It’s been a rough time for the S&P/ASX 200 Index (ASX: XJO) of late, and the Xero Limited (ASX: XRO) share price is no different.

The ASX 200 is down 8.8% over the past month, but Xero has fallen much further — down 15.8% to $76.11 at the time of writing.

This means the Xero share price has lost 48% over 2022, and it’s now 51.4% lower than its all-time high of $156.65 reached in November.

Xero used to be one of the best-performing growth shares on the ASX. Its online-based accounting software has exploded in popularity across Australia, New Zealand and many other countries in recent years. And even though Xero’s share price has taken a big hit, the company is still reporting some impressive growth numbers.

Xero released its FY2022 full-year results last month. They showed revenue growth of 29% to NZ$1.1 billion, as well as subscriber growth of 19% to 3.3 million. Earnings before interest, tax, depreciation, and amortisation (EBITDA) rose 11% to NZ$212.7 million.

So could Xero’s recent share price plunge be a buying opportunity?

Is the Xero share price in the buy zone today?

Well, Goldman Sachs thinks so.

The investment bank and ASX broker is currently rating Xero shares as a buy with a share price target of $118. If that came to pass, it would mean an upside of almost 57% from the current share price.

Goldman is bullish on Xero because it expects the company to keep its revenues growing strongly over the next few years.

It is anticipating Xero to report revenue growth of 23% to NZ$1.39 billion for FY2023. It expects more big increases until at least FY2025 when it expects the company to report NZ$1.98 billion in revenue.

Goldman is expecting acquisitions, international expansion, a transition to the cloud, Xero’s new app ecosystem, and price increases to underpin this revenue surge.

But not every broker agrees with Goldman

It’s worth noting that not all ASX brokers are as bullish on the Xero share price as Goldman.

For instance, fellow broker UBS has a sell rating on Xero with a price target of just $75.

The broker still reckons Xero’s valuation is stretched, and the company’s recent results weren’t enough to change its mind.

No doubt Xero shareholders will be hoping that it is Goldman’s price target that turns out to be accurate.

At the current Xero share price, the company has a market capitalisation of $11.32 billion.

The post Why is Goldman Sachs tipping 50% upside for the Xero share price? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX tech shares Goldman Sachs rates as buys
• Is it time to go bargain hunting for ASX shares?
• 2 ASX tech shares brokers rate as buys this month
• ASX 200 midday update: GUD crashes, tech shares tumble
• Why I think the Xero share price is now too compelling to ignore

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 Goldman Sachs and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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S&P/ASX 200 Index (ASX: XJO) travel shares are lifting to the skies today.

The Webjet Limited (ASX: WEB) share price is up 2.56% while the Qantas Airways Limited (ASX: QAN) share price is 2.26% higher. Meanwhile, Flight Centre Travel Group Ltd (ASX: FLT) shares are trading up 2.89% at the time of writing.

For perspective, the S&P/ASX 200 Index (ASX: XJO) is 1.44% going into the final hour of trading this afternoon.

So why are ASX200 travel shares rising?

Return to profit could be on the cards

New insight from the International Air Transport Association (IATA) indicates a return to profit could be on the cards for the airline industry.

The IATA predicts industry-wide profit in 2023 “appears within reach”. The association highlighted North America will deliver $8.8 billion profit in 2022.

Global industry loss forecasts have also been cut from $11.6 billion to $9.7 billion for 2022. This compares to $137.7 billion in losses in 2020 and $42.1 billion in 2021.

Commenting on the outlook, IATA director general Willie Walsh said:

Airlines are resilient. People are flying in ever greater numbers. And cargo is performing well against a backdrop of growing economic uncertainty.

Losses will be cut to $9.7 billion this year and profitability is on the horizon for 2023.

Closer to home, Qantas has scrapped the requirement to wear masks on outbound flights to the USA, United Kingdom, and Europe from NSW, Queensland, and WA, Sky News reported.

A Qantas internal memo to staff stated “the change to inflight mask requirements on some international flights is an important step in our transition to living with COVID“.

