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Investors have been selling ASX gold shares Silver Lake Resources Ltd (ASX: SLR) and Red 5 Ltd (ASX: RED) on Monday.

At the time of writing, the Silver Lake share price is down 9% and the Red 5 share price is down 3%.

Why are these ASX gold shares falling?

Investors have been selling these ASX gold shares today after responding negatively to the announcement of an agreement to merge and create a ~$2.3 billion, ~445,000 ounces per annum, diversified, leading mid-tier gold company with a strong balance sheet to pursue growth.

According to the release, under the terms of the transaction, Red 5 will acquire 100% of the shares in Silver Lake and each Silver Lake shareholder will receive 3.434 Red 5 shares for every share held.

Upon implementation of the transaction, Red 5 shareholders will own 51.7% of the merged entity and Silver Lake shareholders will own the remaining 48.3%.

The combined entity will be led by Russell Clark (from Red 5) as Chairman and Luke Tonkin (from Silver Lake) as Managing Director and CEO. The board will comprise four directors from each of the current Red 5 and Silver Lake boards.

The Silver Lake board of directors unanimously recommends that its shareholders vote in favour of the transaction. This is subject to the independent expert’s report.

Why are they merging?

Although the market may not be keen on the merger, the two companies believe that it will bring together a highly complementary combination of assets and balance sheets, creating value for shareholders. CEO-elect, Luke Tonkin, said:

This transaction represents a highly complementary combination of assets and balance sheets for the mutual benefit of both Silver Lake and Red 5 shareholders. Mergers work when each company brings attributes that the other company does not possess, which is undoubtedly the case here. The increased scale, diversification and financial strength of the new company that will be formed via this transaction will be primed for continued strong cash flow generation and further growth.

This sentiment was echoed by Red 5’s CEO, Mark Williams. He said:

This transaction represents a logical merger of two leading mid-tier gold companies and represents an exciting inflection point for Red 5 shareholders following the successful development, ramp-up and achieving steady state production at King of the Hills. The merger creates a ~445,000 oz pa diversified gold producer with assets in tier one jurisdictions. With a sector leading balance sheet, the merged entity provides a strong foundation for future growth.

The post Guess which ASX gold shares are sinking after announcing a ~$2.3b merger appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why Boss Energy, GQG, Kali Metals, and Red 5 shares are racing higher today
• Guess which ASX 300 gold shares are charging higher on strong updates

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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Accent Group Ltd (ASX: AX1) shares have risen 22% since 24 November 2023, which compares to a rise of 9.5% over the same time period for the S&P/ASX 200 Index (ASX: XJO).

After such a strong rise in the ASX retail share, could the shoe retailer still be a good investment?

Cheap forward valuation

This year could be tricky for many retailers because of cost of living difficulties, which has led to the share prices of retailers falling.

However, I like looking at cyclical opportunities when they’re at a weaker point in the cycle.

The Accent share price is still down close to 20% from its 52-week high in April 2023.

Profit may drop in FY24, but it could rebound nicely in FY25 and FY26. By FY26, it might be as profitable as ever and make earnings per share (EPS) of 16.6 cents. This would put the business at under 13x FY26’s estimated earnings.

Investing should be a relatively long-term-focused activity. While we don’t have to hold every single ASX share forever, I think it’s a good idea that each investment should make sense on a multi-year timeline.

FY26 really isn’t that far away — we’re already more than halfway through FY24.

I’d call Accent shares a buy for its longer-term potential, particularly when we consider a number of positives about the company.

Positives about Accent shares

The company is continuing to grow the portfolio of global brands that it sells in Australia.

Some of the latest brands to sign up with Accent are Ugg and Herschel, opening up more potential sales. I don’t know what brand might be next, but any more growth could help earnings.

Accent is steadily opening more stores, which increases its scale. The company said at its AGM that its store opening program was on track with 70 new stores expected to open in the first half of FY24.

Another exciting element of the business is its level of digital sales, which can be more profitable than store sales because they don’t come with all of the stored-related costs. In FY23, around a fifth of its sales were digital.

I’ll also point to its growing number of owned brand sales. Businesses like Nude Lucy and Glue Store are owned entirely by Accent, so any growth it achieves is entirely benefiting the ASX retail share for the long-term.

