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If you’re looking to make some new additions to your income portfolio this month, then it could be worth checking out the ASX dividend stocks listed below.

That’s because analysts are currently tipping them as buys and forecasting attractive yields. Here’s what they are saying about them:

Charter Hall Retail REIT (ASX: CQR)

The first ASX dividend share for income investors to check out is the Charter Hall Retail REIT.

It is a supermarket anchored neighbourhood and sub-regional shopping centre markets-focused property company. Among its tenants are Coles Group Ltd (ASX: COL), Woolworths Group Ltd (ASX: WOW), and Aldi.

Citi is a fan of the company. This is due partly to its “defensive net property income growth despite rising interest rate profile.’

Its analysts are expecting this to underpin dividends of 28 cents per share in both FY 2024 and FY 2025. Based on its current share price of $3.51, this will mean generous yields of 6.8% for investors.

Citi currently has a buy rating and $4.00 price target on its shares.

Tourism Holdings Ltd (ASX: THL)

Another ASX dividend share that has been given the thumbs up is Tourism Holdings. It is the largest commercial recreational vehicle rental operator in the world.

The team at Morgans thinks investors should be buying its shares right now, particularly given its dirt cheap price. The broker highlights that “THL is trading on a recovery year (FY25) PE of only 9.3x, which is attractively priced for a global, market leader.”

In addition, Morgans is expecting some decent dividend yields in the near term. It has pencilled in dividends per share of 15 cents in FY 2024 and 17.6 cents in FY 2025. Based on the current Tourism Holdings share price of $3.37, this would mean yields of 4.4% and 5.2%, respectively.

The broker currently has an add rating and $5.02 price target on its shares.

The post 2 ASX dividend shares for income investors to buy today appeared first on The Motley Fool Australia.

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More reading

• Here’s how I’d invest $20k in ASX shares to target a 7% dividend yield in 2024
• Buy these ASX 200 dividend shares with big yields
• Analysts say these ASX dividend shares with 4%+ yields are buys

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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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Investors must be careful that they don’t “buy the dip” on S&P/ASX 200 Index (ASX: XJO) shares just because they’re cheap.

After all, they might have dived simply because they’re terrible businesses. There is absolutely no guarantee that any fallen stock will again rise to its former heights.

However, if the company is performing well and the external conditions seem favourable, then you’re in with a fighting chance to buy the dip on a true bargain.

Here are two ASX 200 stocks precisely in that spot, which experts are rating as buys:

The stock to ‘move higher in the next six months’

The actual company that runs the ASX, ASX Ltd (ASX: ASX), has seen its share price tumble for a long time now.

The shares are 30.8% lower than where they were in November 2021, as troubles over its technology upgrade projects have frightened investors. 

That’s despite a respectable fully franked dividend yield of 3.5%.

Marcus Today analyst Oliver Matthew is predicting a turnaround for ASX Ltd.

“We expect the share price of Australia’s biggest securities exchange to move higher in the next six months as global interest rates peak, bond yields fall and equities rise,” Matthew told The Bull.

The simple fact is that business is booming.

“The average daily number of trades in cash markets in December 2023 was up 13% on the prior corresponding period. Cash markets include equities, interest rate and warrant trades,” said Matthew

“The average daily value traded on-market was $5.371 billion, up 2% on the prior corresponding period.”

He added that a revival might already be underway, with the stock price now more than 19% higher than it was in October.

Buy the dip on this energy stock

Russia’s invasion of Ukraine a couple of years ago showed the world that there is still much work to do before renewable sources can take over the energy market.

This is why, sadly, Fairmont Equities managing director Michael Gable reckons there’s still legs in fossil fuel investments.

“We continue to retain a bright outlook for crude oil. Supply constraints and increasing global demand should elevate energy prices.”

And there is one particular energy stock that his team is recommending as a buy right now.

“Woodside Energy Group Ltd (ASX: WDS) shares are attractive at these levels.”

