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National Australia Bank Ltd (ASX: NAB) shares had a tough time on Thursday.

The big four bank’s shares ended the day over 1% lower at $34.40.

Why did NAB shares fall?

This weakness appears to have been driven by a broker note out of Goldman Sachs this morning.

According to the note, its analysts have been looking over the banking sector following the release of updates this month. Commenting on the updates, the broker said:

1H24 reported PPOP/cash earnings were -8%/-9% on pcp but resulted in small upgrades to our FY24E cash EPS forecasts. Four key earnings themes suggested the deterioration in bank fundamentals may be slowing: i) commercial lending pipelines are strong, ii) mortgage NIM headwinds are finding a base and deposits spreads have held up, iii) there were some signs of deteriorating asset quality but it remains better than long-run averages and asset values to support losses (and potentially provision releases), and iv) strong capital positions saw A$2.4 bn of additional capital to be distributed to shareholders versus our pre-result forecasts.

While there clearly were some positives, the broker highlights that fundamentals are weak and valuations are extreme. It adds:

Bank 12-m forward PERs are currently at the 99th percentile, our DCF valuations are 17% below current share prices, and the spread between bank fully-franked yields and the 10-year bond yield is currently at its lowest level in nearly 15 years. While bank PER relative to non-bank industrials remains c. 5% cheaper than the historic average, we think this underestimates the relative deterioration in fundamentals.

In fact, the broker warns that the banks are “close to record expensive.” It adds:

To this end, a simple model that assesses bank relative to non-bank industrial fundamentals (EPS growth, ROE and franking) is currently at the third percentile and so when we adjust relative PERs for this, banks are trading at close to record expensive, i.e. 93rd percentile.

NAB downgraded

In light of the above, the broker has taken its buy rating off NAB shares and downgraded them to neutral with an unchanged price target of $34.04. This is a touch lower than where its shares are currently trading. It commented:

NAB is trading on a 12-mo forward PER of 15.4x, at the 95th percentile versus a 15-year history, and the 15-year average of 12.2x. 2. With the exception of CBA, NAB trades well above its 15-year average versus each of its peers on a 12-mo forward PER basis.

The post Why did NAB shares just get downgraded? appeared first on The Motley Fool Australia.

More reading

• What’s the dividend yield of NAB shares right now?
• Here’s what Wilsons is saying about ANZ, CBA, NAB, and Westpac shares
• An ASX dividend giant I’d buy over NAB shares for 2024
• It was huge week for ASX 200 bank shares. Here’s why
• How much passive income would I make from 200 NAB shares?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. 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.

Many income-seeking investors may be focused on individual ASX dividend shares. ASX-listed exchange-traded funds (ETFs) could be a useful addition to a portfolio.

An ETF’s dividend yield is dictated by the payments from their underlying holdings. If the businesses inside the ETF collectively have good dividend yields, then the ETF’s yield should also be appealing too.

There aren’t many ASX ETFs paying dividend yields above 5%, but below are four that do have relatively high yields.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The concept of this fund is that it provides low-cost exposure to companies on the ASX with higher forecast dividend yields than other ASX shares.

Diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% in any one company.

It has a total of 71 holdings, with significant positions in companies like Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), National Australia Bank Ltd (ASX: NAB), Wesfarmers Ltd (ASX: WES) and Westpac Banking Corp (ASX: WBC). It gives a lot of exposure to the ASX’s blue-chip shares.

According to the latest Vanguard monthly update, the VHY ETF has an annual management fee of 0.25% and a grossed-up dividend yield of 6.5%.

Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

This fund owns 20 of the largest ASX blue-chip shares, providing quarterly income to investors. It also employs a ‘covered call‘ strategy to enhance dividend income and “partly offset potential losses in falling markets” according to Betashares.

Four companies in the YMAX ETF portfolio have a weighting of at least 7%: BHP (15.4%), CBA (13.6%), CSL Ltd (ASX: CSL) (9.5%), and NAB (7.4%).

This fund has a higher management fee of 0.76% than the VHY ETF, though it also has an even higher grossed-up dividend yield of 9.8%.

