Key points

• Westpac is the first major bank to increase its interest rate in 2022
• Its fixed rate has been increased by up to 0.20% for owner-occupiers and investors
• Brokers think that the Westpac share price can benefit from rising rates

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The Westpac Banking Corp (ASX: WBC) share price is in focus after the big four bank decided to raise its interest rate again.

Westpac and its other major peers – Commonwealth Bank of Australia (ASX: CBA), Australia and New Zealand Banking Group Ltd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) – have been increasing interest rates.

But Westpac has decided to be first move and raise its interest rate first in 2022.

How much has Westpac increased the interest rate?

According to reporting by Ratecity.com.au, Westpac decided to increase its fixed interest rate by up to 0.20%. The increases were for owner-occupiers as well as investors. It apparently includes all of Westpac’s divisions including the Bank of St George, Bank of Melbourne and BankSA.

Different time periods of loan lengths saw different increases.

The one-year fixed rate saw an increase of 5 basis points from 2.34% to 2.39%, the two-year fixed rate saw an increase of 10 basis points from 2.49% to 2.59%, the three-year fixed rate rose by 15 basis points to 3.04%, the four-year fixed rate increased 15 basis points to 3.34% and the five-year fixed rate went up 20 basis points to 3.59%.

Why did the interest rate increase?

Ratecity explained that Westpac decided to increase the interest rate because of the rising cost of fixed rate funding and expectations that the Federal Reserve in the United States is going to increase interest rates “faster and more aggressively” than previously thought.

The financial site is expecting many more lenders to increase interest rates this year.

Ratecity’s Research director, Sally Tindall, said:

Westpac is the first big four bank to hike fixed rates in 2022 but certainly won’t be the last.

The cost of fixed-term funding is rising with inflation in the US hitting its fastest pace in nearly four decades.

We expect other banks to follow within days on the back of sharp increases to the cost of wholesale funding.     

Mortgage holders who were fortunate enough to lock in a record-low fixed rate over the last couple of years are immune to these hikes, but only for the duration of their fixed rate term.

Anyone who fixed at the start of the pandemic for two years should start thinking about what their next step might be. When they come off their fixed rate, they’ll be looking at a very different market.

What could this mean for the Westpac net interest margin (NIM)?

When Westpac released its FY21 result, it said that its margins were being challenged in a competitive, low-rate environment.

Margins were being pushed lower to attract and retain customers. It was also being impacted by the portfolio mix – with more people choosing the lower-costing fixed rate loans.

In terms of the outlook, given in November 2021, it said that loan growth was expected to be sound as the economy rebounds, although net interest margins would be under pressure from the low interest rates and competition.

However, with banks now quickly increasing rates, it will be interesting to see how that plays out with wholesale costs rising too.

Westpac share price rating

One of the latest brokers to have their say on Westpac was Morgan Stanley. It currently rates the bank as a hold/’equal-weight’ with a price target of $22.70. It thinks that higher interest rates could be a positive for Westpac.

The post Westpac (ASX:WBC) share price in focus after raising loan interest rates again appeared first on The Motley Fool Australia.

More reading

• Does the NAB (ASX:NAB) share price make it the best value bank right now?
• Westpac (ASX:WBC) share price wobbles, bank predicts 5 rate hikes in 2022-24
• How are ASX bank shares performing today?
• What to expect from Westpac (ASX:WBC) during earnings season
• Is the NAB (ASX:NAB) share price an undervalued smart buy for dividends?

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 recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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If you’d like to invest in a large number of shares but aren’t sure which ones to buy, you could look at the two exchange traded funds (ETFs) listed below instead.

These ETFs allow investors to buy and collection of shares through a single investment. Here’s what you need to know about them:

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

The first ETF to consider is the VanEck Vectors Video Gaming and eSports ETF. This ETF gives investors exposure to many of the largest companies involved in video game development, eSports, and gaming related hardware and software.

Among the companies you’ll be owning are game developers Activision Blizzard (which Microsoft is hoping to acquire), Take-Two, and Electronic Arts, as well as graphics processing unit (GPU) developer Nvidia. These companies appear well-placed for

growth thanks to the popularity of video games and eSports.

One of the companies in the fund is Take-Two. It is the game developer behind the Grand Theft Auto (GTA) and Red Dead franchises. These games, and GTA in particular, continue to generate significant revenues long after their releases thanks to micro transactions on their online versions.

