

Among Thorney Technologies’ major investments are Nitro Software Ltd (ASX: NTO), Imugene Limited (ASX: IMU), and Calix Ltd (ASX: CXL).

And yesterday wasn’t the first time the billionaire bought into the ASX tech-focused share in December. He forked out $38,412 on 16 December to buy 192,062 shares in Thorney Technologies for 20 cents apiece.

The post Guess which ASX tech billionaire just bought a million of their company’s shares appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX lithium share is rocketing 22% on a deal with BMW
• The worst investment decision I ever made (and what I learned from it)
• Is there something strange going on with ANZ shares today?
• Why is the Fortescue dividend yield so high?
• Novonix share price sinks on surprise production guidance downgrade

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The market may be charging higher today but that is nothing compared to the gains being recorded by the European Lithium Ltd (ASX: EUR) share price.

In morning trade, the lithium explorer’s shares were up as much as 22% to 8.8 cents.

The European Lithium share price has pulled back a touch since then but remains up 15% at 8.3 cents.

Why is this lithium share racing higher?

Investors have been scrambling to buy the company’s shares this morning after it announced a binding offtake agreement with auto giant BMW.

According to the release, European Lithium will supply BMW with a total of 50,000 metric tonnes of battery grade lithium hydroxide from the Wolfsberg Lithium Project in Austria.

This is expected to begin in 2026 and continue for six years until 2031, at which point the offtake agreement can be extended for three years. The first year will see the supply of 5,000 metric tonnes to BMW. After which, the agreement is for 9,000 metric tonnes of battery grade lithium hydroxide each year.

Pricing will be based on Fastmarket spot prices for lithium hydroxide with an unspecified discount applied. Though, before all that happens, the agreement is conditional upon the successful start of commercial production and full product qualification and certification.

The release also notes that BMW will make an advanced payment of US$15 million, which will be repaid through equal set offs against the supply delivered to BMW.

‘A key milestone’

European Lithium’s executive chairman, Tony Sage, appeared to be very pleased with the news. He said:

With the signing of the binding offtake agreement with BMW, our first offtake is secured, and we look forward to partnering with BMW in the future.

The company added:

Securing its first offtake is a key milestone which will allow the Company to focus on the final steps of development and construction of the Wolfsberg Project while it looks to the future and builds a portfolio of prospective battery metals projects located in Europe.

The post Guess which ASX lithium share is rocketing 22% on a deal with BMW appeared first on The Motley Fool Australia.

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More reading

• The worst investment decision I ever made (and what I learned from it)
• Is there something strange going on with ANZ shares today?
• Why is the Fortescue dividend yield so high?
• Novonix share price sinks on surprise production guidance downgrade
• Pilbara Minerals share price leaps on positive lithium price update

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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Since I started investing, I’ve been lucky that only a few of my own ASX share investments have gone down heavily. But, the one that did the worst hurt and taught me a lot was Slater & Gordon Limited (ASX: SGH).

Thankfully it was only a small amount of money lost as it was near the start of my investment journey.

There were a number of things that seemed promising about the lawyer business as an investment, before its big acquisition in the United Kingdom. And then everything went wrong.

It was delivering revenue growth, including organic revenue growth, and net profit after tax (NPAT) growth. The dividend was being grown strongly by the board.

One of the most promising elements of the business (at the time) was that it was expanding in the UK with bolt-on acquisitions. Growth of its addressable market and scale seemed compelling.

But then it made a $1.2 billion acquisition of UK business Quindell’s professional services division. In time, it had to write off a huge amount of that value, with personal injury laws proposed to be changed in the UK which would impact compensation claims about minor motor accident injuries.

There were a few different things I learned from this experience. The Slater & Gordon share price didn’t go to $0, but it was smashed and has remained down heavily.

Cash flow is extremely important

Ensuring that operating businesses have a good cash flow profile is important.

Achieving net profit after tax (NPAT), and growth, is important. But, I think NPAT is not as good an indicator of profitability as cash flow. Revenue and cost recognition can vary in different businesses and industries.

The company said that its normalised net operating cash flow to NPAT ratio was 86.3% in FY14 and just 73.6% in FY15. Ideally, a company’s cash flow should fairly closely match (underlying) net profit year to year.

Good cash flow allows the ASX share to organically fund its own growth, rather than issuing lots of new shares or taking on a lot of debt.

Major takeovers can destroy value

I’m not going to go over everything that went wrong with the Quindell acquisition – though there were several elements to it. Slater & Gordon was also unlucky with the timing of the law change.

