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This ASX 200 stock may have reached a record high today, but top broker Goldman Sachs says it’s a buy.

The stock in question is automobile classifieds company Car Group Limited (ASX: CAR).

In earlier trading on Tuesday, the Car share price hit an all-time peak of $35.47.

But Goldman reckons the ASX 200 communications stock has further room for share price growth.

In a note published today, Goldman upgraded its rating on Car Group shares to buy and increased its 12-month share price target to $39.40.

Let’s find out why.

Car Group shares hit record high share price today

There was no official news propelling the Car share price to a new all-time peak today.

But Goldman says it’s upgraded its rating largely due to the company’s 1H FY24 report last week.

The auto listings company reported a 60% jump in revenue to $531 million and a 34% increase in adjusted net profit after tax (NPAT) to $163 million.

Goldman said that following its US trip in late 2023 and Car Group’s 1H FY24 result, it was “increasingly confident in the earnings momentum (both locally & globally)” for the auto listings business.

It pointed out that Car shares have already performed strongly. After all, the ASX 200 stock is up 56% in just 12 months.

But on a relative price-to-earnings (P/E) ratio basis, the broker said Car stock was trading at a discount to ASX 200 peers like Seek Ltd (ASX: SEK) in the Australian online classifieds arena.

Goldman said:

We are increasingly confident in CAR’s ability to sustain double digit EBITDA growth. This follows … the 1H24 result in Feb-24, with CAR delivering strong growth across all key drivers, and materially stepped up investment into product/growth that will sustain its ‘Good’ earnings growth through the cycle ….

Goldman is now forecasting FY24 and FY25 EBITDA growth of 38% and 13% respectively for Car Group.

The broker said the ASX 200 stock’s valuation “still screens reasonable”.

Goldman commented:

Reflecting our increased confidence in CAR outlook, alongside peer re-rating, we have increased our CAR EV/EBITDA multiple to 25X (blended) from 23X, which combined with the earnings upgrade drives our 12m TP to $39.40.

That 12-month share price target for Car implies a potential upside of 11.1% over today’s record high.

ASX 200 stock price snapshot

The Car Group share price has grown by 76% over the past three years while the ASX 200 grew 13%.

The post Goldman Sachs says buy despite this ASX 200 stock trading at a record high appeared first on The Motley Fool Australia.

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More reading

• Car Group share price falls despite 32% first-half earnings jump

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 Goldman Sachs Group. The Motley Fool Australia has recommended Car Group and Seek. 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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Looking at the Woodside Energy Group Ltd (ASX: WDS) share price today, it’s likely that one metric will jump out at you. That would be Woodside’s seemingly monstrous dividend yield.

Today, Woodside shares have had a pretty rough time. The ASX 200 energy stock closed at $30.53 a share yesterday. But this morning, Woodside shares opened at $30.29 each, and are currently trading at just $30.10, down a chunky 1.42% for the day thus far.

This fall has resulted in Woodside shares trading on a trailing dividend yield worth a whopping 11.29%.

Woodside’s dividend payments normally come with full franking credits attached too, so that 11.29% yield can be grossed up to a huge 16.13% with the value of those franking credits.

Well-trained dividend investors might be hearing alarm bells by now. After all, it’s not too often that we see a company trading on dividend yields of this magnitude. Well, not unless they turn out to be dividend traps, of course.

So is this massive dividend yield from Woodside shares for real?

Trailing dividends yields and traps

Well, a company’s trailing dividend yield is calculated based on the shareholder income that the company had paid out over the past 12 months.

In Woodside’s case, shareholders were treated to a final dividend of $2.15 per share in April last year. As well as the September interim dividend of $1.24 per share. As we touched on earlier, both of these divided payments came fully franked.

Plugging that annual total of $3.39 in dividends per share gives Woodside shares a trailing yield of 11.29% at current pricing. So that all checks out.

However, this dividend yield from Woodside is a trailing yield. That means it reflects what investors have enjoyed in the past. Not what they can expect in the future.

We can’t know what any ASX dividend share will pay out going forward until the company in question lets us know. In Woodside’s case, the company’s next earnings are scheduled for 27 February next week.

Dividends from cyclical companies like miners and oil drillers are particularly hard to predict. That’s because the profitability of these companies rests on something that is completely out of their control: what price they can sell their commodities at.

In Wodside’s case, this would be the global oil price.

The general rule for Woodside is that if oil prices remain high going forward, Woodside’s dividends will be larger. But the opposite is also true.

