Tag: Motley Fool

The All Ordinaries Index (ASX: XAO) is having a very choppy day so far in Thursday’s trading. At the time of writing, the All Ords is up, but only just, having clocked a 0.02% gain so far. That comes after the index spent most of the morning in red territory. But one All Ords share doesn’t seem to have got the memo. That would be the Southern Cross Media Group Ltd (ASX: SXL) share price.

Southern Cross shares are currently up an impressive 8%, going for $1.76 at the time of writing. That comes after the media company closed at $1.62 a share yesterday and opened at $1.70 this morning.

So why are Southern Cross shares having such a strong day today? It could be the result of the announcement the company made this morning.

Before market open, Southern Cross released a market update to investors. This contained two new pieces of news. The first was an announcement that revealed the company has “received unsolicited approaches from several parties indicating potential interest in acquiring SCA’s regional television assets”.

Southern Cross stressed that these offers were non-binding and incomplete, and did not include “details of timing, price or conditions”.

The company is assessing its options and engaging with these interested parties, and told investors that it will “continue to update shareholders as appropriate”.

Southern Cross share price gains amid new share buyback announcement

The other piece of news that was revealed was a new on-market share buyback program worth up to $40 million. Here’s some of what the company had to say on this matter:

With modest gearing and consistent free cash flow generation expected to continue, the Board has approved the buyback to enhance shareholder returns. SCA will fund the buyback from existing cash reserves and debt facilities, while continuing to invest in SCA’s digital audio strategy to grow audiences and revenue opportunities.

It could be one or both of these announcements that are fuelling investor interest in Southern Cross today. Interest in buying a company’s assets from multiple parties usually bodes well for a company and its market valuation.

Additionally, share buybacks have a direct benefit for existing shareholders. When a company purchases and retires its own shares on the open market, it reduces the company’s total share count, boosting existing earnings per share (EPS). It also usually comes with share price gains, since the supply of the shares is being constricted.

So it’s this announcement that is likely providing the boost to the Southern Cross shares that we are currently seeing.

At the current Southern Cross Media share price, this ASX All Ords share has a market capitalisation of $430.7 million, with a dividend yield of 5.11%.

The post Buyback bonanza! Why the Southern Cross Media (ASX:SXL) share price is up 8% today appeared first on The Motley Fool Australia.

More reading

• Why is the Piedmont Lithium (ASX:PLL) share price on ice today?
• How can investors in ASX shares hedge their portfolios amid uncertainty in 2022?
• The ASX quarterly rebalance takes effect today. Here’s what you need to know
• 2 small-cap ASX shares to rule them all this year: experts
• The DGL (ASX:DGL) share price has soared 200% in less than a year, but this insider is still buying up big

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 Bruce Jackson.

from The Motley Fool Australia https://ift.tt/ARSlKqh

The Nickel Mines Ltd (ASX: NIC) share price has been on a bit of a rollercoaster ride in recent weeks.

Since this time last month, the nickel producer’s shares have been as high as $1.79 and a low as $1.15.

The Nickel Mines share price is currently trading close to the middle of this range at $1.34.

Is the Nickel Mines share price good value?

According to a note out of Bell Potter, its analysts see a lot of value in the Nickel Mines share price at the current level.

The note reveals that the broker has retained its buy rating and lifted its price target to $1.88.

This implies potential upside of 40% for investors over the next 12 months. And if you include the almost 5% dividend yield the broker expects in FY 2022, the total potential return stretches to 45%.

What did the broker say?

Bell Potter notes that PT Oracle Nickel Industry (ONI), the operating entity housing the Oracle Nickel RKEF project, has been granted material corporate tax relief.

Based on the broker’s current modelled assumptions for the Oracle Nickel project, it expects the main tax concession to eliminate an expense of ~US$50m per annum for ten years. It notes that “this flows directly through to the bottom line and to free cash flow, boosting earnings and our NPV-based valuation.”

Combined with a recent pullback in the Nickel Mines share price, the broker believes this is a buying opportunity for investors.

It commented: “We view NIC’s steep price drop as an acquisition opportunity. The operating and development fundamentals of the business are unchanged and we view the perceived risk increase as tangential to NIC. We lower our CY22 and CY23 earnings forecasts by 15% and 9%, respectively, on higher costs, but continue to forecast aggressive EPS growth. Our target price increases by 7%, to $1.88/sh as we factor in the latest tax concessions. We retain our Buy recommendation.”