Betashares Martin Currie Equity Income Fund (ASX: EINC)

This ASX ETF invests in an actively managed portfolio focused on ASX shares with good income attributes. It aims to provide a stronger dividend yield than the S&P/ASX 200 Index (ASX: XJO) and grow income faster than the rate of inflation.

The fund, managed by Martin Currie, selects “quality Australian companies paying attractive income, and with the potential for long-term income growth.”

It currently has names like APA Group (ASX: APA), Medibank Private Ltd (ASX: MPL), Telstra Group Ltd (ASX: TLS) and Atlas Arteria Group (ASX: ALX) in the portfolio.

Australian Bank Senior Floating Rate Bond ETF (ASX: QPON)

This ASX ETF invests in a portfolio of some of the largest and most liquid senior floating rate bonds issued by ASX bank shares. In other words, it invests in some of the safest bonds Aussie banks have issued, with their yield linked to interest rates.

If the RBA interest rate increases, the income yield rises. However, if the RBA interest rate falls, so does the income payment.

The income is paid monthly and, according to Betashares, is “expected to exceed the income paid on cash and short-dated term deposits.”

The biggest eight bond positions all have a weighting of more than 8%, and those large positions are bonds from ANZ, Westpac, NAB and CBA.

According to BetaShares, the current ‘all-in’ yield is 5.1%. This ETF has an annual management fee of 0.22%.

The post 4 ASX ETFs with yields over 5% appeared first on The Motley Fool Australia.

More reading

• Buy these 4 ASX ETFs for income, growth, or mining exposure
• Inherited a substantial sum of money? Here’s how I’d spend it (including the ASX stocks I’d buy)
• Where I’d invest $10,000 in dividend stocks
• Buy these excellent ASX ETFs for your income portfolio in May

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 CSL and Wesfarmers. The Motley Fool Australia has positions in and has recommended Apa Group, Telstra Group, and Wesfarmers. The Motley Fool Australia has recommended CSL and Vanguard Australian Shares High Yield ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

With approximately $7.9 billion in assets under management, the iShares S&P 500 ETF (ASX: IVV) is arguably one of the most popular exchange-traded funds (ETFs) on the ASX. It’s certainly one of the most popular international index funds that track shares outside the ASX.

One of the perks of an ASX-based index fund, though, is the dividend income potential it can provide. Even if an ASX-based ETF isn’t geared to provide high levels of dividend payments specifically, most ASX shares fork out relatively high levels of income, not to mention those valuable franking credits.

As such, even investors who opt for a vanilla ASX index fund like the Vanguard Australian Shares Index ETF (ASX: VAS) can expect to receive an annual dividend yield of between 3-5%. That would also come with some franking credits attached too.

But in stark contrast, US shares are famous for their lack of dividends. Many of the largest companies in the US markets don’t even pay a dividend. That includes the likes of Amazon, Alphabet and Berkshire Hathaway.

Indeed, Facebook-owner Meta Platforms made waves earlier this year when it declared its first-ever dividend. Yep, despite its near-US$1.2 trillion market capitalisation, Meta’s maiden dividend came in 2024.

So what kind of divided income can one expect from the iShares S&P 500 ETF?

Does the IVV ETF pay a decent ASX dividend?

Well, this ETF does pay its investors dividend distributions. In fact, those investors enjoy quarterly payments every three months from their IVV units – an unusual thing on the ASX.

Over the past 12 months, the iShares S&P 500 ETF has doled out a total of approximately 66 cents per unit.

That’s a little more than what investors bagged over the preceding 12 months.

At the current ASX IVV unit price of $53.73 (at the time of writing), these distributions give the fund a trailing dividend yield of… 1.23%. Given this ETF holds no ASX shares, its dividend distributions do not come with franking credits attached.

So yes, the IVV ETF does pay an ASX dividend. It just might not be on the scale that most ASX investors would be accustomed to.

Saying that, ASX investors who have held this ETF for a long time arguably don’t have many reasons to complain. What this ETF lacks in dividend firepower, it has certainly made up for when it comes to recent capital growth.

As of 30 April, IVV units have returned an average of 14.17% (growth plus dividends) per annum over the past three years. Over the past five years, investors have enjoyed a 14.69% average annual return, which stretches to 16.24% over the past ten years.

