Things have gone from bad to worse for the Bravura Solutions Ltd (ASX: BVS) share price on Thursday. Prior to today, the struggling financial technology company’s shares were down 53% over the last 12 months.

Today, the Bravura share price has gone one better, losing more than half of its value again shortly after the open. In early trade, the company’s shares are down 59% to a record low of 54 cents.

Why is the Bravura share price crashing again?

Investors have been hitting the sell button in a panic today after the company released a very disappointing update after the market close on Wednesday.

Following a strategic review, Bravura revealed that the company needed to be “reconfigured.” It explained:

The review has indicated that whilst Bravura has solid foundations, the business will be required to be reconfigured to scale our products across customers. This will require enhancing the existing technology stack to unlock the existing microservices strategy, drive higher resale multiples on technology development and reduce single customer efforts.

The pace of change from a traditional services model to a more scalable technology solutions provider will accelerate but requires a realignment of the organisation and resources to create greater product discipline. This will deliver efficiencies and support a greater focus on spend, project execution and key account management. Several key appointments to drive technology, project delivery and go-to-market capability are in progress.

Guidance misses by a mile

Unsurprisingly, given the above, the company’s guidance for FY 2023 has fallen well short of expectations.

This is due to its customers adopting a cautious approach to spending, the winding down of three legacy contracts, and a sizeable 16% to 20% increase in operating costs.

The sum of the above, is as follows:

The cumulative impact of the factors discussed above, and allowing for additional costs associated with one off initiatives from the Strategic Review, is that Bravura is expecting its FY23 earnings to differ materially from analysts’ consensus forecasts.

With modest revenue growth of between $270 to $275 million, and increase in the FY23 cost base, Bravura now expects to deliver EBITDA of between $10 and $15 million and NPAT to be within the range of ($5M) to $0. The H1 result is expected to reflect lower run rate revenue which is expected to build into the second half, however, costs are expected to remain broadly consistent across the year.

Broker ‘surprise’

The team at Goldman Sachs was taken by surprise by this update. It commented:

We had previously flagged ongoing risk to Bravura’s earnings outlook (here and here) from 1) wage inflation; 2) higher cost investment to execute on strategic priorities; and 3) pressure on the dividend due to softer cash flow. That said, Bravura’s update came as a surprise given the extent of cost investment, both from organisational change and BAU wage pressures, and in the context of commentary at the FY22 result suggesting 1H23 EBITDA would be consistent with the 2H22 run-rate (anchoring consensus to mid-40’s EBITDA).

Unfortunately, the broker believes it could take some time until the company is back to its best. It concludes:

[I]n our view this is likely to take several years of heightened investment (with significant execution risk) and we look to further clarity on timing for a resumption in earnings growth, particularly given commentary regarding competing forces in FY24 from expected cost efficiencies on one hand and revenue headwinds in EMEA on the other.

The post Why is the Bravura share price crashing 59% today? appeared first on The Motley Fool Australia.

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More reading

• 3 ‘bullish’ ASX shares to buy as FOMO grips the market: expert
• Why did the Incannex share price go up in smoke in October?
• How big is the AFIC dividend yield right now?
• Are IGO shares a buy after a huge quarter of profit growth?
• Why Tesla shares dropped Wednesday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bravura Solutions Ltd. The Motley Fool Australia has positions in and has recommended Bravura Solutions Ltd. 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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Despite the central banks in Australia and the US raising interest rates this week, more than one expert is predicting share markets will rise heading into the new year.

Shaw and Partners portfolio manager James Gerrish noted that the S&P/ASX 200 Index (ASX: XJO) is now within striking distance of the psychological 7,000-point barrier.

“The ‘risk on’ theme is slowly gathering momentum courtesy of fund managers holding their highest cash position in more than 20 years,” he said in the Market Matters newsletter.

“There’s nobody left to sell, and a degree of ‘fear of missing out’ (FOMO) feels inevitable if stocks remain firm.”