The post Top broker tips Nickel Mines (ASX:NIC) share price to rise 40% appeared first on The Motley Fool Australia.

More reading

• Here are the 3 most heavily traded ASX 200 shares this Wednesday
• 5 things to watch on the ASX 200 on Wednesday
• These 3 ASX 200 shares are topping the volume charts this Monday
• These 3 ASX 200 shares are topping the volume charts this Thursday
• Why did the Nickel Mines share price rebound today?

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 Bruce Jackson.

from The Motley Fool Australia https://ift.tt/zfMqv75

It’s a rough day on the market for S&P/ASX 200 Index (ASX: XJO) bank shares.

In fact, it’s proving to be a tough one for nearly all stocks on the S&P/ASX 200 Financials Index (ASX: XFJ). The sector has slumped 0.65% at the time of writing, with only a few financial bigwigs posting gains.

Let’s take a closer look at what’s going on with the index and how the ASX 200 big four banks are tracking on Thursday.

What’s weighing on ASX 200 bank shares today?

The ASX 200 has been wobbling on Thursday. After spending much of this morning in the red, the broader market has regained its feet to record a 0.11% gain.

Still, the market is being weighed down by its financial constituents’ struggles. The sector is one of its worst performers today.

Though, the financial sector is doing better than the S&P/ASX 200 Information Technology Index (ASX: XIJ). It’s fallen 1.7% at the time of writing.

Unfortunately, ASX 200 bank giants haven’t managed to avoid today’s downturn.

The Australia New Zealand Banking Group Ltd (ASX: ANZ) share price has slumped 0.93%.

Meanwhile, shares in the Commonwealth Bank of Australia (ASX: CBA) and Westpac Banking Corp (ASX: WBC) have slipped 0.74% and 0.21% respectively.

The National Australia Bank Ltd (ASX: NAB) share price is outperforming its big four peers to record a 0.03% slide.

NAB’s slightly better performance might be due to news it’s completed its $2.5 billion buyback. Excitingly, the bank has announced it’s now embarking on another buyback that could prove to be the same size.

Another banking giant, Macquarie Group Ltd (ASX: MQG), is also suffering today, posting a 1.37% slip.

Buy now, pay later provider Zip Co Ltd (ASX: Z1P) is the sector’s biggest weight, falling 6.38%.

Finally, right now, there are only 2 ASX 200 financial stocks in the green today. Those are embattled Magellan Financial Group Ltd (ASX: MFG) – posting a 0.41% gain – and AMP Ltd (ASX: AMP) – up 1.06%.

As market watchers might be aware, Magellan announced the departure of its co-founder and former chair, Hamish Douglass, this week.

While there’s been no news from AMP, the battered company’s stock is 80.9% lower than it was 5 years ago.

The post Why are ASX 200 bank shares underperforming on Thursday? appeared first on The Motley Fool Australia.

More reading

• NAB share price lower despite new $2.5bn buyback
• 5 things to watch on the ASX 200 on Thursday
• Own ANZ shares? Here’s why today was a big day for the bank
• Why did the CBA share price just close at a new 2022 high?
• NAB, ANZ and CBA shares in focus as top broker tips extra $5b share buyback

from The Motley Fool Australia https://ift.tt/bqfRKpQ

The oOh!media Limited (ASX: OML) share price is backtracking during mid-morning trade following a board resignation.

At the time of writing, the out of home media company’s shares are down 6.87% to $1.56.

Another senior member departs

Investors are reacting to the latest news from the company, sending the oOh!Media share price into negative territory.

In a statement to the ASX, oOh!Media advised that non-executive director, Mick Hellman will resign from the company’s board.

This is scheduled to occur before the April board meeting following the sale of HMI Capital’s shareholding in the company.

It is worth noting that Mr Hellman is the managing partner of HMI Capital.

The United States-based investment company provided strong support to oOh!Media’s capital raising during the early stages of the COVID-19 pandemic.

Mr Hellman tenure will cease after spending around 2 years on the oOh!Media board.

The departure follows yesterday’s announcement from the company that chief financial officer (CFO), Sheila Lines will also leave.

After spending 4 years in the role, Ms Lines has decided to pursue other external opportunities.

While no date was given, Ms Lines will temporarily stay on to assist oOh!Media with the transition to finding a new CFO.

About the oOh!media share price

Over the past 12 months, the oOh!media share price has moved in a sideways channel hovering around the $1.60 mark.

