Commonwealth Bank of Australia (ASX: CBA) shares have always been a popular choice for ASX investors seeking dividend income. No doubt this trend will continue in 2023. But should it?

Since we are at the start of the year, it might be a good chance to examine some ASX articles of faith such as these and see if they still hold true. So let’s check out what might be in store for CBA’s dividend this year and beyond.

So let’s start at the beginning. Last year, Commonwealth Bank shares paid out two dividends. The first was the interim dividend of $1.75 per share that investors received in March. The second was the final dividend of $2.10 per share that was doled out in September.

Both dividends, as is typical with CBA, came fully franked.

Commonwealth Bank shares were trading at $103.47 each, up 0.31% at the market close today. At this pricing, those two dividend payments give the CBA share price a trailing dividend yield of 3.72%. That grosses up to 5.31% with the full franking.

So that’s where we’re starting out at. If an investor picks up CBA shares at this price today, and the bank manages to pay out exactly the same dividends in 2023 as it did in 2022, then investors can expect to receive a yield of 3.72% on their capital.

That’s decent, but arguably nothing spectacular. Many savings accounts and term deposits offer better yields in this era of rising interest rates.

But what if CBA juices up its dividends this year? Well, if that happened, investors would enjoy an even greater yield on cost.

ASX broker tips higher dividends from CBA shares

ASX broker Morgans reckons CBA will indeed be in a position to give income investors a dividend pay rise. As my Fool colleague covered late last month, the broker expects CBA shares to pay out a total of $4.10 in dividend income per share in FY2023.

Even better for investors, Morgans reckons CBA will up its game again in FY2024, with total dividends per share of $4.55.

If these scenarios were to be realised, these dividends would give CBA shares a forward yield of 3.96% and 4.4%, respectively, on the current CBA share price.

So if these numbers turn out to be accurate, CBA could indeed be a solid buy for ASX dividend income in 2023. But we shall have to wait and see what CBA pulls out of its dividend hat.

The post Are CBA shares worth buying for dividend income in 2023? appeared first on The Motley Fool Australia.

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• Will 2023 get better for ASX 200 shares?
• ASX 200 shares to rise by up to 7% in 2023: CBA
• ASX financial shares lifted the ASX 200 today
• Here’s how I plan to recession-proof my ASX share portfolio this year

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 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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While the market volatility has been disappointing for investors over the last 12 months, it has potentially created some great buying opportunities for investors.

Two ASX shares that have fallen heavily and could be worth considering are listed below. Here’s what experts are saying about them:

Domino’s Pizza Enterprises Ltd (ASX: DMP)

The first beaten down ASX share to look at is Domino’s. This pizza chain operator’s shares have lost 40% of their value over the last 12 months.

This has been driven by concerns over the impact of inflationary pressures on both consumers and its margins.

The team at Morgans appears to believe that this is a temporary issue and remains very positive on the long term. Particularly given the company’s bold expansion plans. In light of this, the broker has put an add rating and $90.00 price target on its shares.

Morgans commented:

Cost inflation and adverse FX movements present significant challenges to earnings at present, as evidenced by EBIT margins, which fell from 13.4% in FY21 to 11.5% in FY22. […] We believe these pressures are transitory in nature. In our opinion, now is the best time to consider an investment in a quality business like DMP that is facing headwinds that will reverse in time.

Temple & Webster Group Ltd (ASX: TPW)

The Temple & Webster share price has been hammered over the last 12 months and has lost over half of its value. This has been driven by a de-rating of tech shares amid rising interest rates and global economic growth concerns.

Goldman Sachs appears to believe this has left the online furniture and homewares retailer’s shares trading at a very attractive level. In fact, it has put a buy rating and $7.50 price target on the company’s shares, which implies over 50% upside.

Thanks to the shift online and its strong market position, Goldman is expecting Temple & Webster to grow its EBITDA at a rapid rate over the next decade. It commented:

We view TPW as one of the strongest long term structural growth opportunities in our coverage and forecast a +22% EBITDA CAGR over the next 10 years. Despite the pull forward in online penetration, TPW still only has c.3.5% population penetration and c.2% share of the total category which provides a long term runway for growth. We believe the market is underestimating the long term potential of this business given near term macro headwinds across the category.

The post These beaten down ASX shares are cheap buys: experts appeared first on The Motley Fool Australia.

