Tag: Motley Fool

Telstra Group Ltd (ASX: TLS) shares are falling on Thursday.

In morning trade, the telco giant’s shares are down 2.5% to $3.89.

What’s happening?

Investors have been pushing the sell button today in response to the company’s half-year results.

For the six months ended 31 December, Telstra reported a 1.2% increase in total income to $11,700 million and a 3.1% lift in underlying EBITDA to $4,001 million.

This reflects growth across mobile services, International, Telstra InfraCo Fixed, and Amplitel, which offset weakness from mobile hardware, Fixed C&SB, Fixed Enterprise, and Fixed Active Wholesale.

This ultimately allowed the Telstra board to increase its fully franked interim dividend by 5.9% to 9 cents per share.

Why are Telstra shares falling?

While on paper this looks like a decent result, it was actually a touch short of the market’s expectations.

In addition, Telstra shares are under pressure today after management revised its earnings guidance range for FY 2024.

Previously, the company was targeting EBITDA of $8.2 billion to $8.4 billion. However, it has now revised this in response to a weaker than expected performance from its Network Applications and Services (NAS) business.

Telstra CEO, Vicki Brady, explained:

Within our Enterprise Fixed business, Data & Connectivity is performing as expected, however NAS is clearly a long way from where we need it to be. […] Given the performance in our NAS business, we are tightening our FY24 Underlying EBITDA guidance range to $8.2 to $8.3 billion. FY24 guidance across other measures is reaffirmed.

Broker response

The team at Goldman Sachs notes that the result was short of its expectations. It said:

Telstra has reported 1H24 Income/EBITDA/NPAT of A$11.72bn/A$4.0bn/A$964mn, which was -1%/-1%/-0.2% vs. our estimates, and -1%/-1%/0% vs. Visible Alpha Consensus (VAe).

The broker also highlights that Telstra’s guidance implies a larger than normal earnings skew in the second half. It adds:

FY24 EBITDA guidance narrowed to $8.2bn to $8.3bn (from $8.2-$8.4bn, i.e. -1% at mid-point and vs. GSe/VAe). All other guidance metrics are unchanged. We note the 1H24 EBITDA and revised FY24 guidance implies a 48.7%/51.3% 1H/2H skew (mid-point) vs. TLS FY16-23 1H avg. of 49.5% – with this skew previously flagged at the Nov-23 investor day. The lower guidance reflects the disappointing NAS performance flagged at the Investor Day – which has continued Nov-Jan (lower business confidence), with its performance not expected to improve in 2H24 (i.e. typically 2H skew).

The post Telstra shares tumble on half-year disappointment appeared first on The Motley Fool Australia.

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More reading

• Telstra share price on watch amid earnings miss and guidance revision
• 5 things to watch on the ASX 200 on Thursday
• How does investing in a term deposit compare with buying ASX shares?
• Forget Westpac and buy these top ASX dividend stocks
• Will these ASX 200 shares help you retire rich?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Telstra 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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The Whitehaven Coal Ltd (ASX: WHC) share price is taking a tumble today.

Shares in the S&P/ASX 200 Index (ASX: XJO) coal stock closed yesterday trading for $7.51. In early morning trade on Thursday, shares are changing hands for $7.03 apiece, down 6.4%.

For some context, the ASX 200 is up 0.7% at this same time.

This follows the release of Whitehaven’s half-year results for the six months ending 31 December (H1 FY 2024).

Read on for the highlights.

Whitehaven share price dives as dividend slashed

• Revenue of $1.59 billion, down 58% from H1 FY 2023
• Underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of $623 million, down 77% year on year
• Underlying net profits after tax (NPAT) of $372 million, down from $1.79 billion in H1 FY 2023
• Net cash down 43% to $1.50 billion
• Fully franked interim dividend of 7 cents per share, down from the prior interim dividend of 32 cents per share

What else happened with Whitehaven during the half-year?

Other core metrics impacting the Whitehaven share price include coal production, which increased during the period. Run of mine (ROM) production was up 17% from H1 FY 2023 to 10.35 million tonnes.

Unfortunately, costs were up too. Unit costs per tonne rose to $111 per tonne, up 16% from the prior corresponding half year. And coal stocks declined by 34% to 1.23 million tonnes.

Whitehaven reported it achieved a realised average price of AU$220 per tonne over the six months.

In the biggest development for the ASX 200 coal miner during the period, Whitehaven confirmed its intention to acquire the Daunia and Blackwater metallurgical coal mines, owned by the BHP Group Ltd (ASX: BHP) Mitsubishi Alliance.