Meanwhile, popular tourist destination Thailand will relax travel restrictions from 1 July, Crisis 24 reported.

Foreign arrivals will no longer be required to show insurance coverage for COVID-19 or apply for the Thailand Pass. Travellers will, however, need to show a COVID-19 vaccination certificate, or a negative COVID-19 test.

ASX 200 travel share price recap

Qantas shares have dropped more than 2% in the last year while the Webjet share price has climbed more than 5%. In contrast, Flight Centre shares have surged nearly 16%.

For perspective, the benchmark ASX index has lost nearly 10% in the past year.

The post ASX 200 travel shares take off again on Tuesday. Here’s why appeared first on The Motley Fool Australia.

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More reading

• What’s boosting the Qantas share price on Tuesday?
• Why are ASX 200 travel shares lifting off on Monday?
• Qantas share price lifts amid new sustainability partnership
• These are the 10 most shorted ASX shares
• What happened to the Qantas share price today?

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 recommended Flight Centre Travel Group Limited and Webjet 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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The BHP Group Ltd (ASX: BHP) share price is back in the green today following a disastrous day’s trade on Monday. The mining giant’s stock slumped 5.3% yesterday amid tumbling iron ore futures.

Fortunately, today is proving to be brighter. At the time of writing, the BHP share price is $41.27, 2.48% higher than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) is currently 1.59% higher.

Let’s take a closer look at what might be going on with the ASX’s biggest company by market capitalisation this week.  

BHP share price recovers some of yesterday’s tumble

The BHP share price appears to be on the mend on Tuesday despite the continued fall of iron ore prices.

Iron ore futures sank 2.6% overnight to US$128 a tonne, according to CommSec.

The latest fall comes amid concerns Chinese demand for steel could further weaken. Some steel mills in the nation are even rumoured to have cut outputs, according to Reuters.

Despite the commodity’s downturn, the BHP share price is lifting alongside the company’s home sector – the S&P/ASX 200 Materials Index (ASX: XMJ). It’s currently the market’s second-best performer, having gained 2.06% at the time of writing.

It’s also worth mentioning that plenty of other commodity prices lifted overnight. Notably, the price of copper and nickel – both produced by BHP – each increased by 0.3%.

BHP’s fellow iron ore giants Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) are also in the green. Their share prices have gained 2.68% and 2.88% respectively at the time of writing.

Today’s rise included, the BHP share price is 11% higher than it was at the start of 2022.

Though, it’s almost 13% lower than its high on 8 June. Finally, it is up 1.8% since this time last year.

The post BHP share price claws back half of Monday’s losses on Tuesday appeared first on The Motley Fool Australia.

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More reading

• ASX 200 midday update: BHP and Rio Tinto rebound, Westpac rated as a buy
• Why is the BHP share price crashing 5% today?
• Why are ASX 200 iron ore shares getting hammered on Monday?
• Own BHP shares? Here’s why the miner could be set for a $1.85 billion boost
• BHP share price ends Friday’s session 8% lower for the week

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

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In afternoon, the S&P/ASX 200 Index (ASX: XJO) is back on form and on course to record a strong gain. At the time of writing, the benchmark index is up 1.5% to 6,531.6 points.

Four ASX shares that have failed to follow the market’s lead are listed below. Here’s why they are tumbling lower:

Bowen Coking Coal Ltd (ASX: BCB)

The Bowen Coking Coal share price is down 17% to 28.5 cents. This morning this this coal miner revealed that it has executed a series of funding arrangements totalling approximately $190 million. These funds will be used to support the company’s development of its portfolio of development-ready coking coal assets.

Lake Resources N.L. (ASX: LKE)

The Lake Resources share price has crashed 17% to $1.12. This lithium developer’s shares have fallen heavily this week following the announcement of the shock exit of its managing director, Steve Promnitz. In addition, there are concerns about rising short interest.

Premier Investments Limited (ASX: PMV)

The Premier Investments share price is down almost 2.5% to $19.67. This decline has been driven by the retail conglomerate’s shares trading ex-dividend this morning. Eligible shareholders can now look forward to receiving the Smiggle owner’s 46 cents per share fully franked dividend on 27 July.