The stock is in a particularly tempting dip at the moment, trading 19.5% cheaper compared to its September peak. 

A sweet fully franked dividend yield of 11% helps too.

According to CMC Invest, seven out of 13 analysts currently rate Woodside as a buy.

The post Down 31%: Buy the dip on these ‘attractive’ ASX 200 dividend shares appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Monday
• Which had the better year in 2023: Telstra, Woodside or Wesfarmers shares?
• 5 things to watch on the ASX 200 on Thursday
• Why Santos shares could face headwinds despite $5.7 billion Barossa win
• 5 things to watch on the ASX 200 on Wednesday

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 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 start of 2024 looks like a great time to invest in ASX shares. Some share prices are below their all-time highs and interest rate cuts may be coming later this year.

I’m always on the lookout for good businesses at good prices. I think the below ten are well worth an investment for the long term.

Bailador Technology Investments Ltd (ASX: BTI)

This company invests in relatively small, but growing technology businesses that have international revenue generation, a large market opportunity and attractive unit economics.

Bailador is currently trading at a sizeable discount to its underlying value, the net tangible assets (NTA) per share. It also offers a dividend yield of 4% of the pre-tax NTA, so the yield is even bigger right now because of the valuation discount it’s trading at.

I think Bailador’s portfolio of businesses can outperform the S&P/ASX 200 Index (ASX: XJO) over the next three to five years, particularly as interest rates come down.

Close The Loop Ltd (ASX: CLG)

This ASX share is focused on the circular economy, meaning recycling and ensuring that zero waste goes to landfill.

Its core offering is collecting various products and then turning them into consumer goods.

Close The Loop can grow its business organically with its existing businesses as more households and businesses look to become more environmentally friendly. This ASX share can also make acquisitions to expand into other forms of recycling.

Centuria Office REIT (ASX: COF)

This is a real estate investment trust (REIT) that owns a portfolio of office buildings. It owns properties around the country but has less exposure to the Sydney and Melbourne markets than one might expect. Those smaller Australian markets have generally performed quite well and are avoiding the disaster other places in the world are seeing.

I think the market may have oversold this ASX share, particularly if interest rates start falling this year. One of the things that makes me think that is the size of the distribution yield, which is projected to be 9.4% in FY24, according to Commsec.

Frontier Digital Ventures Ltd (ASX: FDV)

This ASX tech share has fallen heavily since its peak in 2021, it’s a lot cheaper. It has been working on its profitability during this period and it’s now reporting a small (positive) earnings before interest, tax, depreciation and amortisation (EBITDA) and positive cash flow.

It has invested in a number of classifieds website businesses (like real estate and cars) in emerging markets like Latin America and Asia. I think digital adoption alone in those countries is a strong tailwind for the underlying businesses. Adding additional users can be a real boost for profit because of the operating leverage and network effects.

GQG Partners Inc (ASX: GQG)

GQG is a fund manager based in the US, which is looking to expand overseas in countries like Canada and Australia.

The fund managers’ investment fund performance has done well, which organically grows funds under management (FUM). It also helps attract more FUM.

GQG isn’t priced highly considering it’s growing earnings at a decent rate and it pays a large dividend yield thanks to its dividend payout ratio of 90% of distributable earnings.

Johns Lyng Group Ltd (ASX: JLG)

Johns Lyng is an ASX share that specialises in offering repair and rebuild services after an insured event, like flooding, storms or a fire. It’s rapidly growing its exposure to and revenue from catastrophe work, with clients like local and state governments.

The business is seeing impressive double-digit growth each year, and it’s displaying operating leverage, enabling its profit to grow a bit quicker than revenue.

I’m also pleased to see the business is expanding into bolt-on areas that can extract synergies with the main business units. I’m talking about its acquisitions focused on body corp/strata services, as well as electrical, gas and fire safety and compliance. These areas offer defensive, recurring earnings and plenty of room to grow market share.

