Key Points

• The Woodside share price closed 0.16% down to $25.20 on Tuesday
• The company has announced the sell-down of its 49% stake in Pluto Train 2
• The LNG asset is on track for its first cargo in 2026

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The Woodside Petroleum Ltd (ASX: WPL) share price will be one to keep an eye on this Wednesday morning. This comes after the company advised it completed the sale of its onshore LNG processing facility located in Western Australia.

At yesterday’s closing bell, the oil and gas company’s shares finished the day down 0.16% to $25.20.

Woodside completes sell-down of Pluto Train 2 interest

Investors will be keen to watch how the Woodside share price reacts today following the company’s announcement last night.

In a statement to the ASX, Woodside advised it has finalised the sale of Pluto Train 2 Joint Venture to Global Infrastructure Partners (GIP). This will see a 49% non-operating participating interest transferred to GIP. The remaining 51% stake will be controlled by the energy giant’s subsidiary Woodside Burrup Train 2 A Pty Ltd.

The deal was originally announced on 15 November 2021 after both parties signed a sale and purchase agreement.

A week later, the final investment decision was approved for the Pluto Train 2 Joint Venture Scarborough developments. The landmark achievement also included new domestic gas facilities and modifications to Pluto Train 1.

The estimated capital expenditure for the development of Pluto Train 2 is estimated to be around US$5.6 billion (A$7.8 million).

Following the new joint venture arrangement, GIP will now need to fork out US$822 million (A$1.14 billion) in capital expenditure.

The first LNG cargo from Pluto Train 2 is being targeted to go online sometime in 2026.

Woodside CEO Meg O’Neill touched on the close collaboration with its co-party, saying:

GIP brings established, global capabilities to the Pluto Train 2 Joint Venture which will support delivery of a world-class project.

The development of Scarborough gas through Pluto Train 2 is expected to deliver significant value to our shareholders, create thousands of jobs and deliver energy to domestic and international customers for decades to come.

About the Woodside share price

Over the past 12 months, the Woodside share price has fallen by 6%. However, year to date, its shares have risen by 15% following a surge in oil prices.

Based on today’s price, Woodside commands a market capitalisation of roughly $24.43 billion with approximately 970 million shares on its registry.

The post Woodside (ASX:WPL) share price on watch following sell-down of onshore LNG asset appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Woodside (ASX:WPL) share price struggles amid hydrogen project update
• 5 things to watch on the ASX 200 on Tuesday
• Is this driving Santos (ASX:STO) and Woodside (ASX:WPL) shares higher on Monday?
• ASX 200 (ASX:XJO) midday update: Wesfarmers’ update, energy shares rise

Motley Fool contributor Aaron Teboneras owns Woodside Petroleum Ltd. 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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Key Points

• The Webjet share price is moved sideways this year
• The company’s management is taking advantage of present opportunities
• Brokers weigh in on Webjet shares

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The Webjet Ltd (ASX: WEB) share price has failed to take off in 2022 following a broader market sell-off on the S&P/ASX 200 Index (ASX: XJO).

It’s no secret that record cases of COVID-19 have caused severe disruptions in Australia’s travel market.

At Tuesday’s market close, the online travel agent’s shares ended 1.11% lower to $5.37 apiece.

What’s the latest with Webjet?

While COVID-19 continues to rapidly accelerate across the country, Webjet has been taking advantage of its opportunities.

It noted in its FY22 first-half results that competition has decreased due to financial pressures impacting the travel industry.

As such, the company highlighted that its WebBeds business is poised to deliver significant revenue growth.

Management has focused on expanding the domestic offering in all regions, with increased penetration into the North American B2B market.

Webjet also boosted and optimised its application programming interface (API) connections for key business to consumer (B2C) clients. It stated that the financial strength of the company makes it a trusted partner for hotel suppliers.

A retained global footprint, hotel supply relationships, and global customer network is set for the global travel market to reopen.

The above has led its WebBeds business to return to profitability. Total Transaction Value (TTV) in H1 FY22 stood at $436 million, a 504% increase when compared against the prior corresponding period.

In addition, WebBeds costs came down to $43 million, a decline of 25% on H1 FY21 levels. This means the company’s transformation into a much leaner and agile business is on track for FY22.

Will Webjet shares make a comeback in 2022?

It’s anyone’s guess when the Webjet share price will return to pre-COVID levels. However, a number of brokers recently weighed in with their thoughts on the company’s shares.

