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There is an impression among many investors that big riches can only be achieved with ASX growth shares.

But that can’t be further from the truth. There are multiple paths to the promised land.

The fact is that strong returns are possible with ASX dividend shares.

Let’s take a look at how you could turn $5,000 into $50,000 this way.

Compounding is like magic

The way to grow your portfolio using dividend stocks is to utilise the magic of compounding.

So rather than treat dividends as income, reinvest it immediately. This can be done manually, or automatically using a dividend reinvestment plan (DRP).

The great advantages of a DRP are that you don’t need to worry about execution, the share purchase price could be cheaper than market value, and there is no brokerage fee.

This means that an initial $5,000 outlay could balloon into $50,000 after 27 years if a 9% yield is continually reinvested.

Not bad. 

But in reality, $50,000 could be reached much faster.

There are three ways the returns could be supercharged:

• Franking: Australian investors are lucky enough to have this tax benefit if you pick stocks for certain companies that have already paid company tax.
• Capital growth: If you pick the right dividend stocks, the share price itself may rise to provide extra returns.
• Regular contributions: You don’t have to stop at $5,000! If you add a small amount to the portfolio every once in a while, it makes a huge difference to the end result.

After franking and capital growth, let’s assume you can bump up the annual returns from 9% to 12%. Then let’s say you chip in $100 each month.

That way you’ll turn $5,000 into $50,000 in just over 12 years.

Amazing. That’s the power of compounding.

3 ASX dividend shares that could land you a 10-bagger portfolio

So which are the best dividend stocks to buy now to achieve such returns?

Remember, that blindly picking the ASX shares with the highest dividends is asking for trouble.

One must balance decent yield with positive business prospects. You don’t want the share price to shrink over time, nor do you want the dividends to collapse because the company is in financial trouble.

Here are three suggestions that fit the bill: McMillan Shakespeare Ltd (ASX: MMS), Australian Clinical Labs Limited (ASX: ACL), and Ampol Ltd (ASX: ALD).

McMillan Shakespeare and Ampol pay out a dividend yield of 8.64% and 8.95% respectively. Australian Clinical Labs is handing out a stunning 13.3%. They are all 100% franked.

Professional investors like the business prospects of all three companies. 

According to CMC Markets, four of five analysts currently covering Australian Clinical Labs rate the stock as a strong buy. Five of seven reckon McMillan Shakespeare is a buy, while 11 out of 12 say that about Ampol.

No analyst surveyed on CMC Markets rated any of the trio as sells.

The post 3 magnificent ASX dividend shares that could turn $5k into $50,000 appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• 12 ASX dividend shares with yields over 10%. Are they too good to be true?
• Here are the top 10 ASX 200 shares today
• Which ASX All Ords healthcare share has a 20% dividend yield?
• 11 ASX shares to buy with 4 on-trend qualities right now

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended McMillan Shakespeare. 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 Thursday, the S&P/ASX 200 Index (ASX: XJO) was on form again and pushed higher. The benchmark index rose 0.5% to 7,236.8 points.

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

ASX 200 expected to rise

The Australian share market looks set to end the week in a positive fashion following a strong night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 14 points or 0.2% higher this morning. In the United States, the Dow Jones was up 0.35%, the S&P 500 rose 0.95%, and the NASDAQ jumped 1.5%.

Xero shares rated as a buy

The Xero Limited (ASX: XRO) share price was on fire on Thursday following the release of the cloud accounting platform provider’s full-year results. The good news is that Goldman Sachs sees potential for its shares to keep rising. This morning, the broker has responded to the result by reiterating its buy rating with an improved price target of $130.00.

Oil prices fall

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a poor finish to the week after oil prices fell overnight. According to Bloomberg, the WTI crude oil price is down 1.1% to US$72.10 a barrel and the Brent crude oil price is down 1.2% to US$76.05 a barrel. A stronger US dollar weighed on prices.

Gold price tumbles

Gold shares Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) could have a tough session after the gold price tumbled overnight. According to CNBC, the spot gold price is down 1.25% to US$1,960.2 an ounce. Hawkish US Fed bets put pressure on gold.

Aristocrat still a buy

Aristocrat Leisure Limited (ASX: ALL) shares fell yesterday following the release of the gaming technology company’s half-year results. Goldman Sachs sees this as a buying opportunity and has reiterated its conviction buy rating with an improved price target of $46.70. It said: “While the market reaction to this update was weak, which we believe to be largely driven by Pixel United, the update offers incremental support to our Buy thesis.”

