Tag: Motley Fool

The Liontown Resources Ltd (ASX: LTR) share price powered home in FY22 with a 30% gain for the year.

Now that we’ve rolled over to FY23, trends have shifted and Liontown shares are now 15% down in the past month.

Before the open on Thursday, the Liontown share price was resting at 94.5 cents.

Liontown share price set to roar in FY23?

Analysts are bullish on Liontown’s prospects this financial year and reckon the ASX lithium share is a buy.

Bell Potter recently said Liontown was one of its top lithium picks for FY23. The broker values Liontown shares at $3.06 apiece.

Four analysts covering Liontown rate the share a buy right now, according to Refinitiv Eikon data. There is just one hold rating and no sell ratings.

From this list, the consensus price target for Liontown is $2.08 per share. That means, on average, analysts tip it to deliver more than 120% upside in the next 12 months.

Meanwhile, if company earnings estimates among ASX lithium shares are anything to go by, it appears that the lithium sector is set to continue growing in FY23.

Analysts at Macquarie are bullish on the sector, pricing in earnings growth for Liontown’s peers, Pilbara Minerals Ltd (ASX: PLS) and Allkem Ltd (ASX: AKE).

The broker rates all three shares a buy, with an average 86% upside price target across them.

With that in mind, analyst sentiment is certainly positive on Liontown’s growth prospects and potential share price appreciation.

Liontown has clipped a 26% gain in the past 12 months. This is despite incurring a 43% loss this year to date.

The post What’s the outlook for the Liontown Resources share price in FY23? appeared first on The Motley Fool Australia.

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More reading

• Why are these ASX 200 lithium shares tumbling today?
• ASX battery metals shares trying to power up after a horror June
• Here are the top 10 ASX shares today
• Liontown Resources roared home with a 30% gain in FY22
• Can ASX lithium shares recharge in FY23?

Motley Fool contributor Zach Bristow 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 Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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When it comes to consumer staples shares and the role they can play in one’s ASX share portfolio, one word probably comes to mind: defensive. When we hear investors discuss consumer staples shares, it normally involves the idea that these companies can protect an investor’s portfolio from volatility and capital loss.

That’s because consumer staples are goods and services that we all need, rather than want. They include food, drinks, household essentials, and vices like alcohol and tobacco.

But, like all assumptions in the world of investing, this might not always be the case. So let’s see if this reputation still holds water after what has been an especially tough year so far for investors in 2022 by checking out the iShares Global Consumer Staples ETF (ASX: IXI).

This exchange-traded fund (ETF) is the only one on the ASX that solely holds shares in the consumer staples sector. But not just ASX consumer staples shares though. IXI holds a basket of underlying companies that hail from the United States, the United Kingdom, Switzerland, Japan and France, amongst others.

But Australia is also included, with IXI holding ASX shares like Woolworths Group Ltd (ASX: WOW), Coles Group Ltd (ASX: COL) and Endeavour Group Ltd (ASX: EDV).

But even though most of IXI’s holdings are outside the ASX, you might still be very familiar with some of its top companies. These include Coca-Cola Company, Nestle, PepsiCo, Philip Morris International, Walmart and Unilever.

Has the Consumer Staples ETF protected investors’ portfolios in 2022?

So let’s look at how the iShares Consumer Staples ETF has held up in 2022 so far. So 2022 has been a very rough year for ASX shares. As it currently stands, the S&P/ASX 200 Index (ASX: XJO) remains down by a painful 11.1% in 2022 thus far.

It’s even worse over in the United States. The S&P 500 Index (INDEXSP: .INX) remains down by around 20% year to date.

So how has the IXI ETF fared? Well, over 2022 thus far, the IXI unit price has lost just 3.81%, falling from $88.72 a unit to the $85.34 the ETF closed at yesterday.

Not only that, but investors have also received two dividend distribution payments over 2022 thus far. These amount to $1.73 in distributions per unit. That translates into a trailing yield of just over 2%, bringing this ETF’s 2022 losses even lower

So IXI may have had a disappointing performance over 2022 thus far. But it has still outperformed the ASX 200 by more than 7%, and the S&P 500 by far more than that.

So it seems that in this case, the reputation of consumer staples shares as defensive portfolio protections against market losses and volatility remains intact.

The post Has the iShares Consumer Staples ETF protected investors’ portfolios in 2022? appeared first on The Motley Fool Australia.

