Tag: Motley Fool

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

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

What happened 

Tesla‘s (NASDAQ: TSLA) stock was moving higher today, likely as investors processed an analyst’s recent upgrade for the electric vehicle stock and after Cathie Wood-led Ark Investment Management added more Tesla shares to its portfolio yesterday. 

The EV stock was up by 2.5% as of 2:55 p.m. ET Tuesday. 

So what 

Yesterday, RBC Capital analyst Joseph Spak upgraded Tesla’s stock to outperform from sector perform and put a price target on the company’s shares of $1,100.  

Spak thinks that Tesla has a competitive advantage over its peers because of its supply chain and vertical integration. He said in the investor note that “The company’s early focus on vertical integration (not just batteries/raw materials but also motors, semis, software) is likely to pay off.” 

Spak also thinks that Tesla’s automotive margins could be higher than 30% in the second half of the year as the average selling price for its vehicles increases and the company’s Shanghai, Berlin, and Texas plants boost vehicle production. 

In addition to the analyst’s positive comments, investors may be reacting to the fact that Ark Investment once again bought up more shares of Tesla. Ark Invest bought 2,800 Tesla shares yesterday, worth about $1.8 million, which marked the fifth time this month that the fund has added more Tesla shares to its portfolio.

Now what 

Investors are worried about rising inflation, supply chain issues, and the potential for an economic slowdown in the U.S., all of which has sent Tesla’s share price on a wild ride over the past year. 

But today’s gains show that despite all of the volatility in the market, many investors still have a long-term perspective on the EV maker. 

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

The post Why Tesla shares were rising today appeared first on The Motley Fool Australia.

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

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

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The heavy declines of the ASX share market are having a big impact on share prices. Not only is this making S&P/ASX 200 Index (ASX: XJO) shares cheaper, but it’s also boosting the potential dividend yield from ASX dividend shares.

Investors have been hitting the sell button as inflation soars and worries heighten about how central banks will respond to bring this under control.

But, with the heightened fears come potential buying opportunities. These two ASX 200 dividend shares look really good to me at these lower prices.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is one of the most diverse businesses in the ASX 200, in my opinion.

Not only does it have its retail operations of Bunnings, Kmart, Officeworks, Target, and Catch, but it also has businesses in other sectors, including industrial, chemicals, energy, fertiliser, lithium, healthcare, and stakes in other businesses.

There is a potential danger that inflation and other impacts could hurt Wesfarmers’ retail earnings in the short term. Management said it wants to be a price leader for customers amid this inflation, which may indicate lower margins in the shorter term.

However, I think this economic situation will eventually pass, just like other bumpy economic periods in the past.

Governor Philip Lowe said last night the Reserve Bank of Australia is expecting inflation to peak at the end of 2022, with inflation “clearly dropping” into the second half of next year, with a lower rate of inflation in the first quarter. With that in mind, I think the lower Wesfarmers share price represents good value – it’s down 30% in 2022.

Bunnings is a high-quality business, in my opinion. It generated around 70% of Wesfarmers’ FY22 first-half underlying earnings before tax (EBT). It also made a return of capital of 79%, meaning that it makes a lot of profit for the amount of money invested in Bunnings.

Wesfarmers could go hunting for potential acquisition opportunities during this period by using its balance sheet flexibility and boost its long-term prospects further. The company generated $1.6 billion of operating cash flow in HY22, allowing it to pay dividends and invest substantially into the business for more growth.

Using estimates from CMC, the Wesfarmers share price is valued at 20x FY23’s estimated earnings with a projected grossed-up dividend yield of 6.1%.

Washington H. Soul Pattinson and Co Ltd (ASX: SOL)

Soul Pattinson is one of my favourite ASX dividend shares and I recently bought more shares for my portfolio because I thought it looked more attractive after the decline — it’s down 23% this year to date.

It operates as an investment house. The business owns a large portfolio of ASX shares including TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW), New Hope Corporation Limited (ASX: NHC), Commonwealth Bank of Australia (ASX: CBA), Macquarie Group Ltd (ASX: MQG), Pengana Capital Group Ltd (ASX: PCG), and Tuas Ltd (ASX: TUA). These are just some of the biggest positions in the portfolio, but there are many more holdings.

