This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon‘s (NASDAQ: AMZN) big news so far this week was the announcement on Monday that the company plans to lay off 10,000 workers. However, the e-commerce and cloud-hosting giant followed up with an even more surprising development.

On Tuesday, the company introduced its new virtual care service, Amazon Clinic, which “connects customers with affordable virtual care options when and how they need it.” Is Amazon stock a buy after the unveiling of this new healthcare service? 

The second time’s the charm?

If this story sounds really familiar, it should. Amazon launched another virtual care service called Amazon Care in 2019. However, the company is shutting that service down by the end of this year.

How does Amazon Clinic differ from Amazon Care? For one thing, it’s much more limited in scope. Amazon Clinic will provide virtual care only for about 20 common conditions. These include acne, allergies, migraines, and urinary tract infections. 

Amazon Care was available nationwide. Amazon Clinic, though, will at least initially be available in only 32 states. Amazon Care also offered in-person healthcare services in many cities, while Amazon Clinic will provide only virtual care services. 

With Amazon Clinic, customers will be able to choose from a list of licensed telehealth providers. However, they’ll have to pay for the services out of pocket. Amazon Clinic won’t accept insurance, at least for now.

Potential impact

Amazon’s shares jumped nearly 4% in early trading on Tuesday. Were investors celebrating that Amazon will once again join the ranks of telehealth stocks? Maybe a little. However, the main reason for Amazon’s surge was that all the major market indexes rose after October wholesale prices increased less than expected.  

The reality is that the impact of Amazon Clinic on the company’s overall business will almost certainly be quite small. Amazon generated revenue of $127.1 billion in the third quarter. It would take a lot of virtual care visits to even amount to chump change in comparison to that massive sales total.

Sure, Amazon Pharmacy could receive a boost from prescriptions stemming from Amazon Clinic. But customers will be able to choose other pharmacies as well. The increased volume for Amazon Pharmacy probably won’t be large, especially in the early innings for Amazon Clinic.

Amazon did say that its healthcare services will be eligible for flexible spending accounts (FSAs) and health savings accounts (HSAs). However, not accepting insurance will almost certainly get in the way of Amazon Clinic making a big impact on the company financially. 

Two different questions

Is Amazon stock a buy because of its new healthcare service? No. The impact of Amazon Clinic probably won’t be great enough to influence investors’ buying decisions. However, whether Amazon stock is a buy at all is a different question. I think that the answer to this second question is a resounding yes.

Amazon still has significant growth opportunities. The latest indication that inflation could be moderating should be great news for the company. Lower inflation would benefit Amazon’s e-commerce business as well as its Amazon Web Services cloud hosting unit.            

The stock has fallen the most from its peak since the Great Recession. History shows that when Amazon experiences a steep decline, it roars back.

Amazon Clinic could eventually be a huge success. But even if it isn’t, the virtual care service highlights Amazon’s ability to expand into new markets. Sometimes the company will win with these moves and sometimes it won’t. However, stocks with as many potential ways to generate growth as Amazon tend to perform really well over the long term. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Amazon unveils new healthcare service: Is the stock a buy? appeared first on The Motley Fool Australia.

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Keith Speights has positions in Amazon. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Since the Coles Group Ltd (ASX: COL) share price first listed on the ASX back in late 2018, the company has quickly built up a reputation for strong and consistent dividend income. Coles has paid out two dividends per year since finding its own two feet on the ASX.    

What’s more, the company has managed to increase its annual dividends every year since 2019. That includes during the COVID-disrupted year of 2020, not something arch-rival Woolworths Group Ltd (ASX: WOW) can say.

And yet the Coles share price hasn’t quite been so kind. Today (at the time of writing), Coles is sitting at $16.55 a share. This puts the supermarket operator at a year-to-date loss of 7.5%. Coles has lost close to 15% of its value since mid-August alone when the company hit a new record high of $19.65. 

Saying that, the company still remains well above the approximate $1.50 levels it floated at back in 2018. Investors are still up a healthy 29% or so since Coles was spun out of Wesfarmers Ltd (ASX: WES) back then.  

