Tag: Motley Fool

Navigating the sometimes stomach-churning volatility associated with investing in ASX shares is not for the faint-hearted. That’s why some people choose to park their money in a term deposit instead, assuming it’s risk-free.

But no investment is completely without risk. Not even bank savings accounts and term deposits.

Legendary investor Warren Buffett once described investing in cash and cash equivalents as “a terrible long-term asset, one that pays virtually nothing and is certain to depreciate in value”.

The main reason for this is inflation. Even if your primary goal is Buffett’s number one investment rule – to not lose money – your term deposit may do just that when bank interest rates don’t keep up with Australia’s inflation rate.

So much for a safer and more stable investment than ASX shares – your wealth could actually be diminishing in real terms!

On that note, we turned to our Foolish writers for some more appealing possibilities and asked them which ASX shares they think offer the best alternative to a term deposit in 2024.

With their conservative investor hats on, here is what the team came up with:

6 ASX stock tips for risk-averse investors in 2024

• GQG Partners Inc (ASX: GQG), $5.05 billion
• Medibank Private Ltd (ASX: MPL), $10.60 billion
• Washington H Soul Pattinson & Company Ltd (ASX: SOL), $11.89 billion
• Coles Group Ltd (ASX: COL), $20.77 billion
• Telstra Group Ltd (ASX: TLS), $45.87 billion
• Commonwealth Bank of Australia (ASX: CBA), $189.70 billion

(Market capitalisations as of 19 January 2024).

Why our Foolish writers think you should buy these ASX shares instead of parking your cash in the bank

GQG Partners Inc

What it does: GQG Partners is a multinational investment services company headquartered in the United States.

By Tony Yoo: This $5 billion US outfit appears to be on the upward part of its business cycle, as investor sentiment is turning more positive due to inflation settling down and interest rate cuts potentially looming.

Already, many ASX stock investors have woken up to this, sending the GQG share price soaring more than 31% since 9 November. Despite the bull run, all five analysts surveyed on CMC Invest are tipping this financial services stock as a buy.

As a foreign company, the dividends come with no franking. However, the yield is still a very respectable 5.1%. That’s certainly better than most one-year term deposits, which have little prospect of capital growth.

Motley Fool contributor Tony Yoo does not own shares of GQG Partners Inc.

Medibank Private Ltd

What it does: Medibank Private is Australia’s largest health insurer, providing coverage to more than 4 million customers across its Medibank and ahm brands. The company derives most of its income from the difference between claims made and premiums charged. Additional income comes from returns on its investment portfolio – the funds it holds to pay out claims. 

By Mitchell Lawler: If I were hoping to earn more than a term deposit without taking too much risk, I’d search for a deep-seated company with no indication of disappearing. Companies that will play a role in our kid’s lives, and possibly even their children. 

Medibank Private holds such a strong brand that not even a catastrophic cyber breach could stop it from reaching record customer numbers in FY2023. That speaks to the loyalty and brand strength this insurer holds in the Australian market. 

As the Australian population grows through migration, Medibank could see its paying customers continue to swell. Throw in a fairly consistent ~4% in dividends each year, and I think this company could provide 10% to 11% in annual returns for the next five years – double what is commonly possible from a term deposit.

Motley Fool contributor Mitchell Lawler does not own shares of Medibank Private Ltd.

Washington H Soul Pattinson & Company Ltd

What it does: Investment company Soul Pattinson joined the ASX in 1903, so it’s been listed for more than a century. It is invested in numerous sectors, including telecommunications, building products, financial services, agriculture, swimming schools, resources, and many more.

By Tristan Harrison: Soul Patts has proven its longevity, surviving two world wars, two global pandemics, and numerous recessions and market crashes. The growing diversification of the company’s portfolio helps protect it against any sector-specific risks.

The company has paid a dividend every year since it was listed in 1903 — a great record that very few global businesses can exceed. Soul Patts has also grown its annual ordinary dividend every year since 2000.

Past performance is not a guarantee of future results, but Soul Pattinson has a long track record of delivering capital growth, partly because it continues to re-invest retained net investment cash flow into more ASX shares and other assets each year, which also helps grow its dividend potential.

Soul Patts has a grossed-up dividend yield of 2.64% at the close on Friday. 

Motley Fool contributor Tristan Harrison owns shares of Washington H Soul Pattinson and Co Ltd.

