The AMP Limited (ASX: AMP) share price is one to watch this morning after the Aussie financial group’s half-yearly results release.

AMP share price in focus as profit lifts

AMP provided its operational and financial update for the half-year ended 30 June 2020 (1H21). Investors will be keeping an eye on the AMP share price today after the company reported the following highlights:

• Net profit after tax up 57% on the prior corresponding period (pcp) to $181 million.
• Australian wealth management assets under management (AUM) up 8% to $121.0 billion.
• Australian wealth management net cash outflows of $2.7 billion, compared to net cash outflows of $4.0 billion in 1H20.
• Controllable costs (ex AMP Capital) down 6% to $387 million.
• Surplus capital of $452 million above target requirements.
• Underlying group return on equity up to 8.3% (6.0% in 1H20).

The AMP share price is also one to watch this morning after the board declined to pay an interim 2021 dividend.

What did management say?

The AMP share price has been under pressure in 2021 and investors will be watching today’s results carefully. Newly appointed AMP CEO Alexis George, however, was positive about the performance and turnaround efforts.

Our business has had a stronger first half financially, we have demonstrated our commitment to deliver our strategic priorities of reshaping and simplifying the business and focusing AMP Capital on private markets.

We are starting to see some positive signs of growth and innovation, particularly in our bank and platforms businesses where we are introducing new services that our clients want.

Getting our demerger done will be a core priority. We’ve set out a clear timeline to establish and separate the AMP Capital Private Markets business this year, and complete the demerger in 1H 22.

What’s the outlook for FY21?

The AMP share price will be in the spotlight on Thursday following the financial giant’s half-yearly update. AMP did also provide some full-year guidance to the market this morning.

The financial group is forecasting controllable costs of $775 million, in line with previous guidance figures. AMP is expecting the Global Equities and Fixed Income (GEFI) and Private Markets businesses to internally separate in FY21.

Loan growth momentum for AMP Bank is expected to continue in the second half of the year while AMP Capital FY21 earnings are forecast to decline versus FY20 due to lower performance and investment returns.

How has the AMP share price performed recently?

The AMP share price climbed 1.4% higher on Wednesday ahead of today’s results release. However, shares in the Aussie financial group are down 30.8% in 2021 and are trading near an all-time low.

The post AMP (ASX:AMP) share price on watch as net profit jumps 57% appeared first on The Motley Fool Australia.

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• How did the AMP share price respond last earnings season?
• The AMP (ASX:AMP) share price is trading on a forecast 9.4% dividend yield
• If you invested $1000 in AMP (ASX:AMP) shares a decade ago, this is how much it would be worth now
• The AMP (ASX:AMP) share price is down 6% over the past month. Here’s why
• AMP (ASX:AMP) share price on watch as new CEO commences “rebuild”

Motley Fool contributor Ken Hall 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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The Rio Tinto Limited (ASX: RIO) share price has fallen 4% over the last week. Could it be worth looking at after its recent drop?

Iron ore miners are in focus as the iron ore price drops. According to reporting by various media, Chinese iron demand is falling at the moment.

As one of the world’s biggest iron ore miners, Rio Tinto is being put in focus.

The decline of the iron ore price isn’t a surprise to some analysts out there. The broker UBS was expecting the iron price to fall with demand falling and an expectation of larger iron ore supply.

Rio Tinto is one of the miners expected to deliver a higher level of iron ore production in the next few months.

Rio Tinto’s production guidance

In 2021, Rio Tinto is expecting Pilbara iron ore production to be between 325 Mt to 340 Mt. In the first six months, it produced 152.3 Mt of iron ore, which was a decline from 161.1 Mt produced in the first half of 2020.

The miner also highlighted in its FY21 half-year result that mining has commenced at the $2.6 billion Gudai-Darri replacement iron ore mine in Western Australia, with more than nine million cubic metres of pre-stripping completed in June. Despite labour shortages, first ore in the crusher is expected in 2021, although commissioning is later than originally planned. The project is expected to ramp up in early 2022 and reach full capacity in 2023.

A large recent announcement has been that $2.4 billion of funding has been committed to the Jadar project in Serbia, one of the world’s largest greenfield lithium projects, subject to receiving all necessary regulatory approvals. First saleable production is expected to be in 2026, with full production in 2029.