Gerrish’s team is aiming for a Santa rally to push the index up to 7,200 by Christmas.

“That is now only 3% away, hence I remind subscribers of our caveat that surprises are likely to be on the upside.”

So considering this bullish outlook, what are the best stocks to take advantage?

Gerrish named one example each from his growth, income, and emerging companies portfolios:

All-time high share price within reach

Funnily enough, National Australia Bank Ltd (ASX: NAB) is the pick from Gerrish’s growth stable.

The team believes NAB and its big bank mates will all rally through November with three of the four expected to pay massive fully franked dividends.

“NAB is set to report in a week’s time and we believe it will perform strongly,” he said.

“Even though they are experiencing below-sector growth in total mortgage and business lending, this is a time to be prudent. It’s forecasted to pay an 82c fully franked dividend on the 16th.”

Believe it or not, NAB’s all-time high was 15 years ago, when the share price breached the $40 mark.

Gerrish’s team is targeting the bank stock to set a new all-time high.

“However we do caution that we are only looking for a 5% to 10% move plus a dividend making it a very active play from here.”

Not just a boring infrastructure stock

Among the income producers, Gerrish likes toll operator Transurban Group (ASX: TCL).

“On face value, the toll road operator is a solid defensive stock, offering a reasonable ~4%, largely unfranked yield while their high levels of debt are seen as a risk in this sort of interest rate environment,” he said.

“However, there is more to this story which underpins our positive view on the stock.”

New assets like Sydney’s WestConnex stage 2 and NorthConnex will drive 8.5% annual growth in earnings and dividends over the coming five years, according to Gerrish.

“This is also supported by revenue linked to CPI, which as we all know is running hot, along with expected capital releases, which will also support dividend growth over the coming years.”

He forecasts that, by financial year 2024, the dividend yield will be above pre-COVID levels, then “rise steadily from there”.

The Market Matters team is bullish on Transurban shares for the long run.

One door closes, 60 more open

Carbon capture technology provider Calix Ltd (ASX: CXL) is the favoured pick from Gerrish’s emerging companies portfolio.

Horrifyingly, the stock has halved in value since Easter.

Just in the past week, Calix shares lost more than 22% after the federal government withdrew $41 million of funding for its projects with Boral Limited (ASX: BLD) and Adbri Ltd (ASX: ABC).

“The company was hugely disappointed with the news… particularly given it came just a few days after a federal budget which promised spending on green initiatives with an explicit focus on cement,” said Gerrish.

“Despite the news, Calix noted that both Boral and Adbri had firm commitments to reduce carbon emissions by 2030, and will need to act now to hit their targets, with the company confident it remains part of this plan.”

Calix has stated its services have considerable global interest, with more than 60 projects underway that are in total worth far more than the lost government funding.

Calix shares closed Wednesday at $4.27. Gerrish’s team remains bullish about the stock if it can be purchased around that price.

The post 3 ‘bullish’ ASX shares to buy as FOMO grips the market: expert appeared first on The Motley Fool Australia.

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More reading

• If you invested $1,000 in NAB shares 5 years ago, here’s how much you’d have today
• Why is the Calix share price stooping to a new 12-month low on Monday?
• Here’s how the NAB share price has fared in October
• Bell Potter names 9 ‘champion’ ASX 200 shares to buy for the next five years
• Are NAB shares the most expensive of the big four banks?

Motley Fool contributor Tony Yoo 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 Incannex Healthcare Ltd (ASX: IHL) share price went up in smoke in October, underperforming the S&P/ASX 300 Index (ASX: XKO) by 15% over the course of the month.

That was despite plenty of seemingly positive news being released by the healthcare stock.

The company works to develop medicinal cannabinoid pharmaceutical products.

 After closing September at 27.5 cents, the Incannex share price closed October at its lowest point of the month ­– 25 cents – marking a 9.1% fall. Meanwhile, the ASX 300 lifted 5.9%.

 So, what went wrong for the cannabinoid favourite? Let’s take a look.