The post Does the iShares S&P 500 ETF (IVV) pay a decent ASX dividend? appeared first on The Motley Fool Australia.

More reading

• 3 excellent ASX ETFs for beginner investors to buy
• 16% per annum: Is the iShares S&P 500 ETF (IVV) too good to turn down?
• How much money should I put in one ASX ETF?
• Top ASX shares to buy for your superannuation fund in May 2024
• If I’d put $5,000 in iShares S&P 500 ETF (IVV) at the start of 2024, here’s what I’d have now

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Alphabet, Amazon, Berkshire Hathaway, Meta Platforms, and Vanguard Australian Shares Index ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Berkshire Hathaway, Meta Platforms, and iShares S&P 500 ETF. The Motley Fool Australia has recommended Alphabet, Amazon, Berkshire Hathaway, Meta Platforms, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Buying what looks like a high-yield ASX dividend stock isn’t always the slam dunk that an investor might hope for. A high dividend yield does indicate that a share may prove to be a lucrative source of dividend income going forward. But it also might be warning investors that the markets are expecting dividend cuts in the future. In other words, a dividend trap in the works.

When looking at ANZ Group Holdings Ltd (ASX: ANZ) shares today, one might wonder which of these camps the ASX bank stock falls into right now.

At first glance, the dividend yield on ANZ shares looks mightily compelling. At the current share price of $28.29 (at the time of writing), this big four bank was trading at a trailing dividend yield of 6.26%.

Unlike most other ASX banks, ANZ’s dividends don’t tend to always come with full franking credits attached anymore. But even so, ANZ’s latest dividend, the upcoming 83-cent interim payment that investors will bag on 1 July, will be partially franked at 65%.

The previous dividend, the December final dividend of 94 cents per share, which contributes to the second half of ANZ’s current yield, was also partially franked at 56%.

So that brings us to the crux. Is this high-yield ASX dividend stock a buy right now?

Should you buy this 6%-yielding stock?

Well, looking at ANZ shares today, I think the answer to this question depends on what kind of investor one might be.

To start with, I don’t believe ANZ shares are a dividend trap right now. Despite the high yield on display. It’s normal for all ASX banks shares to trade with relatively high yields compared to other ASX blue chips.

What’s more, ANZ is one of the big four banks. All four of these ASX stalwarts have mature business models, a loyal customer base, and established market share, honed over decades. They are also heavily regulated to ensure their own stability. All of these factors make ANZ’s earnings base (from which it pays out its dividends) very robust.

As such, I think ANZ shares would be a great addition to any investor who primarily invests in ASX shares for dividend income. Yes, the bank doesn’t offer fully franked dividends. However, its high starting yield would make it a valuable addition to any ASX dividend-focused portfolio.

Income but no growth?

However, saying that, I don’t believe ANZ shares are a great buy right now for anyone who doesn’t prioritise dividend income from their investments. Whilst ANZ shares do offer significant passive income potential, this bank does not have a strong history of delivering capital growth. To illustrate, today ANZ is trading at the same share price it was way back in January 2007.

Since ANZ is arguably one of the weaker members of the big four, I don’t see the company turning this around anytime soon. Sure, ANZ has a robust and mature customer base. But I don’t think the bank has what it takes to steal any meaningful market share from its competitors going forward.

As such, I don’t think ANZ shares are a market-beating investment. It’s my view that investors who are chasing absolute returns, and not just dividend income, would be better off looking elsewhere for their next investment.

The post Is now a good time to buy this high-yield ASX dividend stock? appeared first on The Motley Fool Australia.

More reading

• Here is the earnings forecast through to 2026 for ANZ shares
• Here’s what Wilsons is saying about ANZ, CBA, NAB, and Westpac shares
• How ASX growth shares can become top dividend stocks
• Here’s the ANZ dividend forecast through to 2026
• Why ANZ, Fletcher Building, Macquarie, and Sayona Mining shares are dropping today

Motley Fool contributor Sebastian Bowen 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.

Two more S&P/ASX 200 Index (ASX: XJO) shares are due to go ex-dividend next week, so if you’re not already an owner and you want to pick up these dividend payments, you’ll need to act quickly.