In November, analysts at Morgan Stanley raised the 12-month price target for Webjet shares by 16% to $5.00 a share.

On the other hand, Credit Suisse slashed its outlook on the online travel agent’s shares by 5.3% to $5.40.

Leading Australian investment firm, Morgans had a more bullish outlook. The broker lifted its view on Webjet shares by 6.5% to $6.60.

Also following suit, the team at Macquarie cut its 12-month price target on Webjet shares by 8.3% to $6.10 apiece.

While each of the brokers has varying price points, it’s worth noting that Morgans and Macquarie offer an attractive upside. Based on the current share price, this implies increases of around 22.9% and 13.5%, respectively.

Looking ahead, Webjet is scheduled to report its FY22 results in May 2022.

Webjet share price summary

Year to date, the Webjet share price has risen by 4% despite Australia experiencing record COVID-19 cases in the background.

Based on valuation grounds, Webjet has a market capitalisation of around $2.04 billion, with approximately 380.51 million shares on issue.

The post Will the Webjet (ASX:WEB) share price travel higher in 2022? appeared first on The Motley Fool Australia.

More reading

• Why are ASX 200 travel shares down today?
• These are the 10 most shorted ASX shares
• How did the Webjet (ASX:WEB) share price perform in 2021?
• When did Webjet (ASX:WEB) last pay a dividend and when might the next one be?
• These are the 10 most shorted ASX shares

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 recommended Webjet 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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Key points

• JB Hi-Fi and Pacific Current are two ASX dividend shares expected to pay big yields in FY22
• JB Hi-Fi continues to see strong customer demand for its products, supporting profit
• Investment manager Pacific Current is seeing net inflows. It’s also adding to its portfolio

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There are some ASX dividend shares in Australia that offer both a high yield and have been consistent with their payouts.

Plenty of the ASX’s blue chips have cut their dividends in recent years like Australia and New Zealand Banking Group Ltd (ASX: ANZ), Sydney Airport (ASX: SYD) and Transurban Group (ASX: TCL).

Dividends are certainly not guaranteed. But the below two options have been growing the dividend and could pay a high yield in FY22:

JB Hi-Fi Limited (ASX: JBH)

JB Hi-Fi is one of the biggest retailers in Australia (and New Zealand) with its JB Hi-Fi and The Good Guys businesses.

The retailer is currently rated as a buy by the broker Morgans, with a price target of $54.

JB Hi-Fi recently gave its second quarter sales update which showed that JB Hi-Fi Australia sales were up 1.9% year on year, New Zealand sales were down 3.4% and The Good Guys sales went up 3.4%.

The ASX dividend share noted that sales momentum was strong throughout the first half of FY22, with continued heightened customer demand for both consumer electronics and home appliance products. Total half-year sales were down 1.6% year on year, but up 21.7% over a two-year period.

JB Hi-Fi noted that net profit is expected to be a bit lower in HY22, with net profit after tax showing a 9.4% drop to $287.9 million. However, net profit was still 68.8% higher over a two-year period thanks to management of gross profit margins and “disciplined cost control”.

Morgans is expecting JB Hi-Fi to pay a FY22 annual dividend per share of $2.17. This translates to a grossed-up dividend yield of 6.2%.

Pacific Current Group Ltd (ASX: PAC)

Pacific describes itself as a multi-boutique asset management outfit that applies its strategic resources, including capital, institutional distribution capabilities and operational expertise to help its investment partners excel.

At the end of September 2021, Pacific’s total funds under management (FUM) controlled by the boutique asset managers it’s invested in was $150.1 billion, an increase of 5.5%. Strong inflows at Victory Park, Roc, EAM and GQG Partners Inc (ASX: GQG) helped FUM grow.

Management were pleased with the breadth of that growth and expect it to continue “well into 2022”.

The ASX dividend share continues to expand its portfolio. A couple of weeks ago it bought a 35% stake of Banner Oak Capital Partners, a private equity real estate business which had $5.7 billion of assets on its platform. The initial investment is US$35 million. Pacific will receive 35% of the management company’s earnings.

The Oak Capital Partners contribution is expected to add approximately 25% of Pacific Current’s FY21 underlying net profit before tax.

It’s currently rated as a buy by the broker Ord Minnett, with a price target of $10.30 – that’s 40% higher than where it is right now.

Ord Minnett thinks Pacific is going to pay a grossed-up dividend yield of 7.4% in FY22 and 8.3% in FY23.