Lovisa Holdings Ltd (ASX: LOV)

Lovisa is a retailer that sells affordable jewellery. It makes good profit margins on its products, and it doesn’t cost much to open new stores.

The company has been rapidly growing its store network around the world, entering markets like Canada, Mexico, China and Vietnam. Lovisa’s sales and profit seem to be climbing at roughly the same rate as its store network up until FY23 – I think it can double its store count over the next five years and continue to pay a nice dividend yield.

Vaneck Morningstar Wide Moat ETF (ASX: MOAT)

This is an exchange-traded fund (ETF) that has produced very strong long-term returns, though that’s no guarantee for the future. I like its investment style – it targets businesses that have competitive advantages which are expected by Morningstar analysts to almost certainly endure for the next decade and more likely than not endure for 20 years.

It only buys businesses when Morningstar thinks these competitively-advantaged businesses are trading materially below what Morningstar thinks they’re worth.

Pinnacle Investment Management Group Ltd (ASX: PNI)

Pinnacle is a business that helps leading fund managers start their own businesses and also takes a stake. In addition, it offers a number of services like legal, compliance, distribution, seed funding and so on, allowing the fund manager to just focus on the investing.

I think this business is associated with a group of quality managers that will be able to deliver outperformance and attract more FUM.

With asset markets rebounding and seeming more confident, I think this is a strong tailwind for the company over the next financial year or two.

Xero Limited (ASX: XRO)

This ASX tech share is still down 25% from November 2021, but it has grown its revenue and profit considerably since then.

The cloud accounting software company is focusing a bit more on balancing growth and profit from now on.

I think this business can become one of the most profitable on the ASX (outside of the big miners and banks), with an incredibly high gross profit margin, which means extra revenue adds a lot of extra usable money for investing in growth or boosting the bottom line.

The post Here are 10 ASX shares I’d buy in 2024 appeared first on The Motley Fool Australia.

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More reading

• How I’d create investment cash flow in retirement from ASX ETFs
• Top ASX shares to buy in 2024 instead of investing in a term deposit
• Want $1 million in retirement? 3 ASX shares I think could make it happen
• Forget term deposits and get rich with ASX shares the Warren Buffett way
• Here’s how the ASX 200 market sectors stacked up this week

Motley Fool contributor Tristan Harrison has positions in Bailador Technology Investments, Close The Loop, Johns Lyng Group, Lovisa, and Pinnacle Investment Management Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bailador Technology Investments, Frontier Digital Ventures, Johns Lyng Group, Lovisa, Pinnacle Investment Management Group, and Xero. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group and Xero. The Motley Fool Australia has recommended Bailador Technology Investments, Close The Loop, Frontier Digital Ventures, Johns Lyng Group, Lovisa, and VanEck Morningstar Wide Moat ETF. 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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Growth investors certainly are a lucky bunch! The Australian share market is home to plenty of ASX growth shares that have very bright long-term outlooks.

But which ones could be buys? Three that Bell Potter is very bullish on are listed below. Here’s what the broker is saying about them:

Cettire Ltd (ASX: CTT)

Bell Potter’s analysts think this online luxury retailer could be an ASX growth share to buy.

It likes Cettire because of its scalable proprietary technology platform and its massive global market.. The broker commented:

Cettire has a rapidly growing global online luxury personal goods retailing platform in a large market with a structural shift to online well underway. We believe CTT will continue to outperform its peer group consisting of global luxury retailers and local e-commerce players given its <1% market share in a growing market, which could remain more resilient than other discretionary categories in a likely recessionary environment.

Bell Potter has a buy rating and $4.00 price target on its shares.

Corporate Travel Management Ltd (ASX: CTD)

Another ASX growth share that Bell Potter is positive on is travel management solutions company Corporate Travel Management.