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

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More reading

• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• 12 ASX exchange-traded funds (ETFs) smashing new 52-week highs today
• Here’s the latest on the US debt ceiling and what it means for ASX 200 shares
• Why Nufarm, Serko, Temple & Webster, and Xero shares are charging higher

Motley Fool contributor James Mickleboro has positions in Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Xero. The Motley Fool Australia has positions in and has recommended Xero. 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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Many of the ASX 200 bank shares have taken a fall in 2023.

Isn’t that a bit strange, given interest rates have been rising at their fastest pace on record?

The banks make most of their money from lending, so aren’t rising interest rates a positive?

Let’s investigate this together.

ASX 200 bank shares lose up to 17% in 2023

First, let’s check out the state of play for the most well-known ASX 200 bank shares.

Over the year to date, here’s how these bank stocks have performed:

• The Bank of Queensland Ltd (ASX: BOQ) share price has dropped 17%
• The Bendigo and Adelaide Bank Ltd (ASX: BEN) share price has declined 10%
• The National Australia Bank Ltd (ASX: NAB) share price has tumbled 10%
• The Westpac Banking Corp (ASX: WBC) share price has fallen 8%
• The Commonwealth Bank of Australia (ASX: CBA) share price has dipped 3.2%.

Only a couple of ASX 200 bank shares are in the green. They are:

• The Macquarie Group Ltd (ASX: MQG) share price has risen 5.4%
• The ANZ Group Holdings Ltd (ASX: ANZ) share price has ascended 2.7%.

The positives of rising interest rates for ASX 200 bank shares

On the banks’ balance sheets, we see the positive impact of rising interest rates in a number of ways.

One of them is improved net interest margins (NIMs) across the board for all of these companies.

The NIM is the amount of money the banks earn from the interest they are paid by borrowers, less the interest they pay to their savings account holders.

Here’s where the NIMs are today, in descending order:

• Commonwealth Bank NIM of 2.1% for 1H FY23, up 0.23% on 2H FY22
• Westpac NIM of 1.96% for 1H FY23, up 0.05% on 2H FY22
• Bendigo and Adelaide Bank NIM of 1.88% for 1H FY23, up 0.19% on 2H FY22
• Bank of Queensland NIM of 1.79% for 1H FY23, up 0.04% on 2H FY22
• National Australia Bank NIM of 1.77% for 1H FY23, up 0.14% on 2H FY22
• ANZ Bank NIM of 1.75% for 1H FY23, up 0.07% on 2H FY22.

The negatives of rising interest rates for ASX 200 bank shares

There are actually a bunch of negatives, and a few of them are as follows.

Higher interest rates mean the banks have to pay more to deposit holders. As we all know, many banks have been slow to apply higher interest rates to savings accounts but quick to raise rates on loans.

They do this to maximise their profits by raising their NIM.

The highest savings rate available at the moment is 5.3% with the Bank of Queensland. Meantime, most homeowners are paying home loan rates in the 6% to 7% bracket now.

Secondly, the banks are highly leveraged to the Australian property market, and higher interest rates tend to lower sales volumes (meaning fewer new loans) and lower sale prices (due to less buyer demand).

This intensifies competition between the banks for a smaller pool of new loans, prompting them to fork out money on expensive incentives to attract new business, such as cashbacks.

Lastly, rising interest rates tend to boost mortgage stress, which is defined as people spending more than 30% of their income on housing costs. This tends to raise the prevalence of loan arrears and defaults.

So, while the ASX 200 banks are certainly happy to be charging more on their loans, they have to be careful to get the balance right.

The fallout of US bank collapses

Rumblings in the global banking sector are making everyone a bit nervous these days. Some commentators are saying this could be a prelude to a recession in the United States.

The silver lining is that softened prices for ASX 200 bank shares may present a buying opportunity.

Buying the dip is so much more fun when stocks are down for sentiment reasons only.

As my colleague Bernd recently wrote, Australian banks are among the world’s most capitalised, and therefore, they’re considered a pretty safe bet for ASX investors.

Are ASX 200 bank shares a buy?

There are mixed reviews among the brokers at the moment.

Their opinions boil down to their assessment of how each bank is operating, as well as their share price valuations, rather than the universal positive of higher interest rates for ASX 200 bank shares generally.