The ex-dividend date is the first day that a share trades without the next dividend payment attached.

But beware of this strategy.

It sounds like a quick and easy way to secure some extra dividend income, and yes, it certainly is. But there’s a catch (because nothing about investing is that easy!).

The catch is the share price will typically go down on the ex-dividend date. So, don’t think you can simply buy the stock, qualify for the payment, and then sell out for a profit in a couple of quick transactions.

The reason the share price typically goes down on the ex-dividend date is that buyers will not be entitled to the next dividend payment, so the stock is less appealing for purchase.

And, of course, every time a company pays dividends, it loses a tonne of money off its balance sheet. So, that reduces the company’s cash assets, and therefore, it loses a little of its market value.

For existing shareholders, it’s handy to be aware of upcoming ex-dividend dates so you won’t be shocked when the share price drops on the day! So this is important information for you, too.

Next week, there are two ASX 200 shares going ex-dividend. Here are the essential details.

ASX 200 shares going ex-dividend next week

Elders Ltd (ASX: ELD)

This ASX 200 agricultural and consumer staples share will pay an interim dividend of 18 cents per share on 26 June. The payment will come with 50% franking.

The ex-dividend date is next Tuesday 28 May.

Elders reported a 19% decline in revenue to $1,341.8 million for the six months ending 31 March compared to the prior corresponding period (pcp).

Statutory net profit after tax (NPAT) cratered 76% to $11.6 million. The underlying return on capital fell from 16.9% to 11.4% and the underlying earnings per share (EPS) tumbled 72% to 9.1 cents per share.

Elders said its weak half-year report was due to four headwinds: challenging seasonal conditions, cautious client sentiment, softening crop input prices, and lower livestock prices.

However, its real estate services business performed well with gross profits increasing 22.5%.

The ASX 200 share is up 12.3% in the year to date. The Elders share price is $8.43 at the time of writing.

Technology One Ltd (ASX: TNE)

The ASX 200 technology share will pay a record interim dividend of 5.1 cents on 14 June. Investors will benefit from 65% franking.

The ex-dividend date is next Thursday 30 May.

Technology One reported a 16% bump in revenue over the pcp to $244.8 million, with total annual recurring revenue (ARR) up 21% to $423.6 million.

The company’s profit after tax was up 16% pcp to $48 million, so it decided to bump up its interim dividend by 10% this year.

The ASX 200 share is up 15.6% in the year to date. Technology One shares are currently $17.73 apiece.

The post 2 ASX 200 shares trading ex-dividend next week appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Why Droneshield, TechnologyOne, Telix, and Webjet shares are rising today
• Guess which 7 ASX 200 shares are smashing new 52-week highs today
• Is this ASX 200 tech stock in the buy zone following its results?
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Bronwyn Allen 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 Technology One. The Motley Fool Australia has recommended Elders and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you’d invested $3,000 in Liontown Resources Ltd (ASX: LTR) shares at this time last year, you’d be nursing some hefty losses.

Hit by another sharp retrace in lithium prices over the latter months of 2023, shares in the S&P/ASX 200 Index (ASX: XJO) lithium stock are down a painful 48.8% over the full year.

But that’s not what we’re here to talk about.

Because a month ago, on 23 April, Liontown shares began a remarkable turnaround.

At the time, you could have snapped up the ASX 200 lithium stock for $1.10 a share.

So, you could have bought 2,727 shares with a $3,000 investment.

Since then the stock has soared 28.6% to today’s $1.41 a share.

That means your 2,727 shares purchased just one month ago would be worth $3845.07 today.

Quite a tidy profit from a stock that proved it’s no falling knife.

Here’s what’s been stoking ASX 200 investor interest.

Why have Liontown shares been on a tear?

The ASX 200 lithium stock ended April with a bang.

On 29 April, Liontown shares closed up 8.0% after the company reported some strong quarterly results.

Liontown is not yet in the production stages of lithium. The miner is currently developing its Kathleen Valley Lithium Project in Western Australia.

And investors reacted positively to news that Kathleen remains on track and on budget for first production by mid-2024.

Management noted that as at 31 March Kathleen was more than 85% complete “on an earned value basis”.