Its analysts believes the company’s shares are good value based on its forecast for double-digit earnings growth this year and next. The broker explains:

We are positive on the Company’s growth outlook and market leading position as the corporate travel market continues to recover and view any existing uncertainty regarding the recovery trajectory, macro-outlook, and structural industry headwinds as largely priced in by the market. We therefore see upside risk with CTD: (1) having already exceeded pre-pandemic TTV driven by new client wins; (2) remaining well capitalised; and (3) forecast to deliver strong double-digit earnings growth in FY24-25e.

Bell Potter has a buy rating and $21.00 price target on its shares.

IDP Education Ltd (ASX: IEL)

A final ASX growth share that Bell Potter is saying good things about is language testing and student placement company IDP Education.

Its analysts think it could be a great option due to structural growth tailwinds and its dominant market position. The broker said:

Whilst increased competition in English language testing is likely to impact IELTS volumes, we expect this to be partially offset by strength in the student placement segment supported by strong 1QFY24 student visa data in the Northern Hemisphere and structural growth tailwinds. In addition, the business has a solid dividend yield, relatively low working capital intensity, and has historically maintained strong cash conversion. IEL trades at a premium to its peers on a FY24e EV/EBIT of ~24x, however, we believe this is justified given its dominant market position, potential for M&A and successful track record.

Bell Potter currently has a buy rating and $27.00 price target on its shares.

The post 3 exciting ASX growth shares Bell Potter rates as buys appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• These are the 10 most shorted ASX shares
• ‘Consistent alpha generation’: 3 ASX 200 shares sitting pretty for the long run
• Here are the top 10 ASX 200 shares today
• Top brokers name 3 ASX shares to buy 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 positions in and has recommended Corporate Travel Management and Idp Education. The Motley Fool Australia has recommended Cettire, Corporate Travel Management, 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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On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week with a strong gain. The benchmark index rose 0.75% to 7,476.6 points.

Will the market be able to build on this on Tuesday? Here are five things to watch:

ASX 200 expected to edge lower

The Australian share market is expected to edge lower on Tuesday despite a good start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 7 points or 0.1% lower. In late trade in the United States, the Dow Jones is up 0.35%, the S&P 500 is up 0.3%, and the NASDAQ is 0.4% higher.

Buy the Liontown selloff

The Liontown Resources Ltd (ASX: LTR) share price was sold off on Monday following a disappointing update on the Kathleen Valley Lithium Project. The team at Bell Potter believes this could be a buying opportunity for investors with a high risk tolerance. This morning, the broker has retained its speculative buy rating with a reduced price target of $1.60 (from $2.25). This implies 70% upside from current levels. It notes that the “Kathleen Valley lithium project remains highly strategic in terms of its stage of development, long mine life and location.”

Oil prices jump

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Karoon Energy Ltd (ASX: KAR) could have a great session after oil prices jumped overnight. According to Bloomberg, the WTI crude oil price is up 3.2% to US$75.75 a barrel and the Brent crude oil price is up 2.5% to US$80.52 a barrel. A drone attack on Russian supplies was behind the jump.

Lynas remains a buy

Bell Potter also believes that investors should be snapping up Lynas Rare Earths Ltd (ASX: LYC) shares. In response to its quarterly update, the broker has retained its buy rating on the rare earths producer’s shares with a trimmed price target of $7.60 (from $8.50). It said: “LYC remains a high-quality business, and a key supplier of separated rare earths to Western economies.”

Gold price falls

ASX 200 gold shares Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a subdued session after the gold price fell overnight. According to CNBC, the spot gold price is down 0.3% to US$2,023 an ounce. The gold price fell after US Fed rate cut optimism waned.

The post 5 things to watch on the ASX 200 on Tuesday appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why Appen, Baby Bunting, Cooper Energy, and Liontown shares are sinking today
• Mineral Resources shares tumble 9% on unfavourable broker rating
• Lynas share price sinks alongside 50% quarterly revenue fall
• Why are Liontown shares crashing 26% on Monday?

