Tag: Fool

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

Investors went wild for Nvidia‘s (NASDAQ: NVDA) stock split. 

Shares of the artificial intelligence (AI) chip leader jumped 27% from the stock split announcement on May 22 to the execution of the split on June 7.

The gains were enough to put Nvidia past the $3 trillion market cap mark and within a hair of becoming the most valuable company in the world. (It’s in a close three-way race with Apple and Microsoft.) While a strong first-quarter earnings report from Nvidia also helped give the stock a boost, the stock split seemed to be the main reason for the 27% pop. Shares continued to march higher after the earnings report, and even gained another 9% in the week after the split went into effect.

Now, fellow chip stock Broadcom (NASDAQ: AVGO) is taking a turn. Following Nvidia’s 10-for-1 stock split, Broadcom announced a similar 10-for-1 split when it reported fiscal second-quarter earnings after hours on June 12. Broadcom’s stock split is set to go into effect on July 15.

Investors seem to like the move. Shares of Broadcom, which may be best known for its networking chips, have already jumped 16% in the two days since the announcement.

Broadcom was due for a stock split

Broadcom shares now trade above $1,700, higher than Nvidia was before its stock split. This is one of the highest share prices on the market.

In the announcement, management said the stock split was intended to “make ownership of Broadcom stock more accessible to investors and employees.”

Since it was acquired by Avago (which took the name Broadcom) in 2016, the company hasn’t split its stock, though the old Broadcom split its stock three times between 1999 and 2006.

While the share price appreciation is one reason for the stock split, Broadcom’s growth potential in the generative AI era offers another reason for the split.

Broadcom acquired virtualization software specialist VMWare late last year, and VMware has been the primary driver of its growth. Revenue jumped 43% in the second quarter to $12.5 billion, ahead of estimates at $12 billion, though without VMware, revenue rose 12%.

Management also said revenue from AI products reached $3.1 billion, representing roughly a quarter of total revenue. Management said demand from cloud infrastructure companies for both networking and custom accelerators is strong. It now expects networking revenue to grow 40%, compared to its earlier forecast of 35%, due to AI demand. It also raised its full-year revenue guidance from $50 billion to $51 billion, $11 billion of which would be AI revenue.

Is Broadcom a buy?

With or without the stock split, Broadcom looks like a smart long-term stock to own. The company has a long history of successfully integrating acquisitions and cutting costs, and it looks poised to do that again with VMware.

Meanwhile, the company might not have as much exposure to AI as Nvidia, but its competitive strengths in areas like networking and custom ASIC chips are becoming apparent. For example, seven of the largest eight AI clusters in deployment today use Broadcom Ethernet solutions.

Broadcom stock has soared in recent months so some of the growth in AI is baked into the price. But its financials also got a boost from the VMware acquisition, which is giving profits a significant boost.

Buying Broadcom on the stock split alone isn’t a good idea, but the split could help push shares higher in the coming months. As enthusiasm for AI stocks continues to percolate, Broadcom deserves to gain with the broader sector, as it’s clearly benefiting from increasing demand for generative AI. 

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

The post Nvidia jumped 27% after its stock split announcement. Can Broadcom beat it? appeared first on The Motley Fool Australia.

More reading

• 3 reasons to buy Nvidia like there’s no tomorrow (Hint: The stock split Isn’t 1 of them)
• 5 Reasons Nvidia isn’t in an AI-fueled bubble
• 2 reasons to buy Nvidia after the stock split (and 1 reason to sell)
• With nothing in my savings account, I’d use Warren Buffett’s golden rule to build wealth
• Which ‘other’ US AI stock is soaring this week?

Motley Fool contributor Jeremy Bowman has positions in Broadcom. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple, Microsoft, and Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Broadcom and has recommended the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool Australia has recommended Apple, Microsoft, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Sun Silver Ltd (ASX: SS1) share price is catching the eye of investors on Tuesday morning.

At the time of writing, the ASX mining stock is up a sizeable 16% to 53 cents.

Why is this ASX mining stock rocketing?

Investors have been fighting to get hold of the silver and gold explorer this morning after it released an update on the Maverick Springs Silver-Gold Project in Nevada, United States.