The ASX 200 dividend share also has a growing portfolio of private business investments. Examples of those private businesses include electrical parts business Ampcontrol, swimming school business Aquatic Achievers, an agriculture portfolio, and financial service businesses.

Soul Pattinson’s diversified portfolio lowers the risk of the overall business, in my opinion. It also gives management a broad range of target areas to look for investment opportunities.

The company has tried to build a defensive portfolio that can continue generating attractive cash flow during downturns, which can also fund dividends.

Soul Pattinson has grown its annual ordinary dividend to shareholders every year since 2000.

With the last 12 months of dividends totalling 65 cents per share, the ASX 200 dividend share has a trailing grossed-up dividend yield of 3.9%.

The post Why I think these 2 ASX 200 dividend shares offer great buying right now appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks, Washington H. Soul Pattinson and Company Limited, and Wesfarmers Limited. The Motley Fool Australia has recommended Macquarie Group Limited and TPG Telecom 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 St Barbara Ltd (ASX: SBM) share price tanked to a 52-week low of $1.0775 yesterday.

This is a sharp contrast to when the gold miner’s shares reached a year-to-date high of $1.64 on 14 March.

However, after heavy falls on the ASX on Tuesday, St Barbara shares closed 1.30% lower to $1.135.

What happened to St Barbara shares?

The general market sentiment remains negative amid sky-high inflation and possible bigger rate hikes.

St Barbara shares have been caught up in the whirlwind along with other gold resource companies.

As such, Northern Star Resources Ltd (ASX: NST) shares touched a multi-year low of $7.69 yesterday.

On the other hand, shares in Australia’s largest gold miner Newcrest Mining Ltd (ASX: NCM) are down almost 5% in a week.

In addition, the price of gold has tumbled 3.5% from last Friday to US$1,810 per ounce at the time of writing. This is because investors are shifting their assets from gold to government bonds as the yields become more attractive.

Nonetheless, this could weigh on St Barbara’s margins as gold losses its value.

Can St Barbara shares make a comeback?

According to ANZ Share Investing, one broker gave its take on the St Barbara share price in early May.

Following the company’s third-quarter results, Macquarie slashed its price target by 6% to $1.70 per share. This represents an upside of close to 50% based on the current share price.

The broker believes the St Barbara share price is significantly undervalued at this point in time.

About the St Barbara share price

Over the past 12 months, the St Barbara share price has dropped by 39%.

Year to date, its shares are down 22%.

St Barbara has a price-to-earnings (P/E) ratio of 8.76 and commands a market capitalisation of roughly $925.86 million.

The post Can the St Barbara share price recover its losses in 2022? appeared first on The Motley Fool Australia.

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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 Dicker Data Ltd (ASX: DDR) share price tumbled to a year-to-date low of $10.87 yesterday before climbing back up.

Widespread turmoil across the ASX on the back of Monday’s heavy losses on Wall Street sent investors packing.

Shares in the hardware, software and cloud distributor defied the sell-off to finish 0.61% higher to $11.57. However, when factoring in the past month, its shares have fallen 8%.

For context, the S&P/ASX 200 Index ended the day down 3.55% to 6,686 points.

Let’s take a look at what’s weighing on Dicker Data shares in recent memory.

What’s driving Dicker Data shares lower?

A number of factors outside the company’s control have led the Dicker Data share price to sink since 24 March.

Russia’s attack on Ukraine continued to spook international markets as sanctions were handed down on the Kremlin.

Subsequently, oil and gas prices rose and global markets began to tank as this would stall worldwide economic growth.

While this didn’t have anything to do with Dicker Data directly, its shares weren’t spared, falling to $12.11 on 9 May.

Furthermore, the latest inflation figures and potentially aggressive rate hikes in 2022 are having a detrimental effect on international markets.

The S&P/ASX All Technology Index (ASX: XTX) is down 7% in a month, and 36% for the current calendar year.

While Dicker Data reported strong growth in its first-quarter update on 11 May, this hasn’t been enough to stem the bloodshed.

If the ASX plunges further, it’s most likely that the IT distributor’s shares will follow suit.

Dicker Data share price summary

In 2022, Dicker Data shares have lost around 22% due to a severe downturn across global markets.

Although, when looking over the past 12 months, its shares are up 11% in that time frame.

Dicker Data commands a market capitalisation of roughly $1.99 billion and has a trailing dividend yield of 4%.