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

More reading

• Here are the top 10 ASX shares today
• Why Allkem, BrainChip, Data#3, and JB Hi-Fi shares are charging higher
• ASX 200 (ASX:XJO) midday update: Rio Tinto’s Q4 update, JB Hi-Fi rockets, Kogan sinks
• JB Hi-Fi (ASX:JBH) share price shoots 7% higher on ‘strong sales’
• Why Adbri, Australian Ethical, JB Hi-Fi, and Wesfarmers shares are racing higher

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

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Key points

• The NAB share price has outperformed in recent months
• NAB is expected to keep growing its dividend in FY22 and FY23
• Analysts don’t think the big four bank is going to deliver much capital growth this year

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Could the National Australia Bank Ltd (ASX: NAB) share price be an undervalued opportunity for dividends in 2022?

Looking at the last six months of performance, NAB shares have materially outperformed the other big four banks.

In the past half-year, the Westpac Banking Corp (ASX: WBC) share price has fallen 13%, the Commonwealth Bank of Australia (ASX: CBA) share price has risen 3% and the Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price has gone up 6%.

But the NAB share price has been the star performer, rising almost 15% over the last six months.

What’s driving the NAB share price higher?

Investors have been judging the NAB business as one that is now higher quality and more promising than (some of) its peers in the banking sector.

Wilson Asset Management (WAM) noted a few months ago that NAB delivered a “strong” FY21 result. Cash earnings rose by 77% to $6.56 billion.

For the WAM Leaders Ltd (ASX: WLE) portfolio, NAB was/is the preferred exposure in the banking sector 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.

NAB is liked by some brokers as well, including Macquarie, partly because it has less exposure to mortgages than other banks.

However, the tight mortgage market is putting pressure on profitability for the sector. Whilst NAB may have less exposure, it does still have a very large mortgage book. But in the last several weeks, NAB and other banks have been raising interest rates.

How is the dividend tracking?

NAB more than doubled its FY21 annual dividend to $1.27 per share thanks to its significant profit growth, a high level of capital on the balance sheet and the regulator removing the main COVID-era dividend limitations.

There are expectations of dividend growth in FY22 and beyond. For example, Macquarie thinks that NAB will pay annual dividends of $1.35 and $1.37 per share in FY22 and FY23, translating to grossed-up dividend yields of 6.6% and 6.7% respectively.

Commsec numbers suggest even bigger potential dividends from NAB – $1.39 per share in FY22 and $1.49 in FY23. Those annual payouts would be 6.75% and 7.2% respectively.

Is the NAB share price a buy?

Macquarie rates NAB shares as a buy. However, the price target is $30.50, suggesting a fairly low single digit capital return over the next year.

Some brokers are a bit less optimistic. For example, Morgan Stanley only rates NAB as a hold (‘equal weight’) on the bank with a price target of $27.90. That’s around 5% lower than where NAB shares are now.

One of the most optimistic views on NAB is from the broker Ord Minnett, with a price target of $31.40. That’s a potential upside of around 7% for the major bank.

So, whilst analysts are expecting dividend growth and pretty high yields from the bank, the general view seems to be that the NAB share price isn’t going to do much in 2022.

The post Is the NAB (ASX:NAB) share price an undervalued smart buy for dividends? appeared first on The Motley Fool Australia.

More reading

• Is the NAB (ASX:NAB) share price an ASX buy or sell for 2022?
• Brokers name 2 ASX 200 dividend shares to buy
• 2 buy-rated ASX dividend shares
• Analysts name 3 ASX 200 shares that could generate strong returns
• An ASX XI to take on the world

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 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 Bruce Jackson.

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Key points

• WAM has revealed two ASX shares that are liked in the WAM Active portfolio
• TPG Telecom is one buy-rated stock, with merger synergies and a potential asset sale as positives
• Mincor Resources is a nickel player which is making promising progress in WA

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Respected fund manager Wilson Asset Management (WAM) has recently identified two ASX shares that it owns in one of its portfolio.

WAM operates several listed investment companies (LICs). Two of those LICs are WAM Capital Limited (ASX: WAM) and WAM Leaders Ltd (ASX: WLE).

There’s also one called WAM Active Limited (ASX: WAA) which looks at businesses it thinks are the most undervalued.

WAM says WAM Active invests in market mispricing opportunities in the Australian market.

The WAM Active portfolio has delivered gross returns (that’s before fees, expenses and taxes) of 11.8% per annum since inception in January 2008, which is superior to the Bloomberg AusBond Bank Bill Index return per annum of 2.9%.

