The Appen Ltd (ASX: APX) share price was out of form again on Monday.

At one stage, the artificial intelligence (AI) data services company’s shares were down almost 4% to a multi-year low of $9.28.

When the Appen share price reached this level, it meant it had fallen a disappointing 64% since the start of the year.

Is the weakness in the Appen share price a buying opportunity?

While the decline in the Appen share price is bitterly disappointing for shareholders, it could be a buying opportunity for non-shareholders.

That’s the view of the team at Citi, which remain very positive on the company despite its recent struggles.

According to a recent note, the broker has a buy rating and $18.80 price target on the company’s shares.

Based on the latest Appen share price, this implies potential upside of greater than 100% over the next 12 months.

What did the broker say?

Citi remains upbeat on Appen’s outlook and has recently highlighted an acceleration in advertising revenue from Facebook and Google as a reason to be positive.

The broker believes this could support increased investment in AI and machine learning activities in the near future, which could lead to increased demand for Appen’s services.

After all, it was the lack of investment in these activities from big tech companies that weighed on Appen’s performance over the last 12 months. So, any increased investment could only be good news for Appen.

And while the broker acknowledges that there are concerns that Appen is facing structural issues, it doesn’t believe this is the case and sees positive tailwinds supporting its growth over the medium term.

All in all, it feels this could make the Appen share price a value play at the current level.

The post Why this top broker thinks the Appen (ASX:APX) share price can double 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. owns shares of and has recommended Appen Ltd. The Motley Fool Australia owns shares of and has recommended Appen 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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ASX tech shares could be the place to find exciting long-term opportunities.

Technology is often the sector that is able to generate good profit growth because of the low cost of the underlying product. Tech businesses are often able to grow quickly because of how they can provide services digitally for customers or clients.

These two tech stocks could be ones to consider:

Pushpay Holdings Ltd (ASX: PPH)

Pushpay is a key enabler of US churches to receive electronic donations. It is actually responsible of processing billions of dollars. In FY21 it processed US$6.9 billion of donations, which was an increase of 39% on FY20.

The company says that it adopted best-in-class software tools and scalable processes early in its development. Combined with “strong financial discipline”, these investments will allow significant operating leverage to be achieved as revenue grows.

Despite the high level of investment for growth, Pushpay continues to experience increasing levels of operating leverage.

FY21 saw earnings before interest, tax, depreciation, amortisation and foreign currency (EBITDAF) increase by 133% to US$58.9 million, whilst operating cashflow soared 145% to US$57.6 million.

The ASX tech share is looking to expand in the Catholic segment of the faith sector, which is its first initiative to grow its customer base outside of its existing core base. It has set a goal of reaching market share of more than 25% of the Catholic church management system and donor management system market over the next five years.

The Catholic church is closely associated with many education providers and non-profit organisations, which presents further opportunities within the US and other international jurisdictions. It also continues to look for acquisitions opportunities. It recently acquired video streaming business Resi Media.

At the current Pushpay share price, it is valued at 30x FY23’s estimated earnings.

Kogan.com Ltd (ASX: KGN)

Kogan is a fast-growing e-commerce retailer. It offers a number of different products and services for customers.

The Kogan.com website offers an Amazon-like selection of different categories and items like computers, phones, TVs, clothes, footwear, vacuum cleaners, appliances, furniture and so on. It also has additional services such as a membership program, insurance, credit cards, energy and telecommunications.

FY21 was a year of two halves. The first half showed strong growth, rising profit margins and an expanding customer base. However, the second half showed a growth slowdown and inventory issues.

After working through the inventory difficulties, Kogan’s management is still excited about the future. Over the next 12 months, it’s going to roll out new projects to support its members with membership rewards, new and improved delivery solutions and it will further enhance the online shopping experience.

The ASX tech share will also look to grow its Mighty Ape business in New Zealand, which is growing in size and profitability. Kogan acquired Mighty Ape in December 2020, meaning its contribution for FY21 was seven months to 30 June 2021 where it generated $6.9 million of adjusted EBITDA and $3.7 million of adjusted net profit. For the seven months to 30 June 2021, Mighty Ape contributed around 10% to overall gross profit.