With this deal, the ASX share was hoping to become the leading personal injury law group in the UK.

There is a real danger that if a business overpays for an acquisition and/or buys the wrong business, it can torch lots of shareholder value.

With individual shareholders not having access to the same due diligence materials as management when considering a deal, investors have to hope that the company is looking at the right things and being prudent.

A huge acquisition that goes bad can be dilutive if funded from new shares. If it’s funded by debt and goes bad it can destroy the business.

The attitude and prudence of management are key when it comes to takeovers.

Debt can be very dangerous

Not only does debt have an interest cost, but if there’s too much debt, it can end an ASX share if it isn’t able to repay that debt.

With interest rates so much higher now, businesses that rely on debt now face a very different landscape.

Being able to afford to pay their interest and repay the principal amount is essential.

Debt can be useful, particularly for the right asset. But, I think it’s good to focus on operating companies that have a balance sheet with a net cash position. That means the business has more cash than debt.

That’s not usually applicable for a real estate investment trust (REIT), but I think they deserve to be treated a little differently – they do have large asset backing with the property portfolio.

Generally, if debt is part of the picture, I want to see that a potential investment has low (or no) debt, has plenty of cash flow to afford the interest payments, and that the overall level of debt is relatively small compared to the size of the ASX share.

The post The worst investment decision I ever made (and what I learned from it) appeared first on The Motley Fool Australia.

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More reading

• Guess which ASX lithium share is rocketing 22% on a deal with BMW
• Is there something strange going on with ANZ shares today?
• Why is the Fortescue dividend yield so high?
• Novonix share price sinks on surprise production guidance downgrade
• Pilbara Minerals share price leaps on positive lithium price 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 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’re looking for Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares today you may be running into some issues.

For example, on Australia’s most popular brokerage platform, CommSec, the bank’s shares are nowhere to be seen at first glance.

But don’t worry, they’re still there!

Is something strange happening with ANZ shares?

On Tuesday, the big four bank revealed that its scheme of arrangement was now effective.

This scheme of arrangement sees the company establish ANZ Group Holdings Limited (ANZ NOHC) as the new listed parent company of the ANZ group. It has also separated ANZ’s banking and certain non-banking businesses into two groups.

At its scheme meeting earlier this month, ANZ chair, Paul O’Sullivan, explained the rationale for the change. He said:

Customers are demanding more from their banks. Better services, better products and better digital solutions. Consistent with this, traditional banking is facing significant disruption from new non-bank competitors, mainly global technology companies launching financial services products.

Understandably, these businesses are not regulated in the same way as banks like ANZ. This new NOHC will allow ANZ to partner with technology companies on a level playing field. Essentially, the restructure is about making our banking business more efficient by creating a better structure for investing in our non-bank partners. It will provide greater strategic and operational flexibility.

O’Sullivan also points out that this NOHC setup isn’t new. It is used by the likes of Macquarie Group Ltd (ASX: MQG) and Suncorp Group Ltd (ASX: SUN) in Australia and Bank of America, JP Morgan, HSBC, and Barclays internationally.

Importantly, your dividends will not be impacted by the change and shareholders will receive one ANZ NOHC share for each ANZ share they hold.

So what’s happening today?

As the scheme is now legally effective, ANZ shares on the ASX and NZX have been suspended and ANZ NOHC shares are trading in their place on a deferred settlement basis.

This will remain the case until 4 January, when ANZ NOHC will commence normal trading at long last.

In the meantime, you can find ANZ shares on some brokerage platforms under the ANZDA ticker code.

The post Is there something strange going on with ANZ shares today? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Little downside protection for popular ASX 200 shares as 2023 looms a much tougher year for blue chip stocks
• Buy ANZ Bank and this ASX 200 dividend share: brokers
• What’s with the ANZ share price on Thursday?
• The ANZ dividend is being delivered today. Here’s what you need to know

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 recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Fortescue Metals Group Limited (ASX: FMG) shares pay a very high dividend yield to investors. But how is the ASX iron ore share managing to do this?

Fortescue is one of the largest iron ore miners in the world with a market cap of $62 billion, according to the ASX.

It’s a bit bigger than it was a few weeks ago. The Fortescue share price is up over 20% in the last two months.

Fortescue is known for its large dividend payouts to shareholders. Not just in dollar terms, but also in terms of the dividend yield.

Another big dividend is expected in FY23 according to CommSec, with a projected payout of $1.41 per share. This translates into a forward grossed-up dividend yield of 10% at the current Fortescue share price.

How is the business managing to pay such a good dividend while investing in its green energy endeavours? I think it mainly comes down to two things.