The post The Dicker Data share price is trading at YTD lows. Here’s why appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has positions in Dicker Data Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Dicker Data Limited. The Motley Fool Australia has positions in and has recommended Dicker Data 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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Wesfarmers Ltd (ASX: WES) and JB Hi-Fi Limited (ASX: JBH) have been using facial recognition on unknowing customers in their stores.

That’s the finding from consumer advocacy group Choice, which investigated 25 Australian retailers for their privacy credibility.

The enquiry found Wesfamers-owned retailers Kmart and Bunnings, plus JB Hi-Fi’s The Good Guys appliance outlets, all used the identification technology on anyone who walked through their doors.

According to Choice consumer data spokesperson Kate Bower, the practice is “a completely inappropriate and unnecessary use of the technology”.

“Using facial recognition technology in this way is similar to Kmart, Bunnings, or The Good Guys collecting your fingerprints or DNA every time you shop,” she said.

“Businesses using invasive technologies to capture their customers’ sensitive biometric information is unethical and is a sure way to erode consumer trust.”

Choice announced that it would dob in the retailers to the Office of the Australian Information Commissioner (OAIC) to explore possible breaches of the Privacy Act.

The consumer group also urged the federal government to regulate facial recognition.

Wesfarmers and JB Hi-Fi had not responded to enquiries from The Motley Fool at the time of writing.

Harvested biometric data includes children

What made it worse, according to Bowers, was that 76% of Australians didn’t even realise their unique facial data was harvested.

“Choice observed that Kmart and Bunnings display small signs at the entrance of stores where the technology is in use,” she said.

“However, discreet signage and online privacy policies are not nearly enough to adequately inform shoppers that this controversial technology is in use.”

Bowers added that the biometric data collected included infants and children.

“Choice is concerned that Australian businesses are using facial recognition technology on consumers before Australians have had their say on its use in our community.”

“With the government currently undergoing a review of the Privacy Act, now is the perfect time to strengthen measures around the capture and use of consumer data.”

Wesfarmers shares have dropped more than 30% since the start of the year, while JB Hi-Fi has seen its stock price fall almost 20%.

The post 2 ASX companies busted for sneaky facial recognition on customers appeared first on The Motley Fool Australia.

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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 no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Wesfarmers 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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If you’re wanting to load up on blue chip shares following the market selloff, then look no further.

Listed below are two ASX 200 blue chips that Goldman Sachs rates as buys. Here’s what it is saying:

REA Group Limited (ASX: REA)

The first blue chip ASX 200 share for investors to consider buying is REA. It is the operator of realestate.com.au, which is the dominant player in real estate listings in the Australian market.

It could be a top option for investors due to the recent pullback in its share price, which has come despite management’s positive outlook commentary. REA recently stated that it remains confident it can achieve double digit revenue/EBITDA growth through the cycle.

This went down well with the team at Goldman Sachs, which has a buy rating and $167.00 price target on its shares. Based on the current REA share price of $103.44, this implies potential upside of 61% for investors.

Goldman said:

Overall, we believe these commitments illustrate the pricing power of REA, pipeline of value-add products, and its ability to offset any potential macro weakness, and now forecast FY22-24E Sales growth of 10% despite challenging volume listings.

Woolworths Group Ltd (ASX: WOW)

Another ASX 200 blue chip share that could be in the buy zone is Woolworths. It is of course the retail giant behind the eponymous Woolworths supermarket and Big W brands.

The team at Goldman Sachs is very positive on the company’s outlook even in the current environment. It recently reiterated its buy rating and $41.70 price target on the company’s shares. Based on the current Woolworths share price of $33.83, this implies potential upside of 23% for investors.

Goldman is forecasting solid sales and earnings growth through to FY 2024. It explained:

We are encouraged by the resilience and superior operations of WOW and reiterate our unchanged FY22-24e Sales and EPS CAGR of 6.9% and 14.9% respectively. We expect this to be driven by high price growth, well protected GPM and slight EBIT margin expansion as COVID costs roll-off and cost efficiencies continue.

The post 2 blue chip ASX 200 shares that Goldman Sachs rates as buys appeared first on The Motley Fool Australia.

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More reading

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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 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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The Evolution Mining Ltd (ASX: EVN) share price has been struggling over the past week.