As for Nvidia, it is the world’s leading GPU developer and sits at the forefront of modern technologies. Its GPU deep learning ignited modern artificial intelligence and is used by cryptocurrency miners.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

Another ETF to look at is the Vanguard MSCI Index International Shares ETF. This ETF provides investors with exposure to many of the world’s largest listed companies.

In fact, the ETF currently has a total of ~1500 shares in its portfolio. These include companies from all sectors and almost all geographies. This allows investors to participate in the long-term growth potential of the global economy.

Among its holdings are the likes of Amazon, Apple, Berkshire Hathaway, Facebook (Meta), Johnson & Johnson, Nestle, Shopify, Tesla, and Toyota.

Vanguard believes this ETF would be suitable for “buy and hold investors seeking long-term capital growth, some income, international diversification, and with a higher tolerance for the risks associated with share market volatility.”

In respect to income, the ETF currently provides investors with a dividend yield of 1.5%.

The post Why Vanguard MSCI Index International Shares and this ETF could give your portfolio a boost appeared first on The Motley Fool Australia.

More reading

• 2 ASX ETFs with strong growth potential
• The VanEck Video Gaming and Esports ETF (ASX:ESPO) looks set for a major shakeup. Here’s why
• 2 market-beating ETFs for ASX investors in January
• Here are 2 ASX tech ETFs to buy after recent weakness
• Is the Vanguard MSCI Index International Shares ETF (ASX:VGS) the most diversified ETF on the market?

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. owns and has recommended Vanguard MSCI Index International Shares ETF. The Motley Fool Australia has recommended VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports ETF and Vanguard MSCI Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• The REA Group share price has fallen 14% since 4 January 2022
• Property listings are booming, which is adding to REA Group’s revenue and earnings.
• Ord Minnett currently rates the business as a buy

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The REA Group Limited (ASX: REA) share price has fallen 14% in less than three weeks.

ASX share market volatility might be opening up some opportunities according to some analysts.

Whilst share prices do move around week to week, it has been both a painful week and painful month for plenty of the leading ASX growth shares.

Ord Minnett reckons that REA Group is one of the best businesses on the Australian Stock Exchange and it’s worth taking a look at the company after these recent declines.

REA Group share price target

Brokers regularly release notes and price targets on businesses. The note tells investors their latest thoughts on a business and the price target reflects where the broker thinks the share price could be trading in 12 months.

Broker Ord Minnett has a price target of $165 on the business.

How is the property market going?

REA Group’s profit is not directly correlated to how house prices are going.

There are two key inputs for the owner of realestate.com.au. First, what price is it able to charge for property owners to advertise on the website? Then, how many property listings are on the site?

Whilst REA Group does regularly increase the prices that it charges for advertising, the number of listings is significantly increasing.

In the first quarter of FY22, REA Group reported that revenue (excluding acquisitions) increased by 22% year on year. National listings increased 11% for the quarter, with Melbourne up 79%. Australian residential revenue increased for the quarter, benefiting from increased depth and ‘premiere’ penetration, listings growth, the contracted price rise from 1 July 2021 and continued growth in add-on products.

Quarterly free cashflow was up 29%, excluding acquisitions, to $49 million.

When telling investors about trading in October, it revealed that national residential listings were up 16% year on year.

In reporting regarding the number of homes expected to go under the hammer this weekend, the Australian Financial Review noted that 461 properties were scheduled for auction for the week ending 23 January 2022, an increase of 40% from a year ago as sellers look to capture remaining buyer demand and get ahead of competition.

The AFR quoted CoreLogic head of research Tim Lawless who said that volumes could remain high for the rest of the year:

If you’ve owned a property over the past couple of years you’ve seen a lot of equity created, so now is probably be a good time to cash out.

So, I wouldn’t be surprised if we do see an elevated number of auctions being held this year, which means clearance rates won’t hit those frothy highs in the early-to-mid-80 per cent or 70 per cent that we saw in the last quarter.

We might see demand diminishing further due to affordability and the prospect of interest rate hike this year and further tightening of credit policies.

REA Group share price valuation

After the recent declines, Ord Minnett puts the REA Group share price at 48x FY22’s estimated earnings and 40x FY23’s estimated earnings.

As a reminder, Ord Minnett has a price target of $165 with a buy rating on REA Group.

The post Is the REA Group (ASX:REA) share price a clear buy after dropping 14% in less than 3 weeks? appeared first on The Motley Fool Australia.