ResApp Health Ltd (ASX: RAP)

The ResApp share price has crashed 31% to 12 cents. This morning the digital health company revealed disappointing study results for its COVID-19 smartphone algorithm. This means that the takeover proposal from Pfizer Australia will be 14.6 cents per share instead of 20.7 cents per share. That’s if the healthcare giant still goes ahead with the takeover following the poor results.

The post Why Bowen Coking Coal, Lake Resources, Premier, and ResApp shares are tumbling lower appeared first on The Motley Fool Australia.

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More reading

• Why is the Premier Investments share price falling today?
• Why is the ResApp share price crashing 29% today?
• 5 things to watch on the ASX 200 on Tuesday
• Why is the Lake Resources share price sinking 14% today?
• Top broker names 4 ASX lithium stocks to buy now

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 Premier Investments 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 Polynovo Ltd (ASX: PNV) share price is heading south again today despite the company not releasing any announcements.

Since the start of the week, the medical device company’s shares are down 3% to currently trade at $1.295 each.

While down 1.15% today, this isn’t the case for the S&P/ASX 200 Index (ASX: XJO) which is 1.59% higher to 6,535 points at the time of writing.

Let’s take a look at what is weighing down the Polynovo share price of late.

What’s impacting Polynovo shares?

Besides the recent buying action by the company’s board, it has been relatively quiet for Polynovo.

Its last trading update came in early April when management provided a snapshot of the company’s third-quarter results.

Since then, Polynovo shares tumbled to a multi-year low of 83.5 cents before rebounding to February 2022 levels.

The share price weakness came off the back of negative investor sentiment across the ASX following fears surrounding a possible recession.

However, added to the mix is the large number of short-sellers on Polynovo’s registry.

The latest short position report by the Australian Securities & Investments Commission (ASIC) reveals the level of short interest within companies.

Polynovo remains in the top 10 of short interest ASX stocks, with 10.95% of its shares being shorted by investors.

In case you aren’t aware, short-selling is a common trading strategy that aims to profit from the fall in the price of a security. The goal is for an investor to borrow shares then sell them and buy them back at a lower price for a profit.

On top of this, the S&P/ASX 200 Healthcare (ASX: XHJ) sector has fallen by 4.63% in the past week and is down 15% in 2022.

Yet perhaps the biggest selling pressure has come from Polynovo’s removal from the S&P/ASX 200 Index (ASX: XJO) which took effect on Monday.

The S&P Dow Jones Indices announced changes in its quarterly rebalance earlier this month.

Polynovo’s removal from the ASX 200 means that fund managers must abide by their investing mandate which permits them to only buy shares included in specific indices. It’s commonplace that shares can climb or fall after being included in or excluded from a particular index.

Polynovo share price summary

While staging a small rebound from early May onwards, the Polynovo share price is down 15% year-to-date.

When looking at the past 12 months, its shares are deep in the red by 53%.

Based on today’s price, Polynovo presides a market capitalisation of about $856 million.

The post How have Polynovo shares been performing since leaving the ASX 200? appeared first on The Motley Fool Australia.

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More reading

• These are the 10 most shorted ASX shares
• 5 things to watch on the ASX 200 on Monday
• These were the best performing ASX 200 shares last week
• Buying the dip: 3 ASX All Ord shares insiders are loading up on
• Why is the Polynovo share price rising while other ASX 200 stocks are plummeting?

Motley Fool contributor Aaron Teboneras 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 POLYNOVO FPO. 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.

ESG investing — which stands for environmental, social, and corporate governance — gives investors a chance to look at companies from a different viewpoint. Traditionally, a lot of investment decisions were based solely on a company’s financials, but ESG investing looks past the numbers and into a company’s role in society. By no means does ESG investing mean ignoring a company’s financials and conventional investment wisdom, but those aren’t the only factors in ESG investing decisions.