The company’s shares slumped 8.03% between market close on 7 June and 14 June. For perspective, the S&P/ASX 200 Index (ASX: XJO) tumbled 5.77% in the same time frame. The S&P/ASX 200 Materials Index (ASX: XMJ) also descended 6.13% between these dates.

Let’s take a look at what could be ahead for this gold explorer.

Could higher electricity prices be a risk for Evolution?

Macquarie is concerned gold miners including Evolution could be impacted by higher electricity prices.

Analysts named Evolution, Newcrest Mining Ltd (ASX: NCM), Aurelia Metals Ltd (ASX: AMI), and Oz Minerals Limited (ASX: OZL) as facing the “highest earnings risk from surging electricity prices”, The Australian reported.

Macquarie stated rising electricity prices are due to “increased demand, rising fuel costs and unplanned coal generator outages”. Analysts added:

There continues to be upside risk to power prices in eastern states of Australia, adding cost pressures to miners operating on the East Coast of Australia.

Evolution Mining owns four mines in Australia along with a mine in Ontario, Canada. The company has a production guidance of about 650 thousand ounces (koz) of gold for FY22. Major shareholders include Van Eck, BlackRock, Fidelity, and Australian Super.

The Evolution Mining share price fell 4.86% to $3.33 on Tuesday alone. For perspective, the ASX 200 also shed nearly 4% on Tuesday, while the ASX 200 Materials Index slid 4.44%.

This drop followed Wall Street’s S&P 500 market falling into a bear market on Friday night amid higher inflation. The US Fed reserve is reportedly considering raising rates by 0.75%, sparking fears of a recession.

Gold prices also hit a nearly four-week low on the back of the strong US dollar, CNBC reported. City Index senior market analyst Matt Simpson said:

Gold has faced selling pressure as investors have decided to either go to cash, or offload gold to attend margin calls across other markets.

Evolution Mining share price snapshot

The Evolution Mining share price has plunged 34% in the past 12 months, while it has sunk 18% in the year to date.

For perspective, the benchmark S&P/ASX 200 Index (ASX: XJO) has shed around 9% in a year.

Evolution Mining has a market capitalisation of just over $6 billion based on its current share price.

The post Evolution Mining share price dips 8% in a week as Macquarie flags ‘earnings risk’ from energy crisis appeared first on The Motley Fool Australia.

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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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If you’re looking for dividend shares to buy then you may want to look at the ones below that brokers are recommending.

Here’s what brokers are saying about these ASX dividend shares:

BHP Group Ltd (ASX: BHP)

The first ASX dividend share to look at is mining giant BHP.

While operating conditions have been tough this year due to labour shortages and rising fuel costs, this is being offset by sky high commodity prices. So much so, BHP is being tipped to generate huge sums of free cash flow again in FY 2022.

And due to the strength of its balance sheet, the majority of this free cash flow looks set to be returned to shareholders through dividends.

Goldman Sachs is very positive on the company and recently put a buy rating and $51.20 price target on the Big Australian’s shares. Its analysts note that BHP has an “attractive valuation & FCF, and upside from ~US$20bn Copper growth pipeline.”

As for dividends, the broker is forecasting fully franked dividend yields of over 10% in FY 2022 and FY 2023.

Telstra Corporation Ltd (ASX: TLS)

Another ASX dividend share for income investors to look at is this telco giant.

After years of struggles, Telstra revealed underlying earnings growth during the first half of FY 2022 thanks to the success of its T22 strategy.

The good news for investors is that Telstra will soon embark on its T25 strategy. While T22 was about transforming the company, T25 has been designed to underpin solid earnings growth.

Analysts at Morgans have been pleased with the company’s plans and have put an add rating and $4.56 price target on its shares.

In respect to dividends, Morgans is forecasting fully franked dividends per share of 16 cents in FY 2022 and FY 2023. Based on the current Telstra share price of $3.75, this will mean yields of 4.25%.

The post 2 top ASX dividend shares to buy according to analysts appeared first on The Motley Fool Australia.

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More reading

• Top ASX dividend shares to buy in June 2022
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• 5 things to watch on the ASX 200 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 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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The Goodman Group (ASX: GMG) share price was caught up in the market selloff on Tuesday.

So much so, at one stage the integrated industrial property company’s shares dropped to a 52-week low of $17.21.

