Two S&P/ASX 200 Index (ASX: XJO) stocks just scored substantial broker upgrades.

One of the companies has already been on a tear over the past year, while the other has struggled.

But according to top brokers, the next 12 months could see them deliver share price gains of 11% and 16%, respectively. And that doesn’t include the dividends they both pay.

Which ASX 200 stocks are we talking about?

Read on!

(Broker data courtesy of The Australian.)

Two ASX 200 stocks to buy

The first ASX 200 stock just earning a broker upgrade is financial technology company Hub24 Ltd (ASX: HUB).

The Hub24 share price is down 0.2% in late morning trade today, at $45.98. Shares are up a whopping 76% in a year, making it the third-best-performing ASX 200 share in FY 2024. Hub24 shares also trade on a fully franked trailing dividend yield of 0.8%.

Despite the recent share price surge, Bell Potter foresees more outperformance ahead. The broker gave the ASX 200 stock a buy rating with a $53.20 price target. That’s almost 16% above current levels.

At its most recent half-year results, Hub24 reported a 14% year on year increase in total revenue, which came in at $156.7 million for the six months.

Which brings us to the second ASX 200 stock that just scored a broker upgrade, property and infrastructure group Lendlease Group (ASX: LLC).

The Lendlease share price is up 0.9% today at $5.68 a share. Lendlease shares are down 28% in a year. The stock also trades on a partly franked trailing dividend yield of 3.1%.

Citi believes that the sell-off has run its course. The broker raised Lendlease to a buy rating, while maintaining its $6.30 price target. That represents an 11% potential upside from the current share price.

Citi is upbeat about Lendlease’s ongoing international asset sales, expected to bring in some $4.5 billion.

The broker said this week’s AU$480 million (US$320 million) sale of the ASX 200 stock’s US Military Housing business came in ahead of expectations.

According to Citi analyst Suraj Nebhani (quoted by The Australian):

While there is uncertainty around the future capital receipts from Lendlease’s asset sale program, we see the shares as sufficiently discounted here and providing strong value upside.

Moreover, the progress on asset sales and capital received to date has been encouraging, and we therefore see upside to Lendlease shares from current pricing.

The post These 2 ASX 200 stocks just scored substantial broker upgrades appeared first on The Motley Fool Australia.

More reading

• Brokers just put buy ratings on these ASX 200 tech stocks
• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX 200 shares today
• Why Coronado Global, EML, Immutep, and Lendlease shares are storming higher
• Guess which ASX 200 share is pushing higher on $480m asset sale

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Hub24. The Motley Fool Australia has recommended Hub24. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The RPMGlobal Holdings Ltd (ASX: RUL) share price is having a difficult time on Tuesday.

In early trade, the mining software solutions provider’s shares were down as much as 22% to $2.17.

Its shares have recovered a touch since then but remain down 16% to $2.33.

Why is the RPM Global share price crashing?

Investors have been hitting the sell button today after the company released a trading update.

According to the release, RPM Global sold $50.4 million in software Total Contracted Value (TCV) in the second half of FY 2024. This brings its expected full year TCV to $77 million, which represents a 9.2% increase year on year.

This TCV comprises $75.4 million in subscription licenses (FY 2023: $65.8 million), $1.3 million in perpetual licenses (FY 2023: $2.9 million), and new maintenance of $0.3 million (FY 2023: $1.8 million).

Management notes that the $75.4 million in TCV software subscription sales will deliver annually recurring revenue (ARR) of $9.2 million. As of 1 July, the total value of ARR is $62 million, comprising $50.7 million from subscriptions and $11.3 million from maintenance.

It also highlights that as its software becomes more and more mission critical, mining companies are asking for longer subscription terms to ensure certainty of supply. For example, in the second half of FY 2024, the company sold $18.4 million in software subscriptions with a committed term of eight years and $6.4 million with a committed term of ten years.

Given how the above reads very positively, investors may be wondering why the RPM Global share price is sinking today.