Will Woodside shares pay an 11.3% dividend yield in 2024?

Oil prices have been trending downward for the past few months. That’s probably why analysts are predicting lower dividends from Woodside shares in 2024.

As my Fool colleague Bronwyn discussed last week, the consensus forecast of analysts on CommSec is that Woodside will fund annual dividends of just $1.62 per share in 2024.

If that is the case, Woodside shares would have a forward dividend yield of 5.39% today. That’s nothing to be sneezed at of course. But it’s still around half of the company’s current trailing dividend yield of 11.29%.

Regardless of how large Woodside’s next dividends will be, this exercise just goes to show why investors should never use a trailing dividend yield to make an investment decision.

The post Is the 11.3% dividend yield on Woodside shares for real? appeared first on The Motley Fool Australia.

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More reading

• How these 4 ASX 200 shares just gained major broker upgrades
• 2 ASX 200 financial shares hitting 52-week highs on earnings results
• 5 things to watch on the ASX 200 on Tuesday
• High rates, falling profits: Why are ASX bank shares losing out this reporting season?
• Here are the top 10 ASX 200 shares 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.

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The Medibank Private Ltd (ASX: MPL) share price is outperforming nicely on Tuesday.

In afternoon trade, the private health insurer’s shares are up 2.5% to a 52-week high of $3.89.

This compares favourably to the ASX 200 index, which is down 0.15% at present.

Why is the Medibank share price pushing higher?

Investors appear to have been buying the company’s shares today in response to news of a new partnership.

According to the release, the company’s Amplar Health business has partnered with Amwell, a US-based leader in healthcare technology, to support the delivery of its prevention programs at scale in Australia.

The company notes that this partnership will fast track digital health solutions to support more Australians at risk of chronic disease.

Amplar Health’s Group Lead, Robert Read, points out that the prevalence of preventable chronic disease continues to rise and costs the Australian healthcare system billions. He explains:

The top 10 chronic conditions in Australia contributed to 89% of deaths in 2021, and 66% of the total burden of disease. We need a range of solutions to improve the health of Australians. Tools that provide information in a digestible and timely way can improve health literacy and health outcomes.

Read believes that virtual options could be the solution to the problem. He adds:

Virtual solutions that allow individuals to set personal health goals, make positive lifestyle changes and sustain those changes over time are crucial to the sustainability of the broader health system.

Hospital admissions arising from preventable disease continue to climb, putting hospitals under pressure and risking poor outcomes for patients. We need to be smarter about healthcare delivery and embrace technology to enable widespread access to preventative programs across our communities.

Shareholders will no doubt be hoping that the Medibank share price builds on this and reaches a new high on Thursday when the company releases its half-year results. Stay tuned for that.

The post Medibank share price hits 52-week high on US tech partnership appeared first on The Motley Fool Australia.

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More reading

• Here’s why I’ll be watching the Medibank results like a hawk
• Beyond ASX 200 bank shares: 3 insurance plays with nice dividends
• I’d buy these two resilient ASX dividend shares for big income
• Want a large and growing dividend? Medibank shares might be the answer
• The 3 best ASX dividend shares for 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 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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It goes from bad to worse for the Strike Energy Ltd (ASX: STX) share price.

In afternoon trade, the energy producer’s shares are down 31% to 20 cents.

This means that its shares are now down 55% since this time last month.

Why is the Strike Energy share price crashing?

Investors have been scrambling to the exits again on Tuesday after the company released another update on the South Erregulla project.

Last week, the company’s shares were sold off after the release of a bitterly disappointing update on the well testing of South Erregulla-3 (SE-3).

Today, investors are hitting the sell button in response to the release of an update from well testing activities at South Erregulla-2 (SE-2).

According to the release, well testing has commenced with drilling and completion fluids being displaced from the well bore and brought to surface.

The company notes that gas and formation water is currently being produced to the surface where samples of both have been collected.

The presence of water appears to be why investors are selling down the Strike Energy share price. While the samples need to be analysed, it seems likely that this well could prove to be a dud.

And with SE-3 reporting the same last week, things are not looking good for the South Erregulla project.

This would be a blow given that the company has already secured foundation gas sales agreements for South Erregulla.

One small positive, though, is news that since its testing equipment departed SE-3, approximately 431 psi of well head pressure has been observed to have built up in the SE-3 well head and is continuing to rise.

Management believes this indicates some form of a pressure response from the primary formation in that well. So, it may not be the end of the road just yet.