Broker ratings on the Rio Tinto share price

This increased supply is one of the reasons why UBS rates the Rio Tinto share price as a sell with a price target of $102.

The broker thinks Rio Tinto is valued at 12x FY22’s estimated earnings with a projected grossed-up dividend yield of 14% in the next financial year.

Though some brokers aren’t as pessimistic about the Rio Tinto share price such as Credit Suisse, which has a price target of $133 which is attracted to the prospect of the dividends from Rio Tinto.

Looking ahead to FY22, Credit Suisse thinks that Rio Tinto shares are valued at 8x FY22’s estimated earnings, with a projected grossed-up dividend yield of 11.2%.

In the FY21 half-year result, Rio Tinto declared a total dividend of US$5.61 per share (up 262%), which included a special dividend of US$3.76 per share.

The post Is the Rio Tinto (ASX:RIO) share price a buy right now? appeared first on The Motley Fool Australia.

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• How does the Rio Tinto (ASX:RIO) dividend compare to the materials sector?
• ASX 200 shares could get boost on prediction that A$ will crash to US68c
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• ASX 200 Weekly Wrap: Blockbuster Afterpay deal turbocharges ASX to new record highs
• ASX 200 midday update: REA & ResMed results, Afterpay jumps

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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Are you interested in adding some ASX growth shares to your portfolio this month? If you are, you may want to look at the ones listed below that have recently been named as buys.

Here’s what you need to know about them:

Appen Ltd (ASX: APX)

The first growth share to look at is Appen. It has a team of over one million crowd sourced experts preparing the data that goes into artificial intelligence (AI) and machine learning models. It does this for some of the biggest tech companies in the world such as Google and Facebook. And while demand softened during the pandemic, there are early signs emerging that indicate a rebound is taking place.

For this reason, last week Citi put a buy rating and $18.00 price target on its shares.

Cochlear Limited (ASX: COH)

Another growth share to consider is Cochlear. It is one of the world’s leading hearing solutions companies. Cochlear has been consistently delivering solid earnings growth for years thanks to its world class portfolio of products, ageing populations, and its high level of investment in research and development. And with all these drivers still in place today, Cochlear appears to be in a position to continue its growth over the next decade.

Macquarie currently has an outperform rating and $246.00 price target on its shares.

IDP Education Ltd (ASX: IEL)

A final ASX growth share to look at is IDP Education. It is a provider of international student placement services and English language testing services. Although the company has been hit hard by the pandemic, it is expected to come out of the crisis in a stronger position. This, together with pent up demand and acquisitions, is expected to underpin rapid growth once trading conditions return to normal.

Morgan Stanley has an overweight rating and $33.00 price target on its shares.

The post 3 buy-rated ASX growth shares appeared first on The Motley Fool Australia.

More reading

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• How owning too much Afterpay (ASX:APT) was our biggest regret
• 3 top ASX growth shares rated as buys

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 shares of and has recommended Appen Ltd, Cochlear Ltd., and Idp Education Pty Ltd. The Motley Fool Australia owns shares of and has recommended Appen Ltd. The Motley Fool Australia has recommended Cochlear 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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There is a small number of ASX shares that are broadly liked by a number of brokers.

If many brokers like a business at the same time then that may suggest there could be a potentially opportunity there.

Or it may mean that all of the brokers are wrong at the same time. Only time will tell.

Here are two that are highly liked by multiple brokers:

Credit Corp Group Limited (ASX: CCP)

Macquarie Group Ltd (ASX: MQG) is currently one of the brokers that rate the debt collector as a buy. It’s rated as a buy by at least three brokers.

The broker thinks Credit Corp is performing soundly considering the environment that it’s seeing in both Australia and the US.

Credit Corp recently released its FY21 result to the market. It said that there was an 11% increase of net profit after tax (NPAT) to $88.1 million. Within that, its US segment reported that NPAT doubled to $17.7 million.

There was a near record purchased debt ledger (PDL) investment outlay of $293 million, including $146 million for the PDL purchase from Collection House Limited (ASX: CLH).

But the ASX share did achieve records in other areas. There was a record second half gross lending volume of $105 million. It also saw a record starting PDL investment pipeline of $150 million for FY22.

The company said that it entered FY22 with considerable momentum. Charge off volumes are growing across all markets and the company is expecting further opportunities to grow purchasing over the course of the year.

