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Appen Ltd (ASX: APX) shares had been strongly outperforming in 2023.

Right up until market open this morning.

At yesterday’s close, shares in the artificial intelligence (AI) data services company had gained an impressive 31% year to date.

That strong four-month run for Appen shares came to an end following the release of the company’s trading update.

Appen shares have tumbled 25.08% today on those results, leaving the stock essentially flat in 2023.

Why are Appen shares tumbling on the trading update?

The AI stock enjoyed five years of phenomenal growth after listing on the ASX in January 2015.

Early investors who sold at the 21 August 2020 highs of $40.08 per share will have booked gains of 6,500%, or more.

ASX investors who bought Appen shares at those highs are today nursing losses of 94%.

While things were looking up for the tech stock over recent months amid the emergence of ChatGPT, that hype hasn’t shown up in the past four months’ financials.

Appen reported a 21.4% year-on-year decrease in revenue, which dipped to $96 million. That saw gross profits drop 24.7% to $36 million.

And underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) in constant currency terms went from $8 million in the prior corresponding to period to a loss of $12 million in the first four months of 2023.

As you’d expect, Appen is looking to cut costs where it can. The company reported its previously identified cost savings of some US$10 million will be achieved in FY23.

Management also indicated “a series of significant measures” to achieve an additional US$36 million of cost savings would be achieved over the course of the financial year.

With those measures in mind, and Appen shares down more than 25% today, is the AI stock finally cheap enough to buy?

A bargain or a falling knife?

For some greater insight into that question, we defer to the analysts at Wilsons (courtesy of The Australian).

With Appen’s operating costs increasing faster than its revenue growth in 2021, Wilsons supported the cost savings measures.

But the analysts noted this may leave the door open for the competition.

According to Wilsons:

We remain cautious however on whether this cost out program will result in a further deterioration in sales or underinvestment in its technology/product offering leading to a catch-up from competitors.

Wilsons now has an underweight rating on Appen shares with a $2.11 price target.

That implies an 11.7% downside to the current price of $2.39 per share.

The post Are Appen shares finally cheap enough to buy following today’s nosedive? appeared first on The Motley Fool Australia.

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More reading

• Appen share price crashes 22% amid ‘materially’ declining revenue
• Why Appen, Megaport, Mirvac, and Pilbara Minerals shares are pushing higher today
• Down 60% in a year, are Appen shares a bargain buy?

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Appen. 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 share price of S&P/ASX 200 Index (ASX: XJO) lithium favourite Liontown Resources Ltd (ASX: LTR) is soaring once more on Wednesday, leaping to hit yet another record high.

The stock peaked at $2.97 earlier in today’s session, marking a 3.48% improvement on its previous close.

Though, it hasn’t managed to hold onto its gains. Right now, the Liontown share price is $2.91, 1.39% higher than it was at the end of Tuesday’s session.

For comparison, the ASX 200 has slumped 0.31% at the time of writing.

It marks the third time this month the company’s stock has posted an all-time high. So, what’s been going right for the ASX 200 lithium share? Let’s take a look.

What’s been going right for the Liontown share price?

It’s been an exciting few months for Liontown in many respects. The company has made strides with its flagship Kathleen Valley lithium project and batted away a takeover bid from industry giant Albemarle.

On the former, the company announced it had kicked off open pit mining at the project in February, catapulting it from explorer to miner.

Construction at the project has since continued, with first production on track for mid-2024.

The milestone might have enticed lithium giant Albemarle to throw a $2.50 per share takeover bid at Liontown in late March. The ASX 200 company, however, wasn’t playing ball.

It rejected the offer and the market catapulted its share price a whopping 67% in response.

The stock was boosted once more last week when the company shut down rumours it had been approached with a new takeover offer.  

It’s also worth noting that shorting of Liontown shares has reduced dramatically in recent months. After peaking at 9.1% in March, the stock’s short interest has plunged to 5% at last count.

And it’s little wonder why. The Liontown share price has more than doubled since the start of this year, having risen 137% year to date. That likely dinted the wallets of some short sellers.

Meanwhile, the ASX 200 has gained 4% since the start of 2023.

The post Liontown share price cracks yet another all-time high on Wednesday appeared first on The Motley Fool Australia.