The company’s shares are down 8% since this time last year, and are some way off the $3 level reached pre-COVID.

Based on valuation grounds, oOh!media commands a market capitalisation of roughly 936.88 million.

The post Why is the oOh!Media (ASX:OML) share price slipping 6% today? appeared first on The Motley Fool Australia.

More reading

• Down 8% since February, is the AGL (ASX:AGL) share price a buy?
• Could the Firefinch (ASX:FFX) share price have 130% upside? Broker weighs in
• Is the Appen (ASX:APX) share price on the comeback trail?
• ASX 200 (ASX:XJO) midday update: Brickworks impresses, Uniti confirms takeover approach
• How to survive your first share market crash

Motley Fool contributor Aaron Teboneras 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 oOh!Media Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/iBxGFyj

Shares in AGL Energy Ltd (ASX: AGL) are in the green today, up 2.4% trading at $7.45 at the time of writing.

After a difficult 12 months, AGL shares have soared in 2022 alongside the broad commodities sector as investors reshuffle capital and the macro-narrative continues to play out.

However, the energy company’s shares dipped 8% in February, and are down another 4% in the past month of trade as well (shown below).

Is AGL a buy right now?

From what it appears, analyst sentiment is quite mixed on the stock. Exactly 40% of brokers have it as a buy, whereas 50% say to hold or are neutral.

For example, analysts at JP Morgan are bullish on the company and reckon it has the legs to grow tall in 2022.

The broker likes AGL over other names in the energy space, and is overweight on the company due to its robust fundamentals and the market’s outlook.

“Our analysis suggests significant upside to AGL but less so for Origin [Energy],” the broker told clients in a recent note.

“Applying the average customer value of A$956/customer to AGL’s 4.5 million retail customers generates a value of A$4.3 billion,” it added.

“Adding A$2.9 billion for non-baseload assets (predominately hydro) and A$2.4 billion for Accel less net debt generates a total value of A$10.96/share.”

While the broker has its concerns over the AGL demerger, it still believes there is “potential for corporate appeal” in the name, and hence retains its overweight stance on an $8.75 per share valuation.

It is joined by the team at Credit Suisse which rates AGL a buy with an $8.20 per share price target set around two weeks ago.

Meanwhile, analysts at Barrenjoey Markets initiated coverage of AGL today with a neutral, rating an $8.10 price target on the stock.

That’s below the consensus price target of $8.22 per share, according to Bloomberg data.

AGL’s consensus valuation has crept down with its share price in the last 12 months from $18.70, but curiously, more analysts today rate it as a buy than a year ago.

AGL share price snapshot

In the last 12 months, the AGL share price has collapsed more than 28% and is now almost 4% in the red this past month.

However, this year to date, it has climbed more than 20% and is in the green for the previous 5 days of trading.

The post Down 8% since February, is the AGL (ASX:AGL) share price a buy? appeared first on The Motley Fool Australia.

More reading

• Own AGL shares? Here’s why the company has been making news this week
• Are AGL (ASX:AGL) shares worth buying prior to the planned demerger?
• 3 high-dividend ASX shares that are TRAPS: expert
• Why this broker says buy Origin (ASX:ORG) shares instead of AGL
• Could Origin Energy (ASX:ORG) shares be next on the investment agenda for Mike Cannon-Brookes?

Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 Bruce Jackson.

from The Motley Fool Australia https://ift.tt/5yWN8Go

Analysts believe Firefinch Ltd (ASX: FFX) is significantly undervalued at its current market capitalisation. At the time of writing, the Firefinch share price is 90 cents, a 1.13% gain on the day. In comparison, the S&P/ASX 200 Index (ASX: XJO) is up 0.07%.

Firefinch is a gold explorer and a lithium developer working on the Morila gold mine and Goulamina lithium project in Mali, West Africa.

Let’s take a look at why one broker sees huge upside for the Firefinch share price.

Firetech undervalued

Analysts at J Capital Research believe the Firefinch lithium asset Goulamina is “underappreciated” and gold mine Morila “significantly undervalued”.

Commenting on their view of the company, analysts said:

We believe Firefinch should be trading at a valuation between $1.68 and $2.28 billion. With the current market cap of $990 million, the upside is between 70% and 130%.

We believe Firefinch’s under-appreciated lithium asset, Goulamina, alongside its operational gold mine, Morila, are significantly undervalued based on the current market capitalisation. We view both the gold and the lithium project as de-risked as they are operational and fully funded respectively.

