Embattled ASX 200 bank shares are getting a much-needed reprieve today. The rebound comes as a top broker said the sell-off is a tactical buying opportunity.

Broker Macquarie believes the banks are likely to deliver positive earnings surprises despite the growing macro headwinds buffeting the sector.

ASX 200 bank shares on the rebound

In welcome news for ASX bank shareholders, all the big four banks are gaining today. The Westpac Banking Corp (ASX: WBC) share price is currently up 1.23%, and the National Australia Bank Ltd (ASX: NAB) is climbing 1.38%.

Their peers, the Commonwealth Bank of Australia (ASX: CBA) and Australia and New Zealand Banking Group Ltd (ASX: ANZ), are also up 0.58% and 1.88%, respectively.

Their outperformance stands in contrast to the 0.73% drop in the S&P/ASX 200 Index (ASX: XJO).

Earnings surprise on tap

One reason for Macquarie’s upbeat take on ASX banks is their ability to profit from “lazy” money. The broker explained:

While competition for ‘hot’ term deposits (TDs) is intensifying, banks’ ‘lazy’ customers (who are not chasing ‘special rates’ offered by banks) contribute to margin upside. We estimate that ‘lazy’ term deposits are currently one of the more profitable bank segments and should provide [approximately] 4-9bps [basis points] tailwind over the next twelve months.

Profit margin tailwinds

Don’t forget, margins of ASX 200 bank shares are also benefitting from rising interest rates. The upward sloping bond yield curve is another tailwind.

The curve technically allows banks to borrow more cheaply in the near term and lend at higher rates for longer-term loans.

ASX 200 bank shares on a dead-cat bounce?

But to put today’s ASX 200 bank shares rebound in context, they are still nursing heavy losses. The S&P/ASX 200 Banks Index (ASX: XBK) is down around 9% over the past month despite today’s rally.

With the positive note from the analysts at Macquarie, and the fact that the sector is looking very oversold, one might have expected a stronger bounce.

What likely triggered the sell-off was the aggressive interest rate stance taken by our central bankers. They are forecasting more and faster rate hikes, which can put a big dent in the stalling property market.

Dark clouds still hanging over the sector

Banks have started to become more selective on who they lend to, while would-be borrowers have become more wary of taking on debt. This means slowing home loan growth, which is the engine room of growth for our banks.

Further, Bell Potter’s high-profile trader Richard Coppleson believes institutional investors have been dumping ASX 200 bank shares on fears that the lenders will be stuck with a growing book of delinquencies.

Falling property values and a high level of household indebtedness are increasing the risks of bad debts.

The confluence of positive margin drivers and macroeconomic risks will likely make for a volatile period for bank shares over the coming months.

Hang on to your hats, fellow Fools!

The post Why are ASX 200 bank shares rebounding on Friday? appeared first on The Motley Fool Australia.

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More reading

• ASX 200 midday update: Big four banks rebound, Atlas Arteria’s takeover update
• Here’s the ANZ dividend forecast through to 2024
• 5 things to watch on the ASX 200 on Friday
• The CBA share price has sunk a brutal 10% so far this week. What gives?
• Here are the 3 most traded ASX 200 shares on Thursday

Motley Fool contributor Brendon Lau has positions in Australia & New Zealand Banking Group Limited, Commonwealth Bank of Australia, Macquarie Group Limited, National Australia Bank Limited, and Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Macquarie Group Limited 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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The Fortescue Metals Group Limited (ASX: FMG) share price is tumbling lower on Friday.

In morning trade, the iron ore giant’s shares are down over 4% to $20.63.

Will the Fortescue share price rebound?

Unfortunately for shareholders, one leading broker believes this could be the start of greater declines.

According to a note out of Goldman Sachs this morning, its analysts have reiterated their sell rating and cut their price target down to $13.50.

Based on the current Fortescue share price, this implies potential downside of over 34% for investors over the next 12 months.