The post Why is the Strike Energy share price crashing 31% today? appeared first on The Motley Fool Australia.

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More reading

• Why Breville, James Hardie, Seek, and Strike Energy shares are sinking like stones today
• Guess why this ASX 200 energy stock is crashing 30% today

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The S&P/ASX 300 Index (ASX: XKO) is down 0.29% on Tuesday, but one particular tech stock is outperforming its peers.

Battered ASX 300 tech share Appen Ltd (ASX: APX) is up 15.71% to 41 cents in late afternoon trading.

This is despite no official news from the company, which provides data solutions for machine learning.

What’s the latest with this ASX 300 tech stock?

The last time we heard price-sensitive news for this ASX 300 tech stock was on 12 February.

As we reported, Appen released a cost management update that revealed measures to save $13.5 million per annum in costs to offset the loss of its Google contract.

Appen advised the market on 22 January that Google, owned by Alphabet Inc, was terminating its global inbound services contract, with all projects to cease by 19 March.

While cost savings are always good for businesses, that $13.5 million per annum is a drop in the bucket compared to the revenue loss. In FY23, the ASX 300 company’s revenue from Google was $82.8 million.

Appen points out that the $13.5 million in cost savings will come on top of other initiatives that resulted in a $60 million per annum saving over the course of FY23.

The ASX 300 tech company expects to complete 80% of these additional cost-cutting initiatives by next month. The rest will be completed by June.

Appen expects the first full-year benefit of these cost savings to be realised in FY25.

It will cost Appen between $1.5 million and $2.5 million in one-off total expenses to implement the measures to save $13.5 million per year.

Appen is hoping to return to cash EBITDA profitability in FY24. However, it says this “will largely depend on revenue growth from our non-global customers, the timing of which remains uncertain”.

The ASX 300 tech company is due to report its FY23 full-year results on 27 February.

Appen share price snapshot

The Appen share price has fallen 98% over the past three years.

By comparison, the ASX 300 has risen 12.1% over the same period.

The post Guess which beaten-up ASX 300 tech stock is rocketing 15% today appeared first on The Motley Fool Australia.

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More reading

• How big cost-cutting is hoisting the Appen share price 10% today
• Appen share price hits all-time low on sudden CEO exit
• Would Warren Buffett buy Appen shares after a 99% drop?
• Why Appen, Baby Bunting, Cooper Energy, and Liontown shares are sinking today
• Appen shares crash 37% on huge Google blow

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Motley Fool contributor Bronwyn Allen has positions in Appen. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet and Appen. The Motley Fool Australia has recommended Alphabet. 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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It’s been a fairly miserable day for the S&P/ASX 200 Index (ASX: XJO) and most ASX 200 shares today thus far. At the time of writing, the ASX 200 has lost 0.2% after swinging rather wildly for most of the trading day. But let’s talk about what’s going on with the Lake Resources N.L. (ASX: LKE) share price.

This ASX 200 lithium share is having a shocker this Tuesday. Lake Resources shares closed at 13.5 cents each yesterday afternoon. But this morning, the lithium stock opened at 12.5 cents a share, which is where the company is currently sitting. That’s a drop worth 7.41%.

So what on earth is going so wrong for Lake today?

Why have Lake Resources shares sunk 7% today?

Well, it’s not entirely clear, unfortunately. There’s been no fresh news or announcements out of Lake Resources for almost a week now.

However, there is another possible explanation here.

Today has not only seen Lake Resources shares take a beating, but most ASX 200 lithium stocks. Pilbara Minerals Ltd (ASX: PLS) shares are currently nursing a 3.04% loss down to $3.51.

Core Lithium Ltd (ASX: CXO) has dropped 4.26%, while Sayona Mining Ltd (ASX: SYA) shares have tanked 4.7%.

This could all stem from the woes of the Liontown Resources Ltd (ASX: LTR) share price.

Liontown shares are leading the other lithium stocks off the proverbial cliff today. At present, the Liontown share price has cratered by a nasty 7.54% down to $1.16 a share.

As my Fool colleague James discussed earlier today, Liotown’s share price sorrows seem to stem from a new broker rating.

ASX broker Citi has reportedly downgraded Liontown’s shares to a sell, with a new share price target of $1.

Citi cited the belief that the market is severely overvaluing the current lithium spodumene price relative to the valuations of lithium stocks like Liontown.