And passive income investors may want to mark 8 March on their calendars. That’s when Whitehaven will pay out its interim dividend.

What did management say?

Commenting on the acquisition of BHP’s coal mines, which is failing to lift the Whitehaven share price today, CEO Paul Flynn said:

The program of work to complete the acquisition of Daunia and Blackwater mines and transform Whitehaven into a metallurgical coal business is progressing well…

The US$1.1 billion five-year credit facility, together with US dollar cash on the balance sheet, will be used to fund the upfront payment for the acquisition. Ongoing cash flows being generated by the business will provide additional liquidity.

Whitehaven expects the acquisition to be complete in early April, subject to regulatory approvals.

What’s next?

Looking at what might impact the Whitehaven share price in the months ahead, the company’s FY 2024 guidance forecasts managed ROM coal production of 18.7 million to 20.7 million tonnes. Managed coal sales are forecast to be in the range of 16.0 to 17.5 million tonnes for the full financial year.

On the cost front, Whitehaven expects unit costs (excluding royalties) to be between $103 to $113 per tonne. And capital expenditure is forecast at $400 million to $450 million (excluding acquisition costs).

Whitehaven share price snapshot

With today’s big dip factored in, the Whitehaven share price is down 14% over 12 months.

Shares in the ASX 200 coal stock are up 24% since the 31 May lows.

The post Whitehaven share price crumbles on plunging half-year revenue appeared first on The Motley Fool Australia.

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More reading

• ASX passive income: How much should you invest to earn $1,000 every month?
• If I’d invested $10,000 in this ASX 200 share 3 years ago I’d have $58,538 today!
• Here are the top 10 ASX 200 shares today
• Why EML, Jumbo, Mesoblast, and Whitehaven Coal shares are jumping today
• Why are Whitehaven Coal shares racing 7% higher on Friday?

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 Treasury Wine Estates Ltd (ASX: TWE) share price is up 3.9% in early trade on Thursday despite the company putting out lukewarm half-year results in the morning.

What did the company report?

• First half 2024 net profit after tax down 11% to $166.7 million
• First half 2024 revenue up 0.4% to $1.3 billion
• First half 2024 earnings down due to some product sales weighted to the second half
• Interim dividend 17 cents, compared to 18 cents last year

The results come as Beijing is undertaking a review of punitive tariffs on Australian wine imports into China. Warmer diplomatic relations between the two nations may mean the tariffs are reduced, which will reopen a massive export market for Treasury Wine after it was lost in 2020.

What else happened in the first half?

The big news in the first half was Treasury Wine’s acquisition of Daou vineyards business in the US for about $1.4 billion.

Luxury wines carried the business with net sales revenue up 4.3%, while premium and commercial portfolio respectively lost 2% and 6.5%.

What did management say?

I am pleased with the ongoing underlying performance of Treasury Wine Estates this period, with strong consumer demand for our priority Luxury brand portfolio continuing around the globe.

Penfolds continues to perform and strengthen, whilst Treasury Americas has made significant progress in reshaping its portfolio focus with continued growth of its Luxury brands now supported by the acquisition of DAOU in December. The Premium wine category, whilst resilient, is highly competitive and we continue to innovate and invest to achieve the goal of outperforming the category and importantly attracting new consumers to wine.

Treasury wine chief executive Tim Ford

What’s next?

Aside from the massive potential catalyst of China’s tariff review, Ford said that the company is “on track to deliver mid-high single digit earnings growth in F24”.

“We remain confident that our premiumisation strategy, preeminent brand portfolio and attractive market fundamentals at Luxury price points will allow us to continue to deliver our long-term growth ambitions.”

Treasury Wine share price snapshot

Treasury shares had been down 16.1% over the past 12 months before trading on Thursday. The stock is now trading almost 42% lower than its pre-COVID high.

The post Treasury Wine shares rocket despite profit dive waiting for China tariff relief appeared first on The Motley Fool Australia.

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More reading

• 3 ASX shares to buy for Valentine’s Day
• 2 top ASX bargain stocks that could be ready for a bull run
• Morgans names the best ASX 200 dividend shares to buy in February
• 2 rejuvenated ASX 200 stocks with ‘strong brands’ ready to roar again
• Brokers name 3 ASX shares to buy now

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 recommended Treasury Wine Estates. 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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BHP Group Ltd (ASX: BHP) shares are under pressure on Thursday morning.