Why is Goldman bearish?

The main reason for Goldman’s bearish view on the Fortescue share price is its valuation.

It highlights that the company’s shares are trading at a significant premium to rivals BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO).

For example, the broker estimates that Fortescue’s shares are trading at 1.71x forward net asset value (NAV). Whereas BHP is trading at 1.1x and Rio Tinto is trading at 0.9x.

It’s a similar story for its EV/EBITDA multiple. Goldman estimates that the Fortescue share price currently trades at 6.7x forward EV/EBITDA, whereas BHP is 4.5x and Rio Tinto is 3.9x.

Anything else?

Outside its valuation, the broker has concerns over the “widening of low grade 58% Fe product realisations over the medium to long term due to high coking coal prices and high steel mill margins.”

It also sees “execution and ramp-up risks on the Iron Bridge project and “uncertainties around Fortescue Future Industries (FFI) diversification and Pilbara decarbonisation.”

All in all, the broker believes investors would be better off buying BHP and Rio Tinto shares instead of Fortescue. It has buy ratings on both with price targets of $50.80 and $131.00, respectively.

The post Fortescue share price sinks: Broker warns that it could fall a further 34% appeared first on The Motley Fool Australia.

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More reading

• Here’s why the Fortescue share price is 8% higher so far in June
• Is now the time to load up on Fortescue shares?
• These were the best performing ASX 200 shares last week
• Why Altium, Fortescue, PeopleIn, and REA shares are storming higher
• Why are the ASX 200 iron ore giants outperforming on Friday?

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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One of the ASX’s most renowned COVID-19 victims might be getting ready to launch back onto the market, flagging an upcoming initial public offering (IPO).

Virgin Australia deserted shareholders after it fell into the hands of administrators in 2020. It was ultimately snapped up by Bain Capital. Now, CEO Jayne Hrdlicka has told The Australian the airline has scrambled out of its despair to perform “at least as well” as Qantas Airways Limited (ASX: QAN)’s domestic business in 2022.

Let’s take a closer look at the latest insight into the previously battered Australian airline.

Virgin Australia hints at upcoming ASX IPO

Wounded former Virgin shareholders could have another chance with the airline in the near future. Its CEO has hinted Virgin could undergo an IPO as soon as 2023.

Speaking on the potential of an upcoming IPO and ASX float, the airline’s boss told The Australian:

It’s not outside the realm of possibility.

It’s a lot faster than we thought it would be and we are flattered that this soon after becoming a new company and starting from scratch we’re in a position where we’re having these conversations, because it’s extraordinary.

Virgin Australia returned from administration in November 2020 with a 22% share in Australia’s domestic passenger market. In the years since, the airline has worked to regain its strength.

The Australian Competition and Consumer Commission’s latest report on airline competition found Virgin held between 31% and 35% of the market between December 2021 and April 2022.

Meanwhile, Qantas and its budget brand Jetstar respectively had 37% and 28% of the market in April.

Virgin also held the largest market share – 36% – on routes between larger cities in that time.

Hrdlicka reportedly believes Virgin’s domestic routes’ profitability is “doing at least as well” as Qantas’ now.

Though, she told the publication the airline still carries $1.8 billion of debt. “The debt portfolio needs reviewing and we need to be able to fund growth,” Hrdlicka said, courtesy of The Australian.

The post Virgin Australia eyes upcoming ASX IPO: ‘Doing at least as well’ as Qantas appeared first on The Motley Fool Australia.

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• ‘We need your help’: What’s dragging on the Qantas share price today?
• Qantas share price lifts amid ACCC decision
• Could a lack of pricing power drag on Qantas shares in 2022?
• Top broker tips 20% upside for Qantas share price
• What’s happening to the Qantas share price this 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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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.

While the recent downturn in the crypto market has weighed heavily on the fortunes of Solana (CRYPTO: SOL), it still has one of the brightest long-term outlooks of any of the smaller cryptos attempting to challenge the two market heavyweights: Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH).