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More reading

• Here are 3 ETFs for ASX investors to buy in FY23
• Here are 2 top ETFs for ASX investors next week
• 3 quality ETFs for ASX investors to buy next week

Motley Fool contributor Sebastian Bowen has positions in Coca-Cola, PepsiCo Inc., Philip Morris International, and Walmart Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Philip Morris International and Unilever and has recommended the following options: long January 2024 $47.50 calls on Coca-Cola. The Motley Fool Australia has positions in and has recommended COLESGROUP DEF SET and iShares Global Consumer Staples ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Is Telstra Corporation Ltd (ASX: TLS) a compelling investment opportunity at today’s share price for FY23 and beyond?

As the biggest telecommunications business in Australia, Telstra has a large position in the market. However, ‘large’ doesn’t necessarily mean ‘better’ in terms of potential investment returns.

Over the past month, the Telstra share price has outperformed the S&P/ASX 200 Index (ASX: XJO) by about 2%.

Can this outperformance continue? No one has a crystal ball, but brokers like to estimate where they think a company’s valuation could be in 12 months from now with what’s called a ‘price target’.

Let’s look at where brokers think the Telstra share price could go over the next year.

Broker ratings on the Telstra share price

The Telstra share price was $3.90 at the market close on Wednesday.

The broker Ord Minnett currently rates Telstra a buy with a price target of $4.65. That means a possible rise of about 19%. Ord Minnett is also predicting earnings per share (EPS) growth in FY23.

Morgan Stanley also rates Telstra a buy or ‘overweight’ with a share price target of $4.60. This suggests a possible rise of about 18%. One of the things that the broker likes is the potential for 5G to win customers onto wireless home broadband. That’s where a home broadband connection powered by the NBN is replaced by a 5G-powered home internet connection.

The shift to the NBN hurt Telstra’s margins. Getting households onto 5G home internet would be helpful for margins because Telstra would be providing the connection.

What could drive Telstra’s earnings higher?

The Telstra share price could follow earnings. Rising profits could be helpful in several ways, including funding higher dividends.

The core tactics of the T25 strategy are cutting costs, delivering growth and “exceptional customer experiences”, and continuing network and tech leadership.

In terms of cutting costs, Telstra says it wants to reduce its net fixed costs by $500 million between FY23 and FY25.

There are five areas of the business that Telstra is focusing on to achieve its cost reduction targets.

Telstra wants to:

• “Significantly reduce its IT operating costs”, remove legacy systems, and consolidate platforms
• Transform the ‘Telstra enterprise’ customer value chain across the different processes
• Improve efficiencies in billing, assurance, and activation for customers
• Achieve further labour productivity across the ‘back of house’ and support areas
• Expand its productivity in sale costs, fixed costs, and capital expenditure.

Telstra earnings could also rise as the company increases its prices in line with CPI inflation. These increases could happen annually.

Dividend expectations

Morgan Stanley and Ord Minnett believe the telco giant will pay an annual dividend per share of 16 cents in FY23. This equates to a grossed-up dividend yield of 5.9%.

Telstra share price snapshot

Since the beginning of 2022, Telstra shares have fallen 7.6%. However, the ASX 200 has dropped 12.75%.

The post Is the Telstra share price an opportunity calling in FY23? appeared first on The Motley Fool Australia.

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More reading

• Here are 2 quality ASX dividend shares to buy according to experts
• Own Telstra shares? Here are details on the telco’s 2,000 new Australian call centre workers
• How big will the Telstra dividend yield be in FY23?
• Here’s why brokers rate these ASX dividend shares as buys
• Telstra share price in the red despite taking out green crown

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. 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 positions in and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Shares in Allkem Ltd (ASX: AKE) managed to clip a 60% gain in FY22, despite incurring heavy losses at the back end of the period.

Our attention now turns to FY23 and there’s plenty of external forces that have just arrived on the doorstep of the ASX.

Allkem is at $9.64 per share ahead of the market open on Thursday, after sliding 6% in the past month.

What’s in store for Allkem in FY23?

ASX lithium shares are showing signs of strength in June. Allkem shares have rebounded off lows twice in the past two weeks as lithium prices remain high.

Long-term demand for lithium is tipped to remain strong by Shaw & Partners, potentially offering long-term upside for investors also.

UBS analysts have retained their buy rating. In a recent note, they valued the stock at $15.55 per share.

The UBS team is constructive on Allkem’s free cash flow projections and tips high lithium prices to underpin this.