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More reading

• 3 ASX growth shares to buy with huge upside potential – analysts
• 2 excellent ASX growth shares that analysts say are buys in January
• 3 of the best ASX shares I’d buy now for a stock market rally in 2023
• Here’s how I’ll be investing my money in ASX shares in 2023
• 23 ASX shares to buy in 2023 – brokers

Motley Fool contributor James Mickleboro has positions in Domino’s Pizza Enterprises. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Temple & Webster Group. The Motley Fool Australia has recommended Domino’s Pizza Enterprises and Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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What is investing?

It should be a simple question, with a simple answer, right?

And yet, I think if I polled my readers, I’d get a range of answers.

Moreover, I think people who read these thoughts probably have a relatively similar approach.

So if I asked a broader group of people, I’d almost certainly get an even larger spread.

Is it ‘playing the stock market’?

‘Buying and selling shares (or property)’?

‘Gambling’?

‘Speculation’?

Or something else?

And what does it mean to be an investor?

My thinking was prompted by a very clever article that’s (again) doing the rounds of social media. I don’t know the source, unfortunately, but it’s incredibly clever.

It nicely skewers much of what we consider ‘financial reporting’.

You know the ‘race calling’ of what happened on the ASX (or other markets) today.

Company X was up 0.4%.

Sector Y fell 0.3%.

That sort of stuff.

Seriously, have a read:

But, I have to say, while the parody is very funny, we need to be careful not to be too cynical.

The reporting is often factual, and does answer the sorts of questions that investors tend to ask.

The oil price falling usually leads to lower share prices for oil and gas drillers.

The likelihood of higher interest rates usually means higher bank share prices.

And so on.

The news media have a role in both reporting and explaining those things, and I think the article is probably too harsh on that part.

But where it’s spot on is the ‘so what’.

The oil price might fall today.

And rise tomorrow.

And fall the day after.

It might be higher in a week, and then lower in a month.

Which kinda puts the knee-jerk daily market responses in the right (ridiculous) light, huh?

Let’s say you own shares in Fossil Fuels R Us (ASX: AGW), and the oil price is higher today.

That’s – and I know you know this – one single day in 365 this year.

And over those 365 days, the oil price will move around like a tail-ender facing a Mitchell Starc barrage.

Now, stick with me here.

The profits of said oil driller are going to be the sum-total of the prices received every single day of the next year.

Which are both unknowable and probably volatile.

Meaning reacting to a single day’s price movement is… pretty silly, to put it kindly.

Can you imagine updating the value of a cafe every day, based on the change in the number of coffees sold?

Madness, clearly.

And yet…

And yet, that’s precisely what the stock market does.

But ‘the stock market’ isn’t all of us. Here’s why:

See, I own shares in around two-dozen companies.

I didn’t buy or sell any of them today.

You probably didn’t either.

It’s not ‘shareholders’ who impact the price.

It’s just those who transact on a given day.

Which makes daily market-watching even sillier.

Do you know who bought and sold BHP Group Ltd (ASX: BHP) shares today?

Do you know why?

And even if you did, do you know if those people are even worth paying attention to?

Are they any good? Are they often right? Do they get emotional? Are they having a good or bad day? Are they long term investors? Trend-followers? Day traders?

And yet, despite not knowing the answer to any of these questions, it’s those people we ask, when we wonder what our BHP shares are worth, every time we check the share price.

Which doesn’t make a lot of sense, does it?

And that takes me nicely back to my initial question: what is investing?

Because once you have your answer, it lets you put both the news and the noise in perspective.

After more than 20 years in this caper, I think I’ve worked out the answer.

Not the only answer, perhaps – different people have different views – but the answer that I think works best for me, and the one I’ve been using to advise our members now for over a decade.

And, importantly, the answer that I think gives us the best chance of really significant long-term wealth creation.

I don’t want to try to out-trade high-frequency algorithmic computers. I’ll lose.

And I don’t want to try to beat momentum traders or trading ‘systems’ at their own game, with questionable strategies and even less certain odds of success.

And I keep the hell away from options trading.

The other thing?

Those tend to be zero-sum games: if I win, you have to lose.

My version of investing?

Well, the history of the stock market is very compelling. Which isn’t a guarantee, of course, but for more than a century, it’s been the story of phenomenal long-term value creation.

So there are a few clues there.

First, investing, over time, is probably going to continue to be a positive value creation game, not zero-sum.

Next, I think the value tends to (and will likely continue to tend to) accrue to the patient, over the active.