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More reading

• Top broker tips 7 ASX 200 property-related shares to cash in on the 2023 budget
• ASX 200 stock Technology One halted following cyber attack
• Keen for $1,000 of monthly passive income? Buy 38,462 shares of this ASX 200 stock
• 3 ASX 200 building shares that could rise now that house prices have bottomed
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Brooke Cooper 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 Vanguard Australian Shares Index ETF (ASX: VAS) is a popular investment on the ASX. So popular in fact, that it is the largest exchange-traded fund (ETF) on the ASX by funds under management.

ASX investors typically choose the VAS ETF for its broad exposure to the share market, with its portfolio of the 300 largest publically-traded Australian shares.

But for eagle-eyed investors, something might seem amiss when looking at the VAS share price.

This ETF is still trading under its pre-COVID high. Back in February 2020, VAS hit $90.55 a unit. Today, this ETF is currently trading at $90.31. So it doesn’t look like this ETF has gone anywhere in more than three years: 

That might be a little disappointing, seeing as investors typically choose to invest in an index fund like the Vanguard Australian Shares ETF in order to snag a real return on their money that exceeds what they might get at a bank.

So why is this ETF still where it was more than three years ago?

Why is the VAS share price where it was three years ago?

Well, the answer is a little more complex than it might seem. In the simplest terms, VAS’s ASX units are where they were in February 2020 because the index that the ETF tracks, the S&P/ASX 300 Index (ASX: XKO), is around that same level as well

Of course, both the VAS ETF and the ASX 300 have had a very volatile few years between 2020 and 2023, mostly thanks to the 2020 COVID crash.

But comparing where the Vanguard Australian Shares ETF was in February 2020 and where it is today is not capturing the entire picture. It has not been a zero-sum game for investors of this ETF over the past three and a bit years at all. In fact, in the three years to 28 February 2023, investors enjoyed an average annual gain of 8% from this ETF.

How does that work, if the VAS unit price barely changed over those three years? The answer is dividends.

Because the Vanguard Australian Shares ETF holds 300 ASX shares within its portfolio, it receives any dividends that these shares payout. The ETF then passes through these dividends to its investors in the form of quarterly distributions.

In the 2020 calendar year, investors in the fund received a total of $1.88 in dividend distributions per unit. In 2021, it was $3.43 per unit, which rose to $6.36 in 2022.

So that’s where the approximate 8% per annum return that this ETF’s investors have enjoyed over the past three years or so has come from. When it comes to ASX ETFs like VAS, this just goes to show how important dividend returns are for investors.

The post Why is the Vanguard Australian Shares Index ETF (VAS) still below its pre-COVID high? appeared first on The Motley Fool Australia.

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More reading

• Better investment: Vanguard Australian Shares ETF (VAS) or a term deposit?
• My 5-step plan to achieving $500 in monthly passive income
• If you’d invested $5,000 in the Vanguard Australian Shares Index ETF (VAS) after the COVID crash, here’s much you’d have now
• 5 dividend shares I think are among the safest on the ASX
• I think this underrated reason is key to why ETFs can be great investments

Motley Fool contributor Sebastian Bowen has positions in Vanguard Australian Shares Index ETF. 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 2023 federal budget is in.

Among the key measures, Treasurer Jim Chalmers unveiled $14.6 billion in spending to assist households and small businesses with cost of living increases.

Millions of largely lower-income Aussies stand to benefit from that part of the 2023 federal budget.

Among the policies, there is a $40 fortnightly boost to JobSeeker, Youth Allowance, and Austudy, as well as $500 of rebates to five million low-income households as part of the $1.5 billion Energy Relief Fund.

However, more stimulus spending from the 2023 federal budget isn’t going to help Australia tamp down its stubbornly high inflation.

Which means the odds of yet another interest rate increase from the Reserve Bank of Australia (RBA) have just gotten a lot higher.

ASX 200 shares could face renewed pressure in June

That’s something to keep an eye on when investing in S&P/ASX 200 Index (ASX: XJO) shares.

As you’re likely aware, the RBA hiked rates for the 11th time in 12 months on 2 May. That took Australia’s official cash rate to 3.85%. Only one year earlier, the cash rate stood at an all-time low of 0.10%.

Immediately following the RBA’s unexpected interest rate boost, the ASX 200 tumbled 1%.

The RBA’s next interest rate decision will be announced on 6 June.

Here’s what these experts are saying on the 2023 federal budget’s likely impact on the central bank’s upcoming rate calls.