More reading

• Analysts name 2 excellent ASX 200 shares to buy
• Are these 2 top ASX growth shares buys?
• 2 outstanding ASX 200 blue chip shares to buy
• 3 five-star ASX shares to buy in 2022

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 recommended REA Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It certainly was a week to forget for the S&P/ASX 200 Index (ASX: XJO). A major selloff on Friday led to the benchmark index dropping 2.9% over the period to 7,175.8 points.

Fortunately, some shares were able to avoid the selloff and record gains last week. Here’s why these were the best performers on the ASX 200:

HUB24 Ltd (ASX: HUB)

The HUB24 share price was the best performer on the ASX 200 last week with a 7.9% gain. Investors were buying the investment platform provider’s shares following the release of its second quarter update. According to the release, HUB24 achieved record second quarter platform net inflows of $3.6 billion. This led to an increase in its total funds under administration (FUA) to $68.3 billion, which is up 118% compared to the prior corresponding period. HUB24’s strong quarter was driven by a combination of organic growth and flows from the Xplore acquisition.

Silver Lake Resources Limited (ASX: SLR)

The Silver Lake share price wasn’t far behind with a 6.6% gain over the five days. Investors were fighting to get hold of gold miners following a rise in the precious metal and demand for safe haven assets. Fellow gold miners Westgold Resources Ltd (ASX: WGX) and Gold Road Resources Ltd (ASX: GOR) recorded similar gains during the week.

JB Hi-Fi Limited (ASX: JBH)

The JB Hi-Fi share price was on form and charged 5.8% over the period. This follows the release of a better than expected trading update from the retail giant. JB Hi-Fi recorded modest sales growth during the second quarter, which led to sales falling just 1.6% during the first half despite cycling a very strong prior period. On the bottom line, its first half net profit of $287.9 million was down 9.4% year on year but 12.4% ahead of the consensus estimate.

Worley Ltd (ASX: WOR)

The Worley share price was the next best non-gold miner with a gain of 3.9%. This was despite there being no news out of engineering company. Though, a recent note out of UBS reveals that its analysts believe the company’s shares are great value. They have a buy rating and $13.20 price target on Worley’s shares.

The post These were the best performing ASX 200 shares last week appeared first on The Motley Fool Australia.

More reading

• These were the worst performing ASX 200 shares last week
• Does the NAB (ASX:NAB) share price make it the best value bank right now?
• 2 cheap ASX 200 shares rated as top buys
• These 3 ASX retail shares have grossed-up dividend yields over 8% right now
• ASX 200 (ASX:XJO) midday update: Whitehaven sinks, BHP to unify

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. owns and has recommended Hub24 Ltd. The Motley Fool Australia has recommended Hub24 Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Are you looking for dividend shares to add to your income portfolio when the market reopens next week? If you are, then the two listed below could be worth considering.

Both of these dividend shares have been rated as buys and tipped to provide income investors with attractive and growing yields in the coming years. Here’s what you need to know about them:

Adairs Ltd (ASX: ADH)

The first dividend share to look at is Adairs. It is a leading homewares and furniture retailer with a presence online and offline through three brands. These are the eponymous Adairs brand, its online-only brand Mocka, and the newly acquired Focus on Furniture brand.

Morgans is positive on its outlook and has an add rating and $4.80 price target. it is also forecasting fully franked dividends of 23 cents per share in FY 2022 and 29 cents per share in FY 2023. Based on the current Adairs share price of $3.81, this will mean yields of 6% and 7.6%, respectively.

National Australia Bank Ltd (ASX: NAB)

Another ASX dividend share to look at is NAB. This banking giant could be a top option for income investors that don’t already have meaningful exposure to the sector. This is due to its strong position in business banking and its acquisition of Citi’s Australian consumer business. The latter fills a gap in its offering which bodes well for its future growth.

Bell Potter is bullish on NAB and has a buy rating and $32.00 price target on its shares. It is also expecting attractive yields in the coming years, with fully franked dividends per share of 132.5 cents in FY 2022 and 134.5 cents in FY 2023. Based on the current NAB share price of $28.32, this will mean yields of 4.7% and 4.75%, respectively, over the next couple of years.

The post 2 ASX dividend shares with large and growing yields appeared first on The Motley Fool Australia.