March also saw the miner hit another significant milestone at Kathleen with commissioning commenced at the dry plant towards the end of the month.

Liontown shares received some extra tailwinds two weeks ago, on 10 May, when the company released a new progress update for the project.

The ASX 200 lithium stock reported inking a $71 million agreement with GR Engineering Services Ltd (ASX: GNG) for the Engineering, Procurement and Construction (EPC) contract at Kathleen.

GR Engineering will deliver and commission the project’s Paste Plant facility which will support underground mining operations.

“We are pleased to award the contract for the design and construction of the Paste Plant which will support and further de-risk the planned underground production rates at Kathleen Valley,” Liontown CEO Tony Ottaviano said.

And Motley Fool analyst James Mickleboro noted how this might offer a boost for Liontown shares:

The good news is that this forms part of planned and budgeted next stage of growth capital costs post first production and funding is covered by the recently announced $550 million financing facility.

The post Guess how much a $3,000 investment in Liontown shares ballooned to in just one month appeared first on The Motley Fool Australia.

More reading

• ASX 200 shares vs. property: Which has performed better since the COVID crash?
• These are the 10 most shorted ASX shares
• Here are the top 10 ASX 200 shares today
• Could Liontown shares roar 30%+ higher?
• What the federal budget means for interest rates and ASX shares

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Gr Engineering Services. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

One of the highest growth ASX 200 healthcare stocks on the market went into a trading halt on Thursday.

Neuren Pharmaceuticals Ltd (ASX: NEU) requested the trading halt before the market open today.

The company said it wanted time to analyse data from its Phase 2 clinical trial of its second drug candidate, NNZ-2591, in the treatment of Pitt Hopkins syndrome.

Neuren intends to prepare a statement announcing the top-line results shortly.

The ASX 200 healthcare stock will remain in a trading halt until either the announcement is released or trading commences on Monday.

What is Pitt Hopkins syndrome?

Neuren develops drugs for serious childhood neurological disorders that have no or limited approved treatments.

All of its drugs have ‘orphan drug’ designation in the United States, which gives Neuren access to incentives to support its work. It also has an orphan drug designation for NNZ-2591 in Europe.

Pitt Hopkins syndrome (PTHS) is a neurodevelopmental condition that causes developmental delays.

It causes moderate to severe intellectual disability, hyperventilation and/or breath-holding while awake, seizures, gastrointestinal issues, speech difficulties, and sleep disturbances.

Sufferers often have distinctive facial features and are sometimes misdiagnosed as suffering from autism.

Neuren says PTHS is caused by the loss of one copy, or a mutation, of the TCF4 gene on the 18th human chromosome. The incidence of PTHS is estimated at between 1 in 11,000 people and 1 in 41,000 people.

Previously, Neuren tested NNZ-2591 on mice with the tcf4 mutation for six weeks. The company said its drug “normalized the deficits in all the tests for hyperactivity, daily living, learning and memory, sociability, motor performance and stereotype”.

ASX 200 healthcare stock up 40% in 6 months

Neuren Pharmaceuticals has been a barnstorming stock of the ASX 200 over the past two years.

It was the ASX 200 healthcare stock of the year in 2023, with its share price skyrocketing 214%.

The road has been a little more challenging for the Neuren Pharmaceuticals share price over the past six months. However, it is still up by 39.56% to $20.71 today.

The latest news from Neuren Pharmaceuticals

Prior to today’s trading halt announcement, the last piece of price-sensitive news we received from Neuren Pharmaceuticals was on 9 May.

That’s when the company released its Q1 FY24 update on sales of its maiden drug, Daybue.

Daybue is a world-first drug treatment for Rett syndrome. It’s approved in the US for adults and pediatric patients aged two years and up.

ASX investors appeared underwhelmed by the progress of Daybue sales in the US. As a result, the ASX 200 healthcare stock lost 3.93% on the day of the release.

Q1 net sales of Daybue in the US totalled US$75.9 million, just missing the guidance range of US$76 million to US$82 million. It was also lower than the previous quarter’s net sales of US$87.1 million.

Neuren blamed the fallen sales on seasonal factors, including refills that were due in January and actioned in December before the holidays, and reduced Rett clinic days in January.