By market capitalization, Solana now ranks number nine among all cryptos and could be one of the few coins capable of surviving a prolonged “crypto winter”.

Solana’s primary claim to fame is that it has developed a leading position in the non-fungible token (NFT) marketplace, building up a robust ecosystem of investors, developers, artists, and designers committed to its long-term future.

It is now the number two blockchain for buying and selling NFTs, trailing only Ethereum. At the same time, Solana continues to showcase innovative new use cases for the Solana blockchain, ranging from blockchain gaming (GameFi) to decentralized finance (DeFi).

Solana’s leading role in the NFT market

The case for investing in Solana all starts with SOL’s rising prominence in the NFT space, which remains one of the most promising sectors of the crypto world.

At one time, Ethereum stood alone as the dominant player in the NFT world. All of the biggest NFT projects — including Bored Apes and CryptoKitties — were minted on the Ethereum blockchain and Ethereum dominated NFT sales on popular marketplaces like OpenSea.

But something happened in April that seemed to break Ethereum’s stranglehold on the NFT marketplace: OpenSea began listing NFTs minted on the Solana blockchain.

Since OpenSea is one of the largest, most influential, and most popular NFT marketplaces, this opened up the market for Solana NFTs to a wider group of buyers and sellers, who previously relied on smaller, lesser-known marketplaces like Magic Eden to find new Solana NFTs.

Simply put, the decision by OpenSea to list Solana NFTs brought more attention to the Solana blockchain than ever before and also gave Solana an implicit seal of approval.

Near the end of May, Solana hit an important milestone: It finally passed Ethereum in terms of overall NFT sales volume during a single 24-hour period with the launch of the highly anticipated Trippin’ Ape Tribe NFT collection.

Ethereum still does nearly 10 times the daily NFT sales volume of Solana on an average day, but it’s possible to envision the wide-open potential of Solana if it continues to dedicate resources to its rapidly expanding NFT ecosystem. It just needs more Trippin’ Apes to compete with Ethereum’s Bored Apes.

What’s new under the sun for Solana?

Solana is hardly a one-trick pony. Solana developers are constantly coming up with new, innovative use cases for NFTs.

One great example is STEPN, a lifestyle game/app built on the Solana blockchain that popularized the whole “move-to-earn” craze. Basically, you earn crypto by going for walks or runs each day. In order to do this, however, you have to buy a “sneaker NFT” on the Solana blockchain.

This really expands the idea of what an NFT can be: You can get paid to get into shape, all by investing in a pair of digital running shoes. Mind blown. As long as Solana developers keep coming up with ideas like this, SOL is a very interesting long-term crypto play.

Add in the fact that Solana is committing serious money to new projects, and the case for investing in Solana becomes even stronger. For example, Solana announced in June that it was committing $100 million to invest in South Korean metaverse, gaming, NFT and DeFi projects.

Sunny skies ahead for Solana

Solana first launched to the public back in 2020. Within months, it was already being touted as a potential Ethereum-killer, not just by Crypto Twitter, but also by the likes of CNBC and Bloomberg.

Since Solana offered much faster processing speeds, as well as much lower transaction fees, than Ethereum, analysts predicted that users and developers would eventually abandon Ethereum and move over to Solana. If this migration happened fast enough, then Ethereum would largely become irrelevant as all the most exciting and innovative blockchain projects would be built on top of the Solana blockchain.

Solana has largely lived up to the hype surrounding it, with a few brief network outages in recent months the only real blemish on its record.

While Solana may not have yet displaced Ethereum as the top blockchain for NFTs, it has established a solid foundation for a promising future involving NFTs, gaming apps, and other decentralized applications running on its super-fast, super-inexpensive blockchain.

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

The post What crypto winter? It’s always sunny with Solana appeared first on The Motley Fool Australia.