Coles Group Ltd

What it does: Coles Group is the second-largest grocery and supermarket operator in Australia. It owns the huge network of Coles supermarkets, as well as liquor store chains like First Choice.

By Sebastian Bowen: There are two reasons I think Coles shares would make a great alternative to a term deposit in 2024.

Firstly, I’ve been mightily impressed with Coles’ dividend track record ever since the company was first floated back in late 2018. Coles has delivered annual dividend pay rises every single year since 2019 and now offers a compelling, fully-franked yield of well over 4%.

Secondly, thanks to the nature of Coles’ consumer staples business, this company’s earnings are highly durable and defensive. That means this dividend is, in my view, unlikely to be substantially cut if there’s a recession or other economic malady.

All in all, it’s my belief that Coles stock is one of the steadiest income providers on the ASX, and it would make a great alternative to a term deposit investment today.

Motley Fool contributor Sebastian Bowen does not own shares of Coles Group Ltd.

Telstra Group Ltd

What it does: Telstra is Australia’s leading telecommunications and technology company, offering a full range of communications services. At the last count, it was providing around 22.5 million retail mobile services and 3.4 million retail bundle and data services.

By James Mickleboro: If you’re looking to invest in an ASX share over a low-risk term deposit, you’re going to need a compelling risk/reward balance. The good news is that I believe that Telstra offers exactly this.

In addition, the telco giant has defensive qualities, making it a lower-risk option compared to the average ASX stock.

Getting back to that risk/reward proposition, Goldman Sachs currently has a buy rating and a $4.70 price target on Telstra shares, which implies an 18% upside from Friday’s closing price of $3.97.

The analyst also expects a growing stream of dividends. Goldman is forecasting fully-franked dividends per share of 18 cents, 19 cents, and 20 cents over the next three financial years. This will mean yields of 4.5%+ each year.

Motley Fool contributor James Mickleboro does not own shares of Telstra Group Ltd.

Commonwealth Bank of Australia

What it does: With a market cap of almost $190 billion, CBA counts as Australia’s biggest bank. CommBank offers a range of integrated financial services. These include retail, business and institutional banking, funds management, superannuation, life insurance, general insurance, and broking services.

By Bernd Struben: In 2023, CBA shares gained 9.0%, well ahead of the best term deposit rates. Atop that, CommBank also paid out $4.50 a share in fully franked dividends. That saw the accumulated value of CBA shares gain 13.4% over the year, with some potential tax benefits.

And I believe CBA is well positioned to deliver deposit-rate-beating returns again in 2024, with considerably less risk than investing in small-cap ASX growth stocks.

From a safety standpoint, I like that the bank ended FY 2023 in a strong position in case of unexpected financial shocks. CBA’s common equity tier 1 (CET1) ratio increased 0.46% to 11.8%.

Motley Fool contributor Bernd Struben does not own shares in Commonwealth Bank of Australia.

The post Top ASX shares to buy in 2024 instead of investing in a term deposit appeared first on The Motley Fool Australia.

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More reading

• Which had the better year in 2023: Telstra, Woodside or Wesfarmers shares?
• Forget term deposits and get rich with ASX shares the Warren Buffett way
• 3 ASX 200 dividend shares I think you could safely hold for decades
• Lifetime income: 3 ASX dividend stocks I’m planning to never sell
• ‘Consistent alpha generation’: 3 ASX 200 shares sitting pretty for the long run

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Coles Group, Telstra Group, and Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Even though the ASX reporting season proper is still a couple of weeks away, there are some critical corporate results coming out this week.

These are three biggest ones, according to eToro market analyst Josh Gilbert:

1. ResMed quarterly results 

Resmed CDI (ASX: RMD) might just have been the most discussed ASX stock of 2023.

The ASX healthcare company makes devices that treat sleep apnea.

During the last reporting season, the Resmed share price plunged almost 37% as investors worried about the impact of new GLP-1 weight loss drugs such as Ozempic.

“Some investors felt [GLP-1 drugs] would dampen ResMed’s sales due to the connection between obesity and sleep apnea.”

Although the stock has recovered 23% since the September trough, Gilbert warned anything could happen on Thursday.

“A good result would give shares the next leg up after a solid three months, but a miss on estimates could put shares under pressure, given its recent strong performance.

“The main headwind has been margins, which look set to fall again this week. Gross margins are expected at 56%, down from a year ago.”