But we can conclude that the only meaningful returns Coles shares have enjoyed over the past two or so years, at least on today’s pricing, have come from dividends.

So how much dividend income are investors enjoying from their Coles shares?

How much dividend income would $10,000 worth of Coles shares yield?

Well, let’s say an investor has $10,000 worth of Coles shares right now. That would give the said investor 604 shares at today’s pricing, with a little change left over.

So Coles has dutifully doled out its two dividends already in 2022. The first was the interim payment of 33 cents per share that was received on 31 March. Those 604 shares would have yielded a cash payment of $199.32 for that dividend.

The second was the final dividend of 30 cents per share that investors enjoyed on 28 September. That would have yielded a payment of $181.20. So together, our investor would have been paid a total of $380.52 in 2022 for their $10,000 worth of Coles shares.

That’s a yield worth 3.81% on the current Coles share price. Since Coles’ dividends came fully franked as well, that yield grosses up to 5.44% with the value of those franking credits included.  

The post Here’s how much dividend income $10,000 worth of Coles shares will get you today appeared first on The Motley Fool Australia.

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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 no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended COLESGROUP DEF SET and Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Whitehaven Coal Ltd (ASX: WHC) share price is well and truly in the green today despite no news having been released by the coal producer.

It’s joined in the green by many of its S&P/ASX 200 Energy Index (ASX: XEJ) peers as the sector leads the S&P/ASX 200 Index (ASX: XJO). Meanwhile, the company has slammed a mooted tax on thermal coal and gas.

Right now, the Whitehaven Coal share price is $8.765, 6.5% higher than its previous close.

At the same time, the ASX 200 has dropped 0.51% and the energy sector is up 1.49%.

Let’s take a closer look at what might be going on with the ASX 200 coal favourite today.

Whitehaven share price lifts 7% on Wednesday

The Whitehaven share price is powering up on Wednesday. Its joined in the green by fellow coal producers New Hope Corporation Limited (ASX: NHC) and Coronado Global Resources Inc (ASX: CRN). They’ve gained 5% and 3.7% respectively at the time of writing.

It comes after coal futures lifted 5.9% to US$198.65 a tonne overnight, according to CommSec.

Meanwhile, Whitehaven has hit headlines after urging the federal government to “rule out” a contemplated tax on thermal coal exports intended to lower energy prices. The company today said:

The compounding nature of the measures the Government is actively considering, or has refused to rule out in the case of a new mining tax, is bad news for jobs and investor confidence and is hard to reconcile with Labor’s stated support for Australian mining – including coal – in its pre-election policy platform.

Treasurer Jim Chalmers leant away from tax talk yesterday, telling ABC Radio National:

Our first preference is to try and find a regulatory solution here, rather than a tax solution.

There’s an important reason to leave all the options on the table and that is; there’s a lot of complex interactions here in these markets … [we need] a temporary, meaningful, sensible, responsible intervention in this market which recognises that these high prices brought about by a war in Europe have the potential to strangle our local industries and make life harder for Australians.

But Whitehaven is sceptical a tax would do anything to address energy prices. It said:

Further taxing our coal exports won’t make electricity cheaper for Australian consumers, it will just cost jobs and undermine our reputation as a reliable trading partner.

The rising cost of living is something the Government must address but a new tax will never be a cure for high domestic energy prices.

The post Why is the Whitehaven share price whizzing 7% higher today? appeared first on The Motley Fool Australia.

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• Top ASX dividend shares to buy in November 2022
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• Why these 4 ASX dividend shares stand out from the crowd: fund manager
• Here are the 3 most traded ASX 200 shares on Wednesday

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 Commonwealth Bank of Australia (ASX: CBA) share price is under pressure on Wednesday.

In afternoon trade, the banking giant’s shares are down almost 3% to $103.47.

Why is the CBA share price is dropping?

Investors have been hitting the sell button today after a number of brokers remained bearish on the bank following its first quarter update.

One of those brokers is Credit Suisse, which has downgraded the Australia’s largest bank’s shares to an underperform rating with a trimmed price target of $97.50. This implies potential downside of almost 6% for investors.