J Capital believes Firefinch’s Goulamina lithium project should be worth at least $1.4 billion. Analysts said:

When we compare the Goulamina lithium project to the market value of eight other lithium companies with hard-rock lithium projects, we believe Goulamina is worth at least double what the market currently values it at.

Further, analysts valued Firefinch’s gold venture Morila between $275 and $430 million. After engaging a team of geologists, J P Capital predicted the mine could produce between 100,000 and 156,000 ounces each year. Analysts said:

We have totally discounted any potential upside from an underground mine. This is more conservative than street analysts, who believe Morila is worth double our low-end target.

Firefinch share price snapshot

The Firefinch share price has exploded 316% in the past 12 months, while it has climbed 3.5% this year to date.

Over the past month, Firefinch shares have jumped 35% and are 11% higher over the past week.

Since the J Capital report, the company’s market cap has increased to about $1.04 billion.

The post Could the Firefinch (ASX:FFX) share price have 130% upside? Broker weighs in appeared first on The Motley Fool Australia.

More reading

• Is this boosting the Firefinch (ASX:FFX) share price higher today?
• Get ready! The ASX shares set for a decade-long tailwind: expert

Motley Fool contributor Monica O’Shea 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 Bruce Jackson.

from The Motley Fool Australia https://ift.tt/OvPuCZK

It’s been a rough year for many shares on the S&P/ASX 200 Index (ASX: XJO) in 2022 so far. The ASX 200 remains down around 3% so far this year, which tells us that many shares have failed to break over the year to date. One of the ASX 200’s more disappointing performers has been the Appen Ltd (ASX: APX) share price.

At the time of writing tody. Appen is down by 1.13% at $6.99 a share. That puts it at a dismal loss of 37.6% in 2022 alone. Over the past 12 months, Appen shares are now down by a sobering 61.8%.

Yes despite these clouds of gloom over the Appen share price, there has also been a more recent silver lining for the annotated dataset company. It was exactly a month ago today that Appen found a new 52-week low of $6.08 a share. Since then, the company has gone on to add almost 14% to its share price.

So could this mean Appen shares are on the comeback trail? After all, Appen used to be known as one of the WAAAX market darling growth shares.

Is the Appen share price a buy today?

Well, one investing expert certainly thinks so. That would be Ben Clark, portfolio manager at TMS Capital.

Writing for Livewire, Mr Clark named Appen as one of seven ASX shares “for when the market comes roaring back”. Although Clark acknowledged that Appen’s most recent results were disappointing, he is still bullish on the company’s long-term prospects. Here’s some of what he had to say on Appen:

They’re so far above every analyst’s expectation of where they’ll be in five years. I would also say there was a reaction like, ‘Oh they’re going to take weaker margins to try and grow the revenue line harder on the core’. The CEO was actually adamant that wasn’t going to happen. So, there’s sort of a bit of confusion there.

We’re sticking with it. It’s a business that we skim some time ago, a few years ago, and that we’ve added to in more recent years, it’s a fairly small holding, but I still think that there’s a good business there.

So a comeback trail might be what is in store for Appen going forward, if Mr Clark is to be believed. No doubt Appen’s recently-suffering shareholders would hope so. But we shall have to wait and see, as always.

At the current Appen share price, this ASX 200 tech share has a market capitalisation of $872.3 million, with a dividend yield of 1.44%

The post Is the Appen (ASX:APX) share price on the comeback trail? appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Brickworks impresses, Uniti confirms takeover approach
• 5 things to watch on the ASX 200 on Thursday
• Uniti (ASX: UWL) share price surges 11% to record high as Macquarie bid appears confirmed
• NAB, ANZ and CBA shares in focus as top broker tips extra $5b share buyback
• Here are the 3 most heavily traded ASX 200 shares this Wednesday

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. owns and has recommended Appen Ltd. 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 Bruce Jackson.

from The Motley Fool Australia https://ift.tt/H4JhivK

At lunch on Thursday, the S&P/ASX 200 Index (ASX: XJO) has bounced back from a poor start and is edging higher. The benchmark index is currently up 0.1% to 7,385.7 points.

Here’s what is happening on the ASX 200 today:

Brickworks half year results impress

The Brickworks Limited (ASX: BKW) share price is charging higher today. This follows the release of a half year result which appears to have smashed the market’s expectations. Brickworks reported a 24% increase in revenue to $535 million and a 254% jump in underlying earnings before interest and tax (EBIT) to $450 million. The latter compares very favourably to Citi’s EBIT estimate of $321 million. This was driven by investment earnings of $73 million and a $349 million increase in the value of its share of its joint venture property trust with Goodman Group (ASX: GMG).