The positive is that analysts are expecting net income to increase 9% and for revenue to increase by a double-digit percentage.

“Its valuation also remains attractive at 23 times forward earnings, much lower than its historical average, pricing in recent challenges.”

2. Microsoft quarterly results

An old favourite among Australian investors, Microsoft Corp (NASDAQ: MSFT) last week became the largest company in the world by market cap, overtaking longtime rival Apple Inc (NASDAQ: AAPL).

The 70% rocket in share price over the past year means there will be “little margin for error” in the latest results, according to Gilbert.

“It’s been all about AI, with Microsoft chasing the tail of Nvidia Corp (NASDAQ: NVDA), looking to capture the first adoption benefits. 

“Microsoft has invested significantly, from its big stake in Chat-GPT pioneer Open AI to AI chips and a copilot AI subscription service.”

The quarterly report will provide an update on how much customers are spending on artificial intelligence and Microsoft’s cloud computing service Azure.

“The consensus is for earnings to rise by 20%, whilst revenue is seen climbing by 16%, the highest growth for two years.”

3. Netflix quarterly results

After getting hammered in 2022 in a post-pandemic hangover, Netflix Inc (NASDAQ: NFLX) shares have roared back to the tune of 54% over the past 12 months.

“This resurgence is partly thanks to its new advertising plan and crackdown on password sharing,” said Gilbert.

“Netflix has also stepped up its games service, adding the world-renowned Grand Theft Auto, which should provide a boost in the quarter.”

Analysts consensus is that it could be a blockbuster quarterly report from the streaming giant with nine million net subscribers added, added Gilbert, and revenue expected to see the fastest growth in three years.

“The focus for the quarter is likely to be on the outlook for the full year 2024, with consumer spending set to slow, and investors wanting to see strong profit growth with subscribers now at record levels.”

The post 3 things ASX investors should watch this week appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy next week
• Here’s how the ASX 200 market sectors stacked up this week
• Goldman Sachs says these blue chip ASX 200 shares are top buys
• Better AI stock: Microsoft vs. Amazon
• Is the ResMed share price in the buy zone ahead of next week’s update?

Motley Fool contributor Tony Yoo has positions in Microsoft and ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Apple, Microsoft, Netflix, Nvidia, and ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool Australia has recommended Apple, Netflix, and Nvidia. 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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At the start of each week, I like to look at ASIC’s short position report to find out which shares are being targeted by short sellers.

This is because I believe it is well worth keeping a close eye on short interest levels as high levels can sometimes be a sign that something isn’t quite right with a company.

With that in mind, here are the 10 most shorted shares on the ASX this week according to ASIC:

• Pilbara Minerals Ltd (ASX: PLS) remains the most shorted ASX share after its short interest rose slightly week on week to 21.4%. Short sellers don’t seem to believe that lithium prices will be rebounding any time soon.
• Syrah Resources Ltd (ASX: SYR) has short interest of 15.7%, which is up week on week. Weak graphite prices mean that Syrah is currently limiting production from its Balama operation to save cash.
• Core Lithium Ltd (ASX: CXO) has short interest of 12.8%, which is down week on week. Much like Syrah, this lithium miner has announced plans to suspend production to conserve cash.
• Sayona Mining Ltd (ASX: SYA) has 10.7% of its shares held short, which is up sharply week on week. Short sellers may believe that Sayona Mining will be next in line to hit pause on production.
• IDP Education Ltd (ASX: IEL) has 10.2% of its shares held short, which is up week on week. This language testing and student placement company’s shares recently hit a 52-week low. This has been driven by concerns over the impact of student visa changes and the loss of its monopoly in Canada.
• Deep Yellow Limited (ASX: DYL) has seen its short interest fall to 9%. Short sellers may be regretting this one. Booming uranium prices mean that Deep Yellow’s shares are up 35% in January.
• Genesis Minerals Ltd (ASX: GMD) has seen its short interest remain flat at 8.9%. This high level of short interest may be due to integration risks from recent acquisitions.
• Liontown Resources Ltd (ASX: LTR) has short interest of 8.5%, which is up since last week. Last week, Albemarle Corp (NYSE: ALB) sold off its stake in the lithium developer at a sizeable discount.
• Weebit Nano Ltd (ASX: WBT) has returned to the top ten with short interest of 8.3%. The smart end of town appears to believe this semiconductor company is another Brainchip Holdings Ltd (ASX: BRN). All hype and no substance (or revenue).
• Flight Centre Travel Group Ltd (ASX: FLT) has 8.3% of its shares held short, which is down week on week. Short sellers appear to believe that the market is too optimistic on the travel agent’s outlook.