Credit Suisse has reduced its earnings estimates to reflects inflationary pressures and higher bad debts assumptions, which have offset higher net interest margin forecasts.

What else is being said?

Elsewhere, the team at Goldman Sachs has reiterated its sell rating with an improved price target of $90.98. This suggests even greater downside risk of 12% for investors from current levels.

Goldman’s main concerns are its valuation. While the broker acknowledges that CBA has a strong franchise, it highlights that it isn’t immune from intense competition and tough economic conditions.

As a result, it doesn’t believe the CBA share price deserves to trade at such a premium. Its analysts explained:

While the 1Q23 update highlighted the strength of the CBA franchise (particularly deposits), reflected in its very strong NIM performance, we reiterate our Sell given: i) it does remain more exposed to the intense competition we are currently observing in mortgages (albeit CBA appears to be favouring NIM over volumes), ii) we expect that potential further macro downside is likely to more adversely impact the household this cycle, which CBA is more exposed to, and iii) domestic volume trends have tracked towards system levels. We therefore do not believe its fundamentals justify the 51% 12-mo fwd PER premium it is currently trading on versus peers, compared to the 20% historic average.

The post CBA share price drops on bearish broker notes appeared first on The Motley Fool Australia.

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• 5 things to watch on the ASX 200 on Wednesday
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• Why CBA, DGL, Incitec Pivot, and Readytech shares are pushing higher
• Why is the CBA share price charging higher today?
• CBA share price on watch amid $2.5b Q1 cash profit

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 CSL Limited (ASX: CSL) share price has been edging higher in recent weeks. But could it see even further gains as it grows profit?

One expert has outlined why the business could see a promising future.

Writing in an article on Livewire, Kristiaan Rehder from Kardinia Capital said that the end of easy money and the normalising of conditions means that markets are now rewarding stock pickers “more than ever”.

He noted there has been a reduction of the price-to-earnings (p/e) ratio, which is “well-progressed”. Though there have not been “meaningful earnings downgrades across the broader Australian market”.

Kardinia Capital is expecting further p/e multiple contraction “coupled with earnings downgrades,” making for a “challenging investment environment”.

Rehder said that, in this market, companies with a track record and earnings quality “come to the fore, giving an advantage to a well-structured investment process with a more disciplined approach”.

Rehder then picked some ASX shares the investment team believes could outperform over the next five years, including CSL shares.

Strong tailwinds

The fund manager describes the business as developing “plasma-derived and recombinant therapies to treat serious diseases”. Further, it “manufactures influenza vaccines and treats iron deficiency and kidney disease following its recent acquisition of Vifor”.

One of the things that attracted Kardinia Capital was that CSL’s management has “proven adept at maintaining high returns,” with a return on invested capital (ROIC) of at least 20%. The fund manager attributed that to “consistent product development and innovation to drive growth into existing and new markets”.

Another positive element to the business, in the fund manager’s eyes, is that the company has a high market share in industries that have “strong tailwinds”.

Double-digit earnings growth predicted

At the moment, CSL has higher levels of debt because of the amount of funding it needed to acquire the Vifor business. The business raised about $7 billion in a capital raising, though the total acquisition price represented US$11.7 billion, or AU$16.4 billion, at the time of the deal.

However, the fund manager believes that “strong cash flows” will help gearing return to a “more manageable level”.

Rehder said that the CSL share price is trading on a “high earnings multiple”. But, the fund manager suggests the valuation is attractive. That’s because the pharma is “expecting double-digit earnings growth over the next few years as plasma collections recover post-pandemic”.

Recent CSL share price movements

Over the past month, CSL has gone up by around 4%.

The post Looking to buy CSL shares? Why this fundie is tipping ‘double-digit earnings growth’ appeared first on The Motley Fool Australia.

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• Why is the CSL share price smashing the ASX 200 on Thursday?
• Are CSL shares a good buy right now?

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd. 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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A little-known ASX energy share is leading the charge higher today.