Let’s do a quick canvas of recent broker notes regarding the big four banks, as well as Macquarie.

CBA shares

The CBA share price closed on Thursday at $98.00, up 0.9%.

Citi has a sell rating on CBA shares on valuation grounds. Its 12-month share price target is $80.

UBS is neutral on Commonwealth Bank with a $100 price target.

Goldman Sachs maintains a sell rating with an $87.78 target on the CBA share price.

NAB shares

The NAB share price is currently $26.40, up 0.8% on Thursday.

Goldman Sachs nominates NAB as its favourite among ASX 200 bank shares today.

This is mainly due to NAB’s comparatively stronger commercial business. The other banks have higher residential property exposure.

The team at Goldman sees “volume momentum over the next 12 months as favouring commercial volumes over housing volumes and we believe NAB provides the best exposure to this thematic”.

Goldman has a buy rating on NAB shares and a $30.69 price target.

For extra perspective, two of our Fool scribblers went head-to-head in a Bull vs. Bear article on NAB shares recently.

Westpac shares

The current Westpac share price is $20.96, up 0.19% on Thursday.

Westpac is the preferred option of the ASX 200 bank shares for the Morgans team.

They have an add rating on Westpac shares with a 12-month price target of $24.22.

Goldman is also a Westapc fan with a conviction buy rating on the shares and a $24.67 price target.

As we revealed recently, Westpac is the preferred ASX 200 bank share in millionaire portfolios.

ANZ shares

The ANZ share price is currently $23.64, up 0.25% on Thursday.

Citi reckons ANZ is the best of the big four ASX 200 bank shares to buy now.

As my Fool colleague James reports, this is largely due to its institutional business, which Citi believes is a key differentiator.

The broker said:

We see ANZ’s unique capabilities as set to deliver relative outperformance in the current market conditions. ANZ is our preferred Major Bank exposure.

Citi currently has a buy rating and a $26.50 price target on its shares.

UBS is buy-rated on ANZ shares with a $25 price target.

Goldman Sachs has a neutral rating and a $26.17 target on the ANZ share price.

Macquarie shares

The Macquarie share price closed at $173.59 on Thursday, up 0.84%.

Morgans has an add rating and a 12-month price target of $201.80 on Macquarie shares.

Morgans comments:

MQG is a quality franchise, exposed to structural growth areas, and the company performed exceptionally well in a more difficult FY23 environment. With >10% share price upside to our price target, we continue to maintain our ADD recommendation.

Goldman has a neutral rating on Macquarie Bank shares with a $192.01 price target.

Shaw and Partners portfolio manager James Gerrish says Macquarie shares are a buy because the business offers more earnings diversification than other ASX 200 bank shares.

Gerrish says:

Ultimately, it’s the reason we like the stock. Different divisions perform differently at different times and that creates a nice level of diversification in their earnings.

As we reported recently, Macquarie has the highest profit margin of the ASX 200 bank shares.

Foolish takeaway

Higher interest rates may be a tailwind, on balance, for ASX 200 bank shares, but this doesn’t guarantee that all of them will do well in this climate.

In a clear demonstration of this, Warren Buffett recently sold some bank stocks but kept others.

So, it’s best to remain discerning when choosing which ASX 200 bank shares to hold or invest in today.

For extra reading, we compared the dividend yield and share price growth of the big four over five years.

The post With interest rates rising, why have ASX 200 bank shares been pummelled in 2023? appeared first on The Motley Fool Australia.

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More reading

• Invested $6,000 in NAB shares in November? Here’s how much passive income you’ve already banked
• Why ANZ shares are Citi’s top banking pick
• An ASX dividend giant I’d buy over CBA shares
• Investing in ANZ shares? Here’s what’s happening with the bank’s $3.5 billion Suncorp acquisition
• These ASX dividend stocks have been tipped to offer big yields

Motley Fool contributor Bronwyn Allen has positions in ANZ Group, Commonwealth Bank Of Australia, Macquarie Group, and Westpac Banking Corporation. 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 Bendigo And Adelaide Bank and Macquarie Group. The Motley Fool Australia has recommended Westpac Banking Corporation. 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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Are you looking for retirement portfolio options? If you are, then you may want to look at the quality ASX shares listed below.

Here’s why these shares could be top options for retirees:

Charter Hall Long WALE REIT (ASX: CLW)

The first ASX share to consider for a retirement portfolio is the Charter Hall Long Wale REIT.