According to the release, the company has identified an outstanding high-grade target zone within the north-western section of the “globally significant” project.

The ASX mining stock notes that the high-grade target zone was defined as part of an ongoing comprehensive review of historical data, drill material, and recent field activities. During these reviews, the company’s team has uncovered exceptional high-grade silver intervals in multiple historic drill-holes of up to 6,216g/t Silver (Ag).

Management highlights that these zones are significant as they lie on the north-western boundary of the defined mineralised zone. Furthermore, the grades and intercept widths are significantly larger than the average grades and intercepts of the current JORC modelled mineral resource.

In addition, recent fieldwork has identified rocky outcrops and pathfinder elements up to 1.2 km from the current defined mineralisation boundary in the North-West. It believes that this supports the theory that potential resource extensions may be located in this area.

But it gets better. Management points out that the absence of rocky outcrops within the current mineralised zone excites the team about the possibility of surface mineralisation in the north-west area of the property.

Sun Silver’s exploration team is now finalising drill-hole locations to target the high-grade zone as well as extensional targets along trend.

It notes that definition and mapping of these high-grade intercepts near the north-western corner has guided the exploration team in targeting continuation of mineralisation along-trend but also focusing on higher grade areas as part of its inaugural drilling campaign.

‘Boosted confidence’

The ASX mining stock’s executive director, Gerard O’Donovan, was very pleased with the news. He said:

Defining this high-grade zone and generating inaugural drill targets validates our diligent analysis of crucial data and drill information at Maverick Springs. Mapping high-grade results near the north-western border of the current Resource has boosted confidence in potential for extension of mineralisation beyond defined boundaries and the potential for discovering higher grades. We look forward to testing these theories in our upcoming inaugural drill campaign.

The post Guess which ASX mining stock is rocketing 16% on a new discovery appeared first on The Motley Fool Australia.

More reading

• ASX healthcare stock surges 11% on ‘incredibly valuable’ FDA news
• Nvidia jumped 27% after its stock split announcement. Can Broadcom beat it?
• 2 ASX dividend shares offering over 5% yield
• 3 winning tips both Warren Buffett and Peter Lynch recommend
• These beaten down ASX lithium stocks could rise 35% to 85% in 12 months

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.

In the world of investing, dividends are like the steady heartbeat of a healthy portfolio. They provide a regular income stream, offering a cushion against market volatility.

Are you seeking some reliable ASX dividend shares with impressive yields? Read on to explore two ASX shares currently offering dividend yields of over 5%.

Metcash Ltd (ASX: MTS)

Where do you shop for groceries these days? Surely, Woolworths Group Ltd (ASX: WOW) and Coles Group Ltd (ASX: COL) are the main ones that come to mind.

In addition to these two retail giants, IGA Supermarkets are also doing well, with over 1,400 stores nationwide.

Furthermore, IGA owner Metcash shares are trading cheaper than its bigger peers. Using earnings estimates by S&P Capital IQ:

• Metcash shares are trading at 13x FY25 estimated earnings
• Woolworths shares are trading at 23x FY25 estimated earnings
• Coles shares are trading at 20x FY25 estimated earnings

Based on actual dividends paid over the past 12 months, Metcash offers a higher dividend yield than its peers.

• Metcash offers a fully franked dividend yield of 5.9%
• Woolworth offers a fully franked dividend yield of 3.2%
• Coles offers a fully franked dividend yield of 3.9%

Its 1H FY24 results were mixed. While revenue, net of charge-through sales, grew by 1.3% from a year ago to $7.8 billion, its underlying operating profit decreased 3.4% to $246.5 million. Underlying net profit after tax was down 10.9% to $142.5 million.

With that said, in the same report, Metcash provided a positive trading update for the second half. For the first four weeks of 2H FY24, food sales, excluding volatile Tabacco products, increased by 4.8%, while hardware and liquor sales were up 2.4% and 1.5%, respectively.

The Metcash share price closed Tuesday at $3.72 after falling 4% over the past month.

HomeCo Daily Needs REIT (ASX: HDN)

HomeCo is a property trust focused on owning and managing a portfolio of properties that cater to everyday consumer needs. The real estate investment trust (REIT) currently manages about 1,200 tenants across over 50 properties, serving major brands like Woolworths, Coles, Bunnings, KFC, and more.