Well, this appears to have been driven by softer than expected profitability during the year.

Softer profits

The release reveals that gross revenue for FY 2024 is expected to finish between $113 million and $114 million. This is up from $98.4 million in FY 2023.

EBITDA (before management incentives) is expected to be in the range of $18.7 million to $19.3 million, which is up from $15 million last year.

And finally, profit before tax (pre management incentives) is forecast to be in the range of $14 million to $14.5 million. This is up 52% to 58% year on year from $9.2 million.

This was lower than forecast, which is weighing on the company’s shares today. Management commented:

The lower than forecasted profitability is due to reduced perpetual license sales and the timing of subscription licenses signed during the second half of FY2024.

It is also worth noting that not all of these profits will be retained, with the company intending to reward its employees handsomely. It advised:

Given the growth in TCV, revenue and profitability in FY2024, the Company expects incentives (shared across an increased number of employees) to be in the range of $3.5 million to $3.9 million for the FY2024 year (FY2023: $3.0 million).

Despite today’s weakness, the RPM Global share price remains up over 60% since this time last year.

The post Why is the RPM Global share price crashing 22% today? appeared first on The Motley Fool Australia.

More reading

• These 2 ASX 200 stocks just scored substantial broker upgrades
• Can ASX 200 tech shares produce another strong performance in FY25?
• 3 ASX small-cap shares I think have explosive growth potential
• Why are Liontown shares in a trading halt today?
• Can Nvidia stock cross $1,000 again after the stock split?

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 positions in and has recommended RPMGlobal. The Motley Fool Australia has recommended RPMGlobal. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

S&P/ASX 200 Index (ASX: XJO) tech shares delivered strong returns in FY24. There are multiple quality names within the ASX 200 that have created value for shareholders.

Some of the biggest names in the tech sector include Wisetech Global Ltd (ASX: WTC), REA Group Ltd (ASX: REA), Xero Ltd (ASX: XRO), CAR Group Limited (ASX: CAR), SEEK Ltd (ASX: SEK) and TechnologyOne Ltd (ASX: TNE).

The performance of each individual company’s operational growth and financials will obviously have an impact on how the share prices of the ASX 200 tech shares track in FY25. Aside from that, I think there could be two (foreseeable) important factors.

Interest rates

Interest rates usually greatly impact valuations because if investors can get a good return from safe assets like bank accounts and bonds, then ‘risk’ assets like shares should be priced at a lower level. For example, high interest rates, in theory, should mean a lower price/earnings (P/E) ratio than if interest rates were lower.

One of the world’s greatest investors, Warren Buffett, once said:

The value of every business, the value of a farm, the value of an apartment house, the value of any economic asset, is 100% sensitive to interest rates because all you are doing in investing is transferring some money to somebody now in exchange for what you expect the stream of money to be, to come in over a period of time, and the higher interest rates are the less that present value is going to be. So every business by its nature…its intrinsic valuation is 100% sensitive to interest rates.

Some investors may have already ‘priced in’ interest rate cuts from the US Federal Reserve or the Reserve Bank of Australia (RBA) which is likely partly why we saw such a strong rally of ASX 200 tech shares during FY24.

Based on Australia’s latest inflation numbers and RBA commentary, it could be a while yet before there’s a rate cut.

Valuations too high?

Interestingly, some high-profile, high-performing investors have started reducing their exposure to technology.

The Australian Financial Review recently reported that fund manager GQG Partners Inc (ASX: GQG) has made some “aggressive moves” to produce the next stage of strong returns (in FY25).

The newspaper reported that tech stocks were a major factor in GQG’s recent investment fund performance. However, in the last few months, the fund has reduced its exposure to the tech sector by more than half – from 43% in the portfolio to 21%. This decision was made because it seemed that the significant market interest in AI stocks was not spreading to other sectors as widely as expected.

GQG’s Brian Kersmanc said:

From the semiconductor standpoint, things weren’t broadening out as much –
spending was really isolated to that cluster around AI and data centres.