As such, it seems likely that the drop we have seen in Lake Resources shares stems from this pessimism today.

After today’s drop, the Lake Resources share price is now down 12.9% in 2024 so far, as well as down a nasty 80.3% over the past 12 months.

The post Down 7%: What’s gone so wrong for Lake Resources shares today? appeared first on The Motley Fool Australia.

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More reading

• More bad news: Why Lake Resources shares plunged 5% today
• Are Lake Resources shares going to zero?
• Downgraded: Why Lake Resources shares just lost a bull

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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.

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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a small decline. At the time of writing, the benchmark index is down 0.2% to 7,650.3 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

Baby Bunting Group Ltd (ASX: BBN)

The Baby Bunting share price is down 12% to $1.65. Investors have been selling the baby products retailer’s shares after it released its half-year results. Baby Bunting reported a 2.5% decline in sales to $248.5 million and a 31% decline in pro forma net profit after tax to $3.5 million. This led to the company cutting its dividend by a third to 1.8 cents per share.

Humm Group Ltd (ASX: HUM)

The Humm share price is down 21% to 55 cents. This follows the release of the financial services company’s half-year results. Humm reported a 27% decline in normalised cash profit after tax to $28.1 million. The company’s profits were hit by an interest expense increase of $61.7 million.

Liontown Resources Ltd (ASX: LTR)

The Liontown share price is down 7% to $1.17. Investors have been selling this lithium developer’s shares on Tuesday after it was downgraded by analysts at Citi. In response to a recent rally, the broker has downgraded Liontown’s shares to a sell rating with a $1.00 price target.

Star Entertainment Group Ltd (ASX: SGR)

The Star share price is down 22% to 43.5 cents. This follows news that the NSW Independent Casino Commission is launching another inquiry. The company explained: “The NICC has informed The Star that the purpose of the Inquiry is to assist the NICC in forming a view as to what, if any, action the NICC should take in respect of The Star Sydney Pty Ltd (The Star Sydney) prior to the end of the manager’s appointment on 30 June 2024.”

The post Why Baby Bunting, Humm, Liontown, and Star shares are sinking today appeared first on The Motley Fool Australia.

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More reading

• Liontown shares crash 8% on broker downgrade
• 3 ASX All Ords shares crashing as much as 24% on results
• Star Entertainment share price crashes 26% upon return to trade
• Here are the top 10 ASX 200 shares today
• Star Group share price is frozen in further Sydney license limbo

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 recommended Humm Group. 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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Owners of Brickworks Limited (ASX: BKW) shares have seen a strong flow of dividend income for decades.

There are very few businesses on the ASX that have paid passive income for as long as this ASX dividend share.

Excellent payout record

At the company’s 89^th annual general meeting (AGM) in November 2023, it pointed out that it has been 47 years since the normal dividend was last decreased. In other words, the dividend hasn’t been reduced since 1976.

Just to be clear, it hasn’t increased its dividend every single year, though it has delivered numerous increases this century. It has grown its annual ordinary dividend each year for the past decade.

The FY23 annual dividend saw a 2% rise to 65 cents per Brickworks share. That’s not exactly an Earth-shattering increase, but it builds on previous increases. Compounding is a powerful force if growth happens year after year.

The chair of Brickworks, Robert Millner, said:

We are proud of our long history of dividend growth, and the stability this provides to our shareholders.

Over the past 20 years we have increased our dividend at a compound rate of 6.1% per annum.

It also noted that it has delivered total shareholder returns of 12.2% per annum for 25 years, which would have turned $1,000 invested in Brickworks into $17,700 at the end of FY23.

Can the Brickworks dividend keep rising?

Brickworks has held an investment in Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) since 1968. It currently owns 26.1% of the investment house which has “delivered outstanding returns, steadily increasing dividends and diversification“.

The steadily growing Soul Patts dividend goes to Brickworks and helps fund Brickworks’ growing dividend (and the Soul Patts shares assist the underlying value of Brickworks shares).

I think the Soul Patts investment is a big reason for the consistency of the Brickworks dividend.

The other main asset group that’s funding the higher Brickworks dividend is property, in my opinion.

Brickworks has sold (and continues to sell) excess building product manufacturing land into a joint venture property trust, which is 50% owned by Goodman Group (ASX: GMG).

The main property trust owns prime industrial and logistics property, tenanted by high-quality third-party customers including Amazon.com.

There is enormous demand for this type of property, which is driving the rental potential of the trust, leading to stronger rental profits and bigger distributions to Brickworks.