Management say the synergies and integration is progressing well with Mighty Ape. The New Zealand business has grown its active customers by 10% since acquisition to 764,000.

According to Commsec, the Kogan share price is valued at 22x FY23’s estimated earnings. That’s after falling 28% over the last month.

The post 2 exciting ASX tech shares that could be buys appeared first on The Motley Fool Australia.

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• Why this broker thinks the Kogan (ASX:KGN) share price is a solid long-term buy
• 3 exciting ASX tech shares to buy this month
• 3 compelling reasons why the Pushpay (ASX:PPH) share price could be a buy

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. owns shares of and has recommended Kogan.com ltd and PUSHPAY FPO NZX. The Motley Fool Australia owns shares of and has recommended Kogan.com ltd and PUSHPAY FPO NZX. 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 Australia and New Zealand Banking Group Ltd (ASX: ANZ) share price has struggled in the past few weeks.

The pain for investors continued yesterday, with shares in the banking giant closing 2% lower for the day.

Let’s take a look at why the ANZ share price has been struggling.  

Why is the ANZ share price under pressure?

Despite a disappointing past few weeks, ANZ has not released any price-sensitive news.

As a result, there are many undercurrents that could be putting pressure on the ANZ share price.

Firstly, general weakness in the broader market domestically and abroad could explain why shares in the banking giant have struggled.

During the same period, the broader  All Ordinaries Index (ASX: XAO) has plummeted 4.5%.

A recent broker note could also explain the bearish sentiment on ANZ’s share price.

Leading broker Citi recently released a note that had a sell rating on the bank with a $28 share price target.

According to analysts, recent APRA data indicates a sharp contraction in ANZ’s mortgage book.

In addition, some experts have also flagged a more bearish outlook for the ANZ share price.

According to the commentary, moderation in volume and housing growth could slow near-term growth prospects for the big banks.

Outlook for ANZ

Contrary to the bearish sentiment, some analysts are more optimistic about the outlook for the ANZ share price.

A recent note from Bell Potter had a buy rating on the bank’s shares with a $31 price target.

Analysts cited ANZ’s recent Environmental, Social, and Governance (ESG) update as a positive for the banking giant.

In addition, the broker highlighted ANZ’s focus on retail, business, and the private banking space.

Snapshot of the share price

Although shares in ANZ have struggled in the past few weeks, they remain more than 18.5% higher for the year. 

By comparison, the broader S&P/ASX200 Index (ASX: XJO) has only managed to claw around 8% higher for 2021.

In its recent business update for the third quarter, the banking giant noted that its CET1 ratio came in at 12.2%, a slight reduction from the 12.4% recorded in the previous period. 

With its strong capital position and cost reductions, ANZ announced its intention to buy back up to $1.5 billion of shares on market as part of its capital management plan.

The ANZ share price closed yesterday’s trading session at $27.14.

The post The ANZ (ASX:ANZ) share price is down 8% in 5 weeks. What’s happening? appeared first on The Motley Fool Australia.

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• Top broker tips ANZ (ASX:ANZ) share price to rise 14%
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Motley Fool contributor Nikhil Gangaram 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 South32 Ltd (ASX: S32) share price recently hit a 52-week high of $3.52.

And while the mining giant’s shares have pulled back a touch since then due to the market volatility, they remain 33% higher year to date.

Is the South32 share price a buy for dividends?

Despite the South32 share price trading close to a 52-week high, the company could still be a great option for income investors.

That’s the view of the team at Goldman Sachs, which have a conviction buy rating and $3.80 price target on its shares.

Goldman Sachs likes the company for three reasons. The first is the South32 share price valuation, which it notes is trading below its net asset value.

The second reason is the company’s strong free cash flow generation thanks to favourable commodity prices. This is particularly the case for aluminium, which Goldman believes is in the early stages of a multi-year bull market.