Heading into the lunch hour the All Ordinaries Index (ASX: XAO) is down 0.3% while the S&P/ASX 200 Energy Index (ASX: XEJ) is up 1.3%.

However, ASX oil and gas junior Bass Oil Ltd (ASX: BAS) just rocketed an eye-popping 154.1%. This came after the ASX energy share reported it had identified a “significant gas resource”.

Shares were placed in a trading halt in late morning pending a further announcement, which was just released. That clarified a few typos from the original release, which stated “billions” of barrels of oil rather than “millions”.

ASX energy share leaps on gas discovery

Investors sent the Bass Oil share price soaring after the explorer reported on the results from an independent geological assessment conducted by Fluid Energy Consultants.

According to the release, Fluid identified a potential gas in place of 21 trillion cubic feet (TCF) along with 845 million barrels in place of condensate/oil. The gas and oil potential sits in Bass’s 100% owned PEL 182 site, located in the Cooper Basin in South Australia.

The ASX energy share stated that gas from deep coals, lying below 2,500 metres, represents a new significant gas play in the Cooper Basin as well as a potential new material source of gas for the Australian market.

Commenting on the development, Bass Oil managing director, Tino Guglielmo said:

This is a very exciting development for Bass and its shareholders. At a time when the domestic gas market continues to face huge challenges meeting demand, this new potential gas resource represents a credible material contributor of gas to the domestic market.”

A new gas resource of this kind is able to be commercialised efficiently due to the mature infrastructure of the Cooper Basin.

What’s next?

As far as what’s next for the ASX energy share, Bass said it is studying the best commercialisation strategies to progress the opportunities at PEL 182. Among the options, the company said it is considering self-funding, farmout, and third-party investment.

The post Guess which ASX energy share just rocketed 154% on a new gas discovery appeared first on The Motley Fool Australia.

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• Why is the A2 Milk share price thrashing the ASX 200 on Wednesday?
• Can ASX lithium shares really keep dining out at these price levels?
• Could this top ASX 100 share be the best of an ‘extremely cheap’ sector?
• Are ANZ shares really on track to offer a 7% dividend yield?
• Are Core Lithium shares suddenly on the nose?

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 A2 Milk Company Ltd (ASX: A2M) share price is pushing higher again on Wednesday.

In afternoon trade, the infant formula company’s shares are up almost 3% to $6.03.

This compares favourably to the performance of the ASX 200 index, which is down 0.5% today.

It also means the A2 Milk share price is now up over 14% since this time last month.

Why is the A2 Milk share price smashing the ASX 200 index?

The company’s shares are charging higher today despite there being no news out of it.

However, it is worth noting that A2 Milk’s shares have been performing positively since the company was granted approval to sell its infant formula in the US market.

In addition, A2 Milk commenced its NZ$150 million on-market share buyback last week.

According to the latest update on its buyback, the company bought back 196,859 shares on Monday, bringing the total to date to 2,157,870 shares. That’s the equivalent of approximately NZ$14 million based on today’s price, which is less than 10% of its planned buyback.

This could be an indication that A2 Milk is in the market again today, picking up more shares and driving the price higher.

Are its shares good value?

Bell Potter still sees value in A2 Milk’s shares at the current level.

Earlier this month, the broker retained its buy rating with a $6.80 price target. This suggests potential upside of almost 13% for investors over the next 12 months.

The post Why is the A2 Milk share price thrashing the ASX 200 on Wednesday? appeared first on The Motley Fool Australia.

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• Can this help A2 Milk pick up the pieces in China?
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended A2 Milk. 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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Lithium demand is showing “no signs of slowing” according to ANZ research analysts.

ASX lithium shares include Core Lithium Ltd (ASX: CXO), Allkem Ltd (ASX: AKE), Lake Resources N.L. (ASX: LKE), Sayona Mining Ltd (ASX: SYA) and Pilbara Minerals Ltd (ASX: PLS).

So what could impact the fortunes of ASX lithium shares in the future?

What is ahead for ASX lithium shares?