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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When you see a stock soar, the dilemma is whether it’s too late to grab a piece of the action.

Has all the ‘easy’ money already been made? Or is the business going so well that further elevation in the stock price is inevitable?

According to experts, these two S&P/ASX 200 Index (ASX: XJO) stocks deserve your immediate consideration before they rise any further:

Valuation compares ‘favourably to its peers’

The team at Fairmont Equities was publicly bullish on iron ore last year, even as many other professional investors were not keen on the sector.

Managing director Michael Gable told The Bull his analysts still have the same outlook.

“We remain bullish regarding the outlook for iron ore in 2024.”

Champion Iron Ltd (ASX: CIA) shares have rocketed more than 30% since October, but that’s the iron ore stock Gable is rating as a buy right now. 

“This Canadian-based producer is trading on valuations which compare favourably to its peers,” he said.

“Also, the share price recently broke above a major resistance level near $8, and we believe this should lead to substantial upside from here.”

Gable’s peers very much agree with his bullishness for Champion Iron.

CMC Invest currently shows all seven analysts that cover the stock recommend it as a buy. Six of those say it’s a strong buy.

The ASX 200 stock ready for take-off

Marcus Today analyst Oliver Matthew liked what he saw recently out of Webjet Limited (ASX: WEB).

“This online travel agency posted impressive results in late 2023,” he said.

“The company’s WebBeds business was a standout, posting revenue of $171.8 million in the first half of fiscal year 2024, an increase of 50% on the prior corresponding period.”

Accordingly, the share price has flown more than 23% higher since an October trough.

If you go back a bit further, Webjet shares have almost tripled — that is, seen a 195% gain — since the initial COVID-19 panic in April 2020.

That doesn’t put Matthew off at all from buying now, though.

“We expect the company to generate solid growth in the second half as global airline passenger traffic has returned to normal levels post the pandemic.”

The wider professional community also likes Webjet, but not as unanimously as Champion Iron.

According to CMC Invest, 12 out of 17 analysts rate the travel stock as a buy right now.

The post Tripled since COVID: 2 rocketing ASX 200 stocks not too late to buy appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 shares that could surge in 2024 if the RBA cuts interest rates
• True blue tech: The ASX shares I’d buy to build a Nasdaq index-inspired portfolio
• The 8 ASX mining stocks Goldman Sachs says are buys in 2024
• Here are the top 10 ASX 200 shares today
• Goldman Sachs says these ASX 200 stocks are buys today

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 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’s been a tough couple of years for many Australians, especially those with a mortgage.

The Reserve Bank of Australia raising interest rates 12 times in 13 months, or 13 times in 18 months, is a phenomenon that’s rarely seen.

It had to be done, to quell inflation from damaging levels.

But now that inflation seems to be settling down, there is great hope among economists and the public that we have seen the last of the rate hikes. 

Or maybe just one more, and that’s it.

While no one has a crystal ball to judge whether that’s true, in practical terms the rate increases have to come to an end sooner or later.

Then after that, there might even be a reduction in interest rates to get the economy kick-started again.

And when it does, there are certain businesses that will thrive much more than others.

Here are couple of stocks from the S&P/ASX 200 Index (ASX: XJO) that have the potential to rocket if rate cuts come:

‘Valuation compares favourably to its peers’

Iron ore is very much a mirror of how well the economy is going.

It is a material that is essential for construction, and that sector only gets going when consumers and businesses are confident.

So if global economies receive a stimulatory boost from interest rate cuts, the building industry could be cheering.

And that’s where Champion Iron Ltd (ASX: CIA) comes in.

Champion shares are 1.6% down on 12 months ago, and that makes the price tempting to buy now, according to Fairmont Equities boss Michael Gable.

“This Canadian-based producer is trading on valuations which compare favourably to its peers,” Gable told The Bull.

“We remain bullish regarding the outlook for iron ore in 2024.”