Markets also started pricing in some really blue sky scenarios for these stocks, so
although optically they looked cheap on a price-to-earnings basis, to get to the
estimates that were prevailing in the market, you had to get to some pretty
aggressive assumptions.

The last time GQG significantly cut its tech exposure was when it rotated into energy stocks, according to the AFR. After that, the NASDAQ plunged 33%, and commodity prices soared after Russia invaded Ukraine. The ASX 200 tech shares also had a bad time in 2022.

It’s an interesting sign that GQG has decided to take profits from its tech exposure. Even if tech stocks don’t crash in FY25, this could suggest that the ASX 200 tech shares may not see the same level of returns in FY25 as FY24 because we’ve already seen the expansion of their valuations (such as the P/E ratios).

Better-than-expected earnings growth and/or reducing interest rates could be necessary for another good year.

The post Can ASX 200 tech shares produce another strong performance in FY25? appeared first on The Motley Fool Australia.

More reading

• Brokers just put buy ratings on these ASX 200 tech stocks
• 5 things to watch on the ASX 200 on Tuesday
• Leading brokers name 3 ASX shares to buy today
• Why Guzman Y Gomez, MacMahon, Strike Energy, and WiseTech shares are sinking
• Guess which ASX tech share is sinking after $45 million founder sell-down

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 positions in and has recommended REA Group, Technology One, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended WiseTech Global and Xero. The Motley Fool Australia has recommended Car Group, REA Group, Seek, and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Investing in smaller companies, often called small-cap shares, is quite exciting for many investors. These companies, usually valued between $200 million and $2 billion, have a great potential to grow quickly.

What attracts people to ASX small-cap shares is their ability to respond quickly to new opportunities or changes in the market. This agility can lead to rapid growth. However, remember that while the opportunity for big rewards exists, these stocks can also be quite volatile. Investing in them comes with a mix of high hopes and risks.

With that caveat, let’s dive into 3 ASX small-cap shares that I think have promising growth potential.

PWR Holdings (ASX: PWH)

PWR Holdings is a great example of a company using its strong skills in one area to grow into other industries.

Founded in 1997 by Kees Weel, who is still the CEO today, PWR Holdings has become a top player in advanced cooling systems. The company is a global leader in this niche, providing high-performance products for motorsport, automotive, aerospace, and defence industries.

While the company is best known for its motorsports division, the aerospace and defence industry is growing fast.

In 1H FY24, the company reported robust results, as revenue grew by 22.2% to $64.2 billion, and earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased by 27.2% to $18.4 billion. While the motorsport sector’s 19% revenue growth was solid, the real surprise came from the aerospace and defence sector which saw an impressive 124% growth in revenue. The sector represented 12% of the total revenue, up from 7% a year ago.

Over the past decade, PWR Holdings has delivered stable earnings growth, superior profitability, and high return-on-equity ratios.

The PWR Holdings share price closed Monday at $10.94. Its shares are valued at a price-to-earnings (P/E) ratio of 34x on FY25 earnings estimates using S&P Capital IQ.

VEEM Ltd (ASX: VEE)

If there’s a leader in PWR Holding for the global cooling systems market, there’s also VEEM for the global marine precision parts market. VEEM introduced products that aimed to enhance efficiency and safety within its industry.

Founded in 1968, VEEM makes advanced marine technology and engineering parts, servicing both the defence and commercial marine sectors. Over the years, VEEM has established a strong reputation for innovation and quality, positioning itself as a key player in the global marine technology market.

This expertise and market leadership led to two exciting opportunities for VEEM. Several years ago, VEEM launched VEEM gyrostabilisers, an innovative product that replaces traditional propeller-based stabilisation. While the product’s revenue was just $5 million in 1H FY24, it brings a big market potential. Management estimates its total addressable market would be US$1.1 billion for new builds.