Credit Corp outlined that the increase in organic PDL investment, together with the ongoing impact of the Collection House PDL acquisition, is expected to produce “solid” earnings growth of 8% at the top end of its guidance range. The top end of its profit guidance is $95 million in FY22.

According to Macquarie, the Credit Corp share price is valued at 19x FY23’s estimated earnings.

Bank of Queensland Limited (ASX: BOQ)

The regional bank is currently rated as a buy by at least five brokers. One of the brokers that likes Bank of Queensland is Credit Suisse, which has a price target on the ASX share of $11.50. That suggests a potential increase of the share price of approximately 20% over the next 12 months, if Credit Suisse is right.

One of the main reasons that the broker likes BOQ is due to its deal to buy ME Bank which could lead to substantial synergies. Credit Suisse also believes that BOQ’s net interest margin (NIM) could increase after the acquisition is completed.

If readers didn’t catch the original details of the deal, BOQ is buying ME Bank for $1.325 billion.

BOQ said the acquisition is expected to deliver material scale, broadly doubling the retail bank and providing geographic diversification. It’s expected to add to cash earnings per share (EPS) at a rate of between low double digit to mid-teens including the full run rate of synergies in the first year, being FY22.

The anticipated annualised pre-tax synergies are expected to be between $70 million to $80 million.

In the first half of FY21, BOQ generated $165 million of cash earnings after tax – up 9%. But statutory profit was up 66% to $154 million. The NIM improved by 3 basis points to 1.95%, whilst the interim dividend was increased by 11 cents per share to 17 cents per share.

According to Credit Suisse, the BOQ share price is valued at 15x FY22’s estimated earnings with a projected FY22 grossed-up dividend yield of 6.3%.

The post These 2 ASX shares are rated as strong buys by brokers appeared first on The Motley Fool Australia.

More reading

• Why the Bank of Queensland (ASX:BOQ) share price hit its 52-week high
• The Bank of Queensland (ASX:BOQ) share price is up 61% in a year. Here’s why
• ASX 200 drops, Afterpay jumps again, Credit Corp rises
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• Credit Corp (ASX:CCP) share price charges 6% higher after strong FY 2021 result

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 owns shares of and has recommended Macquarie 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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If you’re looking for big dividends, then look no further. The two ASX dividend shares below have been tipped by analysts to provide investors with yields greater than 6%.

Here’s what you need to know:

Adairs Ltd (ASX: ADH)

The first high yield ASX dividend share to look at is Adairs. It is a leading homewares and home furnishings retailer in the ANZ market. It has a growing presence both in retail parks across Australia and online with its Adairs and Mocka brands.

Thanks to its strong market position, the booming housing market, and a redirection in consumer spending, Adairs has been a very positive performer this year. This led to a very strong first half result, with more of the same forecast in the second half.

The team at Goldman Sachs are very positive on Adairs. They have a buy rating and $4.80 price target on the company’s shares.

The broker is also forecasting fully franked dividends per share of 26 cents in FY 2021, 25.1 cents in FY 2022, and then 26.8 cents in FY 2023. Based on the current Adairs share price of $4.22, this will mean yields of 6.15%, 5.9%, and 6.35%, respectively.

BHP Group Ltd (ASX: BHP)

Another high yield ASX dividend share to consider is BHP. This mining behemoth could be a top option for income investors that are happy to invest in the resources sector.

Australia’s largest miner has a diverse portfolio of world class operations across a number of commodities. This includes petroleum, copper, nickel, and iron ore. And thanks to favourable prices and its low operating costs, the company is currently generating significant free cash flow.

The team at Macquarie expect this to underpin very generous dividend payments in the near term. The broker is forecasting fully franked dividends per share of approximately $3.71 in FY 2021 and then $3.63 in FY 2022. Based on the latest BHP share price of $52.52, this will mean yields of 7% and 6.9%, respectively.

Macquarie has an outperform rating and $60.00 price target on its shares.

The post 2 high yield ASX dividend shares analysts rate as buys 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 recommended ADAIRS FPO. The Motley Fool Australia owns shares of 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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Ask A Fund Manager

The Motley Fool chats with fund managers so that you can get an insight into how the professionals think. In this edition, NAOS Asset Management portfolio manager Robert Miller reveals 2 ASX shares he loves that play in very different sectors.