The post These are the 10 most shorted ASX shares appeared first on The Motley Fool Australia.

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More reading

• Why these ASX 200 shares could rise 20% to 50%
• Are Pilbara Minerals shares a buy for that 7% dividend yield?
• Here are the top 10 ASX 200 shares today
• Why is the Deep Yellow share price missing out on today’s market rally?
• If I’d invested $10,000 in Flight Centre shares a year ago here’s what I’d have now!

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 Idp Education. 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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It was another busy week for Australia’s top brokers. This led to the release of a large number of broker notes.

Three ASX broker buy ratings that you might want to know more about are summarised below. Here’s why brokers think these ASX shares are in the buy zone:

BHP Group Ltd (ASX: BHP)

According to a note out of Goldman Sachs, its analysts have retained their buy rating on the Big Australian’s shares with a trimmed price target of $49.40. This follows the release of a slightly weaker than expected second quarter update from the mining giant last week. Although Goldman wasn’t overly impressed with the update, it has seen enough to remain positive. The broker also continues to forecast an attractive 5% dividend yield for investors in FY 2024. The BHP share price was trading at $45.73 on Friday.

IGO Ltd (ASX: IGO)

Another note out of Goldman Sachs reveals that its analysts have retained their buy rating on this battery materials producer’s shares with a reduced price target of $9.70. Goldman believes that IGO remains a good option for investors even while lithium prices are falling. It highlights that its low costs leave it well-placed to navigate the tough operating environment. Goldman also feels that it is unlikely that ongoing sales curtailments will continue beyond March. The IGO share price was fetching $7.20 at Friday’s close.

ResMed Inc. (ASX: RMD)

Analysts at Citi have retained their buy rating and $29.00 price target on the sleep treatment company’s shares. Ahead of the release of ResMed’s second quarter update next week, the broker is feeling confident. It is forecasting strong revenue growth across ResMed’s devices, masks, and software despite the emergence of GLP-1 drugs like Ozempic. The ResMed share price ended the week at $26.39.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

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More reading

• Why the BHP share price has a nickel thorn in its side
• 3 ASX 200 dividend shares I think you could safely hold for decades
• Brokers name 3 ASX shares to buy now
• Are BHP shares a buy following the miner’s Q2 update?
• Goldman Sachs says these blue chip ASX 200 shares are top buys

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor James Mickleboro has positions in ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and 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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Becoming an ASX share market millionaire is likely to be an aspiration that many readers have.

And while it might seem like you would need big money to achieve this goal, history shows that this isn’t actually the case.

If you have time on your side, then you could build a million-dollar portfolio with ASX shares even by investing modest amounts.

Becoming an ASX share market millionaire

Over the long term, the share market is delivered investors an average annual return of 10% per annum.

There’s no guarantee that it will continue doing the same in the future, but we’re going to assume that it does for the purpose of this article.

Based on that return, let’s now see how long it would take you to become an ASX share market millionaire starting from zero.

If you’re able to invest $500 into ASX shares each month and earned the market return, you would have grown your portfolio to $100,000 after 10 years thanks to the power of compounding.

But as compounding really starts to work its magic the longer you leave it, let’s now fast forward another decade and see what would happen if you continued with your $500 investments.

We’re not quite at your goal yet, but we’re getting closer. After a total of 20 years, your portfolio would have a market value of $360,000.

Let’s now skip to the end. After a total of 30 years of $500 per month investments, you would reach your goal of being an ASX share market millionaire.

This means that a 21-year-old could potentially be a millionaire by the time they are 51 years old.

Getting there quicker

There are ways to get there quicker than this.

If you have more capital to invest, it could be possible to shave some time.

Here’s a quick summary of how long different monthly amounts would take to compound to $1 million based on a 10% return per annum:

• $1,000 – 23 years
• $2,000 – 17 years
• $3,000 – 13.5 years

Overall, I believe this demonstrates that playing the patient game and investing consistently in high quality ASX 200 shares can be a very rewarding endeavour.