These are the two ASX shares that WAM outlined in its most recent monthly update:

TPG Telecom Ltd (ASX: TPG)

TPG is a business that owns and operates mobile and fixed networks. It is the owner of a few of Australia’s most well-known brands including Vodafone, TPG and iiNet.

The fund manager pointed out that in early December, founder David Teoh entered into an agreement to sell around 53.1 million TPG Telecom shares, which led to a sell-off of the TPG share price.

WAM also noted that the spread of the Omicron COVID variant also weighed on the company during the month as it reduced the number of international visitors, leading to a reduction in its consumer subscriber numbers.

WAM Active remains invested in TPG and the fund manager remains optimistic on the company’s fixed wireless rollout strategy which should help increase profit margins.

The fund manager thinks the base business of the ASX share is undervalued considering its growth profile over the next few years, it likes the risk-reward profile. WAM is particularly attracted by the potential sale of the mobile tower business which could take place over the coming months.

Mincor Resources NL (ASX: MCR)

The other ASX share outlined was Mincor Resources. This business is focused on re-establishing sustainable, high-grade nickel production in the Kambalda district of Western Australia.

WAM points out that in December, the business provided an exploration update which said that nickel had been extracted from two development headings at Kambalda. The fund manager said this was a key achievement in the company’s nickel restart plans and supported the investment thesis.

The bull case for the company by WAM is that there is potentially significant undiscovered nickel sulphide at the company’s Kambalda site.

WAM invested in Mincor Resources because of its high-quality management team, the projects which are key to the BHP Group Ltd (ASX: BHP) nickel strategy and the potential for nickel sulphide discoveries.

WAM Active continues to own Mincor Resources shares because the fund manager believes it will continue to grow its resources as it nears production in 2022.

The post 2 top ASX shares to buy according to WAM appeared first on The Motley Fool Australia.

More reading

• Brokers name 3 ASX shares to buy today
• This top broker just rated the TPG (ASX:TPG) share price as a buy
• 2 beaten-up blue chip ASX shares rated as buys

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 TPG Telecom 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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Technology shares have taken a beating the past couple of months.

In Australia, the S&P/ASX All Technology Index (ASX: XTX) has lost more than 14% since mid-November. 

Across the Pacific, it’s even worse.

“Right now about 40% of US tech stocks on the NASDAQ are down 50% since their peak,” said commentator Peter Switzer on his Switzer TV Investing show.

“That makes me think that many good companies are oversold.”

Switzer’s team recently compiled the share price outlook of ASX tech shares from multiple analysts and came up with a few that could be absolute bargains right now.

Here are 2 that have more than 80% upside:

Wearing the big boy pants from this week

Buy now, pay later provider Zip Co Ltd (ASX: Z1P) has seen its shares tumble an eye-watering 74% off its 52-week high.

The stock closed Tuesday at $3.66, with the $14.53 high in February a distant memory.

But analysts are convinced this one’s wildly oversold. On average, the experts think Zip shares have an 82.6% upside.

One broker, Ord Minnett, reckons it can rocket up 157% from the current level.

This week Zip became the largest pure BNPL company on the ASX, as Afterpay Ltd (ASX: APT) departed the bourse.

“I think sometime this year these stocks will benefit from a rotation back into the tech and payment sector,” said Switzer.

“But you’ll have to have patience.”

Elmo sad now, but happy later?

The other stock to look out for is ELMO Software Ltd (ASX: ELO).

The share price for the human resources software maker has fallen more than 40% off its 53-week high, prompting analysts to think this might be a bargain at current levels.

On average, the professionals are betting on an 80.6% upside for the stock.

Morgan Stanley made the biggest call, looking for an 83% spike in Elmo shares this year.

“Good things come to those who wait,” said Switzer.

Elmo shares closed Tuesday at $4.26.

The post 2 ASX shares that now have 80% upside: analysts appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• How did ASX 200 tech shares perform on the market today?
• Own AMP (ASX:AMP) shares? Here’s why this expert downgraded some of its funds
• Zip (ASX:Z1P) will become the largest pureplay BNPL on the ASX this week. What might this mean for shareholders?
• These are the 10 most shorted ASX shares

Motley Fool contributor Tony Yoo owns Elmo Software. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Afterpay Limited, Elmo Software, and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Afterpay Limited and Elmo Software. 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’re looking for dividends shares with big yields, then you may want to look at the ones listed below.