Investment style

The Motley Fool: How would you describe your fund to a potential client?

Robert Miller: We offer a boutique funds management business that is focused on ASX-listed industrials, with a focus outside the S&P/ASX 50 Index (ASX:XFL). Our motto across the business is ‘conviction, long-term and aligned’. 

We’re very concentrated in what we do. We only hold about 20 positions at the moment, approximately, across our total pool of capital. 

We’re long-term investors. All of the shareholder funds that we currently manage are structured as listed investment companies. That allows us to be patient and have a disciplined investment strategy, which is typically a 5-year-plus investment timeframe that we’re looking at.

Another big one for us is alignment. So we’re big believers in investing in businesses alongside founders and management teams that have significant equity ownership in those businesses themselves. 

They’re our 3 key points. It’s a pure focus on industrial-type businesses and we’ve got a strong ESG focus internally as well.

Our ASX share portfolio

MF: Can you name a couple of your holdings and why you love them?

RM: The one I’ll start with is COG Financial Services Ltd (ASX: COG), which is an asset finance, aggregation and broker group. They’re Australia’s largest asset finance and broking aggregator. So it has approximately between 17% and 20% of the market. 

We believe this is a very hard asset to replicate in terms of their distribution footprint. So if you think about what’s happened with the mortgage and insurance industries, to use two examples, clearly there is an intermediary channel there where brokers are the vast majority — or have a very large influence. 

We believe asset finance is going in the same trajectory as the other two industries, and COG has very much a firm footing in that marketplace, being the largest at what they do. So this gives them the opportunity to cross-sell other products over time because the asset finance relationship between the customer and the broker can be very strong. 

A typical product would be, say you needed to buy a bit of yellow kit for farming or construction building — and you need a tractor or a ute, then COG, through their broker network, are the ones who would organise the finance for that.

I touched on insurance before and, obviously, the key in that market, one of the key ones is Steadfast here in Australia. And some of the ex-Steadfast people, including Cameron McCullagh who set this up, are involved in COG. So it’s got that flavour to it. 

They had a very strong FY21 but I think there’s a long way to go in terms of the underlying tailwinds that we’re seeing in a lot of the industries they operate in. Obviously, agriculture is strong, construction and housing and whatnot, that should be relatively strong over the next little while. 

All of those factors, as well [as] the stimulus around the instant asset write-off programs, should all be beneficial to COG over the medium to longer term.

MF: And the other one?

Again, not necessarily our biggest but a material one for us, is Big River Industries Ltd (ASX: BRI). They’re actually [an] over 100-year-old business, despite listing on the ASX in early April 2017, I think it was. 

They’re a building supplies and distribution business. And if you think about Bunnings and Mitre 10… they’re predominantly retail. This is trade-only so there’s absolutely no retail store footprint. 

What they do is, as I said, provide and distribute building supplies. Say frame and truss timber, plywood and formply, and architectural products. They’ve got approximately 22 sites across the country at the moment where they sell products. And they’ve got some manufacturing operations as well, where they manufacture niche products like formply and some architectural products.

We think this business is run by an excellent CEO who knows everything inside-out in that business. And we think there’s a very big opportunity to grow from here. As I said, they’ve only got low 20s in terms of the sites they operate. It’s a very, very large [addressable] market. We believe, for instance, they’ve only got one site in Sydney. Their peers would have many more than that in terms of sites per capital city. So there’s a long way to go in terms of the upside of site M&A, and also the ability to get strong revenues synergies out of that by, say you’re buying a new site, an existing site that rolls into the rest of the group, you then have the ability to cross-sell all of your existing products and distribution capabilities over to that new asset that you’ve bought. In turn, you get margin expansion with scale, and we’re starting to see this materialise now across the BRI group.

Secondly, the building cycle peaked in 2017 and it’s been on the down cycle since then. And I think certainly with the example of [government program] HomeBuilder, obviously there’s been a lot of building approvals over the last little while. A lot of that’s yet to turn dirt. So we think that the building cycle is here to stay for the medium term. It’s certainly in the upward trend and this should benefit Big River.

MF: It gives out a dividend as well.

RM: Yes, it does. As I said at the start, it’s over a 100-year-old business and they’ve been paying dividends for a very long time — throughout many, many cycles. For us, that’s a big factor that the business is able to survive all kinds of cycles and certainly thrive in some as well, like we’re seeing at the moment.