At the time of writing, the mining giant’s shares are down 1.5% to $45.25.

Why are BHP shares falling?

Investors have been hitting the sell button today after the company announced a number of exceptional items that will show up in its upcoming half-year results.

According to the release, these items relate to an impairment of the carrying value of the Nickel West operations and West Musgrave project (Western Australia Nickel) and an increase to the provision for the Samarco dam failure.

Nickel impairment

Management highlights that the nickel industry is facing challenges and there has been a sharp fall in nickel prices.

This has been driven by the supply of nickel from Indonesia significantly increasing and the London Metals Exchange accepting Indonesian-origin nickel products in response to evolving industry dynamics.

Unfortunately, BHP believes these unfavourable operating conditions will endure for a considerable time. Combined with cost pressures, BHP has been forced to impair the Western Australia Nickel’s assets by US$2.5 billion. This reduces the carrying value of the assets to negative US$0.3 billion.

BHP will also record underlying EBITDA of approximately negative US$0.2 billion at Western Australia Nickel in its half-year results.

Management continues to optimise operations at Nickel West and options are being evaluated to mitigate the impacts of the current low prices.

BHP Chief Executive Officer, Mike Henry, said:

This is an uncertain time for the Western Australia nickel industry and we are taking action to address the current market conditions. We are reducing operating costs at Western Australia Nickel and reviewing our capital plans for Nickel West and West Musgrave.

Samarco provision

Also putting pressure on BHP shares is news that the miner will also recognise an income statement post tax charge of US$3.2 billion in relation to the Samarco dam failure.

This reflects the assessment of the estimated costs to resolve all aspects of the Federal Public Prosecution Office Claim and the Framework Agreement obligations.

Henry adds:

BHP Brasil along with Samarco and Vale continue to progress negotiations towards a settlement of the Federal Public Prosecutor Office Claim and Framework Agreement obligations in Brazil. The Renova Foundation has made good progress on reparation and compensation programs and over 84% of the community resettlement cases have been completed.

The post BHP shares fall on multi-billion profit hit from nickel and Samarco appeared first on The Motley Fool Australia.

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More reading

• Own BHP shares? Here’s your first-half results preview
• BHP share price resilient ahead of Friday’s strike action
• 3 things about BHP stock every smart investor knows
• 7 must-see results this ASX reporting season before buying or selling
• Which major ASX mining share will pay the biggest dividend this year?

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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The Wesfarmers Ltd (ASX: WES) share price will be in focus on Thursday after the conglomerate released its half-year results.

Let’s see how the company performed during the half.

Wesfarmers share price on watch after half-year results release

• Revenue up 0.5% to $22,673 million
• Earnings before interest and tax (EBIT) up 1.6% to $2,195 million
• Net profit after tax up 3% to $1,425 million
• Operating cash flows up 47% to $2,898 million
• Fully franked interim dividend up 3.4% to 91 cents

What happened during the half?

For the six months ended 31 December, Wesfarmers reported a 0.5% increase in revenue to $22,673 million.

This was driven by a 1.7% increase in Bunnings revenue, a 7.8% jump in Kmart revenue, a 1.8% lift in Officeworks revenue, and a 3.2% improvement in Industrial and Safety revenue. This offset weaker Catch, Target, Wesfarmers Health, and WesCEF revenue. The latter was down 21.2% on the prior corresponding period.

Wesfarmers’ earnings grew at a quicker rate during the half, with net profit after tax up 3% to $1,425 million.

This was driven largely by the Kmart Group business, which posted a 26.5% increase in earnings for the year. Management advised that its record result reflects the positive customer response to Kmart’s lowest price positioning.

Bunnings earnings were relatively flat for the year but up 3.1% excluding property contributions.

The main drag on its earnings was the WesCEF business, which posted a 46.9% decline in earnings for the period. Its earnings were impacted by lower global commodity prices, as well as higher Western Australian gas costs.

Finally, thanks partly to its strong cash flow generation, the Wesfarmers board elected to increase its interim dividend by 3.4% to 91 cents per share.

How does this compare to expectations?

This result appears to have been a bit of a mixed bag compared to the market’s expectations.

On the positive side, Morgans was forecasting “EBIT to be down 5% mainly due to materially lower WesCEF earnings.”

So, the company has beaten those expectations, which could be good news for the Wesfarmers share price.

One negative, though, is the performance of the Bunnings business compared to expectations.