As you might have guessed from its name, this property company invests in high quality real estate assets that have long weighted average lease expiries (WALEs). These properties are leased mainly to corporate and government tenants and had a WALE of 12 years at the last count.

This provides great visibility on its future earnings and arguably makes it a low risk option in the property space.

Citi is positive on the company and is expecting big dividend yields in the coming years. It is forecasting dividends per share of 28 cents in FY 2023 and 29 cents in FY 2024. Based on the current Charter Hall Long Wale REIT unit price of $4.33, this will mean yields of 6.45% and 6.7%, respectively.

The broker has a buy rating and $5.00 price target on its shares.

Transurban Group (ASX: TCL)

Another ASX share that could be a good option for a retirement portfolio is this leading toll road operator. Transurban owns a high-quality portfolio of roads in Australia and North America. In addition, it has a significant project pipeline that could support its growth in the future.

After being a ghost town during the pandemic, the company’s roads have bounced back strongly and traffic volumes are now booming again. They even hit record levels recently. Combined with its positive exposure to inflation, Transurban has been tipped to grow at a solid rate in the coming years.

UBS is positive on the company. It currently has a buy rating and $15.45 price target on its shares.

In addition, the broker is forecasting dividends per share of 57 cents in FY 2023 and then 61 cents in FY 2024. Based on the current Transurban share price of $14.74, this will mean yields of 3.9% and 4.2%, respectively.

The post Analysts name 2 excellent ASX shares for a retirement portfolio appeared first on The Motley Fool Australia.

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More reading

• Analysts name 2 strong ASX 200 dividend shares to buy
• Here are 2 growing ASX dividend shares for income investors to buy: analysts
• 5 ASX shares I’d buy for a US recession
• Top defensive ASX shares to buy in May 2023
• Citi rates these ASX dividend shares as buys

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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More than one expert reckons these days that ASX shares in the uranium industry are about to enjoy a revival not seen for years.

The Market Matters team, for example, reckons it’s a sector with “meaningful tailwinds that are likely to persist for years to come”.

“The global energy mix is changing as decarbonisation is one of, if not, the most dominant investment theme[s] for the next decade,” said the team leader and Shaw and Partners portfolio manager James Gerrish.

“We believe nuclear energy will become a larger slice of the energy mix, and we are seeing tangible evidence of this occurring.”

He noted that year to date almost 100 million pounds of uranium have been contracted, which is already the highest yearly amount for more than a decade.

Funnily enough, the spot uranium price has held steady over the past 12 months, which means related stocks have also gone sideways.

But, of course, both nuclear reactors and uranium mines take a while to reactivate after being dormant for years.

Over the long term, Gerrish’s team are believers.

“Market Matters is bullish on uranium, believing the sector is about to enjoy a period of renaissance.”

But which ASX uranium shares are the best buys at the moment? There are two that were mentioned:

Two well-funded Aussie businesses ready to rake it in

Paladin Energy Ltd (ASX: PDN) is Gerrish’s “preferred pick from a risk-reward perspective”.

“The company owns 75% of the Langer Heinrich mine in Namibia that had been [in] care and maintenance for a number of years,” he said.

“However, works for a restart are now ~50% complete with first production expected next year.”

While more agile mines might produce uranium earlier than that, Paladin will have economies of scale to its advantage.

“They are well-funded, and construction is on time and on budget with further upside in exploration assets in Australia and Canada.”

The Paladin Energy share price is down 3% so far in 2023.

Gerrish’s team already owns the stock in its emerging companies portfolio.

His team’s second pick, Silex Systems Ltd (ASX: SLX), is not a uranium producer as such.

“Silex is developing a laser-enriched uranium technology in conjunction with sector giant Cameco Corp (NYSE: CCJ),” said Gerrish.

“The demonstration plant in Kentucky is expected to be up and running in around 12 months’ time.”

He added that Silex is cashed up after a capital raise this year.

“The US government is also likely to support any capital requirements as part of the inflation reduction act,” said Gerrish.

“Supply of High Assay Low Enriched Uranium (HALEU), which the next generation of nuclear reactors require, is heavily reliant on Russia.”

Silex shares are already 12% higher than where they started 2023. 

Again, the Market Matters team is bullish and long on the stock, holding it in its emerging companies portfolio.

The post The 2 best ASX uranium shares to buy right now appeared first on The Motley Fool Australia.