High dividend payout ratio

The more of a company’s net profit after tax (NPAT) it pays out as a dividend, the bigger the dividend yield.

Fortescue has a dividend policy of having a dividend payout ratio of between 50% and 80% of its NPAT.

In FY22 it paid an annual dividend per share of $2.07 per share, representing a dividend payout ratio of 75%.

Using the estimates on CommSec for FY23, the ASX iron ore share is expected to have a dividend payout ratio of 70.8%.

This means there is still plenty of cash left for Fortescue to put some of the retained profit into its green hydrogen goals and some into funding mining-based growth for the business.

Low earnings multiple

It’s important to know that even if two businesses have the same dividend payout ratio, they can have different dividend yields, because the valuation of the business is different.

The higher the price-to-earnings (p/e) ratio, the lower the dividend yield. This works in the opposite way as well, when the p/e ratio is lower, it boosts the dividend yield. But, a low p/e ratio doesn’t necessarily mean it’s good value or a reliable business.

Fortescue usually has a low p/e ratio, naturally boosting the dividend yield. Iron ore prices can be volatile, so miner earnings aren’t expected to be consistent year to year. In the good times, the iron ore miner makes tons of profit, and the p/e ratio is typically low. When the iron ore price is low Fortescue shares can sometimes trade on a higher p/e ratio.

According to CommSec, the Fortescue share price is valued at 10x FY23’s estimated earnings.

Foolish takeaway

The Fortescue dividend yield could remain high for at least the next 12 months. If the iron ore price remains above US$100 per tonne, Fortescue could continue to pay good dividends in the medium term. However, investors may be able to grab an even higher dividend yield if they can jump on Fortescue shares when it goes through a significant dip.

The post Why is the Fortescue dividend yield so high? appeared first on The Motley Fool Australia.

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More reading

• 2 reasons I think the Fortescue share price can keep rising (and 2 why it can’t)
• Why did the iron ore price just hit a 6-month high?
• What’s going on with the Fortescue share price on Friday?
• Why is the Fortescue share price having another day to forget?
• Lithium, miners, and tech shares, oh my! Here’s where Aussies put their ASX money in 2022

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 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 Novonix Ltd (ASX: NVX) share price is sinking again on Wednesday.

In morning trade, the battery materials technology company’s shares are down 5% to a new 52-week low of $1.59.

This means the Novonix share price is now down over 85% in 2022, as you can see below.

Why is the Novonix share price falling?

Investors have been selling down the Novonix share price today despite the company announcing a major offtake agreement.

According to the release, the company is expanding its high-performance synthetic graphite anode materials production at its Riverside facility in the United States in order to support a 10,000 tonnes per annum (tpa) offtake requirement from energy storage company KORE Power.

This follows news that KORE Power has secured financing for its lithium-ion battery cell production gigafactory. Novonix signed an agreement with KORE Power last year to be its exclusive supplier of graphite anode material.

Novonix intends to begin production at a rate of approximately 3,000 tpa in 2024, before ramping up to approximately 12,000 tpa in 2028.

So why the selling?

While the above sounds very positive at first glance, it’s actually a production guidance downgrade when you read between the lines.

Novonix was previously guiding to production of 10,000 tpa in 2023 but now only expects 3,000 tpa a year later in 2024.

In fact, it was approximately two months ago that management said:

The Company is on track for reaching annual production capacity of 10,000 tpa of synthetic graphite in 2023 at its existing Riverside facility.

In light of this, meaningful revenue generation could still be some way off for Novonix.

Management commentary

Novonix’s co-founder and CEO, Dr Chris Burns, didn’t speak about the production guidance downgrade and focused only on the offtake agreement. He said:

I am excited to begin delivery of our high-performance synthetic graphite from our Riverside facility to KORE in 2024, our first significant volume offtake. We are pleased with the progress at our Riverside facility as we start to bring production online to support mass production qualification with KORE and other customers.

Dr Burns also revealed that the company won’t be stopping at production of 12,000tpa and is already planning the next facility to boost its output. He concludes:

As we commence our production ramp schedule for Riverside, we plan to begin construction of our next production facility in the first half of 2023 to bring an additional 30,000 tonnes of annual production. We are one of the only companies scaling production of battery-grade graphite in North America, and we are confident in our position to meet growing battery demand for the electric vehicle and energy storage sectors.

The post Novonix share price sinks on surprise production guidance downgrade appeared first on The Motley Fool Australia.