What went wrong for Incannex stock in October?

The Incannex share price stumbled through October despite three seemingly positive announcements being released by the ASX 300 newbie in that time.

The first detailed a meeting with the United States’ Food and Drug Administration (FDA) regarding its drug IHL-216A.

Incannex chief scientific officer Dr Mark Bleackley commented on the regulator’s feedback, saying:

The FDA … indicated that the agency is highly interested in the development of IHL-216A for treatment of traumatic brain injury … The FDA has provided essential advice on inhaled drug development that will guide the most efficient development of IHL-216A.

Sadly, the news appeared to disappoint the market. It bid the Incannex share price 8.6% lower on the release. Fortunately, the next announcement from the company inspired its stock to lift by 3.5%.

Days later, Incannex declared dosing in a phase one clinical trial assessing another drug – IHL-675A – was completed successfully. It will now get started on phase two trials of the drug.

But such gains weren’t to last. The Incannex share price handed back 3.8% on the release of the company’s quarterly report.

It posted a $4 million cash outflow for the three months ended 30 September, $2.26 million of which was related to research and development.

It closed the period with $33.4 million of cash in the bank – enough to fund an estimated eight future quarters.

Incannex share price snapshot

The Incannex share price has struggled this year after posting a near-300% gain in 2021.

As of this morning, it has fallen 61% since the start of 2022. It’s also currently 43% lower than it was this time last year.

For comparison, the ASX 300 has fallen 8% year to date and 6% over the last 12 months.

The post Why did the Incannex share price go up in smoke in October? appeared first on The Motley Fool Australia.

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More reading

• Why is everyone talking about ASX cannabis shares all of a sudden?
• Is ASX 300 healthcare company Incannex profitable?

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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Australian Foundation Investment Co Ltd (ASX: AFI) is the largest listed investment company (LIC) in Australia. It’s known for paying consistent dividends to shareholders. But, how large is the AFIC dividend yield?

For readers who don’t know, the purpose of a LIC is to invest in other shares (or assets) on behalf of shareholders.

Due to the company structure, the board of directors can decide how much of a dividend to declare each year. This gives them more control over the level of income that shareholders receive each year.

LICs have the option of using the investment profits of both dividends and capital gains to pay investors.

AFIC has built a reputation for paying a steady stream of dividends. Indeed, that’s one of its main objectives. It states:

AFIC aims to provide shareholders with attractive investment returns through access to a growing stream of fully franked dividends and enhancement of capital invested over the medium to long term.

AFIC’s current dividend yield

The listed investment company has been paying an annual ordinary dividend per share of 24 cents for a number of years.

Sometimes it has had to use its profit reserve to keep paying that dividend, whereas in other years the profit generated has been larger than the dividend payments.

But, due to its multi-decade history, AFIC has managed to build a good profit reserve that can be tapped during volatile times.

Using the current annual dividend payout of 24 cents per share, at the current AFIC share price, the AFIC dividend yield is 3.3%, or 4.7% including the franking credits attached to each payment.

What does the current portfolio look like?

As a LIC, the returns generated by the fund’s investments dictate its profits.

The investments it normally makes are done with the long-term in mind, so they don’t normally change much from month to month. But I think it’s worth knowing the sorts of businesses that investors are getting the biggest exposure to.

At 30 September 2022, these were the positions that had a weighting of at least 4%:

Commonwealth Bank of Australia (ASX: CBA) – 9.1% of the portfolio

CSL Limited (ASX: CSL) – 8.6% of the portfolio

BHP Group Ltd (ASX: BHP) – 7.8% of the portfolio

Transurban Group (ASX: TCL) – 4.5% of the portfolio

Macquarie Group Ltd (ASX: MQG) – 4.3% of the portfolio

National Australia Bank Ltd (ASX: NAB) – 4.1% of the portfolio

Westpac Banking Corp (ASX: WBC) – 4.1% of the portfolio

Wesfarmers Ltd (ASX: WES) – 4% of the portfolio

AFIC share price snapshot

Over the last six months, AFIC shares have fallen by close to 12%. This compares to a 4.5% decline for the S&P/ASX 200 Index (ASX: XJO).