Other professionals are also fans, with all seven analysts covering Champion Iron rating it as a buy on CMC Invest.

This American mob can’t wait for interest rates to come down

Another victim of rising rates have been high-growth stocks, especially technology.

High interest rates harm the valuation of future-dependent companies, and Block Inc CDI (ASX: SQ2) was no exception.

Just in the first half of 2022, shares for the US fintech lost half its value.

Even within the tech sector, Block Inc was known to be profligate. Even its propensity to issue new shares to staff came into question as rates started creeping up.

But, to its credit, the company has listened to the markets and has made some changes.

“Block Inc outperformed in December following the release of its 3Q23 result the month prior, which exceeded investor expectations with respect to future cost discipline, and strong messaging about internal personnel productivity,” read an ECP memo to clients.

“The result is an expectation of faster operating leverage to emerge across business units, with a plan to hit Block’s ‘rule of 40’ in 2026.”

So, in a leaner and fitter state than a couple of years ago, once rates come down Block Inc could be in an enviable position.

According to CMC Invest, all three analysts who monitor Block Inc shares reckon it’s now a strong buy.

The post 2 ASX 200 shares that could surge in 2024 if the RBA cuts interest rates appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• How I’d invest $300 a month in ASX shares to target $22,000 annual passive income!
• Got a spare $1,000? I’d buy 10 shares of this ASX 200 stock to aim for a million
• ‘Consistent alpha generation’: 3 ASX 200 shares sitting pretty for the long run
• The 8 ASX mining stocks Goldman Sachs says are buys in 2024

Motley Fool contributor Tony Yoo has positions in Block. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block. The Motley Fool Australia has positions in and has recommended Block. 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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Have you got $10,000 saved up that you could invest?

If so, you could utilise ASX dividend shares and the magic of compounding to build up a machine that will automatically generate $500 a month without you lifting a finger.

That’s six grand of passive income — enough for a nice overseas holiday for the entire family — every 12 months.

How can this be?

It’s possible because Australia is blessed with many of the best income-producing stocks in the whole world.

That is no accident. It has come about because of Australia’s tax rules, which dictate investors should not be “double taxed”.

That is, if a company has already paid corporate tax on its profits then distributes some of that cash to shareholders, it comes with franking. The recipient then does not need to pay income tax on that dividend.

This system provides a major incentive for public listed companies to hand back capital to shareholders using dividends, rather than other methods more popular overseas, such as buybacks.

How to invest $10,000 for passive income

Let’s get back to that $10,000 you had.

If we construct a well diversified portfolio full of quality ASX dividend stocks, we can reinvest the distributions each year to grow the pot.

With stocks like Fletcher Building Ltd (ASX: FBU) and Growthpoint Properties Australia Ltd (ASX: GOZ) handing out 8% to 9% dividend yield, there’s no reason why you can’t achieve 10% CAGR each year with the help of franking and capital growth.

If you can keep saving to buy $200 worth of shares each month, even better.

A quick calculation shows that $10,000 growing at 10% with $200 added each month will become $64,187 after just 10 years.

After that, instead of reinvesting the dividends each year, put it in your pocket.

That’ll work out to be about $6,000 annually, which is $500 per month.

Not bad, aye? 

If you want an even larger stream of passive income, just keep reinvesting past the 10-year mark.

After 20 years the portfolio will have reached a phenomenal $204,735.

Cashing in 10% of returns each year from that will provide you $20,000 of passive income.

Imagine what you could do with an extra $1,666 of cash each month.

Best wishes for your investments.

The post $10,000 in savings? Here’s how I’d try to turn that into $500 a month of passive income appeared first on The Motley Fool Australia.

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Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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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Operating margins at the electric vehicle (EV) company have eroded amid aggressive price cuts. In the third quarter, margins sank to 7.6% from 17.2% in the prior corresponding period — some analysts are also expecting further falls in the upcoming Q4 result. Yet, I’m as eager as ever to buy more Tesla Inc (NASDAQ: TSLA) shares.