Macquarie is also bullish on Allkem, valuing the shares at $17 with a buy recommendation. The broker is also constructive on the long-term lithium outlook.

This is certainly good for market sentiment on Allkem, that’s for sure.

In terms of coverage, 10 analysts rate Allkem a buy right now. Three brokers urge their clients to hold, according to Refinitiv Eikon data.

From this list, the consensus price target is $16, offering roughly $6.50 per share in upside potential.

While analysts are bullish, the market is dislocated from this view.

Investors have recently pushed the stock to three-month lows.

Despite this, the Allkem share price has increased by 32.8% over the past 12 months.

The post What’s the outlook for Allkem shares in FY23? appeared first on The Motley Fool Australia.

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More reading

• Why Allkem, Kogan, Metcash, and Sezzle shares are sinking
• Why are these ASX 200 lithium shares tumbling today?
• Is this a good time to go digging for ASX 200 mining shares for FY23?
• ASX battery metals shares trying to power up after a horror June
• Here are the top 10 ASX shares today

Motley Fool contributor Zach Bristow 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 Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Newcrest Mining Ltd (ASX: NCM) share price has continued to tread lower throughout the past month.

Over the past 30 days, the gold miner’s shares are down 18.2% to $18.99 apiece at yesterday’s market close.

This is a tad higher than the multi-year low of $18.97 reached yesterday afternoon.

Shares in Northern Star Resources Ltd (ASX: NST) have also declined by 14.1% over the same period. This is more in line with the benchmark S&P/ASX 200 Resources Index (ASX: XJR), which has dropped by 14.5%.

Evidently, Newcrest shares are among the worst performers in the sector of late.

Let’s take a look at what’s been taking the shine off this ASX gold mining stock.

Why is the Newcrest share price in a funk?

Extreme volatility mixed with investor concerns about further rate hikes by major central banks is impacting the Newcrest share price.

Inflation has been soaring as food and energy prices hit record highs.

In May, inflation rose by 8.6% in the United States, which was the highest level in the past four decades. That was eclipsed last night when the US announced inflation had rocketed to 9.1% in June.

This doesn’t bode well for gold prices, as it’s likely the Federal Reserve will again lift interest rates.

When this occurs, investors tend to shift their money into government bonds because they are perceived to be safe-haven assets.

The price of gold has declined by 4% over the past month to trade at about US$1,730 per ounce. This is the lowest level since August 2021, and a big fall from the US$2,070 it was fetching on 8 March 2022.

If interest rates continue to go up — in the US or here at home — investor appetite for gold could recede. This would likely pile further selling pressure onto Newcrest shares.

What do the brokers think?

A couple of brokers believe the Newcrest share price is currently a bargain.

According to ANZ Share Investing, UBS cut its price target on the company’s shares by 14.5% to $22.40 apiece. Despite the cut, that means there is still a potential upside of 18% for investors.

While the broker reduced its assessment of Northern Star as well, it still sees value in the gold miner.

JPMorgan also changed its outlook on Newcrest from overweight to neutral with a price target of $23.

Newcrest commands a market capitalisation of approximately $17.16 billion.

The post Why has the Newcrest share price lost its shine of late? appeared first on The Motley Fool Australia.

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More reading

• What’s the outlook for Northern Star share price in FY23?
• 5 things to watch on the ASX 200 on Wednesday
• Down 23% in June, can the Northern Star Resource share price go up in July?
• 2 ASX 200 gold mining shares getting plastered with new multi-year lows
• Is this a good time to go digging for ASX 200 mining shares for FY23?

JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Aaron Teboneras has positions in Northern Star Resources Limited. 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.

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The world is currently enduring an economically unsettling time. So it’s more difficult than ever to pick winning ASX shares.

But one expert has identified a particular sector that seems to have just started a turnaround.

It’s such early days that investors could get in on the ground level if they act quickly.

Switzer Financial Group director Paul Rickard said this week that ASX shares in the healthcare industry have staged a remarkable comeback this month.

“I think the healthcare sector is going to do pretty well. In fact, it’s been doing well in the last four to six weeks.”

Indeed, the S&P/ASX 200 Health Care (ASX: XHJ) index is up 6.8% this month, after it plunged 12.4% from the start of the year to the end of June.

Banks and mining are shaky, and the money has to go somewhere

Rickard reckons the upward momentum will continue, due to several drivers.

The first is that there is nervousness about the two dominant industries on the ASX — banking and resources.