In 1H FY24, the REIT boasted robust leasing fundamentals, with over 99% occupancy and rent collection. Funds from operations (FFO) increased by 1% from a year ago to $89.4 million, or 4.3 cents per share (cps) on a unit basis. The trust distributes nearly 98% of its FFO, or 4.2 cps for 1H FY24, in accordance with the REIT’s distribution requirement.

The annual distribution is 8.4 cps, yielding 6.8% at the current security price of $1.22. Although there’s no franking credit attached to it, this is a pretty generous yield.

The trust appears undervalued based on its net asset value. Its net assets were valued at $3.1 billion as of 31 December 2023. This is $1.44 per unit of security, meaning its current security price is at a 16% discount to its asset value.

Morgans also recently recommended HomeCo Daily Needs REIT to buy due to the resilience of its cash flows and its exposure to accelerating click and collect trends.

The HomeCo Daily Needs REIT unit price closed at $1.22 on Monday after falling 3.17% over the past month.

The post 2 ASX dividend shares offering over 5% yield appeared first on The Motley Fool Australia.

More reading

• Where Aussies are spending their money, and the ASX shares that could benefit
• Here are the top 10 ASX 200 shares today
• 3 ASX shares trading below their book values
• 3 lower-risk ASX dividend shares for retirees
• These buy-rated ASX dividend stocks offer 6%+ yields (and plenty of upside)

Motley Fool contributor Kate Lee 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 Coles Group. The Motley Fool Australia has recommended HomeCo Daily Needs REIT and Metcash. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Navigating the stock market can feel like trying to find your way through a complex maze. It’s easy to get lost amidst the twists and turns of market trends, financial jargon, and endless investment options.

However, the insights of investment legends like Warren Buffett and Peter Lynch can illuminate the path, making the journey much less daunting.

These financial experts advocate for simple yet effective strategies that any investor can embrace to enhance their investment outcomes.

Think long term

Buffett and Lynch’s wealth has been built on the principle of holding their investments over extended periods.

Warren Buffett famously said his favourite holding period is forever. Peter Lynch also noted the real key to making money in stocks is not to get scared out of them.

They recommend against the temptation of constant buying and selling in reaction to the market’s immediate fluctuations. If you’ve chosen a solid company at a fair price, allow your investment the time it needs to mature. While the market is inherently volatile, fundamentally strong companies tend to appreciate in value over the long haul.

Just consider the following two charts to see the result of long-term investing. Betashares Nasdaq 100 ETF (ASX: NDQ) shares have more than quadrupled since the ETF’s listing in May 2015. This is approximately an 18% growth every year on average.

The Vanguard Australian Shares Index ETF (ASX: VAS) share price rose from $70 to $95.82 over the past 10 years, implying a cumulative average annual return (CAGR) of about 3%. But this isn’t too bad considering its generous dividend payment of $3.74 over the last 12 months, yielding 3.9% at the current share price. Adding the capital growth and dividend yields, its total annual return is close to 7%.

Invest in what you know

Focus on businesses or sectors within your area of understanding. You don’t have to be an authority, but a solid understanding of how a company operates and its keys to success is vital.

Consider the products you enjoy or the services you find indispensable. If you have faith in these, they might be viable investment opportunities.

Your next big idea may come from where you work. You may be a plumber and like particular piping products from certain brands. Or you may be a medical professional and prefer to use products or systems from one company.

This strategy minimises risk by keeping you within your comfort zone.

Seek quality at a fair value

It’s a common error to hunt for cheap stocks thinking they are bargains. Buffett and Lynch encourage a focus on the intrinsic quality of a company and its potential for long-term growth.

Aim to discover outstanding companies at reasonable prices, rather than just any company at a discount. This approach entails a bit of research to ascertain the real value of a company and patience to invest at an opportune, fair cost.

Washington H Soul Pattinson & Company Ltd (ASX: SOL) may be in that sweet spot today after a 10% drop in the share price over the past three months, as my colleague Tristian highlighted. The company is a consistent dividend payer, offering a fully franked dividend yield of 2.8%.

Foolish takeaway

Investing wisely doesn’t have to be overly complex. These strategies might seem simple, but they’re powerful tools for creating a successful investment portfolio.