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More reading

• Down 20% since February, should I buy the dip on Paladin Energy shares?
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• 3 ASX 300 shares that turned $5,000 into $59,000 or much more in 5 years
• Here are the top 10 ASX 200 shares 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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One expert is urging investors go “long and bullish” on an ASX stock that’s already rocketed this week.

Shaw and Partners portfolio manager James Gerrish said his Market Matters team likes the look of construction materials supplier James Hardie Industries plc (ASX: JHX).

The stock soared 8.3% on Tuesday after its fourth-quarter results “pleased a nervous market”.

“Encouragingly its 1Q24 guidance was a clear beat – at the midpoint they have guided to 1Q profit of US$155 million vs US$137 million consensus — i.e. 13% above,” Gerrish said in his newsletter.

“In our opinion, the key positive was US margins remained solid and their guidance implies this will continue which will drive earnings upgrades.”

Amid dark clouds for the economy, James Hardie showed off its pricing power by pulling off an amazing magic trick.

“While James Hardie has experienced a drop in sales volumes as the building sector struggles, the company’s ability to increase prices has seen revenues actually increase,” said Gerrish.

“The volume of plasterboard/cladding sold in Australia & New Zealand fell by 10%, but revenue increased by 2% as price increases were pushed onto customers in the March quarter.”

Grab James Hardie shares while they’re cheap

With consumers dealing with interest rates more than three percentage points higher than just a year ago, real estate prices have spiralled down and the construction industry is feeling the pressure.

This presents a tempting buying opportunity, according to Gerrish.

“With plenty of bad news built into James Hardie’s share price after it halved from its late 2021 high, Market Matters remains optimistic towards Hardies,” he said.

“The company is operating well in a tough environment hence when the construction sector does show signs of improvement, James Hardie will be very well positioned to benefit.”

Within Australia, Gerrish feels like conditions will improve for the company and the wider building industry.

“The government committed to a large immigration push plus, of course, they have a huge rental crisis to address sooner rather than later,” he said.

“Although this is unlikely to support the weak construction industry over the coming months, we must be conscious that stocks look at least six months ahead.”

Despite the spectacular rise this week, James Hardie shares are still about 35% lower than their December 2021 high.

The post Go ‘long and bullish’ on this ASX share that just rocketed 8% appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Top brokers name 3 ASX shares to buy today
• 3 ASX 300 shares just upgraded by top brokers
• Here are the top 10 ASX 200 shares today
• Why Develop Global, James Hardie, Life360, and Ora Banda shares stormed higher

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 your portfolio lacks banking sector exposure, then now could be the time to pounce on ANZ Group Holdings Ltd (ASX: ANZ) shares.

With the banking giant’s shares down approximately 10% over the last three months, the team at Citi appear to believe a buying opportunity has opened up for investors.

Particularly given that ANZ shares are the broker’s top pick in the banking sector right now.

What is Citi saying about ANZ shares?

According to a recent note, the broker has a buy rating and $26.50 price target on the bank’s shares.

Based on its current share price of $23.58, this implies potential upside of 12.4% for investors over the next 12 months.

And with Citi expecting ANZ shares to provide investors with 7% fully franked dividend yields through to at least FY 2025, the total 12-month potential return on offer here stretches to almost 20%.

Why is ANZ its top pick?

When reviewing the bank’s recent half-year results, Citi revealed why it thinks investors should choose ANZ above other big four banks. It said:

ANZ reported 1H23 cash earnings of $3,821m, in-line with market expectations. However, unlike its recent reported peers, this result was well-received, despite ANZ facing the same competitive pressures on both sides of its balance sheet. We see ANZ having two key advantages for the current environment: 1) a strong deposit franchise finally showing its strength; and 2) a large weighting to Institutional banking.

These advantages are inextricably linked. We have lowered our forward NIM estimates to reflect the industry competition pressure, but the profile shows a more modest decline. Cash EPS estimates are unchanged in FY23, down 7-8% in FY24/25, with our longer-term ROE of 10.5% thereafter remaining intact. This leaves a more modest 3% TP reduction to $26.50. We see ANZ’s unique capabilities as set to deliver relative outperformance in the current market conditions. ANZ is our preferred Major Bank exposure.

All in all, this could make ANZ a top option to consider if you’re lacking banking sector exposure.

The post Why ANZ shares are Citi’s top banking pick appeared first on The Motley Fool Australia.