The post How to become an ASX share market millionaire by investing $500 a month appeared first on The Motley Fool Australia.

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More reading

• Top 10 superannuation funds for growth in 2023 revealed: Chant West
• Here’s how the ASX 200 market sectors stacked up this week
• Here are the top 10 ASX 200 shares today
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares 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 Scott Phillips.

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The Australian share market average dividend yield traditionally hovers around the 4% mark.

While this is a good yield, income investors don’t have to settle for that.

For example, analysts are forecasting bigger than average yields from the ASX dividend shares listed below. Here’s what they expect:

Rural Funds Group (ASX: RFF)

The first ASX dividend share to look at is Rural Funds. It is an agricultural property company with a quality and diverse portfolio of assets. These include almond orchards, macadamia orchards, poultry properties, vineyards, cattle properties, and cropping properties.

Many of these properties are leased by leaders in their industries on long-term agreements with built-in periodic rental increases.

Bell Potter is very positive on the company and is forecasting big yields in the near term. It expects dividends per share of 11.7 cents in both FY 2024 and FY 2025. Based on the current Rural Funds share price of $2.01, this will mean yields of 5.8% for investors.

Bell Potter has a buy rating and $2.40 price target on its shares.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX dividend share that has been tipped to provide above-average dividend yields is Universal Store. It is the youth fashion retailer behind the Universal Store and Thrills store brands.

Morgans is feeling bullish about the company’s outlook thanks to its “attractive array of medium-term growth prospects.”

It expects this to underpin fully franked dividends per share of 26 cents in FY 2024 and then 29 cents in FY 2025. Based on the current Universal Store share price of $4.10, this will mean yields of 6.3% and 7.1%, respectively.

Morgans has an add rating and $4.55 price target on its shares.

The post 2 ASX dividend shares to buy next week appeared first on The Motley Fool Australia.

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More reading

• Buy Coles and these ASX dividend stocks
• 2 ASX dividend shares with juicy yields to buy right now
• 2 ASX dividend stocks expected to pay huge yields in 2025
• Buy Telstra and these ASX dividend shares now
• 2 ASX dividend stocks that could create income forever

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 Rural Funds 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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Chant West has revealed the top 10 Australian superannuation funds with growth strategies in 2023.

Workers can choose between a variety of funds with varying investment strategies offered by their preferred superannuation provider.

For example, the classic ‘balanced’ super fund offers more exposure to defensive assets such as cash and bonds. A ‘growth’ fund is typically comprised of a higher portion of ASX shares and international shares.

Balanced funds are popular with workers close to retirement who want to preserve their super savings.

Growth funds are more suited to younger workers who are willing to take more risk to build up their super monies faster, with time available to them to offset the bad years.

Chant West says the standard ‘growth’ superannuation funds, which are comprised of 61% to 80% growth assets like ASX shares, delivered a median 9.9% return in 2023.

This follows a 4.6% loss in 2022 and is the 11th positive return in the past 12 years. This return also comes in well above the typical target return of 6% adopted by most growth super funds.

Chant West also reported a median 11.4% return among ‘high growth’ superannuation funds, which have 81% to 95% exposure to growth assets like ASX shares.

Balanced funds, with 41% to 60% growth assets, delivered a median 8.1% return in 2023.

Shares drive strong 2023 returns

Chant West senior investment research manager Mano Mohankumar says strong share markets created superior results for superannuation funds with growth strategies last year.

Mohankumar explains:

With share markets performing so well in 2023, the better performing funds over the year were generally those that had higher allocations to shares, particularly international shares.

International shares was the standout asset class with a tremendous 23% return over the year, led by the tech sector which benefitted from advancements in [artificial intelligence] AI.

While Australian shares didn’t reach the same level, it still delivered a healthy 12.1% over the same period.

Mohankumar noted that bonds also performed well in 2023. Australian bonds returned 5.1% and international bonds delivered 5.3%. Cash returned 3.9%.

Top 10 performing growth superannuation funds for 2023

Here are the top 10 superannuation growth funds of 2023, according to Chant West.

These returns are net of investment fees and tax but before administration fees and advisor commissions.