The other exciting venture is VEEM’s partnership with Sharrow Engineering. Last year, the two companies announced an exclusive agreement to adapt Sharrow’s design to a wider range of vessels. While it’s still early days, VEEM saw a positive outcome from initial testing and plans to launch this product line throughout FY25.

VEEM is tightly held by insiders, with Managing Director David Miocevich owning over 50% of the company.

The VEEM share price closed Monday at $1.72. According to S&P Capital IQ, its shares are valued at an FY25 P/E ratio of 30x.

Smart Parking Ltd (ASX: SPZ)

Smart Parking is the smallest company of the three, with a market capitalisation of $173 million, which puts it at the border between small-caps and micro-caps.

The company is growing fast by scaling up its operations. This company has presence in Australia, New Zealand, the UK, Germany, and Denmark.

As the name suggests, Smart Parking specialises in smart parking technology, which helps drivers find available parking spaces more easily and efficiently. Its systems include real-time parking information, automated payment options, and advanced monitoring tools. Smart Parking aims to make parking simpler and more convenient for both drivers and parking operators.

The number of parking sites managed by Smart Parking has grown from 250 in June 2017 to 1,219 in December 2023. During this period, revenue rose from $24.8 million in FY17 to 45.2 million in the last 12 months. As it built scale and operational efficiency, EBITDA margins improved from just 4% in FY17 to over 20% in the last 12 months to December 2023.

In terms of total addressable markets, management estimates there are approximately 45,000 sites in the UK, 90,000 sites in Germany, and 10,000 sites in Denmark. That’s a total of 145,000 parking sites, giving a long runway for growth.

The Smart Parking stock closed at $0.48 on Monday, implying a FY25 P/E ratio of 19x, according to S&P Capital IQ.

The post 3 ASX small-cap shares I think have explosive growth potential appeared first on The Motley Fool Australia.

More reading

• Top ASX shares to buy in July 2024
• Down 15% in 4 months, is it time to buy this ASX growth stock?
• 3 of the best growth-focused ASX shares to buy in June

Motley Fool contributor Kate Lee has positions in Veem. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended PWR Holdings and Veem. The Motley Fool Australia has positions in and has recommended PWR Holdings. The Motley Fool Australia has recommended Veem. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Liontown Resources Ltd (ASX: LTR) shares won’t be going anywhere on Tuesday.

That’s because the lithium developer has entered a trading halt this morning.

Why are Liontown shares in a trading halt?

Liontown requested the trading halt as it prepares to make an announcement relating to the funding of the Kathleen Valley Lithium Project in Western Australia. Its request states:

The trading halt is requested pending an announcement by the Company in connection with funding arrangements. Liontown considers that the trading halt is necessary to ensure the Company can manage its continuous disclosure obligations.

As things stand, Liontown’s shares are expected to be offline until the commencement of trading on Thursday 4 July.

What is happening?

It remains unclear what its funding arrangements involve. But shareholders certainly will be hoping that it includes debt and not equity.

As covered here, Liontown shares were the worst performers on the ASX 200 index in the last financial year. During the 12 months, the lithium developer’s shares lost approximately 70% of their value. So, this really would not be a good time to raise money and dilute its shareholders materially.

But debt financing is easier said than done. Earlier this year, Liontown warned that weak lithium prices were causing issues when it came to financing the Kathleen Valley Lithium Project.

However, it then entered into a A$550 million debt facility agreement in March with a syndicate of lenders. This includes Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), and Export Finance Australia.

The company didn’t expect to need to draw down on the debt facility until early in third quarter of 2024 (i.e. now). However, before then, there were remaining conditions that needed to be satisfied.

And as we have had no update since this announcement about the conditions being satisfied, it seems probable that this trading halt relates to this facility. These conditions include:

[D]emonstrating compliance with customary tests; providing a Base Case Financial Model (BCFM) based off, amongst other things, independent price forecasts and management forecasts of production, capital and operating costs, and which demonstrates compliance with financial ratios; and, entry into key project tripartite agreements.