Goldman Sachs was forecasting a solid 5.1% increase in Bunnings EBIT for the half. Given that it is the key business in the Wesfarmers portfolio, its underperformance could be a worry for some investors.

Management commentary

Wesfarmers’s Managing Director, Rob Scott, was pleased with the company’s performance. He said:

Wesfarmers’ retail divisions executed strongly during the half, responding effectively to changing customer needs as households increasingly sought out value. In this environment, the retail divisions’ core offer of everyday products with market-leading value credentials supported growth in sales and customer transaction numbers.

The retail divisions have benefitted from a proactive focus on productivity and efficiency initiatives in recent years, which together with their unique sourcing capabilities and strong supplier partnerships enabled them to mitigate ongoing cost pressures and provide compelling value for customers during the half.

Outlook

No guidance has been provided for FY 2024, but management has given investors an update on the first five weeks of the second half. It said:

For the first five weeks of the second half of the 2024 financial year, Kmart Group has continued to deliver strong sales growth. Sales growth in Bunnings remained broadly in line with results for the first half. Officeworks’ sales for the first five weeks were in line with the prior corresponding period.

The Wesfarmers share price is up almost 20% over the last 12 months.

The post Wesfarmers share price on watch amid stellar first-half Kmart growth appeared first on The Motley Fool Australia.

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More reading

• Beginners: Here are 2 ASX dividend stocks to get your portfolio started!
• Are Wesfarmers shares a good long-term buy?
• 2 ASX stocks that could explode in February
• Own Wesfarmers shares? Here’s your half-year results preview
• Would I be crazy to buy Wesfarmers shares at $58?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Wesfarmers. The Motley Fool Australia has positions in and has recommended Wesfarmers. 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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S&P/ASX 200 Index (ASX: XJO) bank shares are often seen as some of the best options for dividends. But, there are other sectors that can deliver strong passive income. ASX Insurance shares can also provide a very good yield.

Sure, Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), ANZ Banking Group Ltd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) have some of the bigger yields in the ASX 200 at the moment.

But, banks also come with potential issues. For example, there is a lot of competition in the sector (hurting margins) and banks have huge balance sheets. They have large loan books – it would only take a relatively small amount of loans going bad to hurt profit significantly in one year.

I’m going to talk about three ASX Insurance shares that are demonstrating good dividends and underlying earnings growth.

Medibank Private Ltd (ASX: MPL)

Medibank is the largest private health insurer in Australia, with its Medibank and ahm brands.

The business has millions of policyholders and this number continues to grow, adding scale to the company and helping profitability. In FY23, it saw net resident policyholder growth of 10,900 (0.6%) and net non-resident policy unit growth of 78,400 (39.9%).

Medibank decided on a dividend payout ratio of 80.5% in FY23, which enabled a dividend per share of 14.6 cents. This puts the trailing grossed-up dividend yield at 5.5%.

The business added another 5,200 resident policyholders in the first four months of FY24, as well as ongoing growth in the non-resident business.

The projection on Commsec suggests Medibank could pay an annual dividend per share of 16 cents, which would be a grossed-up dividend yield of 6%.

NIB Holdings Limited (ASX: NHF)

NIB is another private health insurer – it’s not quite as big as Medibank, but it is rapidly growing. The company also has exposure to other areas such as travel insurance and NDIS-related earnings. Diversification is sometimes useful for protecting and growing earnings. It also gives the company more areas to look for acquisitions.

While the dividend hasn’t gone up every single year, it has been steadily trending higher since 2010. The business has provided an attractive mix between income and capital growth, as it has regularly invested for more growth.

One of the most attractive things about NIB and Medibank is that they operate in the healthcare sector, which usually has a more consistent demand for services because we all get sick sometimes (even in a recession), and the ageing tailwinds are growing in strength.

In FY23, NIB paid an annual dividend per share of 28 cents, which means the dividend translates into a trailing grossed-up dividend yield of 5%.

According to Commsec, the business could pay a grossed-up dividend yield of 5.4%.  

Insurance Australia Group Ltd (ASX: IAG)

IAG is one of the biggest insurance businesses in Australia (and New Zealand), with a number of brands including NRMA Insurance, CGU, SGIO, SGIC, Swann Insurance, WFI and Lumley Insurance.

Everyone with a car needs car insurance and I’d imagine most independent adults have some sort of home and/or contents insurance. There’s a lot of consistency to the premiums, the main difficulty is the variability of claims, which can be troublesome if there’s a large and expensive storm or flood.