The Goodman share price ultimately finished the day with a 3.5% decline to $17.91.

Is the Goodman share price weakness a buying opportunity?

The good news for investors is that one leading broker believes the Goodman share price can bounce back materially from current levels.

According to a recent note out of Citi, its analysts have put a buy rating and $29.50 price target on the company’s shares.

This price target suggests that there is potential upside of 65% for investors over the next 12 months.

What did the broker say?

Citi was pleased with the company’s performance during the third quarter and believes there’s more to come. This is thanks to solid demand for industrial property, which it expects to underpin above-guidance growth.

GMG’s 3Q22 update highlights a continuation of strong conditions, which resulted in guidance for FY22 EPS growth being upgraded to 23% (from 20% previously). Like-for-like rental income, development WIP and AUM all increased, albeit with a FX headwind partially offsetting growth in AUM and WIP.

Similar to previous periods, we see FY22 guidance as conservative given strong FUM growth into 4Q22, off the back of development completions and rising asset values (as GMG’s book cap rates are softer than market). Moreover, despite fears, we see the growth outlook as being robust for FY23 as well given solid demand for industrial (which is driving market rental growth above longer-term averages) and ongoing investment demand, which should support asset value and AUM growth. We re-iterate Buy and see the -25% YTD share price decline as a good entry point.

The post Market selloff: Broker says the Goodman share price now has 65% upside potential appeared first on The Motley Fool Australia.

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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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I’m always looking for opportunities to buy more of my favourite ASX shares.

I like businesses that I can own for the long-term, benefit from dividends along the way and hopefully achieve good returns over time.

The two businesses I’m about to talk about are ones that have been in my portfolio for several years. I’m planning to hold them for many more years, but I’d like to own even more of these two ASX shares.

Rural Funds Group (ASX: RFF)

Rural Funds is a real estate investment trust (REIT) which owns a portfolio of farms. Those farms are spread across a number of agricultural sectors including cattle, vineyards, almonds, macadamias and cropping (sugar and cotton).

I like the idea of owning quality farms as it gives exposure to a somewhat defensive sector (we all need food), there’s growing food demand as the population increases in Australia and globally, and it’s a source of income.

The tenants are the ones that take on the operational risks of running the farms, Rural Funds just collects growing rental payments each year. The ASX share also owns a sizeable portfolio of water entitlements for the tenants to use.

The rent is growing. Rural Funds has rental contracts where some of the contracts have a fixed 2.5% annual increase and others are linked to CPI inflation. Some contracts also have periodic market reviews. Another thing helping the business is productivity investments at the farms.

The rental growth is helping fund a 4% annual increase of the distribution. This incremental growth is attractive to me for income stability.

Altium Limited (ASX: ALU)

Altium is one of the world’s leading electronic PCB software businesses. However, it has grown to offer a number of other services such as the cloud platform Altium 365 and electrical parts search engine Octopart.

I think there are a number of positive tailwinds for the business, including the rising number of connected ‘internet of things’ devices. Some products, such as cars, are becoming increasingly electronic and complex.

Indeed, some of Altium’s biggest subscribers are companies like Tesla, Toyota and Ford.

I think the ASX share is doing the right things to attract and retain clients, such as the shift to the cloud with Altium 365. The company says that it connects the electronics industry fragmented value chain to drive productivity and manage production risk.

Another initiative is Altimade which it says “provides cloud based smart manufacturing that will improve productivity and manufacturability of electronics hardware and manage the supply chain of components as well as production risk.”

The potential for longer profit growth looks good, with operating leverage helping profit margins rise in the future. In the FY22 first half, its earnings before interest, tax, depreciation and amortisation (EBITDA) margin was 34.1%. Over the long-term, it wants the EBITDA margin to be between 38% to 40%.

Foolish takeaway

I really like both of these ASX shares, though I did buy my current positions at much lower prices than today, so I’d love to be able to buy more at an even cheaper price.

The post 2 ASX shares I want to buy more of for my portfolio appeared first on The Motley Fool Australia.

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More reading

• Can the Altium share price regain its previous highs in 2022?
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Motley Fool contributor Tristan Harrison has positions in Altium and RURALFUNDS STAPLED. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Altium and Tesla. The Motley Fool Australia has positions in and has recommended RURALFUNDS STAPLED. 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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