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More reading

• Investing in ANZ shares? Here’s what’s happening with the bank’s $3.5 billion Suncorp acquisition
• Citi says these ASX 200 dividend shares are buys for passive income
• Warren Buffett is dumping bank stocks. Should you?
• Why ANZ, Elders, Nanosonics, and Pointsbet shares are falling today
• Why is the ANZ share price sinking 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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Sayona Mining Ltd (ASX: SYA) shares have climbed more than 10% in the last month, but which ASX All Ords lithium company is the largest shareholder?

Sayona shares closed 4.44% lower on Wednesday to finish at 21.5 cents apiece. For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) fell 0.98% yesterday.

Let’s take a closer look at the details of the largest shareholder of Sayona Mining stock.

And the largest shareholder is…

Fellow lithium player Piedmont Lithium Inc (ASX: PLL) is the largest shareholder of Sayona stock with a 14.3% stake.

The two companies are involved in a joint venture known as the North American Lithium (NAL) project.

Piedmont has a 25% stake in Sayona Quebec, with the other 75% equity interest owned by Sayona. Sayona Quebec is developing the North American Lithium mine.

Under the joint venture agreement, Sayona will sell Piedmont either 50% of production at the facility or 113,000 tonnes of spodumene concentrate.

Four shipments from this project are planned for the second half of the 2023 calendar year.

Each shipment will include an allocation for Piedmont, along with other customers. The company is also working on other offtake agreements.

Sayona and Piedmont delivered news of the successful restart of the North American Lithium mine, based in Quebec, on 31 March.

The US$80 million restart took place on time, and on budget. Sayona aims to produce 226,000 metric tonnes of spodumene per year from the facility.

A pre-feasibility study assessing downstream production at the project is currently taking place with results expected by the end of the financial year.

Piedmont also has other lithium projects on the go, including the Tennessee Lithium project and the Carolina Lithium project in the US state of North Carolina.

Share price snapshot

The Sayona share price has lost around 20% in the last year. The company has a current market capitalisation of $1.96 billion.

Meantime, Piedmont shares have gained nearly 12% over the past 12 months. Piedmont has a market cap of nearly $366 million.

The post Guess which All Ords lithium company is the biggest shareholder of Sayona Mining stock appeared first on The Motley Fool Australia.

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More reading

• Here are the 3 most heavily traded ASX 200 shares on Wednesday
• Are ASX 200 lithium shares approaching a ‘tipping point’ for ripper revenues?
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• Power portfolios: Millionaire investors shun ASX 200 lithium shares

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

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The Goodman Group (ASX: GMG) share price has been in fine form this year.

Since the start of 2023, the ASX 200 industrial property stock has risen a sizeable 15.5%.

Can this ASX 200 stock keep rising?

The good news for investors is that one leading broker doesn’t believe it is too late to jump on the Goodman train.

A recent note out of Citi reveals that its analysts have retained their buy rating with an improved price target of $24.30.

So, with this ASX 200 stock currently trading at $20.04, this still implies potential upside of 21% for investors over the next 12 month despite its stellar gains this year.

Why is Citi raving about Goodman?

Citi has become even more positive on Goodman shares following its recent quarterly update. The broker notes that this update demonstrates that industrial property continues to be the bright spot in real estate.

And while its updated guidance is still a touch behind the broker’s estimate, it is worth remembering that Goodman is usually conservative with these things. Citi commented:

Along with the 3Q23 update, GMG upgraded FY23 EPS guidance to 15% EPS growth from 13.5%, which was almost in-line with consensus but slightly below our previous estimate. The update highlighted ongoing tailwinds for industrial with strong market rent growth improving the future rental upside on GMG’s book. Record low vacancy has driven ongoing development demand resulting in a strong development workbook with $13bn in WIP, with near-term growth in developments from less time taken to develop (which will boost annual earnings).

Looking ahead, the broker believes this ASX 200 stock is well-placed for more of the same in the coming years. In light of this and its attractive valuation, the broker feels Goodman is a top buy right now. It concludes:

We see potential for GMG to generate consistent high-single to low-double digit earnings growth over the medium term driven by rental upside and longer term development projects, which will add to management and development earnings. The stock currently trades at c. 19x FY24e, below global industrial peers, despite having higher earnings growth and lower leverage. We therefore see upside to the share price and retain Buy.