The post How big is the AFIC dividend yield right now? appeared first on The Motley Fool Australia.

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• Looking to buy AFIC shares in October? Here’s what you’d be getting

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 positions in and has recommended Wesfarmers Limited. The Motley Fool Australia has recommended Macquarie Group Limited and Westpac Banking Corporation. 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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IGO Ltd (ASX: IGO) shares have come under pressure with the rest of the market on Thursday.

In morning trade, the battery materials miner’s shares are down over 2% to $14.77.

IGO shares down again

This latest decline means that IGO’s shares are now down 12% since this time last week. That’s despite the company announcing its quarterly update earlier this week and revealing stellar earnings growth.

For the three months ended 30 September, IGO reported a 54% increase in underlying EBITDA to a record $398 million and a massive 136% jump in net profit after tax to $253 million.

This strong growth was underpinned by record quarterly spodumene production at Greenbushes and record sales revenue from its nickel business following the contribution from Forrestania.

Is this a buying opportunity?

According to a note out of Citi, its analysts think investors should keep their powder dry for the time being.

In response to the update, the broker downgraded IGO’s shares to a neutral rating with an improved price target of $15.20.

Its analysts believe the IGO share price is fair value at 1.1x NAV and 6x EBITDA. The broker commented:

SepQ overshadowed by the unexpected death of MD & CEO Peter Bradford. New news were: i) Kwinana (lithium hydroxide) train 1 commercial production expected end of CY23; ii) total capex at Cosmos (Ni) now expected to be double at ~A$810m. SepQ highlight was Greenbushes which more than doubled underlying earnings QoQ. Net debt reduced by A$137m to A$396m. We lift our TP by $1.20/sh to A$15.20/sh and move to Neutral. IGO is now trading on ~1.1xP/NAV and FY24 EV/EBITDA +6x. We expect nickel prices to move lower and lithium to track more or less sideways in the near-term.

Though, that hasn’t stopped one insider from topping up with a large purchase this week. A change of director’s interest notice reveals that its non-executive director, Justin Osborne, picked up 10,000 shares for a total consideration of $148,350 on 1 November.

The post Are IGO shares a buy after a huge quarter of profit growth? appeared first on The Motley Fool Australia.

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More reading

• Which ASX 200 mining shares managed to dig up gains in October?
• Could this news be helping the Sayona share price light up today?
• IGO share price higher after lithium demand underpins 136% Q1 profit growth
• 5 things to watch on the ASX 200 on Monday
• If ASX lithium shares are soaring, why is the ACDC ETF down 9% 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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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.

What happened

Tesla‘s (NASDAQ: TSLA) factory in Shanghai, China is its most productive plant. It has been upgraded to have an annual production capacity of about 1.1 million units. So it’s not a surprise to see investors moving the stock lower when there are clouds on the horizon in China. As of 1 p.m. ET, Tesla shares were near the day’s lows, down 2.6%. 

So what

That is likely because of another resurgence of COVID-19 cases and restrictions in China. Tesla generates approximately one-fourth of its sales from its China plant. So when news surfaced that Chinese electric vehicle maker Nio has temporarily suspended operations at two of its plants due to local virus-related restrictions, some investors are betting it will also impact Tesla.  

Now what

Today, Reuters reported that Nio has halted its production due to efforts to stem the virus’ spread. The company confirmed that deliveries and production have both been affected. Nio’s facilities are in Hefei, approximately 300 miles from Shanghai. But production at Tesla’s Shanghai plant was already interrupted earlier this year from COVID-19 lockdowns in China. And Tesla’s suppliers could also be impacted by lockdowns. 