Here’s a quick look at the components of ESG:

• The environmental portion of ESG investing focuses on a company’s current role in contributing to environmental problems, as well as its commitment to addressing imminent issues like climate change.
• When you examine a company on its social standing, you pay attention to how it interacts with employees, customers, and the outside community, which may not impact its bottom line.
• Governance focuses on transparency, compliance, and truthfulness regarding finances and operations.

Here are two reasons you should become an ESG investor and one reason you shouldn’t.

1. You can invest in companies that align with your values

ESG investing allows you to make sure you’re putting your money into companies that align with your values. The main purpose of investing is to make money, but your personal values and financial goals don’t have to be mutually exclusive. Just because a company is committed to operating with high ESG standards doesn’t mean it can’t do so profitably. 

If you’re passionate about fighting climate change, for example, you have the chance to invest in companies making strides in renewable energy and green operations. If you’ve been a victim of a data leak, you may feel strongly about customer data privacy and focus on companies in cybersecurity. Whatever the case, you can make sure your money is going toward companies aiming to positively impact things you care about.

2. You can invest in ESG-themed funds

Luckily for investors, more funds are increasingly being put together that are focused on particular themes of ESG investing. With more than 600 ESG funds in the U.S., if you care about an ESG cause, there’s likely a fund specific to it. You can also choose not to focus on issue-specific funds and invest in funds covering all ESG aspects as a whole.

For example, the iShares ESG Aware MSCI USA ETF (NASDAQ: ESGU), the second-largest ESG fund by assets under management, contains mid- and large-cap stocks of U.S. companies that “have positive environmental, social, and governance characteristics,” and has the highest MSCI ESG fund rating possible. If you don’t want to be limited to just the U.S., there are also international funds for you, like the Vanguard ESG International Stock ETF (NYSEMKT: VSGX), which contains companies of all sizes from non-U.S. countries.

Some ESG funds may seem contradictory

One thing that may stick out when you’re looking into ESG funds is that some of the companies the ESG fund invests in don’t seem to fit its objectives. This is generally due to one of two reasons. First, there’s no universal method for selecting companies for ESG funds; some funds consider all three aspects of ESG, some consider two aspects, and some may only consider one. If an ESG fund is considering one aspect and a company fits the criteria while having a bad standing on the other two, it could still be included.

Another reason you may see an apparent contradiction is that although a company may seemingly go against the purpose of an ESG fund by its current operations, its commitment and investments in change may warrant a spot. Take big oil, for example. It’s not far-fetched to see green ESG funds containing significant stakes in big oil companies. Yes, they play a large role in harming the environment right now, but they also make huge investments in green innovation that could change the future. 

If your values align strongly around a particular aspect of ESG, be sure to look past the fund’s name and stated mission and into its holdings. You may personally find some funds misleading and decide it goes against your investment objective. More than anything, just make sure you’re aware. 

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

The post 2 good reasons to become an ESG investor — and 1 reason you shouldn’t appeared first on The Motley Fool Australia.

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More reading

• ‘The largest unmet medical need in human health’: Why this ASX biotech share is surging 28% today
• Fortescue share price rebounds 3% today
• What’s boosting the Qantas share price on Tuesday?
• How to start investing in stocks: This ASX 200 share is where I’d begin
• Here’s why the Beach Energy share price is leaping 4% today

Stefon Walters 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. 

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

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The Recce Pharmaceuticals Ltd (ASX: RCE) share price is rebounding after hitting a near multi-year low of 56 cents yesterday.

This comes after the pharmaceutical company provided an update on its development of a new class of synthetic anti-infectives.

At the time of writing, the ASX biotech share is soaring 28.32% to 73 cents.

What’s pushing the Recce share price higher?

The company has reported positive results for its broad-spectrum antibiotic Recce 327 drug today.

The phase I study assessed the safety and tolerability of Recce 327 in patients with sepsis.

As such, investigators reviewed the data and found that all 10 male subjects indicated a good safety and tolerability record.

The healthy patients received the cohort six dosing at 4,000mg – an 80-fold increase from cohort one at 50mg.

Following the successful results, the Independent Safety Committee will carefully review the cohort six data. Once completed, the Committee will make a recommendation for the dosage limit and the commencement of testing with the next group of patients.