And I reckon that thinking like a business owner will beat trying to guess daily gyrations. Going back to my example, above, I reckon thinking about the value of a cafe’s long term future beats focusing on the pops and dives of the oil price.

That lets you ask (and have a stab at answering) some very different questions.

Which businesses do I think have the brightest long-term futures?

Which businesses are trading at attractive prices, relative to those futures?

And… that’s it.

I mean, that’s not the end of the process, of course. Each of those questions is answered by digging a little deeper.

But those are the two headline questions. And they’re very different to most of the noise of ‘finance’.

It doesn’t matter what happened to the Australian dollar overnight. Or to the oil price today.

It doesn’t matter what happened on Wall Street last night, or what some ‘expert’ thinks will happen on the ASX in 2023.

It takes some effort to tune out or deprioritise the daily ASX ‘race calling’.

Especially when share prices are falling, and you’re feeling the pain.

(It’s just as hard to tune out when they’re rising, by the way… it just doesn’t hurt!)

But you need to.

You need to change your focus to the businesses themselves, and the opportunities they have in front of them – over the long term.

Because that’s investing.

Fool on!

The post What is investing? appeared first on The Motley Fool Australia.

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More reading

• Leading brokers name 3 ASX shares to buy today
• Guess which ASX gold share has boomed 50% on an ‘extraordinary’ strike
• Here are the 3 most heavily traded ASX 200 shares on Monday
• Why AMP, Computershare, IAG, and Telix shares are dropping today
• Looking to buy South32 shares? Here are the key dates to watch in 2023

Motley Fool contributor Scott Phillips 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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With some brokers still taking a break over the holiday period, there haven’t been many research notes released.

But don’t worry because listed below are three recent broker buy recommendations that still have plenty of upside potential.

Here’s why brokers think these ASX shares are in the buy zone:

Allkem Ltd (ASX: AKE)

According to a note out of Goldman Sachs, its analysts have a buy rating and $15.20 price target on this lithium miner’s shares. Although the broker is expecting lithium prices to weaken substantially in the next 18 months, it remains positive on Allkem. This is due to its attractive valuation at under 1x NAV and its plan to grow production 4x by FY 2027. The broker expects the latter to offset lower lithium prices. The Allkem share price is trading at $11.94 on Monday.

HMC Capital Ltd (ASX: HMC)

A note out of Morgans reveals that its analysts have an add rating and $5.85 price target on this property development company’s shares. Morgans highlights that the HMC Capital share price has fallen heavily amid broad weakness in the REIT sector. Its analysts feel that this has created a buying opportunity for investors. Particularly given its capital light business model and track record for executing on complex deals. The HMC share price is fetching $4.42 on Monday.

Rio Tinto Ltd (ASX: RIO)

Analysts at Morgan Stanley have an overweight rating and $125.00 price target on this mining giant’s shares. The broker believes that Rio Tinto is well-placed to benefit from an increase in spot commodity prices in recent months. In fact, the broker has recently upgraded its earnings estimates for the miner to reflect this. The Rio Tinto share price is trading at $118.38 this afternoon.

The post Leading brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

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More reading

• Why are ASX 200 iron ore shares jumping higher today?
• What’s the outlook for ASX 200 lithium shares in 2023?
• Will 2023 get better for ASX 200 shares?
• Top brokers name 3 ASX shares to buy next week
• Here are the top 10 ASX 200 shares today

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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It’s proved to be a spectacular day for ASX gold share Tempus Resources Ltd (ASX: TMR). The tiny miner has struck gold in a big way, with assays from its Elizabeth Project returning whopping finds.

The stock was halted at 5.4 cents on Friday afternoon, likely leaving investors wondering what today might bring. And no doubt, many were pleasantly surprised this morning.

The company revealed assays results from five drill holes conducted at the project shortly after the ASX opened this morning, sending the gold share soaring.

At its highest point of today’s session, the Tempus Resources share price reached 9.2 cents – marking a 70% gain.

Since then, the stock has fallen slightly to trade near the market close at 8.1 cents. That’s still 50% higher than its previous close.

Let’s take a closer look at the whopping find driving the ASX gold share on Monday.

What’s going right for this ASX gold share?

The Tempus Resources share price is rocketing after the company announced assays revealing more ‘bonanza’ grade gold mineralisation over wide zones at its Elizabeth Project.

The drill holes related to today’s news were conducted at the project’s No. 9 Vein, Blue Vein, and West and Main Veins.