The post 3 winning tips both Warren Buffett and Peter Lynch recommend appeared first on The Motley Fool Australia.

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• Brickworks share price jumps on big Soul Patts news

Motley Fool contributor Kate Lee 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 BetaShares Nasdaq 100 ETF and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF and Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The lithium industry has been a tough place to invest in recent times.

But if you believe that the tide will soon change, then it could be worth taking a look at the three ASX lithium stocks listed below.

That’s because they have been named as buys and tipped to rise materially from current levels. Here’s what analysts are saying about them:

Arcadium Lithium (ASX: LTM)

Bell Potter remains very positive on this lithium giant. It likes the miner due to its diversified operations, which provide exposure to various lithium types. In addition, it highlights the company’s strong production growth potential. It said:

LTM provides the largest, most diversified exposure to lithium in terms of mode of upstream production, asset locations, downstream processing and customer markets. It is a key large-cap leverage to lithium prices and sentiment, which we expect to improve over the medium term. The group has a strong balance sheet and growth portfolio.

The broker has a buy rating and $9.50 price target on its shares. This implies potential upside of approximately 85% for investors.

IGO Ltd (ASX: IGO)

Over at Goldman Sachs, its analysts are positive on battery materials miner IGO despite being bearish on lithium.

The broker likes IGO due to the low costs of its Greenbushes operation. It feels this leaves IGO well-positioned in the current environment of low prices. It commented:

Greenbushes is the lowest cost lithium asset in our coverage. Production growth more than offsets increasing strip ratio: The addition of CGP3 (under construction) and CGP4 (planned) should take Greenbushes production capacity from ~1.5Mtpa today to ~2.4Mtpa (excluding tailings processing of ~0.3Mtpa), and they are planned to be funded from existing Greenbushes debt facilities, combined with Greenbushes cash flows (though we factor in below nameplate). We reiterate our belief that further Greenbushes expansion remains one of the most economically compelling brownfield lithium projects.

Goldman Sachs has a buy rating and $8.10 price target on IGO’s shares. If the ASX lithium stock rose to that level, it would mean a return of 35%.

Liontown Resources Ltd (ASX: LTR)

Analysts at Bell Potter are also very positive on this lithium developer which is on the cusp of becoming a fully-fledged miner.

Liontown’s Kathleen Valley (KV) lithium project is due to begin roaring in the middle of the year, which means it is perhaps just weeks away from producing the battery making ingredient.

Bell Potter thinks very highly of the KV project. It said:

100% owned KV lithium project remains highly strategic in terms of its stage of development, long mine life and location. LTR has offtake contracts with top tier EV and battery OEMs (Ford, LG Energy Solution and Tesla). Hancock Prospecting has a 19.9% interest in LTR. LTR is an asset development company; our Speculative risk rating recognises this higher level of risk.

The broker currently has a speculative buy rating and $1.85 price target on the ASX lithium stock. This suggests that upside of 85% is possible from current levels.

The post These beaten down ASX lithium stocks could rise 35% to 85% in 12 months appeared first on The Motley Fool Australia.

More reading

• These are the 10 most shorted ASX shares
• Why ASX, Brazilian Rare Earths, Liontown, and Sigma shares are sinking today
• Here are the top 10 ASX 200 shares today
• 2 ASX shares to buy that are at 52-week lows
• 3 ASX lithium stocks to buy in June 2024

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.

ASX-listed exchange-traded funds (ETFs) can expose investors to sectors and companies that Aussies normally would need to look overseas for.

The infrastructure sector is responsible for the backbone of the US economy. Plenty of businesses are involved in owning and operating infrastructure, which can be good investments.

The US is the world’s biggest economy and more than 330 million people live there. However, according to the ETF provider Global X, the US is in “dire” need of infrastructure upgrades, with at least US$3.8 trillion ($5.76 trillion) worth of additional investment to “adequately repair existing infrastructure and keep pace with economic expansion.”

Global X also said a growing driver of demand for infrastructure investment is the increased frequency of natural disasters. In 2023, the US reportedly experienced a record-breaking 28 weather and climate disasters, each costing more than US$1 billion.