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More reading

• Is Bitcoin still worth buying to diversify your ASX share portfolio?
• ‘No crazy bug’: Here’s the latest on the Ethereum merge
• How has the ASX-listed Betashares CRYP ETF been performing?
• ‘Wherever there’s smoke there’s probably crypto,’ warns Dogecoin founder
• Why are Bitcoin miners selling their holdings?

Fool contributor Dominic Basulto owns Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin, Ethereum, and Solana. The Motley Fool Australia owns and has recommended Bitcoin, Ethereum, and Solana. 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 AGL Energy Ltd (ASX: AGL) share price is falling today along with the broader ASX market.

At the time of writing, the Australian energy giant’s shares are down 1.48% to $8.63.

For context, the S&P/ASX 200 Index (ASX: XJO) is shedding 0.95% to 6,953.3 points following heavy losses on Wall Street overnight.

What did AGL announce?

Investors are reacting to the company’s latest update, sending the AGL share price in the red.

According to its release, AGL advised that it has completed a technical review of its Loy Yang A Unit 2.

During mid-April, the Loy Yang A Unit 2 went offline following an electrical fault with the generator.

The team ran a number of tests and found that the generator rotor had failed.

Since then, a number of engineers and suppliers have worked with AGL to initiate a plan on conducting repairs.

Previously, management had expected that the unit would return to service at the beginning of August.

However, the date has now been pushed back until the second half of September. The delayed repairs are due to “global supply chain issues and the availability of specialised materials.”

AGL stated it will provide an update in the new financial year regarding the financial impact following the extended outage.

Furthermore, it does not anticipate FY23 earnings guidance will be issued before the review of the company’s strategic direction. This is assumed to be completed sometime in September.

AGL share price snapshot

Despite falling today, the AGL share price has zipped 40% higher in 2022.

A boom in energy prices is being driven by the Russian war in Ukraine as well as inflationary movements.

Although, when looking at the past 12 months, the company’s shares are down 7%.

Based on today’s price, AGL presides a market capitalisation of approximately $5.96 billion.

The post Why is the AGL share price heading south on Friday? appeared first on The Motley Fool Australia.

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More reading

• Energy crisis: Which is the better buy, AGL vs Origin?
• In the dark: ASX energy shares facing a perfect storm
• AGL share price unscathed by scrapped demerger. What’s going on?
• Why the decision to keep AGL as one makes sense: expert
• AGL demerger news ‘huge day for Australia’: Mike Cannon-Brookes

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 Bubs Australia Ltd (ASX: BUB) share price is in the green on the final day of trade this week.

Building on what has already been a monumental month for Bubs, shares in the infant formula company are trading 3.36% higher to 62 cents. Although, the share price reached 64 cents moments after the morning bell. The gain means the Bubs share price is now up by more than 60% over the past month.

In comparison, the S&P/ASX 200 Index (ASX: XJO) is down 0.75%, taking it below 7,000 points once again.

What’s sending the Bubs share price higher?

As my colleague James covered late last month, a deal with the United States government for 1.25 million tins of baby formula gave the Bubs share price a considerable growth spurt.

Today brings another helping of positive news with the latest development regarding the US deal.

According to the release, the Aussie company has secured supply agreements with two major US retailers. This news has been received well by the market, with the Bubs share price rallying this morning.

In a major expansion for the brand, Bubs will be sold through Kroger Co and Albertsons Companies. As a result, the company’s products will have a presence in more than 4,000 stores across 35 states.

Commenting on the news, Bubs founder and CEO Kristy Carr said:

It is certainly a milestone achievement of which Bubs Family can all be proud. We have been working around the clock to ensure we get these critical supplies of infant formula to retail shelves in the USA. I thank all our team in Australia and the USA, our freight and logistics partners, and the U.S. and Australian Government officials, who have all collaborated to bring this much-needed relief to American families.