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More reading

• Is Novonix’s 80% share price crash in 2022 justified?
• Why did the Novonix share price have such a stellar run today?
• Here are the top 10 ASX 200 shares today
• The Novonix share price has crashed another 14% already this week. What’s going on?
• Why did the Novonix share price crash 16% in November?

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

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The Pilbara Minerals Ltd (ASX: PLS) share price is in the green on Wednesday on news of the company’s lithium offtake pricing and its project expansions.

The S&P/ASX 200 Index (ASX: XJO) lithium favourite announced good news of pricing with major offtake customers and updated the market on its expansion activities.

The Pilbara Minerals share price is up 2.85%, trading at $3.97 at the time of writing.

Let’s take a closer look at today’s news from the ASX 200 lithium producer.

What’s driving the Pilbara Minerals share price today?

Offtake pricing increased

Pilbara Minerals today revealed an increase in the price it will sell its lithium products to major offtakers.

Its new average price will equate to around US$6,300 per dry metric tonne (CIF China) on a SC6.0 (6% lithia content) equivalent basis, based on today’s market pricing reference data.

The increased pricing applies to all shipments the company sends to its major offtake customers from December.

For reference, Pilbara Minerals’ realised sales price over the September quarter equated to a reference price of US$4,813 per dry metric tonne on a SC6.0 basis.

Meanwhile, its latest Battery Materials Exchange auction heralded a bid equivalent to US$8,299 per dry metric tonne, inclusive of freight, on a SC6.0 basis.

Pilbara Minerals CEO and managing director Dale Henderson commented:

The improved pricing outcomes are expected to further improve cash-flow generation from the Pilgangoora Project, helping the business to continue on its rapid growth trajectory into 2023 and beyond.

Pilgangoora expansion update

The Pilbara Minerals share price might also be getting a boost from news of its expansion project.

The P680 expansion project aims to increase Pilgangoora’s annual nameplate production capacity from around 580,000 tonnes to 680,000 tonnes. The company green-lit the project in June.

Today, however, the company announced the expected cost of the expansion has jumped 36%. It’s now expected to cost around $404 million – up from previous estimates of $297.5 million.

That’s mainly due to higher material and equipment costs, costs to maintain its delivery schedule, greater engineering work, and a tight labour market. Henderson said:

Our strong balance sheet and the current cash generating capacity of the Pilgangoora Project enables the company to continue the timely delivery of the P680 project, notwithstanding the capital escalation.

The expansion’s primary rejection facility is on track for completion in the 2023 September quarter. After that, the crushing and ore sorting facility is expected to kick off in the 2024 March quarter.

Finally, Pilbara Minerals has approved $38.3 million of pre-final investment decision funding for the P1000 Expansion Project.

The expansion could see the Pilgangoora Project’s total spodumene concentrate production capacity reach a million tonnes annually. A final investment decision has been flagged for the upcoming March quarter.

The post Pilbara Minerals share price leaps on positive lithium price update appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• While the ASX 200 struggled in 2022, investors doubled down on lithium shares. Here’s why
• Here are the 3 most heavily traded ASX 200 shares on Monday
• ASX lithium shares have just been crunched. Time to buy?
• Top brokers name 3 ASX shares to buy next week

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 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 Vanguard Australian Shares Index ETF (ASX: VAS) is the most popular exchange-traded fund (ETF). It’s worth considering whether it’s a buy in the current environment.

The ETF hasn’t fallen as much this year as other ETFs, like international share-based ones.

In 2022 to date, it has fallen by around 10%. Meanwhile, the Betashares Nasdaq 100 ETF (ASX: NDQ) has dropped 30%.

That’s pleasing for investors in the Vanguard Australian Shares Index ETF. But it could also mean there’s less of a rebound in 2023 compared to United States shares or international shares.

However, 2023 could still be fruitful for a number of reasons.

Rising interest rates

One of the most talked-about things in the economy at the moment is rising interest rates and, moreover, how high they’re going. This is affecting businesses and households in a number of different ways.

But, with financial shares making up a sizeable portion of the ETF, what happens with interest rates can have a major impact on ASX bank shares.

There are plenty of banking names that could benefit from higher interest rates including Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group Ltd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB), Bank of Queensland Ltd (ASX: BOQ) and Bendigo and Adelaide Bank Ltd (ASX: BEN).

With banks passing on loan rate hikes quicker than savings interest rate increases, this period could mean substantially better lending profitability for the banks. This could boost bank share prices and shareholder returns, including dividends.

However, at some point, it could lead to higher arrears, so I’m keeping an eye on that.

Improving COVID-19 situation in China

A lot of Australian commodities are exported to the Asian superpower, with iron ore being a key resource.