I’m sure it sounds outrageous to want to invest more capital into a company with declining margins. However, below, I’ll explain my reasoning for this bullish sentiment at a time when most are convinced the EV maker is about to be consumed by competition.

Adding Tesla shares in anticipation of its iPhone moment

I’ve owned shares in Tesla for several years now. For much of this time, the choice to invest was led by my expectation of widespread electric vehicle adoption and the company being a leader in autonomous driving.

Although, I’m starting to think cars (autonomous or not) might be just the tip of the iceberg for Tesla. Much like Apple Inc‘s (NASDAQ: AAPL) first decades being dominated by Mac computers, the biggest opportunity might still be ahead of Tesla (aka, its iPhone moment).

Optimus folds a shirt pic.twitter.com/3F5o3jVLq1

— Elon Musk (@elonmusk) January 15, 2024

https://platform.twitter.com/widgets.js

Last week, Tesla founder Elon Musk shared the latest demonstration of its autonomous humanoid robot. I was astounded. As shown above, the bot steadily folds a shirt without any assistance. Albeit slowly and while tethered (i.e. not through its onboard processing). Still, it illustrates the pace at which robotics is evolving at Tesla.

So why do I want to buy more shares after a basic demo?

Mature economies need it

The developed world is suffering a productivity drought. Australia and many other mature economies are seeing labour productivity growth decline. In recent years, Australia has experienced a fall in output per hour worked, shown below.

Ultimately, countries need innovation to continue increasing gross domestic product (GDP) per capita and maintain improving living standards.

Autonomous robots, such as those being developed by Tesla, might be the antidote. I see this being impactful in two ways:

1. Unlocking more time for people via household applications
2. Significantly reducing the cost of labour for manufactured goods

On the second point, labour is the largest cost component of physical goods. If a robot can operate for three times as long — at the same efficiency as a person — for half the cost, the deflation in the price of goods could be enormous.

This would mean immense quality of life improvements for the populous.

Adapt or die

If Tesla can commercialise the Optimus Bot, the flywheel effect could rapidly kick in. During the Industrial Revolution, you implemented machine tools or went out of business.

When an invention greatly increases productivity, there is no way of competing using old methods. The Howe’s sowing machine of the early 1800s performed 640 stitches per minute versus the 23 achieved by hand.

This is a possible scenario if autonomous bots are created. If one company in an industry uses them, all companies will likely scramble to roll it out. The likely alternative is to stick with costlier methods, driving customers away to cheaper options.

Thinking long-term about Tesla shares

I firmly believe an individual investor’s greatest advantage is to think in decades and not quarters — as do many ‘professional’ analysts.

There might be some weaker results ahead for Tesla. However, the rate of innovation inside the company gives me confidence that the next decade could be bright.

In addition, my assigned probability of the Tesla Bot coming to fruition has increased following the latest snippet. I’m not saying commercialisation is guaranteed — far from it… but it looks more likely now than a year ago.

The post Automation era: Why I’m buying more Tesla shares despite margin decline appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Own Woolworths shares? Here’s a $15 billion piece of news
• Why has the Pilbara Minerals share price just tanked 6%?
• Buying ASX 200 shares? Here’s why Goldman Sachs expects a Fed interest rate cut in March
• Why I think CBA is one of the best ASX bank shares

Motley Fool contributor Mitchell Lawler has positions in Apple and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple and Tesla. The Motley Fool Australia has recommended Apple. 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 post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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• Why 4DMedical, A2 Milk, QBE, and Zip shares are charging higher today
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Motley Fool contributor Sebastian Bowen has positions in A2 Milk. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block, Idp Education, Life360, and PolyNovo. The Motley Fool Australia has positions in and has recommended Block and Steadfast Group. The Motley Fool Australia has recommended A2 Milk, Aub 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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