Additionally, it is expected that six lines of various formula products will hit shelves from 20 June 2022. For shareholders, this means the Bubs brand will take a prominent position in nearly all of Kroger’s retail banners — visited by around 11 million customers per day.

Furthermore, Albertsons Companies is recognised as one of the largest food and drug retailers in the US. Supplying Albertsons will give Bubs a spot on the shelves of around 2,200 stores. Albertsons’ brands include names such as Safeway, Vons, and Randall’s.

What else?

Importantly, Carr noted the demand from the US was not impacting its ability to fulfil other markets. This includes local Australian orders. This was a point stressed by the CEO upon the announcement of the US deal.

The Bubs share price is well outperforming the benchmark index so far this year, thanks to the US boost. Shares are now up 29% year-to-date, compared to the negative 8.4% netted by the broader market.

The post Bubs share price lifts as the brand readies for debut on 4,000 US shelves appeared first on The Motley Fool Australia.

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More reading

• These were the best performing ASX 200 shares last week
• Why Bubs, IGO, Strike Energy, and Woodside shares are pushing higher
• Bubs share price jumps on first US shipments
• Why Bubs, PolyNovo, Suncorp, and Zip shares are dropping
• Bubs share price tumbles 5% amid broker downgrade

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 recommended BUBS AUST FPO. 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.

The Dow Jones Industrial Average sunk close to 640 points after concerns over a looming recession grew louder today. In a recent survey conducted by CNBC among various chief financial officers, not one of the 22 respondents thinks a recession is avoidable in the near future. Roughly 68% of respondents thought a recession would occur in the first half of 2023, and every CFO responding expects a recession to hit by the end of 2023.

Additionally, unemployment claims climbed to their highest level last week since the very beginning of 2022. Filings for the week ending June 4 grew to 229,000, up from just over 200,000 the week prior and well above economist estimates.

Jobless claims are a good indicator of economic health and also a sign of whether or not the Federal Reserve will be able to engineer a soft landing, as it raises its key benchmark lending rate in order to reign in some of the highest levels of inflation seen in 40 years. The Fed’s goal is to bring down consumer prices without hurting the currently healthy job market. If unemployment heads higher as the Fed raises rates, the economy could find itself in trouble.

Boeing and Disney lead the fall

The two biggest losers in the Dow today on a percentage basis were the aviation and defense company Boeing (NYSE: BA), which saw its shares decline by more than 4.2% today. Walt Disney (NYSE: DIS) was not far behind, with shares sinking roughly 3.8% today.

There didn’t look to be a ton of news driving Boeing’s decline beyond broader market forces. But a report released today by the U.S. Government Accountability Office said the aerospace giant is having issues finding the right workers to finish two Air Force One jets, which are specifically for U.S. presidents.

Disney made waves today after the company announced the abrupt firing of one of its chief television content executives, Peter Rice, who had also supposedly been a candidate to succeed current CEO Bob Chapek one day. CNBC reported that Rice was told he wasn’t a good fit from a cultural perspective. 

I consider both events surrounding Boeing and Disney to be near-term headwinds in nature. Boeing has seen an increase in defense spending by foreign governments lately, due to Russia’s ongoing invasion of Ukraine, which should continue to play out this year. While internal employee issues are never good, I don’t view Disney’s firing as enough to derail the company or the success of Disney+, the House of Mouse’s wildly successful streaming network.

Will the economy tip into a recession?

I agree that there’s a strong likelihood the economy does tip into a recession in the near future, and recent data this week suggests the economy might indeed be on the brink of seeing U.S. gross domestic product go negative for two straight quarters.

However, not all recessions are severe, and not all last a long time. The U.S. consumer is still relatively healthy and spending at strong levels. While recent jobless claims aren’t exactly encouraging, the job market is by and large still healthy. While I don’t think anyone knows exactly how things will play out, there is no certainty yet in my mind that a severe recession will occur.