Drilling at the No. 9 Vein returned 28.1 grams of gold per tonne over 28.5m, setting a new record in terms of combined grade and width for the project.

Tempus Resources president and CEO Jason Bahnsen dubbed the result “extraordinary”, saying:

[It intersected] certainly one of the best intersections I have seen during a +30-year career.

Assays have also extended bonanza and high-grade zones at both the No.9 Vein and the Blue Vein to more than 150m each in strike.

Bahnsen noted it’s possible the veins were joined. If so, there is the potential for additional gold mineralisation at the intersection and more extensions along the strike to the southwest.

Assays from the West and Main Veins provide more confirmation the veins extend around 220m beyond the previous drilling – thereby extending the vein sets to around 400m.

The company is still awaiting results from another six drill holes, including holes targeting the above-mentioned veins.

Sadly, though, today’s gain hasn’t been enough to boost the ASX gold share back into the long-term green. The stock has fallen 36% since this time last year.

The post Guess which ASX gold share has boomed 50% on an ‘extraordinary’ strike appeared first on The Motley Fool Australia.

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More reading

• What is investing?
• Leading brokers name 3 ASX shares to buy today
• Here are the 3 most heavily traded ASX 200 shares on Monday
• Why AMP, Computershare, IAG, and Telix shares are dropping today
• Looking to buy South32 shares? Here are the key dates to watch in 2023

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 S&P/ASX 200 Index (ASX: XJO) has kicked off this week’s trading on a positive note.

At the time of writing, the ASX 200 has gained a reasonable 0.57% so far, which puts the index at just under 7,150 points. At this point, it has been a very happy new year for the ASX indeed, with the index’s year-to-date gains now sitting at close to 3%. 

But let’s now dig a little deeper by taking a look at the ASX 200 shares currently topping the share market’s trading volume charts, according to investing.com.

The 3 most traded ASX 200 shares by volume this Monday

South32 Ltd (ASX: S32)

First up this Monday is the ASX 200 mining giant South32. A hefty 13.82 million South32 shares have changed hands during today’s session so far. There hasn’t been much out of the company itself today that might explain this volume.

But that hasn’t stopped the South32 share price from popping by a healthy 4.24% today to $4.43 a share at present. It’s this sharp rise that probably explains the volumes we are witnessing.

Pilbara Minerals Ltd (ASX: PLS)

Next up we have ASX 200 lithium producer Pilbara Minerals. This Monday has seen a sizable 17.82 million Pilbara shares bought and sold at this point. We haven’t seen any ASX announcements out of Pilbara today, or indeed in 2023 as of yet.

So this volume can probably be explained by the machinations of the Pilbara share price itself. Pilbara has had a bumpy day this Monday. The company is currently up by 0.13% to $3.96 a share. But Pilbara has shown a bit of volatility today, bouncing between $3.92 and $4.06 a share. This could be the cause of Pilbara’s presence on this list.

Core Lithium Ltd (ASX: CXO)

Finally, we have another ASX 200 lithium share in Core Lithium. A notable 18.06 million Core Lithium shares have been exchanged on the ASX thus far this Monday. We’ve also seen some significant volatility with this ASX 200 share today, with Core trading between $1.19 and $1.27 a share over the course of this session.

We did get a new announcement from the company this morning. This discussed the relocation of the company’s head office to Perth, as well as the appointment of two new executives, including chief financial officer Andrew Forman.

So perhaps it is a combination of these factors that is leading Core Lithium to top our most traded shares list today.

The post Here are the 3 most heavily traded ASX 200 shares on Monday appeared first on The Motley Fool Australia.

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More reading

• Looking to buy South32 shares? Here are the key dates to watch in 2023
• Will 2023 bring gains for ASX 200 shares? Here’s what Citi is forecasting
• Mineral mania: 5 ASX 200 mining shares smashing new highs on Monday
• This ASX 200 coal share is up 170% in a year. But one director is still buying
• Why are ASX 200 iron ore shares jumping higher today?

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 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a decent gain. At the time of writing, the benchmark index is up 0.55% to 7,148.9 points.

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

AMP Ltd (ASX: AMP)

The AMP share price is down over 4% to $1.26. Investors have been selling this financial services company’s shares after it released an update on the divestment of its Colimate Capital businesses. AMP continues to wait for approval for the transfer of its interest in China Life AMP Asset Management. There is a danger that if this drag on any longer the transaction could be reduced in value or even terminated.