The joint venture is steadily completing new large warehouses at its newer estates, which is creating more rent and also leading to development profits.

No dividend is guaranteed, but I think owners of Brickworks shares have a very good chance of seeing another dividend increase in FY24 and beyond.

The post Owners of Brickworks shares haven’t seen a dividend cut for 47 years! appeared first on The Motley Fool Australia.

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More reading

• Retirees: Here’s how to boost your pension in 2024
• Transform $50 into monthly income: The best ASX dividend stocks under $50
• Brickworks shares: Buy, Hold, or Sell?
• 3 reasons why I think the Brickworks share price is a buy
• 2 excellent ASX dividend shares I’d buy with $3,000

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Tristan Harrison has positions in Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon, Brickworks, Goodman Group, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Amazon and Goodman Group. 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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Woolworths Group Ltd (ASX: WOW) shares are trading at $35.73 in late afternoon trading on Tuesday.

Earning season is underway, and the supermarket giant is due to release its 1H FY24 results and interim dividend tomorrow.

So, what are the experts expecting Woolworths shares to pay its investors this time around?

How much will Woolworths pay in dividends in 2024?

The consensus analyst forecast published on CommSec is for Woolworths to pay $1.10 per share in total annual dividends this year.

They expect this to rise to $1.189 per share next year and $1.288 per share in 2026.

A $10,000 budget (minus a brokerage fee of $5) will buy you 279 Woolworths shares at the current price.

Total spend = $9,968.67.

If we multiply 279 shares by $1.10, we get a total annual dividend of $306.90 and a yield of 3.08%.

But Woolworths investors also receive 100% franking with their dividends.

If we add that benefit, we get an anticipated gross annual dividend of $438.43 on a yield of 4.4% for 2024.

What about next year and 2026?

As discussed earlier, analysts expect Woolworths shares to pay higher dividends in 2025 and 2026.

So, let’s run the numbers again to figure out the dividend yields you can expect if you buy Woolworths at today’s share price.

2025: 279 x $1.189 = $331.73. With franking, it’s $473.90 and a gross dividend yield of 4.75%.

2026: 279 x $1.288 = $359.35. With franking, it’s $513.36 and a gross dividend yield of 5.15%.

Woolworths share price snapshot

Woolworths is down 2.87% over the past 12 months compared to a 3.96% bump for the ASX 200.

The post If I invest $10,000 in Woolworths shares, how much dividend income will I receive in 2024? appeared first on The Motley Fool Australia.

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• ASX blue chip shares: The best of the best for February 2024
• Buy these top ASX 200 stocks for 18%+ returns
• Will these ASX 200 shares help you retire rich?
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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.

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The S&P/ASX 200 Index (ASX: XJO) is having a subdued session on Tuesday. In afternoon trade, the benchmark index is down 0.2% to 7,650.3 points.

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

ARB Corporation Ltd (ASX: ARB)

The ARB share price is up 11% to $39.62. This morning, this 4×4 automotive parts company released its half year results and reported a 0.1% lift in sales revenue to $341.5 million and an 8.1% jump in profit after tax to $51.3 million. Management also revealed that it has started the second half positively.

Bravura Solutions Ltd (ASX: BVS)

The Bravura share price is up 30% to $1.25. Investors have been buying the investment software provider’s shares following the release of its half-year results which revealed a return to profit. Bravura reported EBITDA of $7.9 million for the half, up from negative EBITDA of $3.6 million a year earlier.

Hub24 Ltd (ASX: HUB)

The Hub24 share price is up 7.5% to $40.36. This follows the release of the investment platform provider’s half-year results. Hub24 reported a 14% increase in revenue to $156.7 million and a 39% jump in net profit after tax to $21.5 million. This was driven by record half year net inflows of $7.2 billion, up 26% on the prior corresponding period.

Suncorp Group Ltd (ASX: SUN)

The Suncorp share price is up 6% to $15.27. Investors have been buying the insurance giant’s shares after the Australian Competition Tribunal approved the sale of its banking operations to ANZ Group Holdings Ltd (ASX: ANZ). Suncorp Group CEO, Steve Johnston, notes that the sale would result in Suncorp becoming “a dedicated Trans-Tasman insurance company at a time when the value of insurance and the need for continued investment in a vibrant private insurance sector had never been greater.”

The post Why ARB, Bravura, Hub24, and Suncorp shares are storming higher appeared first on The Motley Fool Australia.

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