The third reason is the broker’s belief that South32’s shares will yield fully franked, double-digit dividend yields in the near term.

Goldman recently pencilled in dividends per share of 29 US cents in FY 2022 and 31.9 US cents in FY 2023. Based on current exchange rates, this will mean 40 cents and 44 cents in Australian currency.

So, with the South32 share price fetching $3.32, this equates to fully franked yields of 12% and 13.2%, respectively, over the next 24 months. This is significantly better than the market average and anything you’ll find with term deposits or savings accounts.

What did the broker say?

Goldman explained why it is bullish on the South32 share price.

It commented: “We retain our Buy rating (and keep S32.AX on the ANZ Conviction List) on: (1) Valuation: The stock is trading at 0.92x NAV (A$3.75/sh). (2) Strong FCF outlook: We forecast a FCF yield of c. 15-18% in FY22 & FY23 (over 20% at spot), driven mostly by higher base metal prices (combined c. 70% of FY22 EBITDA). Spot EBITDA is over US$3.8bn vs. our base case c. US$3.0bn estimate. (3) Increased capital returns: We assume the buyback continues to be extended (at US$250mn p.a) and S32 continues to pay out 70% of earnings (40% ordinary, 30% special dividend component). On our estimates, S32 is on a dividend yield of c. 12-13% in FY22 & FY23.”

The post Is the South32 (ASX:S32) share price a buy for dividends? 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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The share prices of Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group Ltd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) could be put under the spotlight by rising mortgage stress.

According to reporting by The Sydney Morning Herald, research by the University of NSW has revealed that the percentage of households in mortgage stress has risen to 42%.

This mortgage stress evaluation is based on how much money households have after their normal expenditure (including housing) compared to their income. Households with less than 5% left are deemed to be “stressed”. Ones with a deficit of more than 5% are “severely stressed”.

The research is based on 52,000 households that are either paying a mortgage or paying rent. It shows that just under 33% were in stress in February 2020, it has now risen to 41.7%. Sydney and Melbourne are the places where stress is particularly popping up. Investors are also reportedly facing increased stress with their loans. This could apply to plenty of the borrowers at CBA, Westpac, ANZ and NAB considering their overall market share of the mortgage market.

What does the RBA think is the problem?

Low interest rates are widely acknowledged to be a factor for increasing asset values, not just housing.

However, the RBA also pointed to how property investment is encouraged by the tax system and it also leads to people not moving and selling. Examples included the capitals gains tax concession and how the principal place of residence is excluded from the age pension means test.

The SMH referred to the RBA’s submission to a parliamentary inquiry into housing affordability, which mentioned negative gearing:

However…the RBA believes that there is a case for considering the tax system in a holistic way, taking into account the interaction of negative gearing with other aspects of the tax system.

The housing market is a big deal for the big four ASX banks

CBA, Westpac, ANZ and NAB all earn a large amount of their profit from loans to households and property investors.

This report of increasing household stress may not be a good look when it comes recently after UBS’ survey showed that a record number of loan applicants were not being truthful on their applications relating to the income, expenses or financial liabilities.

The big four ASX banks aren’t the only ones that need to keep an eye on mortgage stress. There are other ASX shares involved in mortgages including Bank of Queensland Limited (ASX: BOQ), Suncorp Group Ltd (ASX: SUN), Bendigo and Adelaide Bank Ltd (ASX: BEN) and MyState Limited (ASX: MYS).

It will be interesting to see if anything comes of this mortgage stress. Some banks like ANZ have been launching share buy-backs and releasing credit from their provisions for potential bad debts. Mortgage stress may not necessarily lead to bad debts for the banks considering the high level of house price growth over the last 12 months.

The nationwide COVID-19 vaccination effort may also open up numerous economic sectors so they can get back to earning again.

The post Climbing mortgage stress: Are the CBA, ANZ, NAB and Westpac share prices in danger? appeared first on The Motley Fool Australia.