Tesla doesn’t provide monthly sales data, but Nio missed expectations for deliveries in October partly due to the COVID-19-related impacts. And Reuters has also reported that Walt Disney‘s Shanghai theme park resort has closed with visitors being required to test negative for the virus to exit. 

Tesla’s Shanghai plant is an important one for the company. Until its new German factory ramps up to full capacity, the China plant has also been supplying European customers. So it makes sense for investors to be concerned if production at the Shanghai factory is limited. That helps explain today’s stock drop, but investors should know that the company’s long-term potential won’t likely be affected by these short-term issues.     

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

The post Why Tesla shares dropped Wednesday appeared first on The Motley Fool Australia.

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• Could ‘no deal’ with Tesla actually be good news for Core Lithium shares?
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Howard Smith has positions in Nio Inc., Tesla, and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Nio Inc., Tesla, and Walt Disney. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2024 $145 calls on Walt Disney and short January 2024 $155 calls on Walt Disney. The Motley Fool Australia has recommended Walt Disney. 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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When share markets go downward, I think it’s a good time to look at ASX dividend shares. Not only are valuations cheaper, but the dividend yields also get a boost.

It’s true that what interest rate investors can get from a term deposit has increased, but the dividend yields from shares are now looking even more attractive.

I wouldn’t buy a business just because it has a high dividend yield. I’m looking for businesses that can hopefully grow profit over the long term, particularly ones with plans for growth.

These are two of the high-yielding shares I think could make good buys this month.

Rio Tinto Limited (ASX: RIO)

This business is one of the ASX’s largest miners. It’s involved with a number of different commodities including iron ore, aluminium, copper, diamonds, titanium dioxide and borates. It is also building a lithium project in South America as the business looks to build its exposure to decarbonisation resources.

Iron ore has been the key profit generator for the ASX dividend share. However, the iron ore price has been falling in recent weeks and months. There have been concerns that Chinese demand for iron ore will reduce, due to an unstable property sector and COVID-19 lockdowns, leading to a subdued iron ore price.

Since 8 June, the Rio Tinto share price has fallen by over 20%. I think it’s times of commodity weakness that make the best time to buy shares in mining stocks. However, China (and its demand for iron) will essentially decide how Rio Tinto’s iron ore earnings perform in the coming years.

I like the way this ASX dividend share is increasing its exposure to copper and I’m optimistic about the lithium play as well.

According to CommSec, the FY23 grossed-up dividend yield could be 12.2%.

GQG Partners Inc (ASX: GQG)

GQG is one of the largest fund managers on the ASX with a market capitalisation of over $4 billion according to the ASX.

It offers investors a number of different investment strategies including global shares, dividend income, emerging markets, and US shares.

This business continues to experience net inflows of investor money, despite all of the volatility in the share markets. In the three months to September 2022, it experienced net inflows of US$0.8 billion. It finished the quarter with US$79.2 billion of funds under management (FUM).

The vast majority of its net revenue comes from management fees (which are a percentage of assets managed), rather than performance fees. This means its revenue can be more consistent.

This ASX dividend share aims to pay out 90% of its distributable earnings to investors.

According to CommSec, GQG is predicted to pay a dividend yield of 8.25% in FY23.

The post I think right now is the time to buy these 2 ASX dividend shares appeared first on The Motley Fool Australia.

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More reading

• Why Atlantic Lithium, Coronado Global, Lake Resources, and Rio Tinto are charging higher
• Why is the Rio Tinto share price pushing higher today?
• Which ASX 200 mining shares managed to dig up gains in October?
• Could ASX 200 iron ore shares be heading for more pain?
• Why CBA is much more upbeat on Rio Tinto shares than the government

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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The Lynas Rare Earths Ltd (ASX: LYC) share price has been among the more inspiring ASX success stories over the last few years, despite no dividends having been paid by the company.

The stock has gained more than 250% over the last three years amid soaring demand for rare earths. Right now, it’s trading for $8.68.

Like lithium and copper, which are perhaps better known, rare earths are an essential component of modern technology and, in turn, the green energy transition.