But, the inflationary period has led to strong gross written premium (GWP) growth, and its investments in bonds are now making a lot more of a return thanks to higher interest rates. Things are looking good for the company, particularly if it can achieve ongoing higher insurance profit margins.

According to Commsec, the business is forecast to pay an annual dividend per share of 27 cents. At the franking credit rate of the last dividend paid, this would translate into a forward grossed-up dividend yield of 4.9%.

The post Beyond ASX 200 bank shares: 3 insurance plays with nice dividends appeared first on The Motley Fool Australia.

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More reading

• Big news: 15 ASX 200 shares smashing 52-week highs this Tuesday
• I’d buy these two resilient ASX dividend shares for big income
• Want a large and growing dividend? Medibank shares might be the answer
• Brokers say these 3 ASX dividend shares are buys
• IAG share price hits 2-year high ahead of earnings results next week

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 NIB Holdings. 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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Commonwealth Bank of Australia (ASX: CBA) shares were under pressure on Thursday.

The banking giant’s shares dropped 1.5% to $114.07 following broad market weakness and the release of its half-year results.

Should you buy CBA shares?

The team at Goldman Sachs has been running the rule over the bank’s results and was relatively pleased with what was reported. It said:

CBA’s 1H24 cash earnings grew by 3% hoh and were -1%/+2% versus GSe / Visible Alpha consensus expectations (VAe). The quality of the result was good, with PPOP +2%/+1% vs. GSe/VAe, largely on account of expenses.

However, the broker saw nothing in the result that it believes can justify the premium that CBA shares trade on compared to the rest of the big four banks. It adds:

CBA’s relative NIM resilience was evident in today’s result and was attributed to i) the effective management of its volume vs. margin trade-off, supported by ii) its deposit franchise strength.

Despite this, we do not think this justifies the 55% 12-month forward PPOP premium CBA is currently trading on versus peers (ex-dividend adjusted), compared to the 29% 15-year average.

In addition, it highlights that the bank is facing competitive and cost pressures. It said:

Coupled with i) a business mix that leaves it more exposed to the current competitive environment, and ii) the fact we do not think it can escape elevated FY24E cost pressures given heightened inflation, despite historically good performance on balancing investment and productivity, we stay Sell.

In light of the above, the broker has reiterated its sell rating with a trimmed price target of $81.98 on CBA’s shares (from $82.37). Based on its latest share price of $114.07, this implies potential downside of 28% for investors over the next 12 months.

The post Why you should sell your CBA shares before it’s too late appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Everything you need to know about the CBA dividend
• CBA shares tumble 3% on half-year profit decline and margin pain
• CBA share price on watch following $5b cash profit and dividend boost
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Looking for some ASX growth shares to buy? If you are, then it could be worth considering the three listed below.

Both have been named as buys by brokers and tipped to rise strongly from current levels. Here’s what you need to know about them:

Life360 Inc (ASX: 360)

The first ASX growth share for investors to look at is Life360.

It is a Silicon Valley-based technology company with a focus on products and services for digitally native families.

The company’s key product is the eponymous Life360 app, which has almost 60 million active users. It offers features such as communications, driver safety, and location sharing.

Goldman Sachs is a big fan of the company, noting that it is “exposed to a US$12bn global TAM with a large opportunity to expand its product suite, grow average revenue per paying circle (ARPPC), increase payer conversion, and lift penetration rates outside of the US.”

The broker currently has a buy rating and $10.50 price target on its shares, which suggests potential upside of 42%.

Megaport Ltd (ASX: MP1)

Analysts at Macquarie still see material upside potential for this ASX growth share despite its recent gains.

The broker appears to believe that the stars are aligning for the leading global provider of elastic interconnection services and is tipping explosive earnings growth over the coming years.

It is for this reason that the broker reiterated its outperform rating on Megaport’s shares at the end of last month with an improved price target of $15.50. This implies potential upside of 22% for investors.

TechnologyOne Ltd (ASX: TNE)

Another ASX growth share that Goldman Sachs is a big fan of is enterprise software provider TechnologyOne.

Goldman believes the company “is well placed to meet its A$500mn FY26 ARR target through a combination of SaaS flip uplift, net expansion and new customer growth.” It expects this and margin expansion to “drive a mid-high teens EPS CAGR to FY26E.”

Goldman has a buy rating and $18.05 price target on its shares. This would mean upside of 13% for investors.