The forward dividend yield is also compelling. According to Commsec, it could pay a grossed-up dividend yield of 10.25% in FY26.

The post Are Accent shares a good buy right now? appeared first on The Motley Fool Australia.

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More reading

• Brokers say these ASX dividend shares are buys next week
• The ASX dividend dream: 18% returns to fuel your income goals
• ASX domination: The 5.5% dividend stock to watch
• Top ASX shares to buy in February 2024
• Buying ASX retail shares? You’ll want to see these numbers

Motley Fool contributor Tristan Harrison has positions in Accent Group. 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 Accent 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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ASX dividend share Universal Store Holdings Ltd (ASX: UNI) may pay enormous dividends in 2025 and 2026 if things go well for the retail company.

Universal Store owns a group of what it describes as “premium youth fashion brands”. Spearheaded by its Universal Store brand, it also has the THRILLS, Worship and Perfect Stranger brands. It’s trialling the Perfect Stranger brand as a standalone retail concept.

At the last count, it operates 98 physical stores across Australia, as well as three online stores.

How big could the dividend be?

The company has increased its dividend payouts since it started paying them in 2021. In FY23, it paid an annual dividend per share of 22 cents. This is a trailing grossed-up dividend yield of 4.6%.

According to Commsec projections, the business may pay an annual dividend per share of 23.1 cents in FY24. This increase would be a grossed-up dividend yield of 8%.

In FY25, the ASX dividend share is then projected to pay an annual dividend per share of 25.9 cents — a grossed-up dividend yield of 9%.

Going onto FY26, Universal Store is forecast to pay an annual dividend per share of 28.2 cents, which would be a grossed-up dividend yield of roughly 10%.

In other words, the company is expected to keep growing its payout throughout this period and keep the dividend growth streak alive.

Can profit grow over the long term?

The company is projected to generate earnings per share (EPS) of 46.2 cents in FY26, which would put it on a forward price/earnings (P/E) ratio of just 9. Retailers typically trade on a low earnings multiple, which enables an appealing dividend yield, if they pay a dividend.

There are a number of things the ASX dividend share is doing to grow profit.  

It’s opening new stores across its brands, with the growth of Perfect Stranger particularly interesting. The already-opened newer stores are maturing, meaning they’re reaching their full potential. The ASX dividend share is also working on “developing [the] online experience and integration with physical stores”.

Another area of focus is that Universal Store is improving the productivity of its operations and technology.

If the employment rate of younger Aussies can stay relatively strong during this period, which it appears to be so far, then sales and profit could continue to be strong. That may unlock the dividend yields of the future that I’ve talked about.

The post This ASX dividend share is predicted to pay a 10% yield in 2026 appeared first on The Motley Fool Australia.

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More reading

• Brokers say these ASX dividend stocks are buys
• Morgans says these ASX dividend shares are buys this month
• Buying ASX retail shares? You’ll want to see these numbers
• Get a big income boost from these high-yield ASX dividend stocks
• 2 ASX dividend shares to buy 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 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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ASX tech stock Bailador Technology Investments Ltd (ASX: BTI) looks to be a great investment option right now. In fact, I’d rather invest in it than the electric vehicle maker Tesla Inc (NASDAQ: TSLA).

Let me start by saying I’m not suggesting it’s going to perform as well as Tesla has done over the long term — I mean from today onwards.

Tesla has performed incredibly well in the last few years, and it might continue to do very well. However, the US giant does now have a huge market capitalisation, and there is growing competition from other car makers manufacturing electric cars, including China’s BYD.

There are a few key reasons why I like Bailador, which primarily invests in relatively small, unlisted tech companies. It describes itself as a growth capital fund focused on the information technology sector.

Let’s get into why I think it’s got great return potential.

Strong revenue characteristics

Bailador says it typically invests between $5 million to $20 million in companies seeking growth-stage investment.

There are particular areas it likes to look at for opportunities: software as a service (SaaS) and other subscription-based internet businesses, online marketplaces, software, e-commerce, high-value data, online education, telecommunication applications and services.