More reading

• Does the NAB (ASX:NAB) share price make it the best value bank right now?
• These 3 ASX retail shares have grossed-up dividend yields over 8% right now
• 2 buy-rated ASX dividend shares with generous yields
• NAB (ASX:NAB) share price target raised at Morgan Stanley. So, is it a buy?
• 2 buy-rated ASX dividend shares with fully franked yields

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. owns and has recommended ADAIRS FPO. The Motley Fool Australia owns and has recommended ADAIRS FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• The NAB share price has performed strongly over the last year
• NAB is investing in technology and efficiencies to improve customer service and lower loan processing times
• Institutional investors like the quality that the bank is displaying

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The National Australia Bank Ltd (ASX: NAB) share price has gone up by 17% over the last year. This is sound outperformance of the S&P/ASX 200 Index (ASX: XJO) which has only risen 5.5% in the last year.

NAB has been going through a turnaround strategy with a fairly new leadership duo in place, both the CEO and chair.

What is helping the NAB share price deliver outperformance?

The bank is focused on improving both its business banking and home lending.

It’s investing in its small and medium business banking segment, as well as its business and private banking division, to grow by delivering differentiated and better banking experiences for customers and colleagues.

One of the things it’s doing in the business banking side is embedding performance disciplines. It’s also increasing its focus on simplifying, automating and digitising to provide faster, more seamless banking experiences. It is also leveraging data and analytics to provide insights, more personalised experiences and faster decisioning.

In FY21, small and medium business lending increased by 7%. Its market share in both SME and agricultural lending improved over the year.

In home lending it’s a similar story where it is increasingly simplifying and digitising the experience. During FY21, it simplified and streamlined its home lending policies, rollout digital application and decisioning tools and improved the ability for customers to self-serve through the NAB app.

These initiatives are delivering quicker, better outcomes for customers and colleagues despite there being a significant increase of application volumes. Unconditional approval times are approximately 30% faster.

In FY21, NAB delivered $6.56 billion of cash earnings, an increase of 76.8%. This was up 38.6% compared to FY20 excluding the FY20 large notable items.

After such a big profit increase, is the NAB share price now the best value bank?

Bank valuations

To keep the comparable bank valuations simple, these are the following estimates for FY23 on Commsec.

The Commonwealth Bank of Australia (ASX: CBA) share price is valued at 18x FY23’s estimated earnings.

The Westpac Banking Corp (ASX: WBC) share price is priced at 11x FY23’s estimated earnings.

NAB shares are valued at 13x FY23’s estimated earnings.

The Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price is valued at 12x FY23’s estimated earnings.

So, whilst NAB may have a fairly low price/earnings ratio for FY23, it is not quite as low as Westpac and ANZ.

However, some investors are fans of the work that NAB is doing.

Is the NAB share price the best value bank?

Being the cheapest may not necessarily mean the best value.

Ord Minnett rates NAB as its favourite in the banking sector and rates it as a buy with a price target of $31.50. That’s more than 10% higher than where it is now.

The managers of WAM Leaders Ltd (ASX: WLE) also prefer NAB as the choice for big bank exposure due to its capital management team, a sector-leading business bank taking market share, further progressed cost management initiatives than peers, and its strong capital position.

The post Does the NAB (ASX:NAB) share price make it the best value bank right now? appeared first on The Motley Fool Australia.

More reading

• These were the worst performing ASX 200 shares last week
• 2 cheap ASX 200 shares rated as top buys
• ASX 200 (ASX:XJO) midday update: Whitehaven sinks, BHP to unify
• 2 buy-rated ASX dividend shares with generous yields
• 5 things to watch on the ASX 200 on Friday

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 recommended Westpac Banking Corporation. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) was out of form last week and recorded its largest weekly decline in over a year. The benchmark index fell 2.9% over the period to end it at 7,175.8 points.

While the majority of shares on the ASX 200 fell over the period, some fell more than most. Here’s why these were the worst performers on the index last week:

Megaport Ltd (ASX: MP1)

The Megaport share price was the worst performer on the ASX 200 last week with an 18.7% decline. Investors were selling the elastic interconnection services provider’s shares following the release of its second quarter update. According to the release, Megaport posted a quarter on quarter monthly recurring revenue (MRR) increase of $0.6 million to $9.2 million. This led to an 8% increase in second quarter revenue to $26.6 million. While its revenue was in line expectations, a number of brokers lowered their price targets due to expectations of a higher investment spend.

PolyNovo Ltd (ASX: PNV)

The PolyNovo share price was some way behind as the next worst performer with a decline of 11.4%. This means that the medical device company’s shares gave back all of the previous week’s gain and a little bit more. Short sellers will have been pleased. PolyNovo remains one of the most shorted shares on the ASX.