Core Lithium shares have exploded 179% in the past year, while Allkem shares have surged 52%. Lake Resources shares have leapt 16% in the last 52 weeks, while Sayona shares have soared 56%. Meanwhile, the Pilbara Minerals share price has rocketed 102.5% ahead. For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) has jumped nearly 15% in the last year.

However, ASX lithium shares suffered in the market on Tuesday and some are continuing to fall today.

For example, Core Lithium shares fell more than 15% on Tuesday and are down nearly 2% today.

Pilbara Minerals shares descended 9% on Tuesday but are climbing 1% today.

Lake Resources shares descended 7% on Tuesday and are 0.28% in the red at the time of writing.

Research analysts at ANZ have highlighted multiple factors that could be positive for ASX lithium shares in the future.

Commodity strategists Daniel Hynes and Soni Kumari, in a recent research note, highlighted that China’s lithium carbonate imports are on the rise. Analysts said:

Demand for battery minerals shows no signs of slowing. Retail sales of new energy vehicles in China jumped by 75% y/y in October to 556,000 units.

China’s imports of lithium carbonate were up 21% m/m in August. 

Another potential boost for lithium could be the US Reduction Act.

Further, strategists highlighted the benefit of US President Joe Biden’s Inflation Reduction Act. This Act provides tax breaks for new electric vehicle purchases.

Under the legislation, the critical minerals used in the EV batteries must come from the US or a country with a free trade agreement with the USA. This could be an opportunity for Australia.

Commenting on this incentive, analysts said:

The US’s Inflation Reduction Act has spurred producers and battery manufacturers to look at capitalising on possible incentives that the new legislation provides to countries with free trade agreements with the US.

Imports of lithium carbonate subsequently surged 86% m/m in August. This comes as supply disruptions from Sichuan’s power issues persist. 

What else?

Analysts at Macquarie are still positive on lithium shares despite the falls on Tuesday, the Financial Review reported. Lithium carbonate futures fell 6.2% on Tuesday on the Wuxi Stainless Steel Exchange but have since jumped 1.5%, analysts noted. Macquarie said:

Despite near-term future price volatility, we believe buoyant lithium prices present potential for valuation upside to all lithium names under our coverage universe.

In other news, Indonesia is in talks with Australia on a potential lithium partnership, The Australian reported earlier this week. Australian Prime Minister Anthony Albanese has joined multiple global leaders in Bali for a G20 Leaders’ Summit this week. Responding to questions on the potential of critical mineral partnerships including Lithium on Tuesday, Albanese said:

Indonesia will grow, along with India, next year’s host of the G20, to be in the top four economies in the world over coming decades.

There’s enormous opportunity for Australia. There’s enormous goodwill. And the fact that Australia has the largest business delegation here at the B20 is a sign of that.

The post Can ASX lithium shares really keep dining out at these price levels? appeared first on The Motley Fool Australia.

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• Are Core Lithium shares suddenly on the nose?
• The future of ASX lithium shares: Are investors looking through rose-coloured glasses?
• Pilbara Minerals share price higher on maiden dividend news
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• Here are the 3 most traded ASX 200 shares on Tuesday

Motley Fool contributor Monica O’Shea 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 Suncorp Group Ltd (ASX: SUN) share price opened lower today and is currently down 1.26% at $11.73.

Other ASX financial shares are mostly in the red this morning as well. The benchmark S&P/ASX 200 Index (ASX: XJO) is down 0.47%.

One expert reckons ASX insurance shares are “extremely cheap” and is backing Suncorp ahead of the rest.

Why is the Suncorp share price cheap?

Paul Taylor, the portfolio manager for Fidelity’s Australian Equities Fund, says insurance is “by far” one of the cheapest sectors in the market today, alongside ASX energy shares and materials shares.

He points out that insurers are raising their premiums in today’s inflationary environment.

Taylor said:

The insurance sector is… extremely cheap and with premiums on the rise, we believe the general insurance sector is well positioned for growth.

The Fund has significant over-weight positions in… Suncorp.

The Suncorp business is changing

Taylor says his team has been “recession-proofing” their fund by structuring it into these areas.