Computershare Limited (ASX: CPU)

The Computershare share price is down 5.5% to $24.25. This may have been driven by optimism that interest rates won’t rise as much as fear amid signs of easing inflation in the United States. While this is good news for the share market, it is a small blow to Computershare which benefits greatly from higher interest rates.

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price is down 1.5% to $4.68. This morning, this insurance giant announced its 2023 reinsurance program. IAG’s CFO Michelle McPherson said: “Global reinsurance has become more challenging over the past year due to the impact of capital markets and Australian and international natural peril events.”

Telix Pharmaceuticals Ltd (ASX: TLX)

The Telix share price is down almost 5% to $7.05. This follows the release of the radiopharmaceuticals company’s trading update this morning. Telix reported unaudited revenue of $76.8 million for the fourth quarter of 2022. While this is a 39% quarter on quarter increase, it appears to have fallen a touch short of expectations.

The post Why AMP, Computershare, IAG, and Telix shares are dropping today appeared first on The Motley Fool Australia.

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More reading

• The 3 best-performing ASX tech shares of 2022
• Here are the top 10 ASX 200 shares today
• Bell Potter names the ASX healthcare shares to buy in 2023
• The 3 best-performing ASX 200 healthcare shares of 2022 revealed
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has positions in Telix Pharmaceuticals. 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 Insurance Australia Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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2022 was a rather rough year for ASX shares and the S&P/ASX 200 Index (ASX: XJO). Over the year just passed, the ASX 200 fell by a depressing 5.5%, ensuring that any ASX exchange-traded fund (ETF) tracking the ASX 200 Index would have fallen by a similar amount

But that doesn’t mean all ASX ETFs had a rough year. So let’s check out the three best-performing ETFs from last year. Just to be clear, we’ll go off the change in unit prices alone over the year here.

The top 3 ASX ETFs of 2022 revealed

BetaShares U.S. Equities Strong Bear Fund (ASX: BBUS)

First up is this inverse ETF from BetaSahres. Inverse ETFs are designed to rise in value when the value of the index they track falls. In the Strong Bear Fund’s case, the returns are also leveraged. This means that a 1% fall in the US market will generally give this ETF a boost of between 2% and 2.75%.

The US markets had an even worse year than the ASX 200 in 2022, with the S&P 500 Index (SP: .INX) falling by more than 19%. So it’s perhaps no surprise that this ETF had a cracking year.

Strong Bear Fund units started 2022 at $8.22, but finished up at $10.82, meaning investors enjoyed a total capital gain of 31.63% for the year.

BetaShares Global Energy Companies ETF (ASX: FUEL)

Another fund from BetaShares, this one is a little different. The Global Energy Companies ETF is not an inverse or leveraged fund. It simply tracks a basket of global energy giants operating in the oil and gas industries. These include well-known names like Exxon Mobil, Shell, BP and Chevron.

2022 saw oil and gas prices skyrocket thanks to a potent mix of geopolitical and economic challenges. This resulted in a very pleasing year for these kinds of companies.

We can see this reflected in the Global Energy Companies ETF’s unit price. This ETF started last year at a price of $4.69 but finished up at $6.46. That’s a gain worth 37.74%.

Global X Ultra Short Nasdaq 100 Hedge Fund (ASX: SNAS)

Our final and best-performing ETF of 2022 is another inverse, leveraged fund. The Global X Ultra Short Nasdaq 100 Hedge Fund is designed to move in the opposite direction to the US Nasdaq 100 Index.

The Nasdaq 100 is an index that reflects 100 of the largest companies on the tech-heavy NASDAQ exchange over in the US.

The Nasdaq 100 had a horrible 2022, falling by almost 33% last year. That’s a perfect storm for a cracking year for this ETF. The Ultra Short Nasdaq Fund started 2022 off at $3.04 per unit but ended the year at $5.53. That’s a gain worth a stellar 81.9%.

The post Here are the 3 best-performing ASX ETFs of 2022 appeared first on The Motley Fool Australia.

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• Why is the Fortescue share price lagging the ASX 200 materials sector today?
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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 positions in and has recommended BP. 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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When it comes to the Woodside Energy Group Ltd (ASX: WDS) share price, oil prices tend to have a big impact on whether its rises or falls.

In light of this, before buying the energy producer’s shares in 2023, it could be worth thinking about where oil prices could be heading.

The good news for investors is that one hedge fund trader believes oil prices could be destined to climb materially in the near future.