Will the 2023 federal budget usher in another RBA rate hike?

Up first, we have Treasurer Jim Chalmers.

Chalmers, as you’d expect, doesn’t believe the 2023 federal budget is inflationary. According to Treasury forecasts, Australia’s inflation rate will drop back into the RBA’s target range of 2% to 3% in 2025.

But the analysts at Citi don’t concur.

While measures like the Energy Relief Fund, and subsidies for child care and rental assistance, will decrease headline inflation, the broker pointed out that this will also put more money in households’ pockets.

According to Citi (courtesy of The Australian Financial Review), “Therefore, the impact on underlying inflation is ambiguous, and risks remain tilted to the upside because households could spend more because of subsidies.”

Citi reaffirmed its forecast for another 0.25% rate hike from the RBA in June.

BetaShares chief economist David Bassanese went a step further, calling the 2023 federal budget “unambiguously expansionary”.

With lower-income households generally more prone to spend extra income than save it, Bassanese said the budget is likely to fuel consumer demand rather than slow it.

“Hence, this is why it would have been beneficial to introduce other offsetting budget tightening measures at the same time,” Bassanese said.

BetaShares believes the budget has increased the chances ASX 200 investors will see at least one if not two more rate hikes from the RBA this year.

Joining the rate hawks in the wake of the 2023 federal budget is Goldman Sachs. With many households’ disposable incomes boosted by the budget and Australia’s immigration levels seeing the population swell, Goldman expects a 0.25% rate lift in July, or possibly in June.

UBS also believes the RBA will lift rates by another 0.25% at least one more time this year, most likely in July.

“Indeed, despite a rapid fiscal consolidation of the budget position in 22/23, the overall stance of the budget outlook is still stimulatory,” UBS economist George Tharenou said (quoted by the AFR).

That tends to be the thing with federal budgets. They give with one hand and take away with the other.

At the end of the day, after all, it’s the taxpayers’ money they’re reallocating.

The post Did the 2023 federal budget just lock in another RBA rate rise? appeared first on The Motley Fool Australia.

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More reading

• ASX hydrogen shares surge on 2023 federal budget $2b cash splash
• Bubs share price ricochets following CEO sacking
• UBS tips 4 ASX 200 retail shares to benefit from the federal budget
• Why is the NAB share price tumbling 4% on Wednesday?
• Top broker tips 7 ASX 200 property-related shares to cash in on the 2023 budget

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

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Key ASX hydrogen shares are taking off today following the delivery of the 2023 federal budget last night. And for good reason.

The budget saw $2 billion set aside to accelerate Australia’s renewable hydrogen industry.

That’s good news for Fortescue Metals Group Limited (ASX: FMG). The company’s hydrogen venture Fortescue Future Industries is aiming to be a leader in the space.

The Fortescue share price is up 0.5% right now, trading at $20.68.

Meanwhile, shares in fellow hydrogen-focused stocks Pure Hydrogen Corporation Ltd (ASX: PH2) and Hazer Group Ltd (ASX: HZR) are putting the iron ore giant’s gains to shame.

Stock in Pure Hydrogen are surging 11.4% to trade at 19.5 cents at the time of writing while those in Hazer are leaping 6.9% to reach 69.5 cents.

For comparison, the benchmark All Ordinaries Index (ASX: XAO) is slipping 0.1%.

Let’s take a closer look at the government spending that’s seemingly putting wind under the renewable energy-focused ASX shares on Wednesday.

Labor reveals $2b Hydrogen Headstart program

It’s an exciting day for those invested in ASX hydrogen shares. The federal government revealed its $2 billion Hydrogen Headstart program alongside its 2023 budget last night.

In last night’s speech to parliament, treasurer Jim Chalmers said:

Hydrogen power means Wollongong, Gladstone and Whyalla, can make and export everything from renewable energy to green steel. Seizing these kinds of industrial and economic opportunities will be the biggest driver and determinant of our future prosperity.

The Hydrogen Headstart program makes up half of the $4 billion new renewable energy spend announced as part of this year’s budget.

It aims to scale up the development of Australia’s hydrogen industry by providing revenue support for large-scale renewable hydrogen projects through competitive production contracts.

A joint release from Chalmers, minister for climate change and energy Chris Bowen, and assistant minister for climate change and energy Jenny McAllister reads:

These [contracts] will help bridge the commercial gap for early projects and put Australia on course for up to a gigawatt of electrolyser capacity by 2030 through two to three flagship projects.