The post This 100-year-old company is the ASX share that keeps giving appeared first on The Motley Fool Australia.

More reading

• 2 high yield ASX dividend shares analysts rate as buys
• 2 ASX 200 shares that could offer good dividend income
• 5 things to watch on the ASX 200 on Thursday
• Telstra (ASX:TLS) FY 2021 results preview
• The easiest $150,000 you’d ever make

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 Bruce Jackson.

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A number of S&P/ASX 200 Index (ASX: XJO) shares could be interesting for investors to consider as options for good dividend income.

There were quite a few big dividend cuts during the difficult 2020 year which saw COVID-19 impacts reach far and wide. Westpac Banking Corp (ASX: WBC) and Flight Centre Travel Group Ltd (ASX: FLT) were just two examples of heavy dividend reductions.

But these two businesses continued to make profit and pay dividends to shareholders. They have ongoing commitments to shareholder returns:

Magellan Financial Group Ltd (ASX: MFG)

Magellan is one of the largest funds management businesses in Australia.

In the latest monthly update, the ASX 200 share announced that its funds under management (FUM) had increased $3.1 billion to $117 billion over the month of July 2021. The biggest increase was with its global equities strategies, with an increase of FUM from $85.4 billion to $87.9 billion.

The business is currently rated as a buy by the broker Morgans with a price target of $58.05. That suggests a potential increase of the share price over the next 12 months of more than 10%.

Magellan has a stated dividend policy for shareholders. Ordinary interim and final dividends will be based on 90% to 95% from the funds management business excluding crystallised performance fees. The annual performance fee dividend is also 90% to 95% of net crystallised performance fees after tax.

In the first half of FY21, the ASX 200 share grew its interim dividend by 5% to 97.1 cents per share. That was after half-year net profit after tax grew 3% to $202.3 million. Magellan’s funds management business saw profit before tax and before performance fees grow 8% to $256.2 million. Its external investments, like Guzman y Gomez may be able to help grow profit in the future too.

Morgans has forecast a FY22 dividend of $2.31 per share, equating to a partially franked forward dividend yield of 4.5%.  

Wesfarmers Ltd (ASX: WES)

The leadership at Wesfarmers are focused on dividends and shareholder returns.

Indeed, the company has stated:

Wesfarmers’ primary objective is to provide a satisfactory return to shareholders.

It points out how between FY16 and FY21, it has paid more than $14 billion of fully franked dividends for shareholders. Whilst it’s investing for the long-term, it also says it has an ongoing focus on shareholder returns with an approach underpinned by maximising the value of franking credits for shareholders.

The ASX 200 share notes that it has achieved long-term earnings growth and strong cashflow generation. It has a portfolio of businesses with strong market positions such as Bunnings, Officeworks, Kmart and Catch.

Wesfarmers aims to be flexible and opportunistic with a disciplined approach to all investment decisions. It’s always on the look out for adjacent opportunities (such as Catch) as well as value-accretive transaction.

The company is looking to improve its operations by establishing a market-leading digital ecosystem that spans its retail businesses. It’s going to invest around $100 million to develop this ecosystem.

Wesfarmers is also investing in its platforms for long-term growth. For example, it’s investing in Catch to become the leading Australian marketplace. It wants to grow Bunnings’ commercial offering. The company is also investing in its supply chain capabilities so that it can become more efficient, with lower costs.

According to Commsec, at the current Wesfarmers share price, it has a FY22 grossed-up dividend yield of 4.2%.

The post 2 ASX 200 shares that could offer good dividend income appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison owns shares of Magellan Financial Group. 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 shares of and has recommended Wesfarmers Limited. The Motley Fool Australia has recommended Flight Centre Travel 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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On Wednesday the S&P/ASX 200 Index (ASX: XJO) followed Wall Street’s lead and climbed higher. The benchmark index rose 0.3% to 7,584.3 points.

Will the market be able to build on this on Thursday? Here are five things to watch:

ASX 200 expected to edge higher

The Australian share market looks set to rise again on Thursday. According to the latest SPI futures, the ASX 200 is expected to open the day 6 points or 0.1% higher this morning. This follows a solid night of trade on Wall Street which saw the Dow Jones climb 0.6% to a record high, the S&P 500 rise 0.25%, and the Nasdaq edge 0.15% lower.