Soul Pattinson delivers strong half year profit growth

The Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) share price is rising today. Investors have been buying the investment company’s shares following its half year results release. Soul Patts reported a 281% jump in adjusted profit after tax to $343.7 million thanks to strong performances by its major investments. This allowed the company to lift its interim dividend by 11% to 29 cents a share.

Uniti confirms takeover offer

The Uniti Group Ltd (ASX: UWL) share price has returned from its trading halt and is pushing higher. This morning the telco confirmed speculation that it has received a second takeover approach. The release notes that it has received a non-binding, incomplete, and indicative $5.00 per share proposal from Macquarie Infrastructure and Real Assets. This compares favourably to a $4.50 cash per share from Morrison & Co last week.

Best and worst ASX 200 performers

The best performer on the ASX 200 on Thursday has been the Brickworks share price with a 4.5% gain. This follows a positive response to its half year results. The worst performer has been the Zip Co Ltd (ASX: Z1P) share price with a 6% decline amid weakness in the tech sector.

The post ASX 200 (ASX:XJO) midday update: Brickworks impresses, Uniti confirms takeover approach appeared first on The Motley Fool Australia.

More reading

• Why is the Zip share price getting smashed so much more than other BNPL stocks in 2022?
• Soul Pattinson (ASX:SOL) share price on watch after 281% surge in net profit
• Brickworks (ASX:BKW) share price on watch amid 269% first half profit jump
• 2 ravaged ASX shares that will rise again: expert
• 5 things to watch on the ASX 200 on Thursday

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. owns and has recommended Brickworks, Washington H. Soul Pattinson and Company Limited, and ZIPCOLTD FPO. The Motley Fool Australia owns and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Uniti Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/J1AKrvo

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.

Although the S&P 500 experiences a correction of 5% about every 13 months and a drop of 10% about every 19 months (on average), investors still get spooked any time that it actually happens. This is because there are probably numerous other negative headlines at the time that have our attention and cause worry. 

The broader index is down 7% so far in 2022, which is not frightening by itself. But add in rising inflation, interest rate hikes, supply-chain challenges, and geopolitical turmoil, and the situation is full of uncertainty that could have investors questioning whether they should sell their stocks. 

In times like these, it’s worthwhile to have the right mindset when it comes to your portfolio. Keeping a level head and not panicking could pay off over the long term. 

Investors should focus on the fundamentals 

Warren Buffett, the legendary investor and head of conglomerate Berkshire Hathaway, recently released his company’s annual shareholder letter in which he emphasized that he and his longtime business partner, Charlie Munger, are not stock pickers, but rather business pickers. Adopting this mentality is absolutely crucial to surviving a market crash. 

Instead of being fixated on the day-to-day gyrations of stock prices, we should have our attention on the underlying fundamentals of the companies we own. Home Depot (NYSE: HD), for example, is down 21% (as of March 21) in 2022, but the business is performing extremely well right now. 

Revenue and diluted earnings per share in the most recent quarter (ended Jan. 30) jumped 10.7% and 21.1%, respectively, compared to the prior-year period. And this is on top of extremely difficult comparisons in the fiscal 2020 fourth quarter. What’s more, Home Depot’s same-store sales, an important metric for any retail business, increased 11.4% in fiscal 2021. 

The company continues to lean on its technological capabilities to serve both its DIY and professional customers. In the last fiscal year, digital sales were up 100% on a two-year basis. Although growth should slow this year, Home Depot will keep benefiting from the robust housing market and consumers’ propensity to take on renovation projects.

Looking at Home Depot’s stock performance in 2022 might make investors want to sell the stock and move on. Key data points that we should have our eyes on, such as the ones I just mentioned, indicate that we should take advantage of the current situation and buy more shares in the business. 

Understanding and focusing on the underlying fundamentals of your portfolio holdings, maintaining a long-term mindset, and realizing that market crashes are normal will help during times like these.

Volatility is the price of achieving outstanding returns 

Investors should not put any money in the stock market that they’ll need within the next five years. That’s because the stock market is inherently unpredictable in the short term, driven entirely by mood and sentiment at any given time. However, over longer periods of time, the performance of the underlying companies in our portfolios is what drives returns. 