Since the agreement was signed, lithium prices have continued to weaken. Furthermore, analysts are now predicting that prices remain at these levels for the foreseeable future. It will be interesting to see how this impacts its BCFM and thus its eligibility for the debt facility.

All being well, everything will be running smoothly and this is just a routine halt. We will find out if that is the case later this week when Liontown shares return to trade.

The post Why are Liontown shares in a trading halt today? appeared first on The Motley Fool Australia.

More reading

• Bell Potter names the best ASX mining stocks to buy in FY25
• These are the 10 most shorted ASX shares
• These were the five worst ASX 200 shares to own in FY24
• Here are the top 10 ASX 200 shares today
• Why Cettire, Collins Foods, Liontown, and Northern Star shares are dropping today

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

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

Nvidia‘s (NASDAQ: NVDA) stock popped up by a dramatic 500% in the past three years. Undoubtedly, much of this recent rally has been fueled by the company’s position as a key beneficiary and enabler of the ongoing artificial intelligence (AI) wave.

Nvidia offers a full-stack AI platform, comprising cutting-edge AI-optimized hardware chips, a complete software ecosystem, high-speed networking solutions, and servers to enable clients to build “AI factories,” or the essential infrastructure for AI-based outputs (text, images, audio, video). The company’s accelerated product release cadence, from two years to one year, also helps it maintain technological superiority against competition.

Furthermore, besides the booming demand from large hyperscale companies, enterprises, and AI start-ups, Nvidia’s AI-optimized hardware and software solutions are now increasingly used in new areas such as Sovereign AI (governments building domestic AI capabilities), automotive vertical, and robotics business.

The AI frenzy propelled Nvidia’s stock to an all-time high of over $1,200 in early June. Its recently executed 10-for-1 stock split made its stock far more accessible to retail investors.

With Nvidia’s stock now around $124 at this writing, long-term investors may be keen to know if the stock can again jump to $1,000-plus levels. Let’s analyze the company’s fundamentals and valuations to find some answers.

Intensifying competition and supply challenges

Nvidia’s technological superiority in developing AI-optimized hardware and software enabled the company to capture a whopping 90% share of the global AI chip market. However, the company’s stronghold may get challenged in the long run. Although currently far behind Nvidia, competitors Advanced Micro Devices and Intel are working hard to capture a slice of the AI market.

AMD’s MI300 family of data center chips witnessed strong demand, while the company is also gearing up for launching families of AI chips such as MI325 and MI350 accelerators, based on advanced architectures, in the coming months. AMD expects these chips to demonstrate faster performance, improved memory capacity, and stronger computing capabilities for AI workloads.

Intel is also aggressively focusing on the AI PC opportunity and hopes to launch Lunar Lake laptop CPUs by September 2024. Lunar Lake chips are expected to be superior in performance, efficiency, and graphics processing compared to their predecessor Meteor Lake chips. Plus, Intel has also introduced Gaudi 3 AI accelerators, offering superior cost-performance benefits for training and inferencing of AI models.

Nvidia also faces the risk of customers such as cloud players and technology giants becoming competitors, as they have been accelerating in-house development of AI-optimized chips and solutions. This risk cannot be ignored, since large cloud players account for roughly 45% of the company’s data center revenues.

Multiple other challenges

While demand for Nvidia’s AI chips and solutions has grown dramatically, the company continues to face supply constraints associated with procuring manufacturing, testing, and packaging capacity from Taiwan Semiconductor Manufacturing and other vendors. Subsequently, the company expects demand for its new H200 chips and next-generation Blackwell chips to outpace supply well until 2025. This headwind can affect the company’s growth prospects in the coming years.

Nvidia also accelerated the pace of release cadence (for major products or features) from once every two years to once annually. Continuously innovating and adapting hardware and software is the need of the hour in the face of increasing complexity and rapid evolution of AI models and workloads.