Bailador invests in businesses with the ability to generate repeat revenue, they should have a huge market opportunity, and they typically generate revenue from international sources.

Software platform Siteminder Ltd (ASX: SDR) is currently its biggest position. It was listed on the ASX after Bailador’s initial investment and has grown enormously. Siteminder is a world leader in hotel channel management and distribution solutions for online accommodation bookings. In the FY24 first half, Siteminder reported revenue growth of 27.9%.

Before Bailador sold its stake in Instantscripts for $52 million (at an internal rate of return of 64% for the fund), that digital healthcare business had grown its revenue at more than 100% year over year.

For FY23, the Bailador portfolio revenue growth was 67%, with around 84% of revenue being recurring.

I’d expect that any future investments Bailador makes will have an attractive revenue outlook, which helps the compounding potential of revenue.

Attractive unit economics

Revenue growth isn’t the only important thing – it needs to be profitable growth in the long term.

If a technology business has good margins, then additional volume should help profitability because of the operating leverage.

Bailador deliberately looks to invest in businesses that have a “proven business model with attractive unit economics”.

In FY23, the gross profit margin of the ASX tech stock portfolio’s company holdings was around 62%. Future investments may have an even higher gross profit margin.

Investors usually focus on the profit potential of a business, and the underlying businesses could be very profitable in the future. It can take a while to get to profit-making status – just look at how long it took Tesla. Siteminder expects to be underlying earnings before interest, tax, depreciation and amortisation (EBITDA) and underlying free cash flow positive in the second half of FY24.

Big valuation discount of the ASX tech stock

I think the Bailador share price is trading at a very attractive discount.

The company said it had pre-tax net tangible assets (NTA) of $1.77 and post-tax NTA of $1.64 at 31 December. The current Bailador share price is around $1.31, which is a 20% discount to the post-tax NTA. The improving wider economic picture could lead to investors seeing value in this ASX tech stock.

Those NTA figures may actually be conservative and underestimate the value of its current investments.

Bailador sold InstantScripts to Wesfarmers Ltd (ASX: WES) at a price 25% higher than what it had valued InstantScripts at – the carrying value.

Bailador also recently saw Rezdy taken over by a US private equity fund, which increased its equity valuation of Rezdy by approximately 46%.

Siteminder’s valuation is decided by its daily share price, but other Bailador investments like Access Telehealth and Rosterfy could be worth more than the ASX tech stock is currently valuing them at.

I think there’s good potential for the ASX tech stock’s NTA discount gap to close, and the strength of the underlying growth may drive these businesses higher.

The post Forget Tesla, I think this ASX tech stock is poised for an incredible run appeared first on The Motley Fool Australia.

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More reading

• Got $1,000? 2 ASX shares to buy right now
• Here are 10 ASX shares I’d buy in 2024

Motley Fool contributor Tristan Harrison has positions in Bailador Technology Investments. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bailador Technology Investments, SiteMinder, Tesla, and Wesfarmers. The Motley Fool Australia has positions in and has recommended SiteMinder and Wesfarmers. The Motley Fool Australia has recommended Bailador Technology Investments. 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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There are plenty of ASX dividend stocks to choose from on the Australian share market.

Three that brokers believe are buys are listed below. Here’s what you need to know about them:

Coles Group Ltd (ASX: COL)

The first ASX dividend stock that could be a buy according to brokers is supermarket giant Coles.

Citi is bullish on Coles and has a buy rating and a $17.50 price target on its shares.

As for dividends, the broker is forecasting fully franked dividends of 64 cents per share in FY 2024 and 70 cents per share in FY 2025. Based on the current Coles share price of $16.09, this will mean dividend yields of 4% and 4.35%, respectively.

Dexus Convenience Retail REIT (ASX: DXC)

Another ASX dividend stock that could be a buy is this convenience focused property company.

Bell Potter is a fan of the company and has a buy rating and $2.85 price target on its shares. It believes the company “offers one of the most attractive risk-adjusted propositions in the sector.”

It also expects some big dividend yields. The broker is forecasting dividends per share of 20.9 cents in FY 2024 and 20.5 cents in FY 2025. Based on its current share price of $2.66 this equates to yields of 7.85% and 7.7%, respectively.