Telstra full year results

The Telstra Corporation Ltd (ASX: TLS) share price will be one to watch when it releases its highly anticipated full year results. According to a note out of Goldman Sachs, its analysts are expecting the company to report an 11% decline in income to $23.2 billion and a 16% reduction in earnings before interest, tax, depreciation and amortisation (EBITDA) to $7.6 billion. The latter includes underlying EBITDA of $6.8 billion, which is towards the higher end of Telstra’s guidance of $6.6 billion to $6.9 billion.

Oil prices rise

Energy producers such as Oil Search Ltd (ASX: OSH) and Woodside Petroleum Limited (ASX: WPL) could have a solid day after oil prices pushed higher overnight. According to Bloomberg, the WTI crude oil price is up 1.5% to US$69.31 a barrel and the Brent crude oil price has risen 1.3% to US$71.53 a barrel. Oil prices rose despite the White House asking OPEC to boost production.

Gold price edges higher

Gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) will be on watch after the gold price climbed overnight. According to CNBC, the spot gold price is up 1.3% to US$1,753.9 an ounce. The gold price rose after tame US inflation data eased fears that the US Federal Reserve would taper its economic support sooner than expected.

AGL FY 2021 results

The AGL Energy Limited (ASX: AGL) share price could be on the move today when it releases its results. According to CommSec, the market is expecting the energy giant to report a $2.1 billion loss for the year. However, despite this, a 34.5 cents per share fully franked dividend is still expected to be declared.

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

More reading

• Telstra (ASX:TLS) FY 2021 results preview
• Here are 3 of the most heavily traded ASX 200 shares today
• ASX 200 rises, CBA climbs after FY21 report, Iress jumps
• Why the Aussie Broadband (ASX:ABB) share price rose 8% to a new high
• How did the AMP share price respond last earnings season?

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 shares of 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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The Telstra Corporation Ltd (ASX: TLS) share price will be one to watch very closely on Thursday.

This is because the telco giant will be releasing its highly anticipated full year results tomorrow morning.

And with the Telstra share price hitting a two-year high today, expectations certainly are high.

What is expected from Telstra in FY 2021?

According to a note out of Goldman Sachs, its analysts are expecting the company to report an 11% decline in income to $23.2 billion.

Whereas for its earnings, the broker has pencilled in a 16% reduction in earnings before interest, tax, depreciation and amortisation (EBITDA) to $7.6 billion. This includes underlying EBITDA of $6.8 billion, which is towards the higher end of Telstra’s guidance of $6.6 billion to $6.9 billion.

And on the bottom line, a 27% decline in net profit after tax to $1.7 billion is being forecast by its analysts.

Despite this decline, Goldman still expects Telstra to maintain its final dividend at 8 cents per share. This will mean a fully franked full year dividend of 16 cents. Which, based on the current Telstra share price of $3.83, will mean a 4.2% yield for shareholders.

What could move the Telstra share price?

One thing that could have an impact on the Telstra share price tomorrow is its guidance for FY 2022.

Goldman Sachs is forecasting FY 2022 underlying EBITDA growth of 6% to $7.2 billion and NBN payments of $330 million. It notes that this compares to the company’s FY 2022 aspirations for mid to high single digit growth.

Another thing that could move the Telstra share price is commentary on its mobile business. Goldman notes that it will be looking at “2H21 Mobile Trends, with Telstra expecting postpaid ARPU to return to growth in 2H21 and accelerate in FY22E (GSe +1%/+5% in 2H21E/FY22E).”

It also expects “solid subscriber growth in a low churn market (postpaid +60k in 2H21 vs. 5Y avg. +130k).”

The Telstra share price is up 27% year to date.

The post Telstra (ASX:TLS) FY 2021 results preview appeared first on The Motley Fool Australia.

More reading

• Why the Aussie Broadband (ASX:ABB) share price rose 8% to a new high
• How did the Telstra (ASX:TLS) share price respond last earnings season?
• Telstra (ASX:TLS) and this ASX dividend share are rated as buys
• These 3 ASX 200 shares were the most traded this Tuesday
• The Telstra (ASX:TLS) share price just hit another new 52-week high

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 shares of 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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If you ask people about their favourite days of the year, many will nominate their birthdays, Christmas, or maybe a wedding anniversary.