“Banks, there are question marks about whether high interest rates will really impact profits and bad debts in the long term,” said Rickard on Switzer TV Investing.

“In the resources sector people are still worried about commodity prices and the R word — recession — and what that might do.”

Another factor is that the Australian dollar is trading lower against the US dollar. Many ASX-listed healthcare companies generate the majority of their revenue from North America and elsewhere outside of Australia, and a weakening dollar makes their exports more competitive.

“Thirdly, we’re coming into reporting season, and healthcare companies have traditionally done really well in reporting season,” said Rickard.

“Companies like CSL Limited (ASX: CSL) have a great record of positive surprises.”

A recession-busting investment?

While CSL is the pick of the industry for Rickard, he named a couple of other ASX shares that could benefit from the healthcare comeback.

“There seems to be value in Resmed CDI (ASX: RMD), which is creeping up, and also Cochlear Limited (ASX: COH).”

Rickard added that healthcare products and services are fairly resilient against economic downturns or recession, and perhaps that’s what’s triggering the July comeback.

“I think there’s value in each of those health companies. Still trading on high multiples… but to me the stocks aren’t going down in price and I think that means they’re going to go up,” he said.

“I think there’ll be some good performance out of healthcare.” 

The post 3 ASX shares to buy in a sector suddenly soaring this month: expert appeared first on The Motley Fool Australia.

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More reading

• Experts name 2 ASX growth shares for investors to buy now
• Why is the CSL share price up 11% in a month?
• Top brokers name 3 ASX shares to buy today
• $264 million! The 10 highest-paid CEOs on the ASX
• Broker names 2 more blue chip ASX 200 shares to buy in July

Motley Fool contributor Tony Yoo has positions in CSL Ltd., Cochlear Ltd., and ResMed Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd., Cochlear Ltd., and ResMed Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended ResMed. The Motley Fool Australia has positions in and has recommended ResMed Inc. The Motley Fool Australia has recommended Cochlear Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Exchange-traded funds (ETFs) can be very effective to passively grow wealth over the long term. It can be hard to know which investments to go for, so buying a whole bunch of shares or other assets at once could make things easier.

But then there’s still the tricky decision of choosing which ETFs to go for.

There are some index funds that focus on a particular market such as the S&P/ASX 300 Index (ASX: XJO). This is tracked by the Vanguard Australian Shares Index ETF (ASX: VAS). But there are others that may be focused on particular attributes or offer wide diversification across different asset classes.

I think the two ETFs below offer investors a good combination of both diversification and growth potential.

Vanguard Diversified High Growth Index ETF (ASX: VDHG)

This ETF is probably one of the most diverse options on the ASX.

It offers “low-cost access to a range of sector funds, offering broad diversification across multiple asset classes”. It invests mainly in “growth assets” and is designed for investors with “a high tolerance for risk who are seeking long-term capital growth”.

It targets a 10% allocation to bonds and 90% to shares.

Bonds are essentially debt that governments and businesses use to fund their operations and projects. It’s essentially how many governments, such as Australia and the US, manage to keep operating and paying for things despite running budget deficits.

The bond funds that the VDHG ETF invests in are global bonds and Australian bonds.

In terms of the shares, just over a third of the VDHG ETF is invested in ASX shares, 5% is invested in ‘emerging market’ shares (think: India, Brazil etc.), 6.4% is invested in small international company shares, and the rest (around 42%) in larger international shares from ‘western’ markets.

As you can guess, the Vanguard Diversified High Growth Index ETF gives underlying exposure to many hundreds of businesses.

VanEck MSCI International Quality ETF (ASX: QUAL)

This investment is much more focused on shares. It owns shares in around 300 businesses that are listed around the world.

While around 75% of the allocation is to US shares, the following countries have weightings of more than 0.5%: Switzerland, the UK, Japan, the Netherlands, Denmark, Ireland, Canada, France, Sweden, and China.

However, aside from offering diversification, a key focus of this ETF is to invest in companies that score well based on three fundamental factors: high return on equity, stable year-on-year earnings growth, and low financial leverage.

In other words, the VanEck MSCI International Quality ETF is invested in businesses that earn good profit compared to how much shareholder money is in the business. They typically generate consistent profit growth, and they don’t have much debt.

While there are 300 holdings, the top ten positions make up 31.5% of the total allocation. Those high-quality names are: Microsoft, Apple, Johnson & Johnson, UnitedHealth, Nvidia, Meta Platforms, Alphabet (A and C class shares), Visa, and Nestle.