Universal Store Holdings Ltd (ASX: UNI)

Finally, Morgans thinks that this youth fashion retailer could be an ASX dividend stock to buy right now.

The broker currently has an add rating and $4.55 price target on its shares.

As for income, Morgans is forecasting fully franked dividends per share of 26 cents in FY 2024 and 29 cents in FY 2025. Based on the current Universal Store share price of $4.12, this will mean yields of 6.3% and 7%, respectively.

The post Brokers say these ASX dividend stocks are buys appeared first on The Motley Fool Australia.

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More reading

• Morgans says these ASX dividend shares are buys this month
• Got $15,000? How I’d invest for a bulletproof ASX passive-income portfolio
• Buying ASX retail shares? You’ll want to see these numbers
• Get a big income boost from these high-yield ASX dividend stocks
• Can Coles shares go from loser to winner in 2024?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in Universal Store. 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 Coles Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Owners of Rio Tinto Ltd (ASX: RIO) shares have been getting juicy dividends for a number of years, thanks to the huge demand for commodities from China.

Its biggest earnings contributor is iron ore, but it also deals with a number of other commodities such as copper, aluminium and a few more.

How big could the Rio Tinto dividends be in 2024 and beyond?

There could be another big annual dividend from the company in 2024, thanks to the strength of the iron ore price.

At the moment, the forecast on Commsec suggests Rio Tinto could pay an annual dividend per share of $7.60. That’s a cash dividend yield of 5.75%, or 8.2% when grossed up.

According to Trading Economics, the iron ore price is sitting at around US$130 per tonne, which is a good price for the ASX mining share to make plenty of profit.

Trading Economics noted there had been further economic support from the Chinese government, with the People’s Bank of China saying that it would reduce its reserve requirement ratio, “adding liquidity to the financial system and supporting manufacturing and construction activity”.

The strong iron ore price comes despite new home prices in China reportedly dropping in December at the fastest pace since 2015.

Trading Economics also said that the iron ore price was supported by hot rolled coil and stainless steel inventories at major Chinese warehouses edging lower in the third week of January, which pointed to “some bidding activity for ferrous metals.”

The iron ore price is hard to predict a few months into the future, let alone years ahead. But, analysts have given it a shot at forecasting what the dividends might be.

On Commsec, the forecast is that Rio Tinto could pay an annual dividend per share of $7.36 in 2024. This would translate into a cash yield of 5.6% and a grossed-up dividend yield of 8%.

Is now a good time to invest?

Rio Tinto is one of the world’s leading miners. As such, it’s very good at what it does. I like the diversification that it offers with different commodities.

I’m particularly excited by the company’s moves to gain exposure to copper, which is an important commodity for the decarbonisation and electrification of the world.

I also like the company’s planned expansion into African iron ore mining with its involvement in the Simandou project.

There’s a lot to like about the future. However, I’m cautious about investing in Rio Tinto shares right now because of the strength of both the iron ore price and the Rio Tinto share price.

To beat the market over the long-term, I’d prefer to invest when the sentiment about iron ore is weak and the iron ore price is much closer to US$100 per tonne, if not below. So, I’d be patient on the ASX mining share, for now.

The post Could Rio Tinto shares be a gold mine for dividends in 2024 and beyond? appeared first on The Motley Fool Australia.

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More reading

• BHP stock and more: 3 ASX commodity titans to watch in 2024
• Buying ASX 200 mining shares? Here’s Citi’s 2024 prediction for the iron ore price
• Buy Rio Tinto and these ASX dividend stocks
• Rio Tinto share price marching higher amid record Aussie solar power agreement
• ASX 200 mining stocks underperforming as Andrew Forrest shutters WA nickel mines

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 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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If history repeats itself, tomorrow could mark the beginning of a big year for S&P/ASX 200 Index (ASX: XJO) shares.

Investors will be carefully watching the Reserve Bank of Australia (RBA) tomorrow. That’s when the central bank announces its next interest rate decision.

Now the odds of an RBA rate cut tomorrow have fallen to virtually zero.

But even a dovish shift in language could be enough to boost ASX 200 investor sentiment.