They said Australia’s path to net zero is dependent on the renewable energy source, which can be combusted for industrial heat, used as a chemical input for green manufacturing and as a fuel for heavy transport, or exported.

Fortescue has welcomed the move, saying it “demonstrates how seriously the government is taking the green hydrogen industry and its critical role in Australia’s future”.

How have ASX hydrogen shares been performing in 2023

Apparent budget-related gains aside, ASX hydrogen shares have been putting out a mixed performance so far this year.

Leading the pack is the Hazer share price, which has gained 25% since the start of 2023.

Meanwhile, that of Pure Hydrogen has lifted 3% and Fortescue stock is up 1% year to date.

Comparatively, the All Ordinaries Index has increased 4% since the new year began.

The post ASX hydrogen shares surge on 2023 federal budget $2b cash splash appeared first on The Motley Fool Australia.

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More reading

• Fortescue share price lifts on 2023 budget’s $2 billion hydrogen program
• What’s the forecast for the Fortescue share price this month?
• 5 things to watch on the ASX 200 on Wednesday
• Fortescue’s Twiggy could wipe this ASX 300 share from the bourse. Here are the details
• Why the iron ore price is ‘not out of the danger zone’

Motley Fool contributor Brooke Cooper 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 an interesting day for the Bubs Australia Ltd (ASX: BUB) share price so far this Wednesday. Bubs shares closed at 18.5 cents each yesterday afternoon and opened at that same level this morning. However, the infant nutrition company initially jumped this morning, climbing to 19 cents a share soon after market open (up 2.7% at the time).

This bouncy performance comes after some big news from Bubs.

Just before market open today, Bubs released an ASX announcement regarding its leadership team. The company revealed that its CEO, Kristy Carr, has been terminated, with immediate effect. This was due to Carr’s alleged “failure to comply with reasonable Board directions”.

Bubs shares spike on CEO “termination”

Former executive chair Dennis Lim has also been terminated from the company. That’s effective immediately. It was only last month that Katrina Rathie was elected chair, replacing Lin.

Carr will be replaced by Richard Paine as interim CEO “until a permanent CEO is confirmed”.

Here’s some of what the statement had to say on this shake-up:

Noting the recent deterioration in Bubs’ financial performance over the half year, the non–executive directors considered the time was right for a change in leadership and to change the governance framework of the company to ensure that it aligns with ASX Corporate Governance Principles and best practice.

On 28 April 2023, Bubs announced that a strategic review of the global business with a particular focus on expenditure management and the Chinese market. The review is on track to be completed by 30 June 2023.

Chair Rathie added the following regarding Carr: “We acknowledge Kristy’s long service to Bubs and the role she has played in building the Bubs brand to the position it enjoys today.”

So that’s all we know for now. But this has certainly been a dramatic day for Bubs Australia.

Judging by the gain in the Bubs share price this morning, it seems investors approve of the decision to axe both Carr and Lin. That’s despite the fact we don’t know what kinds of “reasonable directions” Carr had apparently failed to follow from the board.

Bubs share price snapshot

The Bubs share price has been on a steep decline for a while now, which always increases pressure on a company’s CEO and management team. In 2023 alone, Bubs has lost almost 38% of its value. The company is also down almost 50% from where it was a year ago:

Bubs shares have also lost around 87% of their value since their last all-time high, which we saw back in May 2019.

At the current Bubs share price, this ASX company has a market capitalisation of $139 million.

The post Bubs share price ricochets following CEO sacking appeared first on The Motley Fool Australia.

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More reading

• UBS tips 4 ASX 200 retail shares to benefit from the federal budget
• Why is the NAB share price tumbling 4% on Wednesday?
• Top broker tips 7 ASX 200 property-related shares to cash in on the 2023 budget
• Top brokers name 3 ASX shares to buy today
• ASX 200 stock Technology One halted following cyber attack

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Bubs Australia. 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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Four S&P/ASX 200 Index (ASX: XJO) retail shares look to be among the winners from the 2023 federal budget just unveiled by Treasurer Jim Chalmers.

That’s according to UBS strategist Richard Schellbach.

Schellbach (as reported by The Australian) believes these four ASX 200 retail shares – encompassing both consumer discretionary and consumer staples stocks – could benefit from the federal budget’s billions of dollars of support for low-income households.