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• Why is the CBA (ASX:CBA) share price outperforming its big four peers today?
• The NAB (ASX:NAB) share price has just had a lousy week, what’s next?

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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The Xero Limited (ASX: XRO) share price has been on form over the last 12 months.

Since this time last year, the cloud accounting platform provider’s shares have risen a sizeable 61%.

Can the Xero share price keep rising?

One broker that isn’t convinced the Xero share price can keep rising is Macquarie Group Ltd (ASX: MQG).

In fact, according to a note out of the investment bank last week, its analysts believe its shares could be heading lower from here.

The note reveals that Macquarie has retained its underperform rating and $130.00 price target on the company’s shares.

Based on the current Xero share price of $146.40, this implies potential downside of 11% over the next 12 months.

What did the broker say?

The broker notes that rival Intuit has announced the US$12 billion acquisition of email marketing company Mailchimp.

Macquarie fears this could be a boost to Intuit’s QuickBooks platform and a blow to Xero if it decides to remove Mailchimp from Xero’s ecosystem. The broker appears concerned that it could not only cause some users to switch platforms, but also strengthen QuickBooks’ offering and support its global expansion.

Outside this, the broker has valuation concerns and struggles to justify the current multiples the Xero share price trades on.

Particularly given its view that its ANZ growth will slow materially in the near future and its North American growth may come at the expense of a softening revenue per user metric.

Is anyone bullish?

The team at Goldman Sachs don’t agree with this view. They recently reaffirmed their buy rating and $165.00 price target.

The broker believes Xero has the potential to grow strongly for several decades if everything goes to plan with its global expansion and app ecosystem monetisation.

Time will tell which broker made the right call.

The post Is the Xero (ASX:XRO) share price heading down to $130? 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. owns shares of and has recommended Xero. The Motley Fool Australia owns shares of and has recommended Xero. 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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Many ASX shares are rated as a buy by at least one broker. However, there are a select group that are currently liked by a number of brokers at the same time.

If plenty of brokers like a business at the current valuation then that may indicate that they are opportunities. These brokers are constantly on the lookout for good value ASX shares that may be good buys.

However, there’s a potential risk that all of the brokers are wrong at the same time.

With that in mind, here are two ASX shares that may be ideas to consider:

Audinate Group Ltd (ASX: AD8)

Audinate is a business that offers a solution called Dante, which is audio over IP networking. The company claims it’s a worldwide leader and used extensively in the professional live sound, commercial installation, broadcast, public address and recording industries.

It replaces traditional analogue cables by transmitting synchronised audio signals across large distances to multiple locations at once, using just an ethernet cable.

Despite the very large disruption that COVID-19 has caused to a large number of Audinate’s clients, the company delivered a high level of growth in FY21. Revenue rose 22.5% to US$25 million, gross profit increased 23.1% to US$19.2 million, earnings before interest, tax, depreciation and amortisation (EBITDA) jumped 50.1% to A$3 million and operation cashflow rose 40% to A$6.7 million.

The FY21 net loss after tax also improved 17% to A$3.4 million.

It has launched Dante Video, which it sees as an important phase of growth when combined with Dante audio.

In FY22 the ASX share is expecting to launch more products, improving non-English speaking adoption, increasing cyber protection and implementing business scalability initiatives.

Audinate is currently rated as a buy by at least three brokers, including UBS. One reason for the $11.75 price target is the potential growth of Dante video which may lead to a growing market share.

Telstra Corporation Ltd (ASX: TLS)

The telco is another business that is well-liked by brokers at the moment after a difficult few years.

It is rated as a buy by at least four brokers, including Morgan Stanley with a price target of $4.50. The broker thinks it’s a good thing that Telstra is going to return to profit growth in the next few years.

According to Morgan Stanley, the Telstra share price is valued at 28x FY22’s estimated earnings.