They are essential goods and services, cheap sectors, and self-help businesses (i.e., those that can, or are, making positive pivots to adapt to today’s economy and/or strengthen their position).

Taylor reckons Suncorp shares are not only cheap but also that the company is in self-help mode, given it is trying to sell its banking business to Australia and New Zealand Banking Group Ltd (ASX: ANZ).

Taylor explains:

Suncorp has been simplifying its business and, with the sale of the bank, will become a very focused general insurance business.

This greater business focus should bring considerably improved valuation metrics.

Suncorp is currently seeking government approval for the $4.9 billion takeover deal.

As fellow Fool Brooke reported last month, Suncorp and ANZ are hoping to complete the deal in the second half of 2023.

Suncorp plans to return most of the expected $3.21 per share profit to its shareholders.  

Suncorp share price snapshot

Brooke also reports that insiders have been taking advantage of the fallen Suncorp share price.

Last month, two company directors bought a combined $320,000 worth of shares. At the time, the Suncorp share price was in the $10 range.

Their new holdings are already up by more than 10%.

The Suncorp share price is up 12.5% over the past month and up 2.2% in the year to date.

By comparison, the ASX 200 is up 6.65% over the past month and down 6.35% in 2022 so far.

The post Could this top ASX 100 share be the best of an ‘extremely cheap’ sector? appeared first on The Motley Fool Australia.

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More reading

• Are ANZ shares really on track to offer a 7% dividend yield?
• ASX 200 bank shares: fundie picks winners and losers of the big four
• Could the flurry of recent takeover bids mean ASX 200 shares are going cheap right now?
• Here’s why the ANZ share price could be a good value pick for dividends
• Top brokers name 3 ASX shares to buy next week

Motley Fool contributor Bronwyn Allen has positions in Australia & New Zealand Banking Group Limited. 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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Australia and New Zealand Banking Group Ltd (ASX: ANZ) shares already boast the highest dividend yield of the S&P/ASX 200 Index (ASX: XJO) big four banking stocks.

And it could be set to grow its offerings, according to top brokers. Indeed, one tips the smallest big four bank to grow its dividends by 20% in coming years.

Right now, the ANZ share price is $24.09.

Let’s take a closer look at what experts believe the future could hold for the banking share and its dividends.

Could ANZ shares offer a 7% dividend yield in FY24?

The ANZ share price could be in for a good run in coming years, as could the banking stock’s dividends, if these experts are to be believed.

Two top brokers have responded well to the bank’s recent full-year earnings.

ANZ posted a $7.1 billion profit and $6.5 million of cash earnings from continuing operations for financial year 2022 in late October. Excitingly, it also revealed an exit net interest margin (NIM) of 1.8%.

Citi said such a NIM is “likely to drive material consensus revenue upgrades, and we think the street upgrades core earnings”, as my Fool colleague James reports. Meanwhile, Goldman Sachs said:

Today’s result suggested that while ANZ’s NIM is likely to peak at higher levels than we previously forecast, this peak is also likely to come through earlier.

ANZ also offered investors a 74 cent per share final dividend, lifting its full-year offerings to $1.46 per share. That leaves the stock trading with a 6% dividend yield at the time of writing.

And that could be gearing up to grow. Citi tips ANZ to pay out $1.66 per share in financial year 2023 and $1.76 per share in financial year 2024.

At its current share price, a $1.76 full-year offering would see ANZ shares trading with a 7.3% dividend yield.

However, the broker also has a $29.25 price target on the stock. At such a level, $1.76 in dividends would see ANZ trading with a 6% yield.

The post Are ANZ shares really on track to offer a 7% dividend yield? appeared first on The Motley Fool Australia.

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More reading

• Could this top ASX 100 share be the best of an ‘extremely cheap’ sector?
• ASX 200 bank shares: fundie picks winners and losers of the big four
• Could the flurry of recent takeover bids mean ASX 200 shares are going cheap right now?
• Here’s why the ANZ share price could be a good value pick for dividends
• ASX 200 bank shares: Buy, hold, or fold?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 positions in and has recommended Goldman Sachs. 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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