Among the measures contained in the 2023 federal budget are:

• A $40 fortnightly increase in JobSeeker
• $500 of rebates to five million low-income households as part of a $1.5 billion Energy Relief Fund
• A $40 fortnightly increase in Youth Allowance and Austudy
• A $1.3 billion Household Upgrades Fund targeting 111,000 households

Which ASX 200 retail shares might benefit from the federal budget?

According to UBS, the federal budget’s low-income support measures should offer some tailwinds to Wesfarmers Ltd (ASX: WES). That’s largely from a potential revenue boost for its lower-cost Kmart segment.

The Wesfarmers share price is down 0.39% in midday trading and up 12% so far in 2023.

The second ASX 200 retail share UBS thinks could gain from the federal budget is Domino’s Pizza Enterprises Ltd (ASX: DMP). With the boost in the JobSeeker and Youth Allowance payments, it’s a good bet some of that money will find its way into home-delivered pizzas.

The Dominos share price is down 0.67% today and down 22.5% so far in 2023.

Which brings us to ASX 200 retail share number three, Coles Group Ltd (ASX: COL). The grocery store retailer has been promoting its low-cost items and could see more customers with a little extra cash in their pockets thanks to the federal budget.

In its recent third-quarter results, Coles reported that it had doubled the size of its ‘Dropped & Locked’ value campaign, with the price of more than 300 products dropped and locked in.

The Coles share price is down 0.33% today and up 9.7% in 2023.

Rounding off the list, the fourth ASX 200 retail share UBS tips to benefit from the federal budget is Super Retail Group Ltd (ASX: SUL).

The company’s brands include Supercheap Auto, Rebel, BCF, and Macpac, outlets that could see more business from low-income households with a bit more cash coming in courtesy of the budget.

The Super Retail Group share price is down 0.55% today and up 16.5% in 2023 so far.

The post UBS tips 4 ASX 200 retail shares to benefit from the federal budget appeared first on The Motley Fool Australia.

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More reading

• How my ASX share portfolio is ready for a stock market crash
• Top defensive ASX shares to buy in May 2023
• 5 things to watch on the ASX 200 on Wednesday
• The Wesfarmers share price was in the red today despite green energy acquisition rumours
• Citi rates these ASX dividend shares as buys

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Domino’s Pizza Enterprises and Super Retail Group. The Motley Fool Australia has positions in and has recommended Coles Group, Super Retail Group, and Wesfarmers. The Motley Fool Australia has recommended Domino’s Pizza Enterprises. 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 S&P/ASX 200 Index (ASX: XJO) is having another weak day on the ASX boards so far this Wednesday, building from yesterday’s losses. At the time of writing, the ASX 200 has slipped by 0.28%, dragging the index down to around 7,240 points. I guess investors weren’t too impressed with the Budget last night. But let’s talk about the National Australian Bank Ltd (ASX: NAB) share price.

NAB shares are seemingly having a real shocker today. This ASX 200 big four bank share closed at $27.36 a share yesterday. But this morning, NAB opened at just $26.17 and is presently going for $26.19 a share, down a notable 4.28%.

Most ASX bank shares are having a poor showing this Wednesday. But not on the same kind of scale as the NAB share price. Commonwealth Bank of Australia (ASX: CBA) shares are currently down by 0.45%. ANZ Group Holdings Ltd (ASX: ANZ) shares have lost 0.67%, while the Westpac Banking Corp (ASX: WBC) share price is down by 0.14%.

So why might NAB shares be suffering so much more than both the broader market and other ASX 200 bank shares today?

Well, the answer is a simple and comforting one for shareholders: today is ex-dividend day for NAB.

NAB share price falls as investors lock in latest dividend

It was only last week that NAB revealed the details of its latest shareholder payout. As part of its half-year earnings report, NAB announced an interim dividend worth 83 cents per share, fully franked.

That represents a substantial increase over last year’s interim dividend of 73 cents per share, as well as the final dividend of 78 cents per share that investors enjoyed back in December.

When any ASX dividend share declares a dividend, it must also identify an ex-dividend date preceding it. This is the date when eligibility for the latest dividend is cut off. For NAB, this is today. This means that any investor who owned NAB shares as of yesterday afternoon will receive the bank’s latest dividend. But for anyone who buys NAB shares from today onwards, you miss out.