Despite the heavy decline in 2022, the QUAL ETF has delivered an average return per annum of 13.1% over the last five years, outperforming the MSCI World excluding Australia Index return of 10.1% per annum.

The post I think these 2 ETFs are long-term buys appeared first on The Motley Fool Australia.

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More reading

• Why analysts say these top ETFs are buys
• Expert names ASX share that could fly 67% higher
• Here are 2 buy-rated ASX ETFs for casting a wider net during uncertainty
• How did the Vanguard Australian Shares Index ETF perform in June?
• Here are 2 high quality ETFs analysts rate as buys

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. 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 Alphabet (A shares), Alphabet (C shares), Apple, Microsoft, Nvidia, and Visa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Johnson & Johnson and UnitedHealth Group and has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Apple, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Ask A Fund Manager

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, Redpoint Australian Equity Income Fund portfolio manager Max Cappetta reveals how he would deal with three ASX shares that have had a shocker this year.

Cut or keep?

The Motley Fool: Now let’s see what you think about three ASX shares that used to be darlings but have fallen considerably off the perch this year.

First is WiseTech Global Ltd (ASX: WTC), which has dropped 30% year-to-date. You’ve already spoken about how WiseTech is a buy for you at the moment. Anything further to add?

Max Cappetta: Because it has fallen this far, we think that it is probably trading at a “more attractive” level than it has in the past. 

Investors should bear in mind that that thematic of higher interest rates, therefore impacting the valuation of some of these stocks, is still there. So even though it has fallen, it’s more attractive. If it falls further from here, then it does in fact become quite attractive for the growth profile that the company has put forward it can achieve.

MF: Domino’s Pizza Enterprises Ltd (ASX: DMP) shares have more than halved since September. What are your thoughts?

MC: I think the disappointing aspect that we’re seeing through our quantitative analysis of their financials, is really the weakening of their profit margins over recent years. 

We know that revenues have grown quite strongly for the company over the past few years. And we do know that the promise of their global growth ambitions, really, was to bring that incremental profit growth. And I think there’s just been disappointment about how that has actually been delivered and whether, right here right now, they can get back onto that path. 

If there is that uncertainty, then that’s just going to depress the premium that investors are willing to pay for maybe less certainty around the growth of that company. 

We do know just in recent weeks the company has moved to add a service delivery fee to try and combat some of the higher costs within the business. But, for us, that is a little bit of a stop-gap measure. What we still need to see is an underlying improvement in their operating efficiency, to really justify a much larger rebound from these price levels.

MF: And the quick-service restaurant industry is so competitive and commoditised, isn’t it? 

MC: Yeah, absolutely. It’s that substitution effect, that, if I’m not going to take that one, I’ve got plenty of other options, both in terms of freshly made and also frozen varieties through the supermarkets as well.

MF: Sims Ltd (ASX: SGM) has lost 40% of its value since April. What do you think?

MC: Sims is a real interesting one here. I think for people that might recognise the name, they’ll know it as a metal recycling business. But I think maybe what is less well known is the fact that it really is at the forefront of this global drive to a more sustainable economy. 

The company was founded back in the early 1900s and has really been mainly focused on trading in ferrous metals — iron and steel — as well as other metals, such as copper, aluminium, lead, zinc, and nickel. But I think the interesting element is the diversity that they’re now building, particularly in North America, around some of their electronics recycling and also their curbside recycling businesses.

Now I do take that it has been really a long-term underperformer relative to the market over many years. And that has been really in line with the volatility of iron and steel prices in the marketplace, which impacts the demand for iron, which is one of the key things that they obviously purchase and then recycle. 

Now, I think this could be changing over the years ahead as the company diversifies into these recycling activities in a more broader sense. And as I said before, that ongoing focus on the transition to more sustainable global practices should provide it a tailwind.

Looking at it from an income perspective, it’s trading at a gross dividend yield of approximately 4%, which I think still remains attractive relative to interest rates available, notwithstanding that interest rates are on the way up, but we’re only at around 1.5% there at the moment. 

It’s going to deliver a record profit in financial year 2022 of about $2 per share. Now we do note that expectations in 2023 are that profits will weaken slightly, back to around $1.50 per share, but this is still well ahead of the $1 per share that it made in 2018. And the share price is actually trading at slightly below where it was in 2018. So from a valuation perspective, we think that it is attractive, and maybe some people are staying away from the company due to its volatility. But as the business diversifies into these recycling and sustainable processes outside of the metals industry or related to it, they’re going to be able to provide a more diversified and consistent profit growth in the years ahead.