However, this also exposes Nvidia to significant execution risks and to the risk of clients delaying purchases to get access to the most advanced technologies. Nvidia’s rapid pace of innovation can result in early product obsolescence for its older offerings and increasing risk of self-cannibalization.

Valuation estimates

Nvidia has consistently posting impressive financial metrics for the past several quarters. In the first quarter of fiscal 2025 (ending April 28), revenues were up by nearly 262% year over year to $26 billion, while net income soared by 628% year over year to $14.9 billion.

Analysts expect Nvidia’s fiscal 2025 sales to grow by 97% year over year to $120 billion. While the revenue growth rate is expected to moderate in the next decade, analysts expect the company’s sales to more than triple to $380.9 billion by 2034.

Nvidia is currently trading at a price-to-sales (P/S) multiple of 38.6x. Assuming that this multiple reverts to its 10-year average of 22.27x (a conservative estimate), we can expect Nvidia’s market capitalization to reach around $8.5 trillion by 2034. While the market cap seems huge, it is only 2.7 times the company’s current $3.1 trillion market capitalization. This implies that the stock can reach north of $340 by 2034 (assuming no significant share repurchases or stock splits).

Assuming Nvidia’s P/S multiple remains at the current 38.6x level (a very aggressive estimate), the company’s market capitalization will be around $14.7 trillion — 4.7 times its current market capitalization. Still, the company’s share price can be expected to reach close to $600 by the end of 2034.

Hence, based on current estimates, the chances of Nvidia’s share price crossing $1,000 in the next decade appear slim. These projections, however, can change in case Nvidia makes even more dramatic advances in AI technologies in the coming years.

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

The post Can Nvidia stock cross $1,000 again after the stock split? appeared first on The Motley Fool Australia.

More reading

• One day, Nvidia stock will go down. Here’s how to keep it from hurting your portfolio
• Where will Nvidia stock be in 10 years?
• Nvidia is no longer the most valuable company in the world. Here’s what investors need to know
• Where are we in the share market cycle?
• After Nvidia’s 10-for-1 stock split, is it still a buy?

Manali Pradhan has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Advanced Micro Devices, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Intel and has recommended the following options: long January 2025 $45 calls on Intel and short August 2024 $35 calls on Intel. The Motley Fool Australia has recommended Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Bendigo and Adelaide Bank Ltd (ASX: BEN) shares are under pressure on Tuesday morning.

At the time of writing, the regional bank’s shares are down 1% to $11.31.

Bendigo Bank shares fall on CEO exit

This morning, the regional bank announced that its CEO, Marnie Baker, has decided to step down from the role.

According to the release, Ms Baker intends to leave after 35 years with the company and six years as its leader at the end of next month.

The outgoing CEO leaves on good terms with the bank’s board. Bendigo and Adelaide Bank’s chair, Vicki Carter, “thanked Ms Baker for her decades of service and leadership of the Bank through a period of great opportunity and significant challenge, which included frequent natural disasters, COVID-19 and record low interest rates.”

Carter also praised “Marnie’s authentic leadership style” and “the execution of a significant and necessary transformation agenda which included the consolidation of core banking platforms, brands and divisions.”

Replacement announced

Bendigo and Adelaide Bank’s shares are falling today despite the bank already identifying and appointing its next CEO.

The release reveals that its current chief customer officer for consumer, Richard Fennell, will take the reins on 31 August on a $1.5 million a year contract.

Carter notes “Mr Fennell’s strong focus on the customer, his achievements in digital and significant financial expertise were among the key attributes the Board prioritised in its detailed succession planning, which included a comprehensive external search.”

The company’s chair believes the bank is “in a position of strength and Richard is well placed to lead the next phase of [its] sustainable growth agenda.”

Fennell appears confident that he is up to the job. Commenting on his appointment, he said:

Bendigo and Adelaide Bank is a unique institution that plays an important role in providing Australian banking consumers with a genuine and compelling alternative to the majors. I am grateful for the transformation work Marnie has driven to create strong foundations for the Bank and I am proud to accept the responsibility for leading Bendigo and Adelaide Bank and ensuring its future success.