Friday morning, the U.S. Bureau of Labor Statistics will release data showing how the Consumer Price Index (CPI) trended in May. The CPI tracks the prices of a group of daily consumer goods and services and is one measure of inflation. Investors will be watching anxiously to see if inflation is peaking or still on the rise, which is likely to have a big impact on the market tomorrow. 

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

The post Why the Dow Jones got crushed today appeared first on The Motley Fool Australia.

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• Why Tesla stock enjoyed a rally today
• Is Bitcoin still worth buying to diversify your ASX share portfolio?
• Atlas Arteria share price falls on takeover update
• Is the BHP share price really trading on an 11% dividend yield right now?
• 2 ASX dividend shares I’d buy for the long term

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

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This month has been disastrous for most ASX lithium shares, and the Liontown Resources Limited (ASX: LTR) share price hasn’t escaped the hardship.

The stock has tumbled 19.7% since the end of May amid a broader lithium sell-off. At the time of writing, the Liontown share price is $1.14.

Let’s take a look at what’s been weighing on the lithium explorer and developer this month and what the future could bring.

What’s going on with the Liontown share price?

The ‘lithium boom’ hit a hurdle last week, plunging the share prices of lithium stocks like Liontown into the red.

The stock cratered 19% last Wednesday amid a barrage of seemingly bad news for the future of ‘white gold’.

That day, reports Goldman Sachs was bearish on lithium prices hit headlines amid news Argentina had introduced a reference price for the commodity and that electric vehicle giant BYD planned to source its own lithium.

Goldman Sachs reportedly expects lithium prices to slump to U$16,372 a tonne next year. And plenty of other brokers also predict they’ll slow down in the coming months and years.

Though, that might already be priced into the company’s stock.

Macquarie reportedly expects lithium to trade for US$48,000 a tonne in 2023. It also believes the Liontown share price has factored in a lithium price of just US$11,000 a tonne, reports Livewire.

The broker has a $2.50 price target and an ‘outperform’ rating on the company’s stock. That represents a 110% upside on Liontown’s current share price.

There’s also plenty of hope for the company’s future production. Tesla Inc (NASDAQ: TSLA) stepped in with a deal that will see it snapping up 150,000 dry metric tonnes of spodumene concentrate each year from the company’s Kathleen Valley Lithium Project earlier this week. Production at the project is expected to begin in 2024.

The post The Liontown share price has tumbled 20% so far in June. What’s next? appeared first on The Motley Fool Australia.

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• Why Macquarie still sees ‘material upside’ for ASX lithium shares
• Analysts have just named these 2 ASX lithium stocks as buys
• Here are the 3 most traded ASX 200 shares on Monday
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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Tesla. 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 Washington H Soul Pattinson & Co Ltd (ASX: SOL) share price has surged by more than 50% over the past five years.

Shares in the investment house travelled to all-time highs in 2019, before hitting multi-year lows during COVID-19.

Nonetheless, this didn’t stop Soul Patts shares from quickly recovering and rocketing to a record high of $40.80 in September 2021.

However, since then its shares have tumbled to $25.19 as of yesterday’s market close.

While the company’s shares are still up from 2017, it’s the dividends that have been the highlight.

The Australian share market is well known for paying among the highest dividends in the world.

Let’s take a look to see if Soul Patts’ dividends have provided significant value to shareholders over the past five years.

A recap on Soul Patts’ dividend history

Below, I’ve compiled a list of the Soul Patts dividends that have been paid out to shareholders since 2017.

• May 2017 — 22 cents (interim)

• December 2017 — 32 cents (final)

• May 2018 — 23 cents (interim)

• December 2018 — 33 cents (final)

• May 2019 — 24 cents (interim)

• December 2019 — 34 cents (final)

• May 2020 — 25 cents (interim)

• December 2020 — 35 cents (final)

• May 2021 — 26 cents (interim)

• December 2021 — 36 cents (final)

• May 2021 — 29 cents (interim)

When calculating the above, Soul Patts has paid a total of $3.19 in dividends to shareholders over the five years.