And while it may not happen tomorrow, most analysts are still expecting several rate cuts from the central bank before the end of the year.

Commonwealth Bank of Australia (ASX: CBA) economist Gareth Aird isn’t forecasting a cut tomorrow. However, he said (quoted by The Australian Financial Review), “”We continue to expect an easing cycle commencing in September.”

CBA forecasts the RBA will cut rates by 0.75% over the final months of 2024 and another 0.75% in the first half of 2025. That would see the official cash rate back down at 2.85% from the current 4.35%.

Here’s what history tells us happens when the RBA begins to ease off on interest rates.

ASX 200 and the RBA’s historic rate cycle

In early September 2008, Australia’s official interest rate stood at 7.25%.

The ASX 200, and shares across the world, had been plunging for the better part of a year in the midst of the GFC.

September 2008 saw the first of a rapid series of rate cuts from the RBA. With a final cut of 0.25% on 8 April 2009, the cash rate was slashed to 3.00%.

Although there was as significant lag involved before the ASX 200 bottomed in March 2009, the benchmark index then soared more than 50% before the next tightening cycle commenced on 7 October 2009.

That tightening cycle ran through 1 November 2011, when the official cash rate stood at 4.75%.

During the course of that increasing rate cycle, from October 2009 through to November 2011, the ASX 200 lost 12%.

November 2011 then saw the RBA cut rates by 0.25% in an easing cycle that would last all the way until May 2022, when the central bank raised rates from the rock bottom, post pandemic low of 0.10%.

From November 2011 through to May 2022, during this decade-plus of ever lower interest rates, the ASX 200 gained more than 72%.

Which is why if history repeats tomorrow (or on a Tuesday when the RBA reports later on this year) could mark the beginning of a lengthy run higher for the Aussie share market.

The post If history repeats itself, tomorrow’s RBA decision could mark the start of a big year for the ASX 200 appeared first on The Motley Fool Australia.

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More reading

• Hoping to bag the ResMed dividend? You better be quick!
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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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It won’t be long before the next Resmed CDI (ASX: RMD) dividend is on its way to shareholders. If investors want to gain access to the payout, they’ll need to be quick because it’s nearly deadline day!

The ex-dividend date is one of the most important dates when it comes to dividend investing. Investors need to own shares before the ex-dividend date to gain entitlement to the upcoming payment. If investors buy on the ex-dividend date (or afterwards), they’ll miss out.

Resmed ex-dividend date

The ex-dividend date for the imminent quarterly payment is on Wednesday, 7 February. That means, to ensure entitlement to this upcoming dividend, investors will need to own Resmed shares by the end of trading tomorrow, 6 February.

The ASX healthcare share is planning to pay this dividend of US 4.8 cents per share on 14 March 2024.

At the current foreign exchange rate, that would translate into a payment of AU 7.3 cents per share. Resmed will provide further details about the size of the dividend in Australian dollar terms on Friday, 9 February.

Profitability performance

Resmed recently announced its FY24 second quarter performance for the three months to 31 December 2023.

It reported that revenue increased by 12% to $1.2 billion, the underlying gross profit margin improved 10 basis points to 56.9%, the underlying (non-GAAP) operating profit improved 20%, and it made an operating cash flow of $272.8 million.

You can read more about that update from our coverage of the quarter.

Management said strong growth in patient flow over the past several quarters had “supported ongoing device growth” and added to replenishment programs for “sustained mask and accessories growth”. It was also launching its latest generation platform, AirSense 11, into new markets and geographies.

Resmed share price snapshot

The Resmed share price has fallen more than 8% over the past year.

The post Hoping to bag the ResMed dividend? You better be quick! appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy next week
• 3 ASX All Ords shares with ex-dividend dates in the next week
• Will you miss out if you don’t buy more of this superstar ASX 200 growth stock?
• ResMed shares rise on major Philips news
• Leading brokers name 3 ASX shares to buy today

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

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When you see an ASX stock that’s lost 94% since its glory days, what are your thoughts?

You might think that something has gone horribly wrong, which is probably correct.

But if you think such a dramatic decline means it has no chance of making you money, then you would be wrong.