Now, for the record, my wedding anniversary is obviously my favourite day of the year.

And as a parent, there is nothing that beats being part of the joy that Christmas brings for a child.

But those aside, I have some, ahem, strange favourite days.

I’ve written before that I really, really like Budget Day (and once got a cab home, rather than a tram, to avoid missing watching the speech, live!). It’s a day that combines finance, public policy and a very outward expression of democracy. I know, but I like it anyway.

Another of my favourite days doesn’t really have a name, but I’m going to call it, somewhat unimaginatively, ‘Vanguard Index Chart Day’.

I know this will surprise you, given how cryptically I’ve named it, but it’s the day, each year, that the fund manager, Vanguard, releases its updated 30-year index chart.

I know, I know… not exactly the most important or exciting thing that’ll happen this year.

But stick with me.

See, as I said to my colleagues (and on Twitter) this morning:

“Other than currency or stock certificates, if you truly *get* the power of this chart, it might just be the most valuable single sheet of paper in the world…”

Have I got your attention now?

See that one piece of paper neatly shows — perhaps better than anything else I’ve ever seen — the devastatingly huge power of compounding.

And here it is:

At the bottom left, a hypothetical $10,000 was invested in Australian shares in 1991.

At the top right, the result of 30 years of uninterrupted compounding (excluding brokerage and tax).

The result?

Your $10,000, invested on July 1, 1991, was worth more than $160,000, three decades later.

Three decades that included two recessions, the Asian Financial crisis, the dot.com crash, the GFC and, yes… that little thing called COVID.

Despite all of that — and lots more — 10 gorillas became 160.

By doing precisely… nothing.

Not a bloody thing.

Just leaving well enough alone.

Of course, if you’d regularly added through that time, imagine how much you’d have, now.

Sure, but that was then, this is now, right?

Yep.

Except I’ve been banging on about precisely the same thing for more than a decade, now.

And, even if the annual return varies slightly, depending on the year, my advice hasn’t changed.

And, to borrow a line from Nike: just do it.

There are thousands of excuses.

The level of the market.

Interest rates.

Money printing.

The Fed.

Bitcoin (CRYPTO: BTC).

The economy.

COVID.

SARS (remember that?)

The GFC.

I could go on.

And yet, despite ALL — not one, or two, but ALL — of those things, the ASX has returned 9.7% per year on average over the last 30 years.

When was a good time not to invest? Never.

Sure, in hindsight, we can easily tell the highs and lows. And, if I had a crystal ball or time machine, I’d take full advantage.

But without either device?

My advice is simple.

Invest.

Invest today. And tomorrow. And next week. And next month. And next year.

Some of those days will, in hindsight be unfortunately high.

Some will be remarkably low.

But, unless financial history finally stops repeating, the biggest mistake is not investing at all.

Me?

I’m always almost fully invested.

The only cash I keep is just whatever adds up between the automatic transfer each payday and wherever I get around to buying.

I try not to leave it too long.

Because the market has always gone up, over time.

The longer you wait, statistically speaking, the more money you’re leaving on the table.

Yes, sometimes it sucks.

February and March last year come to mind when the market fell 38%.

But since then?

The ASX has made all of that back, and more.

Plus paid dividends.

I know some really smart people who missed the recovery, by trying to be too clever.

And they truly are clever.

But perhaps also caught out by a little hubris.

In any event, this isn’t about them.

It’s about us.

I’m going to suggest you take the Triple H approach (with apologies to the erstwhile wrestler of the same name):

History

Humility

Heart

Because:

I want you to remember the lessons of history.

I want you to remember that none of us can predict the future, so probabilistic thinking is almost certainly the best approach.

And I want you to stick with it, with wholeheartedness, even when things get volatile. Because they will.

But Vanguard’s chart shows us what can be achieved by committing, and by staying the course.

And, as I said, it actually undersells investing, because it assumes no money is added over that 30-year timeframe.

So, if you print out that chart…

… and start (or keep) investing…

… and add regularly…

It could end up being the most valuable piece of paper you’ve ever seen.

Fool on!

The post The easiest $150,000 you’d ever make appeared first on The Motley Fool Australia.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Nike. The Motley Fool Australia has recommended Nike. 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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