Here’s why analysts rate these high yield dividend shares as buys:

Accent Group Ltd (ASX: AX1)

The first ASX dividend share to look at is this footwear focused retailer. It is responsible for a collection of popular brands including HYPE DC and The Athlete’s Foot. Accent could be a top option for income investors following a recent pullback in its share price caused by concerns over its performance in FY 2022 due to lockdowns and other COVID headwinds.

And while its underperformance is expected to impact its profits and therefore its dividends this year, analysts at Bell Potter expect a big rebound in FY 2023. The broker currently has estimates for dividends per share of 9.1 cents this year and then 13.5 cents next year. Based on the current Accent share price of $2.26, this will mean yields of 4% and 6%, respectively. Bell Potter also sees decent upside for its shares with its price target of $3.05.

BHP Group Ltd (ASX: BHP)

Another ASX dividend share to look at is BHP. It is one of the world’s largest mining companies with a collection of world class operations across a number of regions and commodities. The latter includes Petroleum, Potash, Copper, Iron ore, Coal and Nickel. And while the company is in the process of spinning out its petroleum assets via a merger with Woodside Petroleum Limited (ASX: WPL), shareholders will be given a slice of the new company.

The team at Macquarie is very positive on BHP. It has an outperform rating and $52.00 price target on the company’s shares. As for dividends, the broker is expecting fully franked dividends of ~$3.86 in FY 2022 and ~$2.86 in FY 2023. Based on the current BHP share price of $46.70, this will mean yields of 8.2% and 6.1%, respectively.

The post 2 high yield ASX dividend shares named as buys appeared first on The Motley Fool Australia.

More reading

• These ASX shares could be buys for value investors
• Own BHP (ASX:BHP) shares? Here’s why the iron ore giant is pushing for battery-powered trains
• Leading fund manager says these blue-chip ASX shares are buys right now
• 2 buy-rated ASX dividend shares
• These are the 10 most shorted ASX shares

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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On Tuesday, the S&P/ASX 200 Index (ASX: XJO) gave back its intraday gains to end the day in the red. The benchmark index fell 0.1% to 7,408.8 points.

Will the market be able to bounce back from this on Wednesday? Here are five things to watch:

ASX 200 expected to sink

The Australian share market looks set to sink notably lower on Wednesday after Wall Street returned from the Martin Luther King Jr holiday in terrible form. According to the latest SPI futures, the ASX 200 is expected to open the day 74 points or 1% lower this morning. In late trade in the United States, the Dow Jones is down 1.4%, the S&P 500 is down 1.65%, and the Nasdaq is trading 2.2% lower. The latter does not bode well for tech shares on Wednesday.

Rio Tinto rated as a buy

The Rio Tinto Limited (ASX: RIO) share price is in the buy zone following its fourth quarter update according to analysts at Goldman Sachs. This morning the broker retained its buy rating and lifted its price target to $128.50. This recommendation is based on its attractive valuation, strong free cash flow, the positive iron ore outlook in 2022, and production growth potential.

Oil prices hit seven-year highs

Energy producers such as Beach Energy Ltd (ASX: BPT) and Woodside Petroleum Limited (ASX: WPL) could have another good day after oil prices stormed higher. According to Bloomberg, the WTI crude oil price is up 1.6% to US$85.15 a barrel and the Brent crude oil price has risen 0.9% to US$87.29 a barrel. Oil prices hit seven-year highs after an attack in the UAE caused regional tensions.

Gold price falls

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) will be on watch after the gold price edged lower despite the market selloff. According to CNBC, the spot gold price is down 0.1% to US$1,815.20 an ounce. The gold price edged lower after traders became nervous ahead of another meeting by the US Federal Reserve next week.

Goodbye Afterpay shares

The Afterpay Ltd (ASX: APT) share price will stop trading on the Australian share market at the close of play today. It will then be absorbed by Block and replaced on the ASX with SQ2 shares. Unfortunately, it doesn’t look likely to have a happy send off. The Block share price is down 1% in late trade on Wall Street.

The post 5 things to watch on the ASX 200 on Wednesday appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX shares today
• Here are the 3 most heavily traded ASX 200 shares this Tuesday
• Woodside (ASX:WPL) share price struggles amid hydrogen project update
• ASX 200 (ASX:XJO) midday update: Rio Tinto’s Q4 update, JB Hi-Fi rockets, Kogan sinks
• This is how much the average Aussie needs to feel ‘rich’

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 Afterpay Limited. The Motley Fool Australia owns and has recommended Afterpay 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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With growth shares struggling in 2022, readers may be looking for value options instead.