Kogan.com Ltd (ASX: KGN)

The Kogan share price was out of form and dropped 10.8% over the five days. Investors were selling the ecommerce company’s shares following a couple of poor updates from industry peers. One of those was from the Wesfarmers Ltd (ASX: WES) owned Catch business. It reported first half gross sales growth of just 1% and a sizeable loss. These businesses have previously delivered very similar results, so this may not bode well for Kogan’s performance.

BlueScope Steel Limited (ASX: BSL)

The BlueScope share price wasn’t far behind with a 10.4% decline over the period. This was despite there being no news out of the steel producer. However, last week S&P Global warned that slowing demand for steel in Brazil would limit pricing in 2022.

The post These were the worst performing ASX 200 shares last week appeared first on The Motley Fool Australia.

More reading

• 2 cheap ASX 200 shares rated as top buys
• Why Anteotech, Appen, Boral, and Kogan shares are rising today
• ASX 200 (ASX:XJO) midday update: Whitehaven sinks, BHP to unify
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX shares 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. owns and has recommended Kogan.com ltd, MEGAPORT FPO, and POLYNOVO FPO. The Motley Fool Australia owns and has recommended Kogan.com ltd. The Motley Fool Australia has recommended MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Key points

• The gold price has been on the rise lately
• Many investors are looking to gold to diversify their portfolios
• Here are 3 ways you can get exposure to the yellow metal

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Once again, gold has been a hot topic for ASX investors. The precious metal has seen renewed interest over the past few weeks as inflation concerns and geopolitical tensions have pushed up its price. Just over a month ago, gold was at a multi-month low, under US$1,780 an ounce. But the past week has seen the yellow metal spike in value. Today, it’s sitting at US$1,843 an ounce (a 2-month high), having risen from roughly US$1,816 over just the past few days.

Usually when gold goes up in price, it reflects economic or geopolitical concerns in the broader global economy. And indeed, we have recently seen tensions between the United States and Russia over the situation in Ukraine escalate dramatically. We have also seen some very elevated inflation metrics coming out of the US economy in particular.

So with all of these factors swirling around, it’s not hard to see why investors are again taking a second look at gold. But how does one invest in gold here in Australia? Here are 3 ways you can do it

3 ways ASX investors can invest in gold

Buy physical bullion

The most direct route to owning gold is by buying the physical metal itself. There are many bullion dealers across the country one can visit or contact to buy the precious metal from directly. Many investors prefer this method as it is the only way to completely own gold as an asset. There are some drawbacks though, such as the risk of theft, insurance and cost of storage.

Use an ASX ETF

Investors can also use the exchange-traded fund (ETF) structure to invest in gold indirectly. There are a few ETFs on the ASX that represent ownership of gold bullion. Perth Mint Gold (ASX: PMGOLD) is one. The ETFS Physical Gold ETF (ASX: GOLD) is another. Some investors like investing in gold this way as you don’t have to worry about storage or theft.

Additionally, buying and selling units of an ETF is arguably a lot easier than buying or selling physical bullion. But for investors who like to hold their gold, as it were, an ETF might just not cut it. There are also fees to consider. For instance, Perth Mint Gold charges an annual fee of 0.15% per annum. EFs Physical Gold ETF charges 0.4% per annum.

Buy a gold miner

Buying gold miners is another way to indirectly invest in gold. The ASX is home to more than a few too, the largest of which being Newcrest Mining Ltd (ASX: NCM) and Northern Star Resources Ltd (ASX: NST).

A gold miner may be a company, but most ASX 200 gold miners own mines that contain gold, and by extension, the gold itself. A miner also can pay a dividend, which is one of the few ways to extract a yield from owning gold. Investing in gold this way can also be viewed as a ‘leveraged’ bet. Miners’ costs are relatively stable, so any increase in the price of gold can result in an exponential increase in profitability (although this can cut both ways too).

But this is perhaps the riskiest way to invest in gold. Miners can go broke, or can destroy capital if the gold price sinks to a level that the mine can’t operate profitably at. There’s also longevity to consider. Mines run out eventually, and the company will need to find a new source of gold to remain viable.

Foolish takeaway

Investing in gold is not as straightforward as you might think. Investors who want to walk down the yellow brick road, as it were, need to weigh up the pros and cons of these different methods of investing in gold and see what works for them.

The post Want to buy gold? Here are 3 ways ASX investors can own the precious metal appeared first on The Motley Fool Australia.