The full-year 2024 guidance for net sales is between US$370 million and US$420 million.

Another challenge for this ASX 200 healthcare stock over the past six months was a short seller’s report in February, which described Daybue as a “flop” amid “horror stories” of side effects.

Neuren’s response failed to stop the ASX 200 healthcare stock from losing its upward trajectory from there.

The post ASX 200 healthcare stock up 40% in 6 months halted ahead of major trial results appeared first on The Motley Fool Australia.

More reading

• ASX 200 shares vs. property: Which has performed better since the COVID crash?
• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
• Guess which four ASX 300 shares were just re-rated by top brokers
• Brokers name 3 ASX shares to buy now

Motley Fool contributor Bronwyn Allen 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.

CSL Ltd (ASX: CSL) shares have a long history of delivering market-beating returns for investors.

For example, over the last 15 years, the biotechnology giant’s shares have generated an average total return of 16.55% per annum.

To put that into context, a $10,000 investment back in 2009 would have grown to be worth approximately $99,500 today.

And while the market has historically delivered a very solid 10% per annum return, CSL’s outperformance has led to significantly greater wealth creation than if you had just invested the same $10,000 into an index fund.

For instance, $10,000 compounding at 10% per annum would grow to become approximately $42,000 in 15 years.

That’s less than half the return of CSL shares during the same period. Clearly it has been a great stock to hold in your portfolio.

But does this remain the case today? Let’s see if CSL can be a market-beater again in the future.

Can CSL shares beat the market?

Analysts at Morgans are feeling very positive about the company’s outlook. So much so, CSL has been named on the broker’s best ideas list again this month. Morgans said:

While shares have struggled of late, we continue to view CSL as a key portfolio holding and sector pick, offering double-digit recovery in earnings growth as plasma collections increase, new products get approved and influenza vaccine uptake increases around ongoing concerns about respiratory viruses, with shares trading at 25x, a substantial discount (20%) to its long-term average.

The broker has an add rating and $315.40 price target on its shares. This implies potential upside of 12% for investors from current levels.

Bigger returns to come

Over at Macquarie, its analysts are even more bullish on CSL shares. Macquarie currently has an outperform rating and $330.00 price targets on them. This suggests that potential upside of almost 17% is possible over the next 12 months.

But the returns won’t stop there according to the broker. Macquarie is so positive on the medium term outlook for the key CSL Behring business that it sees scope for the CSL share price to climb beyond $500 within three years. If this proves accurate, it would mean a return of 77% from current levels.

While nothing is guaranteed in the investment world, it is fair to say that analysts are quite confident that CSL can continue its market-beating ways long into the future. Time will tell if that is the case.

The post Can CSL shares deliver market-beating returns for investors? appeared first on The Motley Fool Australia.

More reading

• Don’t get clever, just buy stability: 2 defensive ASX shares to buy now
• 4 ASX shares held by billionaire fund managers
• 5 ASX 200 blue chip shares to buy now
• Top brokers name 3 ASX shares to buy next week
• Buy, hold or sell these 3 ASX 200 healthcare shares: Experts

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

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is out of form and trading lower. At the time of writing, the benchmark index is down 0.45% to 7,813.5 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are rising:

Australian Ethical Investment Ltd (ASX: AEF)

The Australian Ethical share price is up 5% to $4.62. This follows news that the investment company has entered into a binding agreement to acquire the sustainable fixed income asset management business, Altius Asset Management, from Australian Unity. Once complete, it will see Australian Ethical grow its funds under management (FUM) from $10.3 billion to $12.3 billion. This will be an increase of 19%. Management highlights that the proposed acquisition is consistent with its strategy to serve the growing potential addressable market created by the structural drivers favouring responsible investing.

Cromwell Property Group (ASX: CMW)

The Cromwell Property Group share price is up over 7% to 46.7 cents. This morning, the property company announced that it has agreed to sell its European fund management platform and interests to Stoneweg for $457 million. Management notes that the transaction continues the company’s strategy to simplify the business and transition to a capital light fund management model. It also allows Cromwell to focus on its core competencies in Australia and New Zealand.