With that in mind, listed below are two top ASX shares which could be candidates for the value-focused investor. They are as follows:

Accent Group Ltd (ASX: AX1)

This footwear focused retailer’s shares could be a great option for value investors. Especially with the Accent share price trading 27% below its 52-week high. This weakness has been driven by concerns over the company’s performance in FY 2022 due to the impact of lockdowns and COVID on its operations.

According to the team at Bell Potter, its analysts have a buy rating and $3.05 price target on the company’s shares. This compares favourably to the latest Accent share price of $2.26.

As for its valuation, the broker is expecting the aforementioned headwinds to have a big impact on Accent’s earnings in FY 2022 before an even bigger rebound in FY 2023. In light of this, it estimates that the company’s shares are changing hands for 21x FY 2022 earnings but just 13.5x FY 2023 earnings. Another positive is Bell Potter’s expectation for a 4% dividend yield this year and then a 6% yield next year.

South32 Ltd (ASX: S32)

Another value share for investors to consider is this mining giant. Although the South32 share price has charged 58% higher over the last 12 months, analysts at Goldman Sachs believe it is still great value. As a result, it has put a conviction buy rating and $4.60 price target on the company’s shares.

Goldman notes that South32’s shares are trading at ~4x its forward EV/EBITDA estimate excluding the yet to complete acquisition of a 45% stake in the Sierra Gorda copper mine in Chile.

It feels this is great value, especially given its expectation for the more than doubling of its EBITDA in FY 2022 and compelling free cash flow yield of ~18% in FY 2022 and ~17% in FY 2023. This is being driven mostly by its exposure to base metals such as aluminium and alumina.

The post These ASX shares could be buys for value investors appeared first on The Motley Fool Australia.

More reading

• Leading fund manager says these blue-chip ASX shares are buys right now
• 5 things to watch on the ASX 200 on Tuesday
• Why Beforepay, Firefinch, Kogan, and South32 shares are dropping
• ASX 200 (ASX:XJO) midday update: Wesfarmers’ update, energy shares rise
• South32 (ASX:S32) share price lower despite ‘next generation mine’ update

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The last few years haven’t been easy for the Telstra Corporation Ltd (ASX: TLS) share price and its shareholders.

But that all changed in 2021, with the telco giant’s shares among the best performers on the illustrious ASX 50 index.

During the 12 months, the Telstra share price raced a whopping 43% higher.

Why did the Telstra share price shoot higher in 2021?

There were a number of catalysts for the rise in the Telstra share price in 2021. These include its solid result in FY 2021, the announcement of asset sales, the acquisition of Digicel Pacific, and the unveiling of its T25 strategy.

It was arguably the latter that got investors most excited. After years of earnings declines and dividend cuts, the telco giant believes its T25 strategy will drive growth over the coming years.

Telstra’s CEO, Andy Penn, explained that T22 was based on transforming the company, whereas T25 will be about driving growth.

Mr Penn commented: “T25 marks our transition from transformation to growth, from a strategy we had to do, to a strategy we want to do to focus on growth. It is a strategy that builds on the strong foundations we have built over the last three years and remains focussed on what matters most – our customers, our people, our shareholders and on supporting the creation of a vibrant digital economy for Australia.”

According to the update, Telstra is aiming to deliver sustained growth and value by targeting mid-single digit underlying EBITDA and high-teens underlying earnings per share (EPS) compound annual growth rates between FY 2021 and FY 2025.

Supporting this growth will be the company’s cost reduction plans and its 5G network. In respect to the former, Telstra is aiming to make $500 million of net fixed cost outs between FY 2023 and FY 2025 while still investing in its growth. Whereas for the latter, the telco expects to provide ~95% of the Australian population with 5G coverage by FY 2025. Combined with its superior network, management expects this to underpin mobile services revenue growth.

Can Telstra beat the market again in 2022?

The good news for investors is that one leading broker still sees a lot of value in the Telstra share price.

A note out of Ord Minnett from last week reveals that its analysts have a buy rating and $4.85 price target on its shares. With Telstra’s shares currently changing hands for $4.26, this implies potential upside of 14% over the next 12 months.

The post Why the Telstra (ASX:TLS) share price zoomed 43% higher in 2021 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 owns and has recommended Telstra Corporation 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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