Shares don’t care about the past. Only the future performance of the business and the demand for stocks from investors matters.

Along these lines, a pair of much-maligned ASX shares have started 2024 with massive increases in their valuations.

And the analysts at QVG Capital reckon there’s more where that came from:

Beating earnings expectations

The fall of Zip Co Ltd (ASX: ZIP) has been breathtaking.

The share price has tumbled 94% from February 2021, as the market turned away from “buy now, pay later” providers, then growth stocks.

However, recent months have shown signs of life.

The Zip share price, believe it or not, has rocketed more than 148% since the start of November.

The latest boost, according to the QVG team, came in January.

“Zip reported their December quarter result which showed that earnings expectations of $6 million were too low as they produced $30 million of earnings in the first half alone,” read its memo to clients. 

“They now have a repaired balance sheet and improved margin profile, substantially de-risking the business.”

Brilliant ‘turnaround story’ for this ASX stock

Shares for payments technology provider EML Payments Ltd (ASX: EML) have suffered a similar journey to Zip.

They have fallen more than 85% since its April 2021 peak, as a series of regulatory and governance scandals hit the business.

But since 30 March the stock has returned a whopping 102%.

QVG analysts, who are fans of this “turnaround story”, noted EML also provided an upbeat update in January.

“We were attracted to EML early last year when we noticed significant board and management change,” read their memo.

“Sensible, reputable people tend to make equally sensible decisions and this month they announced the closure of a business division that was burning significant cash.”

The momentum is now positive for the ASX stock, the QVG team feels.

“We’re expecting further earnings and balance sheet improvements, potentially via a divestment.”

The post Up 150% in 3 months: It’s not too late to buy these 2 rebounding ASX stocks appeared first on The Motley Fool Australia.

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More reading

• Zip share price surges 7% on quarterly cash flow report
• Why IDP Education, Karoon Energy, Liontown, and Zip shares are falling today
• The Zip share price has soared 147% in 3 months, can it keep going?
• Why 4DMedical, A2 Milk, QBE, and Zip shares are charging higher today
• Zip shares rocket 17% on ‘outstanding’ quarter

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended EML Payments and Zip Co. 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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If you’re looking for some big returns, then it could be worth checking out the ASX growth shares listed below.

That’s because they have been named as buys and tipped to rise 20% or greater.

Here’s what analysts are saying about these buy-rated shares:

Flight Centre Travel Group Ltd (ASX: FLT)

The first ASX growth share that has been named as a buy is travel agent giant Flight Centre.

The team at Morgans is positive on the company, noting that “with confidence that the travel recovery has much further to go and the benefits of FLT’s transformed business model emerging, we think the company is well placed over coming years.”

The broker has an add rating and $26.00 price target on its shares. This implies 20% upside for investors from current levels.

IDP Education Ltd (ASX: IEL)

Over at Bell Potter, its analysts see this beaten down language testing and student placement company’s shares as a top option right now.

The broker likes IDP Education due to structural growth tailwinds. And while its shares have a premium valuation, its analysts “believe this is justified given its dominant market position, potential for M&A and successful track record.”

Bell Potter has a buy rating and $27.00 price target on its shares. This suggests 40% upside for investors over the next 12 months.

Life360 Inc (ASX: 360)

A final ASX growth share that could be in the buy zone is Life360. It is the location technology company behind the popular Life360 app, which has almost 60 million monthly active users.

Goldman Sachs remains very bullish on the company’s outlook thanks partly to its “US$12bn global TAM with a large opportunity to expand its product suite.”

Goldman currently has a buy rating and $10.50 price target on the company’s shares. This represents 37% upside for investors from current levels.

The post Buy these ASX growth shares for 20% to 40% returns appeared first on The Motley Fool Australia.

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More reading

• These are the 10 most shorted ASX shares
• 3 roaring ASX shares I’d hold for the next 20 years
• How big will the Flight Centre dividend be in 2024?
• 2 top ASX growth shares to buy right now and hold for the long term
• This rapidly growing ASX 200 tech stock’s “valuation is compelling”

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, Idp Education, and Life360. The Motley Fool Australia has recommended Flight Centre Travel Group and Idp Education. 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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