As demand for rare earths has taken off, so have the company’s earnings.

It posted $601 million of earnings before interest, tax, depreciation, and amortisation (EBITDA) and a $540 million after-tax profit for financial year 2022 – up 156% and 244% respectively year-on-year. It also closed the year with $965.6 million of cash and cash equivalents.

Why, then, is Lynas not offering those invested in its shares a dividend? And could payouts be on the cards in the future? Let’s take a look.

Could dividends be on the horizon for Lynas shares?

As the figures above suggest, Lynas appears financially able to offer shareholders a dividend.

The miner’s earnings per share (EPS) lifted to 59.95 cents last financial year. Even paying out 30 cents of that would see the stock with a healthy 3.46% dividend yield.

But I don’t think investors should be holding their breath for dividends in the very near future, for two reasons.

First, while the company is profitable in 2022, that’s a relatively new development.

It has only posted a profit for two consecutive financial years, having lost nearly $19.4 million in financial year 2020. It’s also worth noting that Lynas’ revenue slumped 44% in the September quarter.

Thus, it might be waiting until it has more stable earnings before it begins to offer dividends.

Perhaps a more compelling reason I’m sceptical about forthcoming dividends, however, is Lynas’ growth strategy.

The Lynas 2025 growth plan aims to grow the company alongside the market, diversify its industrial footprint, and increase its product range.

After announcing the plan in 2019, the company declared its accelerating and increasing its efforts in August as it revealed a $500 million expansion project at Mt Weld â€“ fully funded from cash flow.

Speaking on the company’s recent full-year earnings, CEO and managing director Amanda Lacaze said:

Further investment in capacity increases at each stage of production will ensure that Lynas is well positioned to continue to grow with the market as a supplier of choice to 2025 and beyond.

With such a focus on growth, it makes sense Lynas might forego offering dividends to those invested in its shares.

However, nothing is certain on the ASX. The company could very well be gearing up to offer a dividend as we speak.

The post Could Lynas shares pay a dividend in the future? appeared first on The Motley Fool Australia.

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More reading

• What’s boosting the Lynas share price on Wednesday?
• Which ASX 200 mining shares managed to dig up gains in October?
• Could the Lynas share price have another 15% upside from here?
• 2 ASX companies producing minerals the whole world wants: expert
• Here are the top 10 ASX 200 shares today

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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Looking for dividend shares to buy? Listed below are two ASX dividend shares that experts rate as buys.

Here’s why they are bullish on these dividend shares:

Accent Group Ltd (ASX: AX1)

Footwear focused retailer Accent could be an ASX dividend share to buy.

Its shares have been crushed over the last 12 months after the company materially underperformed in FY 2022. While this is disappointing, the team at Morgans sees it as a buying opportunity. Particularly given its belief that the company could return to form this year.

It highlights that management is focused on selling at full price again, which it expects to support a recovery in its gross profit margin. In addition, Morgans was pleased with the company’s decision to moderate its store rollout in favour of a more selective expansion strategy focused on return on investment.

Morgans has an add rating with a $2.00 price target. As for dividends, the broker is forecasting fully franked dividends of 9 cents per share in FY 2023 and 11 cents per share in FY 2024. Based on the current Accent share price of $1.51, this will mean yields of 6% and 7.3%, respectively.

Charter Hall Long WALE REIT (ASX: CLW)

The Charter Hall Long Wale REIT could be another ASX dividend share to buy this month. It is a leading property company with a focus on high quality real estate assets.

As its name implies, these properties are leased to corporate and government tenants on long term leases. In fact, at the last count, its weighted average lease expiry (WALE) stood at 12 years.

Citi is a fan of the company and has a buy rating and $4.70 price target on its shares. Its analysts believe Charter Hall Long Wale REIT’s shares are great value after recent weakness. This is particularly the case given its “low risk income stream with c. 12 year WALE and 99.9% occupancy.”