More reading

• Analysts name 2 excellent ASX 200 shares to buy
• Fortescue (ASX:FMG) share price on watch amid Sinosteel Oakajee agreement
• CogState (ASX:CGS) share price crashes 20% on quarterly update
• What’s happening to the Wesfarmers share price (ASX:WES) this year?
• Own AGL (ASX:AGL) shares? JP Morgan is overweight, tips 23% upside in 2022

Motley Fool contributor Sebastian Bowen owns Newcrest Mining Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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While recent volatility has been disappointing, it may have created attractive entry points for some ASX 200 shares.

Two such shares are listed below. Here’s why analysts see a lot of value in them at current levels:

CSL Limited (ASX: CSL)

The first ASX 200 share to look at is CSL. It is one of the world’s leading biotherapeutics and vaccine companies.

CSL has a world class portfolio of products that are used around the world to treat immunodeficiencies, bleeding disorders, hereditary angioedema, Alpha 1 antitrypsin deficiency, and neurological disorders.

But management isn’t resting on its laurels. It is investing ~US$1 billion a year (and growing) into research and development and is in the process of making a major acquisition. The latter will add treatments for iron deficiency, nephrology and cardio-renal through the acquisition of Vifor Pharma for $17 billion.

The team at Citi is positive on its growth outlook over the coming years. For example, this year the broker is forecasting a net profit of US$3,158 million. It expects this to then grow to US$4,689 million by FY 2024.

Citi currently has a buy rating and $340.00 price target on the company’s shares. This compares to the latest CSL share price of $264.52.

REA Group Limited (ASX: REA)

Another ASX 200 share to look at is REA Group. It is best known as the digital advertising company that operates Australia’s leading property website, realestate.com.au.

But there’s more to REA than just the realestate.com.au website. It also owns and operates a number of complementary businesses in the Australian market and internationally. These include property listing websites and mortgage broking.

All in all, together with new revenue streams, its good cost control, and a strong housing market, REA appears well-placed for growth over the coming years.

Goldman Sachs is confident in its growth outlook. It is forecasting a net profit of $388 million in FY 2022, $445 million in FY 2023, and then ultimately $510 million in FY 2024.

In light of this, the broker has put a buy rating and $193.00 price target on REA’s shares. This compares to the current REA share price of $146.83.

The post Analysts name 2 excellent ASX 200 shares to buy appeared first on The Motley Fool Australia.

More reading

• Has the CSL (ASX:CSL) share price dropped back into the buy zone?
• 2 killer ASX shares to buy for a volatile 2022
• How is the CSL (ASX: CSL) share price performing in the age of Omicron?
• Leading fund manager says these blue-chip ASX shares are buys right now
• 2 outstanding ASX 200 shares to buy this month according to analysts

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. owns and has recommended CSL Ltd. The Motley Fool Australia has recommended REA Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Fortescue Metals Group Limited (ASX: FMG) share price will be one to watch on Monday.

This follows the release of an announcement after the market close on Friday.

Why is the Fortescue share price on watch?

Investors may want to keep an eye on the Fortescue share price on Monday after it announced an agreement with China’s state-owned Sinosteel.

According to the release, the two parties have signed a binding Memorandum of Understanding (MoU) to complete a rapid project assessment of Sinosteel’s Midwest Magnetite Project in Western Australia. The assessment will include a rail and port development at Oakajee.

Following the conclusion of the 12 month rapid project assessment and subject to the outcome of that process, Fortescue will have the option to acquire up to 50% of the Midwest Magnetite Project and up to 100% of the proposed port and rail infrastructure project.

Fortescue’s Chief Executive Officer, Elizabeth Gaines, said: “For over three decades, Sinosteel has demonstrated their strong performance and ability to deliver mining projects in Australia including their Channar Mine in the Pilbara. The signing of this MoU demonstrates Fortescue’s commitment to our strategic pillars of investing in the long-term sustainability of our iron ore business, expanding into new regions and continuing to deliver strong returns to our stakeholders.”

Ms Gaines also sees opportunities for its highly divisive Fortescue Future Industries business to leverage the operation.

She said: “We look forward to working with Sinosteel on the next steps for this important project for Western Australia which, in addition to the magnetite and infrastructure development, offers the opportunity for a co-ordinated project combining Fortescue’s iron ore and infrastructure pedigree with Fortescue Future Industries’ green energy objectives.”

“Future development including a renewable, green hydrogen hub in the Midwest region at Oakajee would deliver a large-scale resources and renewables project for Western Australia, further underpinning our enduring relationship with China,” Ms Gaines added.

The post Fortescue (ASX:FMG) share price on watch amid Sinosteel Oakajee agreement appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 Bruce Jackson.

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