Added with the share price gains, parking your money in the company from 2017 would have been a worthy investment.

Currently, Soul Patts has a trailing dividend yield of 2.54%.

It’s also worth noting that the board has consistently paid and increased its dividends over this time, even during COVID-19.

About the Soul Patts share price

Despite accelerating over the long term, Soul Patts shares have lost around 20% in the past 12 months.

Year-to-date hasn’t fared well either, down 15% for the first six months due to strong volatility across global markets.

Based on valuation grounds, Soul Patts presides a market capitalisation of approximately $9.09 billion.

The post How much have Soul Patts shares paid in dividends over the last 5 years? appeared first on The Motley Fool Australia.

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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 Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended 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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We’ve all heard expert advice that in times of downward markets like now, we should hold onto our portfolios rather than locking in losses with mass sales.

But what about buying bargains? Is it wise to do that right now or are there more falls to come?

Is it safe to invest right now?

Marcus Today senior market analyst Henry Jennings gave his answer on this vexed topic.

Nothing is safe, but we take the chance

For Jennings, the answer is the same regardless of what the economic circumstances are.

“The answer is ‘no’. But it is never safe. Not truly. Nothing ever is. Life is not safe,” he said on a Marcus Today blog post.

“It is a question of risk versus reward.”

What he means is that investors will never gain meaningful returns unless they take on meaningful risk.

And ASX shares are inherently risky. They are, in that way, not safe.

But getting out of bed in the morning, driving your car and cooking a hot meal are all risky activities. But we do them because the potential reward exceeds the risk of harm.

Bargains for long-term investors

This is the same philosophy Jennings recommends investors take with investing in ASX shares.

“Finding stocks that have been unfairly treated, with valuations now back to attractive levels and believing in the business,” he said.

“Doing the research and putting in the effort. Taking the risk after evaluating the reward.”

The risk vs reward equation also dramatically changes in the punter’s favour when the investment horizon becomes long.

“If you are a long-term investor there could be some extraordinary bargains around,” he said.

“If you are a short-term trader looking for the bounce, fortune favours the brave (or the plain lucky). By the time we get confirmation that this is more than a bear market bounce, we will be in the next bull run. It is never safe at all.”

Jennings also tells those scared to buy in right now whether they feel the same about other goods that are discounted.

“When we see the ‘sale’ sign at David Jones, do we walk off and avoid the mall?” he asked.

“No. We take advantage of the sale. Even if it’s a bit out of season. We will need those board shorts come summer.”

So what’s an example of such a bargain at the moment?

The best buy at the moment

Gaming provider Aristocrat Leisure Limited (ASX: ALL) is Jennings’ pick.

Its share price has plunged more than 23% since the start of the year, with a failed acquisition bid for Playtech PLC (LON: PTEC) not helping.

“It has suffered as tech stocks have fallen. It has suffered from missing out on Playtech. It has suffered from costs involved in scaling up its online gaming offerings and supply chain issues.”

The Russian invasion of eastern Europe has also been a drag on the business.

“The digital games launch has been delayed with the Ukrainian war probably not the best time to launch ‘Magic Wars: Army of Chaos’,” said Jennnings.

“It’s not easy being a Pixel United (formerly Aristocrat Digital) employee in Ukraine either. Of the 1000 employees, 70% have had to be relocated.”

But Jennings feels like these headwinds are now behind it, and the stock is ready to rally in the long term.

“The gaming pipeline now looks strong,” he said.

“The US opportunity is still huge, and the company is at the forefront of gaming technology. The North American total addressable market could reach US$25 to US$30 billion by 2030.”

Aristocrat shares are trading at a price-to-earnings ratio of 19 on 2023 projections, said Jennings, with “a strong balance sheet”

“Worth pushing the button for a chance at a jackpot.”

The post Is it safe to buy ASX shares right now? appeared first on The Motley Fool Australia.

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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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