The post Brokers say these explosive ASX growth shares are buys with massive upside appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group, Life360, Macquarie Group, Megaport, and Technology One. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Megaport and Technology One. 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 on the lookout for some new ASX dividend shares for your portfolio, then it could be worth checking out the two listed below.

Here’s what analysts are saying about them:

Lovisa Holdings Ltd (ASX: LOV)

Lovisa could be an ASX dividend share to buy according to analysts. It is a leading fast fashion jewellery retailer with over 800 stores across over 30 countries.

But if you thought that would be where its journey ends, you would be wrong. Management has huge global expansion plans and has just entered the massive China market. And importantly, this expansion is being overseen by a highly experienced CEO that has an incredible track record of taking brands global.

The team at Morgans is very bullish on the company’s expansion plans. It notes that “investment will be needed to expand LOV’s network in the US and Europe and to take it into new markets, but the company has the balance sheet capacity to fund this and the returns could be stellar.”

This could be great news for the company’s earnings and dividends over the next decade. In the meantime, Morgans is forecasting fully franked dividends of 70 cents per share in FY 2024 and 81 cents per share in FY 2025. Based on the current Lovisa share price of $25.10, this implies yields of 2.8% and 3.2%, respectively.

The broker has an add rating and $27.50 price target on its shares.

Suncorp Group Ltd (ASX: SUN)

Goldman Sachs is feeling positive about Suncorp and sees it as an ASX dividend share to buy.

Suncorp is the insurance giant behind a huge collection of brands. This includes AAMI, Apia, Bingle, CIL Insurance, GIO, Shannons, Terri Scheer, and Vero.

The broker believes that Suncorp is well-positioned thanks “in large part [to] the tailwinds that exist in the general insurance market.” This includes “very strong renewal premium rate increases and the benefit of higher investment yields.”

Goldman expects this to underpin fully franked dividends per share of 75 cents in FY 2024 and 82 cents in FY 2025. Based on the current Suncorp share price of $14.44, this will mean yields of 5.2% and 5.7%, respectively.

The broker has a buy rating and $15.00 price target on the company’s shares.

The post 2 excellent ASX dividend shares that analysts love appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Lovisa. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Lovisa. The Motley Fool Australia has recommended Lovisa. 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 Life360 Inc (ASX: 360) share price was well and truly on form in 2023.

During the 12 months, the location technology company’s shares rose a massive 55%.

This is six times greater than the return of the ASX 200 index over the same period.

They say lightning can’t strike twice, but could it with Life360 shares? Could they deliver another 55% return for investors from current levels? Let’s find out.

Could the Life360 share price rise another 55%?

There are plenty of analysts that believe the company’s shares can climb materially this year.

For example, the team at Goldman Sachs currently has a buy rating and $10.50 price target on its shares. This implies potential upside of approximately 42% for investors over the next 12 months.

Goldman highlights that the rapidly growing company has a “compelling valuation” and is experiencing a number of tailwinds. It said:

Life360’s valuation is compelling at 0.18x growth-adjusted EV/GP vs 0.41x/0.49x MP1/SDR, and 11x/19x FY25E EV/EBITDA pre/post stock comp (adj. for R&D capitalisation). The set-up heading into the 4Q result is akin to early 2023, with reasonable consensus earnings expectations that could be upgraded through FY24E on better-than-expected operating leverage (noting we assume +15% FY24E OpEx growth). With positive tailwinds from International expansion and improving payer conversion, we stay Buy.

Over at Bell Potter, its analysts have a buy rating and $11,00 price target on the company’s shares. This suggests potential upside of approximately 50% for the Life360 share price from current levels.

Bell Potter sees a huge growth runway ahead for the company thanks to its Life360 app. It said:

The app is used globally by close to 60 million people and, of these, there are around 5 million paying subscribers. There is, therefore, a very long runway to go in terms of converting users to paying customers and even after a recent hefty price rise the company is adding around a few hundred thousand paying subscribers a quarter.

Finally, the team at Morgan Stanley is the biggest bull and believes that another 55% return is possible this year. It has an overweight rating and $11.50 price target on Life360’s shares.

It is tipping a full year result that will beat consensus expectations later this month, setting the stage for a major re-rating of its share price.

The post Will the Life360 share price rise another 55% in 2024? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX shares with millionaire-maker potential
• Analysts tip 10% to 30% returns for these ASX growth shares in 2024
• Why I think Life360 shares are one of the best bargains out there
• Brokers name 3 ASX shares to buy now
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Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Life360. 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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