Fund name	Returns
Mine Super Growth	11.8%
Vision Super Balanced Growth	11.7%
IOOF Balanced Investor Trust	11.2%
Aware Super Balanced	11%
TWUSUPER Balanced (MySuper)	10.6%
HESTA Balanced Growth	10.5%
Brighter Super MySuper	10.4%
UniSuper Balanced	10.3%
Prime Super MySuper	10.3%
Australian Retirement Trust – Super Savings Balanced	10.2%

Patience is a virtue for superannuation investors

Mohankumar reminded investors that superannuation investing was a long-term game, saying:

The 2023 result is also a reward for those fund members who have remained patient and maintained a long-term focus.

And that patience has certainly been tested at various points over the past four years, a period over which super funds’ investment portfolios have proven their resilience and robustness.

They’ve shown their ability to limit the damage during periods of share market weakness …

At the same time, they’re able to still capture a meaningful proportion of the upswing when markets perform strongly, as we saw this past year.

The following chart shows the long-term performance of ‘growth’ superannuation funds with 61% to 80% exposure to growth assets like ASX shares.

We recently reported the average Aussie superannuation balance at ages 60, 65, and 70.

The post Top 10 superannuation funds for growth in 2023 revealed: Chant West appeared first on The Motley Fool Australia.

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More reading

• Here’s how the ASX 200 market sectors stacked up this week
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Many readers are hoping to enjoy a strong ASX share portfolio in retirement. It’s certainly a goal for me, even if it is many years away — reaching a cool $1 million would be wonderful.

We each will have a different timeline on when we might be able to retire with $1 million. It depends on a range of factors, such as age and the amount of money we are able to invest.

Starting from scratch with $0 would obviously take longer than starting with $100,000 or $250,000. The first $100,000 is usually the most difficult. Once the ball is rolling, it’s easier to grow wealth. A $10,000 portfolio that rises 10% only adds $1,000. A $100,000 portfolio that rises 10% would add $10,000 in value.

I’m going to talk about three of my favourite picks that could deliver good growth over the long term.

TechnologyOne Ltd (ASX: TNE)

This ASX tech share describes itself as Australia’s largest enterprise software company, with locations across six countries. It provides a global software as a service (SaaS) enterprise resource planning (EPR) solution that “transforms business and makes life simple” for customers.

TechnologyOne has 1,300 leading corporations, government agencies, local councils and universities as clients.

The company aims to double in size (meaning its profit) every five years. This can come from both revenue and profit growth. Not only is the number of customers increasing, but the company is doing well at growing revenue from its existing customers. The net revenue retention (NRR) was 119% in FY23, which is a strong organic growth rate. Gaining an extra 19% of revenue from existing customers is a promising sign.

At the last update, its total annual recurring revenue (ARR) was $392.2 million and it aims to grow its underlying profit before tax margin of 30% to 35% in the coming years.

The company has also steadily grown its dividend over the past decade, which is a bonus.

Over the past five years, TechnologyOne shares have delivered total shareholder returns (TSR) of an average of 18% per annum.

Betashares Global Quality Leaders ETF (ASX: QLTY)

This exchange-traded fund (ETF) is all about investing in quality businesses from around the world.

I think the global share market has proven what a good wealth-creator it can be. I’d encourage most investors to get exposure to businesses outside Australia, and the QLTY ETF could be the way to do it.

It invests in businesses that rank well on four characteristics – return on equity (ROE), debt to capital, cash flow generation ability and earnings stability. I think this is a powerful combination.

Around two-thirds of the portfolio is from the United States, with other countries like Japan, the Netherlands, France and Denmark having good representation with the allocations.

Past performance is not a guarantee of future returns, but the index the QLTY ETF tracks has returned an average of 14.6% per annum over the past decade, and the ETF has returned 15.4% per annum in the last five years.

Johns Lyng Group Ltd (ASX: JLG)

This ASX share specialises in rebuilding and restoring a variety of properties and contents after damage by insured events, including impact, weather and fire events.

With Johns Lyng growing its exposure to catastrophe work, its scale, revenue and profits are increasing. There are strong tailwinds here, considering there seems to be an increasing number of damaging and costly storms.

I also like that the business is expanding into areas where it can create synergies, such as body corporate/strata services and repairs, as well as electrical, gas and fire safety and compliance. These areas also come with more defensive and consistent earnings.

Over the past three years, Johns Lyng shares have delivered an average return per annum of around 30%.

Get to $1 million in retirement with ASX shares

I’m not sure what the returns of these three potential investments will be in the future – and it’s important to build a diversified portfolio – but I do think they all have the ability to outperform over the long term.