Smartpay Holdings Ltd (ASX: SMP)

The Smartpay share price is up 10% to $1.22. This follows news that the payments company has signed a contract with Cuscal Payments NZ. The contract will see Cuscal provide payment processing services to support Smartpay provide acquiring services in New Zealand. CEO Marty Pomeroy said: “This is a significant milestone in Smartpay’s ongoing partnership with Cuscal and the journey to becoming a trans-tasman instore payments provider, and realising a transformational opportunity for our organisation.”

Xero Ltd (ASX: XRO)

The Xero share price is up 9% to $135.07. Investors have been buying the cloud accounting platform provider’s shares following the release of its FY 2024 results. Xero reported a 22% increase in operating revenue to NZ$1.71 billion for the 12 months. This was underpinned by a 419,000 increase in subscribers to 4.16 million and a 14% lift in average revenue per user to NZ$39.29. On the bottom line, the company swung from a loss of NZ$133.5 million to a sizeable profit of NZ$174.6 million. Xero CEO, Sukhinder Singh Cassidy, said: “This result shows we’re doing what we said we’d do. We’ve delivered a strong and profitable FY24 result and Rule of 40 outcome, demonstrating our commitment to balancing growth and profitability.”

The post Why Australian Ethical, Cromwell Property, Smartpay, and Xero shares are surging appeared first on The Motley Fool Australia.

More reading

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• 5 things to watch on the ASX 200 on Thursday
• 5 stellar ASX growth shares to buy for strong returns
• Here are the top 10 ASX 200 shares today
• Own Xero shares? Here’s what to expect from next week’s results

Motley Fool contributor James Mickleboro has positions in Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Australian Ethical Investment and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool Australia has recommended Australian Ethical Investment. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Do you remember how the COVID-19 market crash began, with ASX 200 shares plummeting almost 700 points in just five trading days?

Oh, the shivers up my spine! And that was just the start of it, too.

ASX 200 shares vs. property during the COVID crash

The first case of COVID-19 was registered in Australia on 31 January 2020.

Just three weeks later on 21 February, there was fear in the share market.

The S&P/ASX 200 Index (ASX: XJO) closed at 7,139 points on Thursday, 20 February… and then began its month-long fall. The benchmark index hit its trough of 4,546 points on 23 March.

All up, ASX 200 shares cratered 2,593 points or 36.3% over those four-and-a-bit weeks.

That was a terrible month for investors and a scary time for all of us for many other reasons, too!

Meantime, in the property market…

Discussions among experts about potentially large price falls due to COVID-19 began in March 2020.

SQM Research director Louis Christopher said a 30% decline in Sydney and Melbourne home values was possible in his worst-case scenario.

AMP chief economist Dr Shane Oliver referred to Treasury forecasts of a potential explosion in unemployment to 10%, which he said could lead to 20% house price falls at worst (courtesy abc.net.au).

But as we now know, that didn’t eventuate.

At best, property could be described as experiencing a ‘blip’ compared to what happened to ASX 200 shares.

The national median value fell for five consecutive months in 2020, but only in small amounts.

According to CoreLogic data, the median value declined -0.4% in May, -0.7% in June, and -0.6% in July. It then fell a further -0.4% in August and -0.1% in September.

Shares vs. property: Which has done better since COVID?

In analysing shares vs. property and their performance since COVID-19 hit us, it is clear that ASX 200 shares have come out the winner if we take an overall view.

Eleanor Creagh, a senior economist at REA Group Ltd (ASX: REA), said PropTrack data covering the four years from March 2020 to 2024 shows a 39.9% uplift in the national home price.

Meantime, the ASX 200 has risen 50.2% from 31 March 2020 to 27 March 2024.

So, ASX 200 shares win from an overall perspective.

But as you’ll see below, some capital city and regional property markets did better than 50.2% growth.

So, it’s fair to say that both asset classes have delivered impressive gains since COVID-19.

Pandemic property boom

Emergency low interest rates, government stimulus payments such as Jobkeeper, and the ability to work from home, thanks to technology, enabled many homeowners to continue repaying their loans.

The banks offered loan repayment holidays to those doing it tough to limit arrears. A moratorium on evictions stopped landlords from evicting tenants who couldn’t pay their rent due to job losses.