In respect dividends, the broker is forecasting dividends per share of 28 cents in FY 2023 and 29.2 cents in FY 2024. Based on the current Charter Hall Long Wale REIT share price of $4.33, this will mean yields of 6.5% and 6.7%, respectively.

The post Analysts say these ASX dividend shares with 6%+ yields are buys appeared first on The Motley Fool Australia.

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More reading

• Why I’d grab today’s cheap ASX shares before it’s too late
• Brokers name 2 ASX dividend shares to buy with big yields
• Here are the top 10 ASX 200 shares today
• Set for life: 5 ASX dividend shares I’d invest in if I ever had a million-dollar windfall
• 2 ASX dividend shares with big yields I’d buy for income

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

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The A2 Milk Company Ltd (ASX: A2M) share price will be one to watch on Thursday.

That’s because this morning the infant formula company made a very positive announcement relating to its US operations.

Why is the A2 Milk share price on watch?

The A2 Milk share price could defy the market selloff today after the company announced that it will soon be selling its infant formula in the massive US market.

According to the release, the United States Food and Drug Administration (FDA) has exercised its discretion to allow A2 Milk to import infant milk formula products into the United States.

A2 Milk applied to the FDA on 26 May but had its application deferred in August. Since then, the company continued to engage with the FDA to meet its requirements and to reconsider A2 Milk’s application.

It has now done enough to convince the FDA to approve its application and has been given the thumbs up to import, sell, and distribute a2 Platinum infant formula products (Stages 1 and 2) from New Zealand into the US through to 6 January 2023. The company is also able to supply Stage 3 toddler products, which does not require enforcement discretion.

What’s different?

The release notes that the product that will be supplied to the United States has the same formulation as a2 Platinum but has different scoops, mixing instructions, and labelling requirements to meet the FDA requirements. This product is not currently available in inventory and needs to be manufactured as soon as possible.

A2 Milk previously indicated to the FDA that if approval was obtained by 30 September 2022, it had the capacity through Synlait Milk Limited (ASX: SM1) to manufacture 9 million cans of a2 Platinum (equivalent to 211 million 8oz bottles) by 30 June 2023 if required during the supply shortage period, subject to customer demand.

However, management highlights that while the United States is a significant opportunity, it is difficult to predict the infant formula sales potential as it is a highly competitive market to enter.

Accordingly, the company believes sales will be significantly below indicated manufacturing capacity and is provisionally forecasting sales of 1 million cans to the United States during the second half of FY 2023.

Furthermore, management expects gross margins to be lower than average, distribution costs to be higher due to potential air freight and rework costs, and incremental marketing and trade investment to enter the category. This makes its earnings impact unclear at this stage.

Management commentary

A2 Milk Company’s managing director and CEO, David Bortolussi, said:

We are pleased to be able to assist parents and caregivers in the US by providing access to significant volumes of high quality, a2 Platinum infant and toddler milk formula manufactured in New Zealand during this challenging period. Our a2 Platinum product meets the FDA’s food safety and nutritional requirements and is made with a2 Milk, which has digestive and other potential health benefits that have underpinned the success of our brand in other markets.

a2MC is well positioned to support this initiative being one of the leading premium international infant milk formula brands with annual sales exceeding 30 million cans. We have scalable production capacity in New Zealand with Synlait plus existing a2MC US sales, marketing and supply chain capability that can be leveraged.

We are increasing our supply to respond to this situation, while importantly ensuring that we continue to meet the needs of our other IMF consumers and trade partners in China and other markets. If the US requires further support over an extended period, we have the proven ability to scale up significantly.

The post A2 Milk share price on watch following US FDA approval appeared first on The Motley Fool Australia.

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More reading

• A2 Milk share price climbs amid legal stoush
• Why is the A2 Milk share price underperforming on Tuesday?
• Why A2 Milk, Argosy Minerals, Dicker Data, and Life360 shares are falling
• Why is the A2 Milk share price having a better end to the week than the index?
• Why is the A2 Milk share price falling today?

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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