Oil prices tipped to rise

According to Bloomberg, hedge fund trader Pierre Andurand believes that global oil demand could increase as much as 4 million barrels or 4% in 2023 if the world fully emerges from COVID restrictions.

This compares to the International Energy Agency estimate for a 1.7 million increase in demand this year.

Andurand, whose main commodities fund gained about 50% last year, believes that this could lead to oil prices climbing to “upwards of US$140 a barrel once Asia fully reopens, assuming there will be no more lockdowns.” Particularly given that jet fuel demand is still down 2.5 million barrels a day from 2019 levels because China has not reopened fully yet.

Overall, the hedge fund trader feels the market is “underestimating the scale of the demand boost” that the COVID reopening would have for oil consumption and ultimately prices.

As a comparison, the WTI crude oil price is currently fetching US$74.47 a barrel and the Brent crude oil price is trading at US$79.42 a barrel. Based on the former, this means that oil prices could rise approximately 90% in 2023.

This would undoubtedly bode well for the Woodside share price if it happened. Especially given that the company was operating with a production cost of US$7.60 per barrel during the first half.

Should you buy Woodside shares?

According to a note out of Citi, its analysts have put a buy rating and $38.50 price target on Woodside shares.

This implies potential upside of 10% for investors over the next 12 months. In addition, the broker is expecting a hefty 9.8% dividend yield in FY 2023, bringing the total potential return to almost 20%.

The post Looking to buy Woodside shares? Trader says oil price has 90% upside appeared first on The Motley Fool Australia.

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More reading

• How different is the Vanguard Australian Shares Index ETF (VAS) now compared to a year ago?
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• 5 things to watch on the ASX 200 on Monday
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• 3 key factors that helped propel the Woodside share price 60% higher in 2022

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 Fortescue Metals Group Limited (ASX: FMG) share price looks set to snap its three-day green streak today.

Shares in the Australian iron ore miner have rallied by 28% during the last six months. However, the company chaired by Andrew ‘Twiggy’ Forrest is losing steam on Monday despite a rather peachy performance across the materials generally.

As we head into the afternoon, the materials corner of the market is holding out as the best-performing sector. At present, the sector is 1.42% above its previous close. Meanwhile, the Fortescue share price is 0.8% underwater at $21.63.

Management maketh the company

Today’s Fortescue share price weakness could be explained by an announcement that the company made earlier today. According to the release, the company’s chief financial officer (CFO), Ian Wells, has put forward his resignation.

Wells has served as group CFO since 2018, overseeing a period of significant earnings growth and shareholder returns. Between June 2018 and now, the Fortescue share price has increased by approximately 390% and earnings have grown by seven-fold.

Commenting on the departure of Wells, Fortescue chair Andrew Forrest said:

I recall fondly back in 2010 when Ian joined our team. The finance team at the time were charged with refinancing our original project finance bonds and the successful refinancing in 2010 enabled the company to make investments to expand capacity to 155mtpa.

Since then, we have seen the company’s balance sheet and capital allocation change from debt repayment to reinvestment and delivering market-leading shareholder returns …

The respected member of the leadership team is stepping away from Fortescue to explore other opportunities. With a finish date of 31 January, the company is already underway with finding and selecting a successor to Wells.

Fortescue share price under scrutiny

Shareholders could be growing concerned about what appears to be a trend at this point. Ian Wells’ exit is yet another in a series of senior outflows — joining Linda O’Farrell, Greg Lilleyman, Don Hyma, and former CEO Elizabeth Gaines to name a few.

At this point, only two out of the 13 executive leadership members displayed in Fortescue’s 2021 annual report are still on board.

The company trades on a price-to-earnings (P/E) ratio of 7.4 based on the current Fortescue share price. For reference, this is roughly in line with peers like Rio Tinto Limited (ASX: RIO) and slightly below BHP Group Ltd‘s (ASX: BHP) 8.1 earnings multiple.

The post Why is the Fortescue share price lagging the ASX 200 materials sector today? appeared first on The Motley Fool Australia.

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More reading

• Why are ASX 200 iron ore shares jumping higher today?
• Will 2023 get better for ASX 200 shares?
• Guess how much a $20k investment in these ASX 200 shares in 2013 is worth now
• Fortescue share price bulls vs bears: Which will prevail in 2023?
• My 3 top-performing ASX shares of 2022, and why I’m still buying 2 of them for 2023

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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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