Starting at $0, if someone can invest $1,500 per month and the portfolio returns an average of, say, 12% per annum, it would be worth $1 million in 18 years. That sounds like an exciting possibility to me.

The post Want $1 million in retirement? 3 ASX shares I think could make it happen appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Johns Lyng Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Johns Lyng Group and Technology One. The Motley Fool Australia has recommended Johns Lyng Group and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Is there a more maligned S&P/ASX 200 Index (ASX: XJO) stock this century than AMP Ltd (ASX: AMP)?

The financial services provider, especially in the past half-dozen years, has lurched from one scandal to another.

There were unfavourable findings from the financial industry Royal Commission, legal action from multiple parties, and the retention of an executive accused of sexual harassment, just to name a few of the bad memories.

The market has responded accordingly, sending the AMP share price plunging more than 80% since February 2018. The stock now trades in the mid-90 cent zone.

Due to all these troubles, the leadership at AMP is occupied by different faces to what it was just five years ago.

So can investors look forward to a turnaround in 2014, or will AMP shares set a new all-time low?

Not much love for AMP shares, even at this price

Probably the biggest observation to make for AMP shares is that hardly any fund manager or analyst talks about it these days.

It seems very few professional portfolios have the stock on their books.

AMP has always had a disproportionately high number of retail investors. That’s because when it demutualised and listed on the ASX in 1998, all previous customer-owners received shares.

Nevertheless, it’s not a great sign when no professional investor is willing to give an ASX 200 stock a run, even as a contrarian play.

This aversion is reflected on CMC Invest, which surveys the sentiment of analysts that keep an eye on AMP.

Currently, there is only one out of 10 experts rating the stock as a buy, and even that’s a low-conviction “moderate” buy.

The rest are either urging sell or hold.

How low can it go?

So how bearish is the market on AMP?

Will it crash to just 80 cents this year, which would mark a new all-time low?

It could get close.

In November, UBS Group AG (SWX: UBSG) analysts downgraded its target price for AMP shares to just 82 cents.

At about the same time, the team at Citigroup Inc (NYSE: C) reduced its 12-month expectations to 90 cents, which is not far off the mark already.

The post Could AMP shares crash to 80 cents in 2024? appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why did the AMP share price sink almost 30% in 2023?
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Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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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If you’re looking for big returns, then your search could be coming to an end.

That’s because the three ASX 200 shares below have been named as buys and tipped to rise more than 20% over the next 12 months.

To put that into context, if these analysts are on the money with their recommendations, this would turn a $20,000 investment into at least $24,000 by the end of the year.

Let’s now see which ASX 200 shares are being tipped as buys:

Flight Centre Travel Group Ltd (ASX: FLT)

The team at Morgans sees plenty of upside potential for this travel agent giant.

Particularly given its “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.”

Morgans has an add rating and $26.00 price target on its shares. This implies that its shares could rise almost 24% from current levels.

Lifestyle Communities Ltd (ASX: LIC)

Another ASX 200 share that has been tipped to rise strongly is Lifestyle Communities. It is one Australia’s leading land lease communities developers.

Goldman Sachs is feeling very bullish about its outlook over the coming years. It notes that “significant cash flow is poised to be unlocked as LIC moves from net development to net settlement in 2H24E.

Goldman has a buy rating and $25.25 price target on its shares. This equates to a return of almost 50% for investors over the next 12 months.

Mineral Resources Ltd (ASX: MIN)

Finally, analysts at Bell Potter continue to believe that mining and mining services company Mineral Resources is an ASX 200 share to buy.

It points out that “MINs businesses are in a period of significant growth. Over the next two-years Lithium and Iron Ore production quantities will grow substantially, accompanied by associated increases in contracted Mining Services volumes.”

Bell Potter has a buy rating and $90.00 price target on its shares. This implies potential upside of 55% for investors.

The post Why these ASX 200 shares could rise 20% to 50% appeared first on The Motley Fool Australia.

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More reading

• If I’d invested $10,000 in Flight Centre shares a year ago here’s what I’d have now!
• Why I’d consider buying Mineral Resources shares to tap into Kali Metals
• My top ASX lithium stock to buy and hold while waiting for the next boom
• These are the 10 most shorted ASX shares
• These 3 ASX 200 shares are ‘significantly undervalued’ by the market

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has recommended Flight Centre Travel 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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