Lockdowns prevented people from leaving their homes, and open homes were disallowed for periods.

These were some of the factors that kept the housing market from collapsing during the first year of the pandemic. After that, a boom ensued, and home values soared across the country.

The prolonged period of emergency low interest rates was an incredibly powerful factor in the boom.

Once-in-a-lifetime rock-bottom mortgage rates encouraged more people to upgrade their homes or buy more property investments after lockdowns were lifted.

A lack of stock for sale kept supply lower than demand, forcing prices higher across the nation.

Creagh notes several trends during the pandemic. These include regional property prices growing faster than capital city prices as thousands of people who could work from home left the major cities.

People also left expensive inner-city areas to buy larger and more affordable homes in city outskirts areas.

Creagh said:

At the very onset of the pandemic, there was a pause in the housing market as lockdown restrictions, closed borders and uncertainty weighed, with many thinking home prices would fall.

In fact, the opposite occurred. Housing demand surged, and along with record low interest rates and limited stock for sale, combined to drive a price boom that saw national prices growing at the third-fastest rate in Australia’s history.

After the pandemic boom, prices began to fall shortly after the Reserve Bank began increasing interest rates in May 2022. But this price moderation did not last long.

Strong population growth after the border reopened, continuing low stock for sale, a tight rental market and continuing low unemployment led to a new property growth cycle commencing in early 2023.

Creagh commented:

Net migration has hit record levels since the international borders reopened, and insufficient housing supply coupled with strong demand has offset the higher interest rate environment and deterioration in housing affordability.

Here is how property prices moved between March 2020 and 2024, according to REA’s PropTrack data.

Property market	Median home value	Price growth March 2020 – March 2024
Sydney	$1,069,000	34.7%
Melbourne	$802,000	17.2%
Brisbane	$801,000	63.1%
Adelaide	$723,000	64%
Perth	$660,000	57.3%
Hobart	$662,000	36.1%
Darwin	$482,000	25.1%
ACT	$827,000	37.4%
Regional New South Wales	$715,000	51.6%
Regional Victoria	$584,000	40.6%
Regional Queensland	$647,000	66.5%
Regional South Australia	$439,000	66.2%
Regional Western Australia	$496,000	55.5%
Regional Tasmania	$501,000	53.6%
Regional Northern Territory	$424,000	9.4%

V-shaped COVID recovery for ASX 200 shares

As stated earlier, ASX 200 shares fell 36.3% between 20 February and 23 March 2020.

Then began the recovery in a fairly pronounced V-shape, as shown in the chart below.

ASX 200 shares went from the trough of 4,546 points on 23 March to 6,198.6 points on 9 June. From there, the benchmark index moved sideways before a Santa Rally in November and December 2020.

The chart shows the journey from there through til today.

During the four-year period we are examining in this article, ASX 200 shares rose 50.2%.

Today, the ASX 200 shares index is 7,799.1 points, down 0.62%.

And a fun fact: the ASX 200 reached a new all-time high of 7,910.5 points on 1 April.

5 top rising ASX 200 shares over 4 years

Here are the ASX 200 shares that had the highest share price growth between 31 March 2020 and 31 March 2024, according to data from S&P Global Market Intelligence.

As you can see, ASX lithium shares and ASX uranium shares dominate the list.

ASX 200 share	Share price growth March 2020 – 2024
Paladin Energy Ltd (ASX: PDN)	2,696%
Pilbara Minerals Ltd (ASX: PLS)	2,153%
Neuren Pharmaceuticals Ltd (ASX: NEU)	2,043%
Liontown Resources Ltd (ASX: LTR)	1,646%
Boss Energy Ltd (ASX: BOE)	1,391%

Here are 9 other ASX 200 shares that you should have bought during the pandemic crash and held.

And here are some ASX shares that were COVID winners but crashed after life returned to normal.

The post ASX 200 shares vs. property: Which has performed better since the COVID crash? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Is the Paladin Energy share price overcooked at $17.40?
• These 2 ASX shares could win big time in the long term
• This top broker says the Pilbara Minerals share price is going to crash 35%

Motley Fool contributor Bronwyn Allen 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. The Motley Fool Australia has recommended REA Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.