I look forward to connecting with all of our people who work hard every day to deliver great outcomes for our customers as we work together to find new ways to ensure the Bank can continue to deliver on its purpose of feeding into the prosperity of our customers and the community.

Bendigo and Adelaide Bank’s shares are up 30% over the past 12 months.

The post Bendigo Bank shares fall on surprise CEO exit appeared first on The Motley Fool Australia.

More reading

• These were the five best ASX bank shares to own in FY24
• 9 ASX 200 shares finishing FY24 on a 52-week high
• Which ASX shares to buy if interest rates rise (and which to avoid)
• 5 ASX 300 shares smashing new highs while the market sinks
• Here’s how the ASX 200 market sectors stacked up last week

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 positions in and has recommended Bendigo And Adelaide Bank. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The economic environment is uncertain for two of the ASX’s largest sectors – mining and banking. I’m going to run through what the dividend projections are for FY25 with some of the largest S&P/ASX 200 Index (ASX: XJO) dividend shares.

The ASX bank share sector is facing rising arrears amid a high cost of living and elevated interest rates. For example, in the recent Commonwealth Bank of Australia (ASX: CBA) update for the third quarter of FY24, CBA said its arrears of home loans that were overdue by at least 90 days increased from 0.44% at March 2023 to 0.61% at March 2024.

According to Trading Economics, ASX iron ore shares, such as BHP Group Ltd (ASX: BHP) and Fortescue Ltd (ASX: FMG), are facing uncertain demand from China. The Asian superpower’s housing construction sector continues to experience difficulties while Chinese iron ore production is growing.

With that in mind, let’s look at how big the dividend payments could be in FY25.

Dividend projections

The following forecasts are based on estimates on Commsec. Remember, forecasts are just educated guesses by analysts – the payouts could be smaller or larger than projected.

Owners of CBA shares could receive a grossed-up dividend yield of 5.1%.

BHP could pay a grossed-up dividend yield of 7.6%.

National Australia Bank Ltd (ASX: NAB) is projected to pay a grossed-up dividend yield of 6.7%.

ANZ Group Holdings Ltd (ASX: ANZ) is forecast to pay a grossed-up dividend yield of 8.3%.

Westpac Banking Corp (ASX: WBC) is predicted to pay a grossed-up dividend yield of 7.9%.

Fortescue is forecast to pay a grossed-up dividend yield of 9.2%.

Rio Tinto Ltd (ASX: RIO) is projected to pay a grossed-up dividend yield of 8.1%.

Macquarie Group Ltd (ASX: MQG) is predicted to pay a grossed-up dividend yield of around 4%.

Wesfarmers Ltd (ASX: WES) is forecast to pay a grossed-up dividend yield of 4.6%.

Woodside Energy Group Ltd (ASX: WDS) is projected to pay a grossed-up dividend yield of 7.7%.

Telstra Group Ltd (ASX: TLS) is predicted to pay a grossed-up dividend yield of 7.5%.

Is this a good time to invest?

The ASX 200 share market has performed strongly since the end of October 2023, rising by 14%.

I don’t think we can call the ASX bank shares good value, considering arrears are rising and competitive pressures remain. And I’m not bullish about the current iron ore price, so ASX iron ore shares don’t strike me as bargains.

Currently, of the ASX 200 dividend shares I’ve mentioned, I’d call Telstra shares good value, and I’d also be happy to own Wesfarmers shares and Macquarie shares because of their ability to compound earnings over the long term.

The post What is the outlook for ASX 200 dividend shares in FY25? appeared first on The Motley Fool Australia.

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• 3 ASX dividend shares to buy with 5%+ yields
• What went right and what went wrong for the BHP share price in FY 2024?
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Motley Fool contributor Tristan Harrison has positions in Fortescue. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group and Wesfarmers. The Motley Fool Australia has positions in and has recommended Macquarie Group, Telstra Group, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.