What did Recce management say?

Recce CEO James Graham commented:

We are pleased with these data which builds on previous results and strongly supports the potential of RECCE 327 as a new treatment option for patients with sepsis.

We look forward to continuing to work with the Independent Safety Committee and further evaluating RECCE 327’s safety and tolerability profile in additional cohorts.

Recce is conducting the study at Adelaide’s CMAX clinical trial facility. It is seeking to evaluate seven to 10 healthy subjects per dose across eight cohorts.

Recce is aiming to wrap up the phase I trial by the second quarter of 2022.

In addition, the PEW Charitable Trusts global antibiotic pipeline review noted that “R327 is the only clinical-stage new class of antibiotic in the world being developed for sepsis, the largest unmet medical need in human health”.

Recce share price snapshot

The ASX biotech share has tumbled 33% in 2022 despite today’s outstanding gains.

For context, the S&P/ASX 200 Healthcare (ASX: XHJ) sector is down 15% over the same time frame.

Based on today’s price, Recce presides a market capitalisation of roughly $113.71 million.

The post ‘The largest unmet medical need in human health’: Why this ASX biotech share is surging 28% today appeared first on The Motley Fool Australia.

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More reading

• 2 good reasons to become an ESG investor — and 1 reason you shouldn’t
• Fortescue share price rebounds 3% today
• What’s boosting the Qantas share price on Tuesday?
• How to start investing in stocks: This ASX 200 share is where I’d begin
• Here’s why the Beach Energy share price is leaping 4% today

Motley Fool contributor Aaron Teboneras 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 is rebounding on Tuesday.

In afternoon trade, the mining giant’s shares are up 3% to $17.52.

Why is the Fortescue share price rising today?

Investors appear to have been picking up Fortescue shares today on the belief that they were oversold on Monday.

The Fortescue share price started the week with a sizeable decline after seaborne iron ore prices plunged in response to sharp falls in the futures markets.

With things looking a little more stable for iron ore prices today, Fortescue, BHP Group Ltd (ASX: BHP), and Rio Tinto Limited (ASX: RIO) shares are rebounding.

Are its shares good value?

Despite the recent weakness in the Fortescue share price, brokers aren’t recommending investors jump in.

In fact, none of the major brokers currently have a buy rating on its shares.

Though, it is worth noting that Macquarie’s neutral rating and $20.00 price target does imply meaningful upside of 14% from current levels.

Elsewhere, the bears at Goldman Sachs have a sell rating and lowly $13.50 price target on the company’s shares. Its analysts see far more value in BHP and Rio Tinto and have buy ratings on both.

The post Fortescue share price rebounds 3% today appeared first on The Motley Fool Australia.

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More reading

• Fortescue’s Twiggy adamant there’s ‘not a snowflake’s chance in hell’ of recession
• Why Bega, Fortescue, Santos, and Silver Lake shares are tumbling lower
• Why are ASX 200 iron ore shares getting hammered on Monday?
• Fortescue share price plunges 7%, but here’s why Twiggy’s not worried about a Chinese iron ore cartel
• Fortescue share price sinks 5% as iron ore price slides

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

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The Qantas Airways Limited (ASX: QAN) share price is leaping ahead today.

Qantas shares have risen 2.6% and are currently trading at $4.545. In comparison, the S&P/ASX 200 Index (ASX: XJO) is up 1.41%.

Let’s take a look at what could be giving this ASX travel share a boost.

Qantas shares rise

Qantas shares are jumping, but it is not the only ASX 200 travel share on the rise today. Webjet Limited (ASX: WEB) shares have risen 3.2%, while Flight Centre Travel Group Ltd (ASX: FLT) shares are up 4.19%.

In today’s news, Qantas has ditched the mask mandate on selected international flights. This includes flight paths between Queensland, New South Wales and Western Australia to the USA, United Kingdom and Rome. An internal memo to Qantas staff cited by Nine News stated:

The change to in-flight mask requirements on some international flights is an important step in our transition to living with COVID, and we welcome this change

Meanwhile, a solution to another international travel barrier is also in focus today. The use of Australian digital COVID-19 vaccine certificates in restaurants and tourist attractions overseas could become easier in the future.