Lockdowns were used to limit the spread of COVID-19. It’s also meant that economic activity has been limited in the country. The iron ore price had drifted lower, but it’s come bouncing back as China has steadily lifted its COVID restrictions.

There are a few high-profile ASX iron ore shares within the Vanguard Australian Shares Index ETF that could drive the performance of the ASX if they can benefit from higher resource prices, including the bigger dividends.

It’s quite possible that the share prices of BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) could rise even further. But, resource prices are unpredictable, so who knows what will happen next?

However, a CBA analyst is speculating that March could be the month of an official COVID change in China.

Good dividend yield

A number of the major positions in the Vanguard Australian Shares Index ETF portfolio pay good dividends, like the ASX iron ore shares, the ASX bank shares, Telstra Group Ltd (ASX: TLS), Wesfarmers Ltd (ASX: WES), Coles Group Ltd (ASX: COL), Woodside Energy Group Ltd (ASX: WDS) and Macquarie Group Ltd (ASX: MQG).

According to Vanguard, the dividend yield of the ETF, excluding franking credits, is 4.3% at the end of November. Regardless of what happens next, the dividends alone could be a good starting point for the annual return.

Foolish takeaway on the Vanguard Australian Shares Index ETF

Overall, I think the Vanguard Australian Shares Index ETF would be a solid long-term investment for 2023 and beyond. It’s cheap with an annual management fee of just 0.10%, though the holdings are not very strongly diversified, with large allocations to banks and resources. A higher technology allocation could be helpful in the long term, though this won’t change unless the S&P/ASX 300 Index (ASX: XJO) changes.

The post Is the Vanguard Australian Shares Index ETF (VAS) worth buying for 2023? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank, BetaShares Nasdaq 100 ETF, Coles Group, Telstra Group, and Wesfarmers. The Motley Fool Australia has recommended Macquarie Group and Westpac Banking. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Telstra Group Ltd (ASX: TLS) share price is under pressure on Wednesday.

In morning trade, the telco giant’s shares are down 0.5% to $4.02.

This compares unfavourably to the ASX 200 index, which is up 1% in early trade.

Why is the Telstra share price falling?

The Telstra share price is underperforming today after the Australian Competition and Consumer Commission (ACCC) blocked the company’s proposed regional mobile network arrangements with rival TPG Telecom Ltd (ASX: TPG).

Earlier this year, Telstra and TPG signed a ground-breaking ten-year regional Multi-Operator Core Network (MOCN) commercial agreement.

Under the deal, TPG would gain access to around 3,700 of Telstra’s mobile network assets, increasing TPG Telecom’s current 4G coverage from around 96% to 98.8% of the population. Whereas Telstra would gain access to TPG’s spectrum across 4G and 5G, which will allow it to grow its network and increase capacity.

Telstra estimated that the deal would deliver between $1.6 billion and $1.8 billion of revenue over the initial 10-year term.

ACCC says no

Unfortunately, the deal has been vetoed by the ACCC.

The competition watchdog notes that under the statutory test, it must not grant authorisation unless it is satisfied the proposed arrangements would not be likely to substantially lessen competition, or that the likely public benefits from the arrangements would outweigh the likely public detriments.

However, after an extensive public consultation and investigatory process, it is not satisfied under either of these tests and therefore cannot grant authorisation.

The ACCC’s commissioner, Liza Carver, explained that mobile networks are incredibly important and any reduction in competition could negatively impact customers. And while she saw some benefits from the proposed agreement, they were outweighed by competition concerns. She said:

We examined the proposed arrangements in considerable detail. While there are some benefits, it is our view that the proposed arrangements will likely lead to less competition in the longer term and leave Australian mobile users worse off over time, in terms of price and regional coverage.

Mobile networks are of critical importance to many aspects of our lives, including our livelihood, our wellbeing and our ability to keep in touch with friends and family. Any reduction in competition will have very wide-ranging impacts on customers, including higher prices and reduced quality and coverage.

The TPG share price is currently down 2% on the news.

The post Telstra share price lower after ACCC blocks TPG deal appeared first on The Motley Fool Australia.

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More reading

• I’d buy these 3 ASX 200 shares in 2023 and hold them for a decade
• Little downside protection for popular ASX 200 shares as 2023 looms a much tougher year for blue chip stocks
• Building a passive income for retirement? Check out these ASX 200 dividend shares – analysts
• Start generating extra income by investing $5 a day in ASX shares. Here’s how
• Why all eyes will be on Telstra shares this week

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 Telstra Group. 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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