Which ASX ETFs can be used to take advantage?

Some businesses are involved with infrastructure projects’ construction, engineering, material procurement, transportation, and equipment distribution processes.

These companies can significantly benefit from the increased expenditure on US infrastructure from governments and privately-funded infrastructure projects.

The Global X US Infrastructure Development ETF (ASX: PAVE) invests in US-domiciled companies to capture the value of growing spending in the world’s largest economy.

Some businesses inside the PAVE ETF include Eaton Corp, Trane Technologies, Quanta Services, Martin Marietta Materials, Emerson Electric and Parker Hannifin. It has a total of approximately 100 holdings.

In terms of risks, Global X noted that these companies “typically face intense competition and can be adversely impacted by shifts in government regulations and actions.”

Do other funds provide infrastructure exposure?

Other ASX ETFs and investments can also provide exposure to global infrastructure. The US economy’s size leads to those funds usually having a large weighting to US shares.

Examples include Vanguard Global Infrastructure Index ETF (ASX: VBLD) (with a 68.8% US weighting), VanEck FTSE Global Infrastructure (Hedged) ETF (ASX: IFRA) (with a 57.2% US weighting) and Magellan Infrastructure Fund (currency hedged) (ASX: MICH) (with a 38% US weighting).

While these ASX ETFs have a smaller allocation to US infrastructure, they’re also not targeted at the new spending on infrastructure in the country. Instead, many of the businesses in the portfolios I mentioned have existing assets that are typically generating strong cash flows for shareholders and are hard to replicate.

The post How to get exposure to a potential $5.7 trillion US sector with ASX ETFs appeared first on The Motley Fool Australia.

More reading

• 3 winning tips both Warren Buffett and Peter Lynch recommend
• These beaten down ASX lithium stocks could rise 35% to 85% in 12 months
• Bell Potter says these ASX shares are strong buys
• Buy these ASX shares for a winning retirement portfolio
• Guess which ASX 300 share could rise over 50%

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 Emerson Electric. The Motley Fool Australia has recommended Magellan Infrastructure Fund. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

There are a lot of great ASX shares for investors to choose from on the local market.

To narrow things down for readers, let’s now take a look at two shares that analysts at Bell Potter rate very highly.

These shares feature on its favoured list for June, which the broker believes offer attractive risk-adjusted returns over the long term. They are as follows:

Regal Partners Ltd (ASX: RPL)

Bell Potter believes that this growing fund manager is being undervalued by the market.

Its analysts highlight that the company has strong organic and inorganic growth potential, strong performing investment funds, and accelerating inflows. The broker commented:

In recent years, Regal has expanded rapidly through strong investment performance, net flows into its funds, launches of new funds, and the acquisition or merger with VGI Partners, PM Capital and Taurus, which have expanded funds under management from $1.1bn in 2017, to over $12.1bn (March 2025). We continue to favour RPL, given its strong organic & inorganic growth potential, and entrepreneurial culture. In the last six months, and following the recent acquisition of PM Capital and Taurus (50%), the firm has shown an acceleration of inflows, strong investment performance (which will give rise to performance fees) and success in marketing new funds. We feel this strong performance is not reflected in the share price and see considerable upside.

Bell Potter has a buy rating and $4.02 price target on its shares. This implies potential upside of 11% for investors from current levels. A ~5.6% dividend yield is forecast over the next 12 months.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX share that Bell Potter is a big fan of is Universal Store. It is a youth focused apparel, footwear and accessories retailer in Australia.

It has a large number of stores under its flagship Universal Store brand. In addition, it is expanding private label brands by growing the stand-alone format of Perfect Stranger and Thrills.

Bell Potter thinks that it has a good growth trajectory thanks to its store rollout and sees scope for margin improvements. It said:

Management execution remains a key strength for UNI and we see good growth trajectory for the name given the building of core brands while growing its store rollout. In our view, the higher margin sales from the majority of private label sales should become a major driver of margin improvement and earnings growth, in an expanded store footprint. While we remain cautious on the overall consumer sentiment, given the return to positive comps while cycling elevated pcp through Jan-Feb, we think UNI is well placed as comps become supportive through the 2H.