Having a long-term approach allows investors to stay the course and not sell should markets take a turn for the worse, which we know happens often. Volatility is just a part of the game, and we must be able to stomach the inevitable ups and downs in order to achieve market-beating returns over time. 

I know it’s not an easy task, but ignoring what stock prices are doing, and instead keeping an eye on metrics like user growth, sales, net income, and cash flow will make it easier to handle market turmoil. And I’m positive that this mentality will ultimately make you a better investor. 

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

The post How to survive your first share market crash appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Brickworks impresses, Uniti confirms takeover approach
• If you were smart enough to buy $10,000 of Wesfarmers (ASX:WES) shares a decade ago, here’s how much you’d have now
• Experts name 3 of the best ASX lithium stocks to buy now
• Here’s why the Mesoblast (ASX:MSB) share price is climbing today
• McPherson’s (ASX:MCP) share price leaps 15% on Chemist Warehouse deal

Neil Patel owns Berkshire Hathaway (B shares). The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Berkshire Hathaway (B shares) and Home Depot. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2023 $200 calls on Berkshire Hathaway (B shares), short January 2023 $200 puts on Berkshire Hathaway (B shares), and short January 2023 $265 calls on Berkshire Hathaway (B shares). The Motley Fool Australia has recommended Berkshire Hathaway (B shares). The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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

from The Motley Fool Australia https://ift.tt/CfljyKx

The Wesfarmers Ltd (ASX: WES) share price has made strong gains over the course of the last decade.

The retail conglomerate had a market capitalisation of around $27.66 billion in 2012 before gaining traction over the years.

During 2017, Wesfarmers’ worth stood at around $37.49 billion, a 35.5% increase from 2012.

However, the decision to spin off Coles Group Ltd (ASX: COL) in 2018 led the value of Wesfarmers to drop. At the time, the parent company’s market capitalisation hovered at $27.24 billion – almost the same as 2012.

Nonetheless, it was a smart decision by management to recalibrate the group’s portfolio in order to maximise shareholder returns. The largest demerger in Australian corporate history has paid off in the years following.

Nowadays, Wesfarmers is valued at $57.12 billion, making it the ninth largest company on the ASX.

Below, we take a look at the power of long-term investing. We will calculate how much you would have made if you invested $10,000 in Wesfarmers shares a decade ago.

What was the Wesfarmers share price in 2012?

If you had invested $10,000 in Wesfarmers shares in 2012, you would have bought them for about $20.74 apiece. This would have given you approximately 482 shares, without topping up along the way.

Fast-forward to today and the current Wesfarmers share price is $50.47. This means that those 482 shares would be worth $24,326.54. When looking at percentage terms, this implies a gain of around 143%.

While this is a solid return, let’s not forget that the Coles demerger also would have given you 1 Coles share for every Wesfarmers share owned.

That means you also would have 482 Coles shares, valued at $8,560.32 based on the current share price of $17.76.

So, in total you would be sitting on $32,886.86.

And the dividends?

Wesfarmers has made a sum of 25 dividend payments including special dividends paid to shareholders from 2012 to 2022.

Adding those 25 dividends payments gives us an amount of $21.08 per share. Calculating the number of shares owned against the total dividend payment gives us a figure of $10,160.56.

On the other hand, Coles has made a total of 7 bi-annual dividend payments equating to $1.87. This gives us a figure of $901.34 from the 482 Coles shares owned as a result of the demerger.

When putting both the Wesfarmers and Coles investment gains and dividend distribution, an investor would have roughly $43,948.76.

In comparison, investing the same amount in the ASX 200 would have netted you a total figure of $17,279.72.

As you can see, investing in Wesfarmers would have more doubled what you would have gotten from investing in the benchmark index.

The post If you were smart enough to buy $10,000 of Wesfarmers (ASX:WES) shares a decade ago, here’s how much you’d have now appeared first on The Motley Fool Australia.

More reading

• Broker: The Coles (ASX:COL) dividend will keep rising
• Today is the last hurrah for API. What does this mean for Wesfarmers (ASX:WES) shares?
• Wesfarmers (ASX:WES) now has control of API, but is the real fight just beginning?
• 5 ASX shares to ride out the 2022 volatility: expert
• Analysts name the best ASX 200 dividend shares to buy now

Motley Fool contributor Aaron Teboneras 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 owns and has recommended Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

from The Motley Fool Australia https://ift.tt/KfvS3UC