Telstra recently released its T25 strategy update to the market. In that it said that it aimed to achieve a compound annual growth rate (CAGR) of mid-single digits for underlying earnings before interest, tax, depreciation and amortisation (EBITDA) and high-teens for underlying earnings per share (EPS).

The telco also said that it’s going to seek to grow its dividend over time, with increasing earnings. This could be helped by a further reduction of $500 million of net fixed costs from FY23 to FY25.

Telstra is also looking to improve its 4G and 5G network coverage for customers, whilst also increasing its number of Telstra Plus members to 6 million by FY25.

At the current Telstra share price, it has a grossed-up dividend yield of 5.9%.

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

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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. owns shares of and has recommended AUDINATEGL FPO. The Motley Fool Australia owns shares of and has recommended AUDINATEGL FPO and 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 favourite barbecue story for ASX investors the last couple of years has been Afterpay Ltd (ASX: APT).

The buy now, pay later provider has been the darling of the local bourse, going from an initial public offer price of $1 per share to $125.67 on Monday afternoon.

In other words, $10,000 invested when it floated in 2016 would now be a tidy $1.26 million.

But now that big US fintech Square Inc (NYSE: SQ) is buying it up for $39 billion, perhaps that explosive chapter of the company’s life will come to a close.

However, did you know there is a business that will list on the ASX next week that was spun out of Afterpay?

In fact, Afterpay still holds a 32% stake.

Touch Ventures about to land on the ASX

Shares for a company named Touch Ventures Limited (ASX: TVL) will start general trade on the ASX on 29 September.

The venture capital provider launched in 2019 as AP Ventures as a way for Afterpay to invest in startups.

Cyan portfolio manager Dean Fergie told his clients in a memo that the Afterpay connection couldn’t hurt.

“Given the huge investor support of Afterpay — additionally so, after its deal with Square that sent Afterpay’s shares 30% higher — another good debut on listing could be expected.”

Fergie’s fund already has some shares after buying in during a pre-IPO funding round.

What does Touch Ventures do?

Touch Ventures invests in startups, primarily by buying some equity in them.

The firm currently has 5 businesses in its portfolio but is aiming to increase that to 8 to 10 companies after the ASX listing.

Normally only sophisticated and institutional investors have access to startup equity as they’re far higher risk than publicly listed stocks.

So the float of Touch Ventures would be a rare way for mum-and-dad investors to get a look into the exciting high-growth startup world.

Perhaps as a sign of its pedigree, Fergie said Touch has 2 buy now, pay later startups on its books: Postpay, which operates in the UAE, and Happay, which is a Chinese fintech. 

“Most significantly, Touch Ventures Limited invested US$25m into Australia Post competitor Sendle which has made significant inroads in Australia and is looking to expand into the US.” 

The portfolio also includes PlayTravel which is arguably another buy now, pay later system. That business allows customers to pay for travel packages in instalments.

The 5th startup in the portfolio is Basiq, a financial data mining platform.

Touch Ventures chair Michael Jefferies said in the prospectus that no geographic zones or sectors are off-limits in the investment strategy.

“Touch Ventures has a preference for global ventures. All companies in the foundation portfolio are generating revenues but are not profitable at this stage.”

The prospectus also mentions that Afterpay could refer investment opportunities onto Touch Ventures.

“Afterpay may also provide specific expertise along with Touch Ventures’ expertise in assessing opportunities referred to Touch Ventures and may separately enter into commercial agreements with companies that Touch Ventures decides to invest in,” said Jefferies.

The IPO, which issued shares at 40 cents apiece to raise $100 million, has now closed. Touch Ventures shares will start normal trading on the ASX on the morning of 29 September.

Afterpay will then hold 23.3% of the total fully diluted stock.

The post This Afterpay-backed company is listing on ASX next week appeared first on The Motley Fool Australia.

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• ASX 200 tumbles but the Afterpay (ASX:APT) share price is green?
• How has the Afterpay (ASX:APT) share price performed since reporting results?
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Motley Fool contributor Tony Yoo owns shares of Square. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO and Square. The Motley Fool Australia owns shares of and has recommended AFTERPAY T 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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If you’re a growth investor looking for some new ideas, then you might want to look at the shares listed below.