The broker has a buy rating and $6.15 price target on its shares. This suggests that upside of 23% is possible over the next 12 months. A ~5% dividend yield is also expected over the period.

The post Bell Potter says these ASX shares are strong buys appeared first on The Motley Fool Australia.

More reading

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• 3 under the radar ASX shares to buy this month
• Analysts name 3 small cap ASX shares to buy for big returns
• These ASX shares could rise 25% to 65%
• 6 ASX retail shares to buy this month

Motley Fool contributor James Mickleboro has positions in Universal Store. 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.

If you are searching for retirement portfolio options this month, then you may want to look at the ASX shares listed below that have been named as buys.

Here’s why these shares could be top options for this portfolio:

CSL Limited (ASX: CSL)

When you are building a retirement portfolio, it is always a smart idea to focus on high quality companies.

Well, there are arguably few higher quality businesses out there than biotechnology giant CSL. It is the company behind the CSL Behring, CSL Seqirus and CSL Vifor businesses, which provide lifesaving therapies and vaccines to patients in more than 100 countries.

And with management always reinvesting heavily in its research and development (R&D) activities, CSL consistently has an R&D pipeline filled with potentially lucrative products.

Macquarie is a fan of the company and believes its outlook is very positive thanks to its key CSL Behring business. It currently has an outperform rating and $330.00 price target on its shares. In addition, it sees scope for them to rise to $500 within the next three years.

APA Group (ASX: APA)

Another ASX share to consider buying for a retirement portfolio is APA Group. It owns and operates energy infrastructure assets and businesses.

This includes energy infrastructure, comprising gas transmission, gas storage and processing, and gas-fired and renewable energy power generation businesses.

It could be a great option for retirees due to its defensive earnings, long track record of growth (almost 20 years of dividend increase), and big dividend yield.

In respect to the latter, analysts at Macquarie are forecasting dividends of 56 cents per share in FY 2024 and 57.5 cents per share in FY 2025. Based on the current APA Group share price of $8.33, this equates to 6.7% and 6.9% dividend yields, respectively.

Macquarie currently has an outperform rating and $9.40 price target on its shares.

Woolworths Limited (ASX: WOW)

A final ASX retirement share to consider buying is supermarket giant, Woolworths. This is due to its positive growth outlook and defensive earnings.

In respect to the former, Goldman Sachs’ analysts “forecast WOW 2-yr sales CAGR FY24-26e of +3.2% and EBIT growth of +4.8%.” This is expected to support the payment of fully franked dividends of $1.08 per share in FY 2024 and $1.14 per share in FY 2025. Based on the current Woolworths share price of $32.85, this implies yields of 3.3% and 3.5%, respectively.

Goldman also sees plenty of upside for investors. It currently has a buy rating and $39.40 price target on its shares.

The post Buy these ASX shares for a winning retirement portfolio appeared first on The Motley Fool Australia.

More reading

• How much could $10,000 invested in CSL shares be worth next year?
• 3 of the best ASX 200 blue chip shares to buy now
• Tax-busters: 5 fully-franked ASX dividend shares I’d buy for FY25
• 3 reasons to be positive on ASX 200 shares in FY25 (and 3 to be wary)
• Where Aussies are spending their money, and the ASX shares that could benefit

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, Goldman Sachs Group, and Macquarie Group. The Motley Fool Australia has positions in and has recommended Apa Group and 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.

Now could be the time to pounce on Clinuvel Pharmaceuticals Limited (ASX: CUV) shares now if you want big returns for your portfolio.

That’s the view of analysts at Bell Potter, which are feeling very positive about the ASX 300 share.

Why is it an ASX 300 share to buy?

In case you’re not familiar with Clinuvel, it is a global specialty pharmaceutical company focused on developing and commercialising treatments for patients with genetic, metabolic, systemic, and life-threatening, acute disorders.

Its lead therapy is Scenesse, which is approved for commercial distribution in Europe, the USA, Israel, and Australia as the world’s first systemic photoprotective drug for the prevention of phototoxicity (anaphylactoid reactions and burns) in adult patients with erythropoietic protoporphyria (EPP).