The post What I’d do with 3 ASX shares that have plunged this year: expert appeared first on The Motley Fool Australia.

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• Here are the top 10 ASX shares today
• ‘Pretty attractive’: Expert reveals 3 ASX shares to buy right now
• Has a turnaround already begun for ASX tech shares? Experts reveal the outlook for FY23
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• Leading brokers name 3 ASX shares to buy today

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Are you searching for dividend shares to buy? Then take a look at the two listed below that have been given buy ratings.

Here’s what you need to know about these ASX 200 dividend shares:

Coles Group Ltd (ASX: COL)

This supermarket giant could be an ASX 200 dividend share to buy.

While many retailers are struggling in the current environment, Coles’ sales have been growing and look set to continue doing so thanks to its defensive qualities, strong market position, and positive exposure to rising inflation.

Combined with its focus on cutting costs with automation and efficiencies, this bodes well for dividends in the coming years.

Analysts at Morgans are very positive on the company and currently have an add rating and $20.65 price target on its shares.

As for dividends, the broker is forecasting fully franked dividends of 61 cents per share in FY 2022 and then 64 cents per share in FY 2023. Based on the latest Coles share price of $18.48, this will mean yields of 3.3% and 3.5%, respectively.

South32 Ltd (ASX: S32)

Another ASX 200 dividend share to look at is South32. It is diversified mining and metals company producing a range of commodities. This includes alumina, aluminium, bauxite, coal, copper, manganese, nickel, and silver across operations.

Macquarie is a big fan of the company and has named it as one of its preferred picks in the resources sector. This is thanks largely to its strong free cash flow generation. Earlier this week the broker retained its outperform rating and $6.00 price target on the miner’s shares.

In respect to dividends, the broker is forecasting fully franked dividends per share of 34.4 cents in FY 2022 and 40.5 cents in FY 2023. Based on the current South32 share price of $3.50, this represents huge yields of 9.8% and 11.6%, respectively.

The post Analysts name 2 ASX 200 dividend shares to buy appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• South32 share price backtracks amid sale of royalties
• 5 things to watch on the ASX 200 on Wednesday
• ASX 200 supermarket shares lead as household spending jumps
• Here are the 3 most heavily traded ASX 200 shares on Tuesday

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 COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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On Wednesday, the S&P/ASX 200 Index (ASX: XJO) fought hard and carved out a small gain. The benchmark index rose 0.2% to 6,621.6 points.

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

ASX 200 expected to edge lower

The Australian share market is expected to edge lower on Thursday following a poor night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 2 points lower this morning. On Wall Street, the Dow Jones was down 0.7%, the S&P 500 fell 0.45%, and the NASDAQ dropped 0.15%.

US inflation hits 40-year high

Investors were selling stocks on Wall Street overnight after US inflation came in hotter than expected. According to CNBC, the consumer price index increased 9.1% from a year ago during the month of June. This was a 40-year high and above the 8.8% Dow Jones estimate. This appears to counter claims that inflation may be peaking.

Oil prices mixed

Energy shares including Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) will be on watch after a mixed night for oil prices. According to Bloomberg, the WTI crude oil price is up 0.25% to US$96.09 a barrel and the Brent crude oil price is down 0.05% to US$99.43 a barrel. News of a build-up in US stockpiles was largely offset by the big inflation report.

Gold price rises

Gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a decent day after the gold price pushed higher overnight. According to CNBC, the spot gold price is up 0.45% to US$1,733.3 an ounce. A softer US dollar boosted the safe haven asset.

Bega Cheese rated as a hold

The Bega Cheese Ltd (ASX: BGA) share price could be fully valued according to analysts at Bell Potter. This morning the broker put a hold rating and $3.80 price target on the dairy company’s shares. Bell Potter said: “Given the ongoing dislocation in farmgate pricing and ingredient pricing we have tempered our long-term ROIC target for BGA resulting in our target price falling to $3.80ps (prev $4.20ps).”

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

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More reading

• Here are the top 10 ASX shares today
• Why Galileo Mining, Platinum, Sezzle, and Woodside shares are dropping
• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• Why has the Aristocrat share price increased 17% in two months?
• These were the 5 top performing ASX energy shares of FY22

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