Here’s what you need to know about these highly rated growth shares:

Hipages Group Holdings Ltd (ASX: HPG)

The first ASX growth share to look at is Hipages. It is a leading Australian-based online platform and software as a service (SaaS) provider connecting tradies with residential and commercial consumers for job leads.

Hipages has been growing strongly over the last couple of years thanks to the increasing popularity of its platform with both tradies and consumers. This has underpinned strong recurring revenues, with the company finishing FY 2021 with monthly recurring revenue (MRR) of $5.2 million. This was 27% higher year on year and annualises to $62.4 million.

The good news is that the company is still scratching at the surface of its market opportunity. The team at Goldman Sachs highlights that Hipages currently captures less than 1% of a total $97 billion tradie business spend.

The broker is very bullish on the company’s future. It has a buy rating and $4.35 price target on its shares.

Life360 Inc (ASX: 360)

Another ASX growth share to look at is Life360. It is the rapidly growing technology company behind the popular Life360 mobile app. This market leading app for families offers a range of features such as communications, driver safety, and location sharing.

At the end of the first half, the company’s Global Monthly Active User (MAU) base had reached 32.3 million. This was up by 4 million users since the end of the first quarter, which demonstrates just how quickly it is growing.

This led to Life360 surpassing US$100 million of annualised monthly revenue, which positions it to deliver another stellar full year result later this year.

In addition, Life360 has also just expanded into the wearables market via the acquisition of Jiobit. This gives it cross-selling opportunities to its large subscriber base.

Bell Potter is a fan of the company. It currently has an outperform rating and $10.75 price target on its shares.

The post 2 stellar ASX growth shares rated 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. owns shares of and has recommended Hipages Group Holdings Ltd. and Life360, Inc. 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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If you’re building an income portfolio, then you may want to look at the buy-rated dividend shares listed below.

Here’s why these ASX dividend shares could be worth considering right now:

Adairs Ltd (ASX: ADH)

The first ASX dividend share to look at is Adairs. This leading retailer of homewares and home furnishings could be a good option due to its strong market position, growing online businesses, and generous yield.

In respect to the former, the company’s strong market position allowed it to take full advantage of favourable trading conditions in FY 2021. This led to the company reporting a 28.5% increase in sales to $499.8 million and the almost doubling of its EBIT to $109.1 million.

This went down well with analysts at Morgans. In response, the broker put an add rating and $4.20 price target on the company’s shares.

Looking ahead, Morgans is confident in its medium term outlook and is forecasting dividends per share of 22 cents in FY 2022 and 27 cents in FY 2023. Based on the current Adairs share price of $3.86, this will mean yields of 5.7% and 7%, respectively.

Telstra Corporation Ltd (ASX: TLS)

Another ASX dividend share to consider is Telstra. After several years of struggles, this telco giant is now on the path to growth again. This was confirmed last week when the company released its T25 update. This is Telstra’s new strategy that will build on the highly successful T22 strategy from next year.

Telstra revealed that it will aim for sustained growth and value by targeting mid-single digit underlying EBITDA and high-teen underlying earnings per share compound annual growth rates (CAGR) from FY 2021 to FY 2025.

This went down well with analysts at Goldman Sachs. The broker believes the strategy will support a return to dividend growth in the coming years.

Goldman is now forecasting 16 cents per share fully franked dividends through to FY 2023. After which, it expects a dividend of 18 cents per share in FY 2024 and then 19 cents per share in FY 2025.

Based on the current Telstra share price of $3.88, this will mean yields of 4.1%, 4.6%, and 4.9%, respectively.

Goldman has a buy rating and $4.40 price target on its shares.

The post 2 high quality and high yielding ASX dividend shares to buy 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. owns shares of and has recommended ADAIRS FPO. The Motley Fool Australia owns shares of and has recommended ADAIRS FPO and 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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