The ASX 300 share is also seeking to expand Scenesse’s use into other treatment areas. It is this that is getting Bell Potter excited. It commented:

CUV are conducting two Phase 3 trials to expand the label of Scenesse to include patients with vitiligo. Following recent company announcements, we have revisited vitiligo development expectations and market forecasts. The first Phase 3 trial primary readout is expected in 2H CY25 and represents one of the next major catalysts for the company excluding financial results. Assuming the Phase 3 trials proceed smoothly, we expect submission to the FDA in late CY26 for potential approval by end-CY27.

Bell Potter notes that if successful, this expansion has the potential to be a huge boost to its sales. It adds:

With ~1% of the US population affected by vitiligo, the market size is far greater than the single rare disease for which Scenesse is currently approved. We estimate a directly addressable vitiligo market in the US of ~65-70k patients (vs. ~2k patients for EPP). This translates into legitimate potential for Scenesse to increase its annual sales several fold if the Phase 3 trials succeed and regulatory approval is granted.

Big return potential

In light of the above, the broker has reaffirmed its buy rating and $22.25 price target on the ASX 300 share. Based on its current share price of $14.60, this implies potential upside of 52% for investors over the next 12 months.

The broker concludes:

We view the first vitiligo Phase 3 readout in CY25 as a significant catalyst for the company and see the current CUV price as a good entry point for those willing to take on clinical risk with downside mitigated to a degree by the existing, profitable EPP franchise.

The post Guess which ASX 300 share could rise over 50% appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Which ASX biotech shares are pioneering the future of medicine?

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.

The National Australia Bank Ltd (ASX: NAB) share price has increased by more than 35% in the last 12 months, as shown on the chart below. Shareholders and other investors may wonder whether the good streak can continue in FY25.

NAB has a different reporting schedule than many other ASX shares. Its full-year ends on 30 September, while June is the last month of the financial year for Australian individuals and many businesses.

There are still three and a half months left of the ASX bank share‘s FY24, so commentary about the outlook could apply to both the end of FY24 as well as FY25.

Worsening arrears

At the beginning of May 2024, NAB reported its FY24 first-half result, which showed cash earnings of $3.55 billion (down 12.8% year over year).

One of the negatives within the result was that the percentage of its loans that were overdue by at least 90 days or impaired is increasing – it was 0.66% in the FY23 first half, 0.75% in the FY23 second half and 0.79% in the first half of FY24. This represented “higher arrears across the Australian home lending and business lending portfolios, partially offset by lower impaired assets.”

NAB said:

The Australian economy is proving resilient and most customers are faring well in the current more challenging environment. However, there remains continued uncertainty in the outlook including the impacts of global instability and the ability of customers to manage the full extent of higher interest rates and elevated cost of living pressures.

Strong competition

NAB reported in the HY24 result that revenue decreased by 3.7%, mainly reflecting “lower margins”.

The net interest margin (NIM) decreased by 5 basis points (0.05%) to 1.72%, while the underlying NIM declined 10 basis points. This reflected “lending margin competitive pressures primarily relating to housing lending, along with higher term deposit costs and deposit mix impacts.”

NAB said the benefits of a higher interest rate environment have been more than offset by competition while cost pressures remain elevated.

NAB shares its outlook

With the FY24 first-half result, the ASX bank share said the following:

With our new executive leadership team in place, we are considering how we evolve our strategic priorities. We start in a great place with strong, safe balance sheet settings and attractive growth options. While no major strategic pivots are needed, we are excited about opportunities to leverage the good work of the past several years to allow us to become even simpler and drive better outcomes for customers and colleagues while maintaining a disciplined approach. This will remain at the core of everything we do and underpin our ability to deliver sustainable growth and returns.

Forecasts

Analysts at broker UBS expect stronger results in FY25 than in FY24.

The broker currently forecasts that NAB could generate net profit after tax (NPAT) of $7 billion in FY24 and $7.15 billion in FY25. This would translate into earnings per share (EPS) of $2.21 in FY24 and $2.27 in FY25. While higher, this does not imply much growth in FY25.

UBS expects NAB shares to offer a fully franked dividend yield of around 5% over the next two financial years.

The broker currently has a sell on NAB shares because of a “fully valued” NAB share price. The price target is $30, implying a fall of 15% from where it is today.

The post Can owners of NAB shares bank on a good outlook for FY25? 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. 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.