The post Why Citi is raving about this amazing ASX 200 stock appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 blue chip shares that brokers love
• ‘Bright outlook’: 2 ‘high quality’ ASX 200 shares to pounce on now 
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• 2 ASX 200 stocks surging ahead following guidance upgrades

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 recommended Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Vanguard Australian Shares Index ETF (ASX: VAS) is an exchange-traded fund (ETF) that gives investors the ability to invest in ASX blue chip shares. There are a number of reasons why it could help someone retire early – low fees, diversification, and compounding.

Its job is to track the S&P/ASX 300 Index (ASX: XKO) which is a group of 300 of the largest businesses in Australia. The VAS ETF also has a portfolio of (around) 300 holdings.

Just looking at the number of businesses in the portfolio suggests good diversification. Certainly, having sufficient diversification is one of the important elements in lowering risk. But there’s more to diversification than just the number of holdings. It’s also important to consider what types of businesses the fund is invested in.

Strong exposure to the Australian economy

When we look at the biggest businesses in the Vanguard Australian Shares Index ETF portfolio, they are mainly from two sectors that Australia excels at – resources and banking.

Most people will be familiar with the names I’m about to mention: BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), Westpac Banking Corp (ASX: WBC), ANZ Group Holdings Ltd (ASX: ANZ), Macquarie Group Ltd (ASX: MQG), Woodside Energy Group Ltd (ASX: WDS), Rio Tinto Ltd (ASX: RIO), and Fortescue Metals Group Ltd (ASX: FMG).

At the end of April 2023, more than 51% of the VAS ETF portfolio was invested in just financials and materials. That’s probably not surprising considering how many resources Australia sells and how important the property market is for the economy.

But there are advantages and disadvantages to this high level of exposure to those sectors.

Many of these businesses have fairly low price/earnings (p/e) ratios and quite high dividend payout ratios. This usually results in a rewarding dividend yield for investors. According to Vanguard, the VAS ETF has a dividend yield of 4.4.%, which doesn’t include the franking credits.

However, these sorts of businesses aren’t known for strong capital growth and, as such, the compounding potential might be less. If I were looking to retire early, I’d want to try to grow my nest egg with a good amount of capital growth. Remember, dividends are taxable when received each year, assuming that person has a tax rate of more than 0%.

Let’s compare the returns of the Vanguard Australian Shares Index ETF against one of Vanguard’s other main ETFs – the Vanguard MSCI Index International Shares ETF (ASX: VGS).

Lower returns

Past performance is not a reliable indicator of future performance, but I think we can see the difference between a more growth-focused ETF like the VGS ETF (purple) and the ASX blue chip-focused VAS ETF (blue).

Let’s also look at how the VAS ETF unit price has changed since COVID-19 – it’s currently almost where it was just before COVID-19 hit, whereas the VGS ETF has gained around 15%.

Over the five years to April 2023, the Vanguard MSCI Index International Shares ETF has returned an average of 11.1%, with 8.7% of that per annum being capital growth.

In the five years to April 2023, the Vanguard Australian Shares Index ETF has returned 8.2% per annum, with over half of that (4.7%) being distributions (which are taxed). However, that level of returns can still deliver decent wealth-building for investors and the unit price of around $90 could be a good starting point for investing.

I’m certainly not saying that VAS ETF is a terrible investment. But for investors trying to grow their wealth for retirement, I think there could be better options. However, I will say that Vanguard Australian Shares Index ETF is an effective way to invest in the Australian economy for a low management fee of just 0.10%.

But I’d look to other ETFs as potentially better investment options for longer-term growth.

The post Could buying the Vanguard Australian Shares Index ETF (VAS) at under $90 help me retire early? appeared first on The Motley Fool Australia.

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More reading

• Millionaire magnet: Why are wealthy investors pouncing on the Vanguard Australian Shares Index ETF (VAS)?
• I’m a dividend investor. Should I buy the Vanguard MSCI Index International Shares ETF (VGS)?
• The top 10 ASX shares held by millionaires
• Why is the Vanguard Australian Shares Index ETF (VAS) still below its pre-COVID high?
• Was the Vanguard MSCI Index International Shares ETF (VGS) worth owning in April?

Motley Fool contributor Tristan Harrison has positions in Fortescue Metals Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Vanguard MSCI Index International Shares ETF. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Vanguard MSCI Index International Shares ETF and Westpac Banking Corporation. 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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