The Sydney Morning Herald reported Australia’s Federal Health Minister Mark Butler is meeting with G20 leaders to discuss reducing “impediments for travellers as they cross borders“. This could include a pilot program to universally recognise vaccine passports from multiple nations including Australia, Canada, Brazil and the United States.

In other news, Qantas announced a new sustainability partnership earlier this week. The airline will work with Airbus to establish a domestic sustainable aviation fuel industry. This involves a US$200 million investment.

Qantas share price snapshot

The Qantas share price has dropped nearly 3% in the past 12 months, while it has slumped more than 9% year to date.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has shed nearly 10% in a year.

Qantas has a market capitalisation of about $8.6 billion based on today’s share price.

The post What’s boosting the Qantas share price on Tuesday? appeared first on The Motley Fool Australia.

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More reading

• Why are ASX 200 travel shares lifting off on Monday?
• Qantas share price lifts amid new sustainability partnership
• What happened to the Qantas share price today?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• How did ASX 200 travel shares perform amid today’s sell-off?

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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It may seem like a pretty scary time to have your money invested in ASX 200 shares.

After all, the S&P/ASX 200 Index (ASX: XJO) is down 14% over 2022 thus far. And many prominent ASX 200 shares have fallen far further than that.

But the reality is that periods like the one we’re in have often proven to be a perfect time to get started in investing. As the saying goes, ‘buy low, sell high’.

But where should one get started? There are hundreds of ASX shares to choose from. Not to mention exchange-traded funds (ETFs) or international shares.

I’ve talked about the conglomerate Washington H. Soul Pattinson and Co Ltd (ASX: SOL) before, and why I think that company is a good starting point. Well, here is another ASX 200 share investment that I personally think would also make a fantastic starting point.

Start with this ASX 200 share

It’s Coles Group Ltd (ASX: COL).

We all know Coles. It’s the second-largest supermarket chain in Australia, and services millions of Australians every year.

So, why this ASX 200 share?

Well, I think it’s important for a beginner to understand they are investing in a business, not just a share.

Coles is not an overly complicated business. Most of us would be able to get a handle on how a supermarket makes a crust. Plus, I think it is beneficial for a new investor to be able to go to one of ‘their’ stores and see how the business works and fares.

In addition, Coles is arguably a fairly safe investment. That doesn’t mean its shares can’t fall dramatically in value from time to time. But we all need (and will keep needing) to eat. That doesn’t change if the economy is in recession, if we have high inflation (or deflation, for that matter), or if interest rates go up.

Many Australians use Coles to fulfil this basic need, and I don’t see this changing too much in the future. It’s an efficient business that will arguably always be fairly competitive when it comes to the prices of food, drinks, and household essentials.

The benefits of dividends

Coles shares also pay a pretty robust dividend. At present, its shares offer a dividend yield of 3.6%, which also comes with full franking credits. I also believe a dividend-paying share is a great thing for a beginner investor, since it demonstrates how owning shares of a business can put money back into your pocket.

If an investor bought Coles shares today as their first investment, they can likely expect their first dividend payment in September.

No business is perfect, and Coles is certainly not a ‘double your money in two weeks’ kind of stock. But that’s precisely why I think it will make for a great starting ASX 200 share.

The post How to start investing in stocks: This ASX 200 share is where I’d begin appeared first on The Motley Fool Australia.

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More reading

• The ANZ share price has tumbled 24% from its 2022 high. Is it time to pounce?
• ASX 200 shares lift as RBA says recession not on the horizon
• Morgans is urging investors to buy these 2 ASX 200 shares for this challenging environment
• Why is the Premier Investments share price falling today?
• ASX 200 midday update: BHP and Rio Tinto rebound, Westpac rated as a buy

Motley Fool contributor Sebastian Bowen has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended COLESGROUP DEF SET and Washington H. Soul Pattinson and Company 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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