But there are no free lunches on the ASX. So because NAB shares don’t come with this dividend attached, as of today, their intrinsic value has fallen. That’s why we are seeing such a steep drop in the NAB share price this Wednesday. It’s the ASX’s typical reaction to a big dividend payer trading ex-dividend.

Eligible NAB investors can now look forward to receiving this latest dividend in around two months’ time on 5 July.

Right now, the NAB share price is offering a forward dividend yield (including the July payment) of 6.14%, or 8.77% grossed-up with this ASX 200 bank’s full franking credits.

The post Why is the NAB share price tumbling 4% on Wednesday? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in National Australia Bank. 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 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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The 2023 federal budget – the second from the Albanese government – has been delivered.

It has likely left many investors wondering what sectors could benefit from government spending, and which might be dealt a blow.

Fortunately, it looks like it could be a good one for seven S&P/ASX 200 Index (ASX: XJO) property-related shares. That’s according to UBS, anyway.

7 ASX 200 shares that could benefit from the 2023 budget: expert

The 2023 budget contains a few notable housing initiatives that could benefit ASX 200 property-related shares. Notably, a tax break for managed investment trusts behind build-to-rent projects, as well as expanded access to the home guarantee scheme.

Tax break for built-to-rent developers

The first change might offer some benefit to the likes of Mirvac Group (ASX: MGR) and Lendlease Group (ASX: LLC), UBS equity strategist Richard Schellbach envisages, as per The Australian.

The managed investment trust withholding tax rate attributed to new build-to-rent developments will be cut from 30% to 15% from 1 July 2024.

The capital works tax deduction rate, otherwise called depreciation, will also be lifted from 2.5% to 4% a year. That will increase the returns offered by new build-to-rent developments.

Building to rent is a relatively new concept in Australia. Indeed, Mirvac opened the first large-scale development in Sydney in 2020.

Expanded access to first home buyer scheme

Mirvac and fellow developer Stockland Corporation Ltd (ASX: SGP) are also capable of benefiting from changes to the first home guarantee scheme.

Schellbach also reportedly said ASX 200 building material providers CSR Limited (ASX: CSR) and Boral Limited (ASX: BLD) could be rewarded.

Finally, property advertising and media companies Domain Holdings Australia Ltd (ASX: DHG) and REA Group Ltd (ASX: REA) might also experience a boost on the back of the change, according to the analyst.

The first home guarantee sees the government backing a portion of a buyer’s first mortgage. It, therefore, allows Australians to get their first foothold on the property ladder with as little as a 5% deposit.

Thanks to the 2023 budget, first-home buyers will be able to apply alongside friends or family. Previously, only spouses or de facto couples could jointly apply.

Australians who haven’t owned property in the last decade will also be made eligible for the scheme.

The post Top broker tips 7 ASX 200 property-related shares to cash in on the 2023 budget appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper 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 REA 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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Many of Australia’s top brokers have been busy adjusting their financial models again, leading to the release of a number of broker notes this week.

Three ASX shares brokers have named as buys this week are listed below. Here’s why they are bullish on them:

CSL Limited (ASX: CSL)

According to a note out of Morgan Stanley, its analysts have retained their overweight rating and $339.00 price target on this biotherapeutics company’s shares. This follows the release of a quarterly update from one of CSL’s rivals, which revealed a sharp reduction in plasma collection costs. Morgan Stanley hasn’t factored this into its model, but highlights that if CSL were to experience the same type of reduction, its earnings would be well ahead of estimates in FY 2024. The CSL share price is trading at $300.84 this morning.

Rural Funds Group (ASX: RFF)

A note out of Bell Potter reveals that its analysts have retained their buy rating and $2.65 price target on this agricultural property company’s shares. Bell Potter highlights that the company’s shares have been crushed over the last 18 months. This has left them trading at a 31% to their net asset value. It points out that this implies a downward correction in property values comparable to that seen in US agricultural land values in 1932-33 and 1985-87. The broker sees this as highly unlikely. The Rural Funds share price is fetching $1.94 today.

Westpac Banking Corp (ASX: WBC)

Analysts at Goldman Sachs have retained their buy rating on this banking giant’s shares with a trimmed price target of $24.67. The broker was pleased with Westpac’s net interest margin management during the first half of FY 2023, noting that its exit margin was stable compared to the deteriorating margins of peers. And while Westpac has walked away from its cost target, Goldman still expects a broadly flat cost trajectory over the next two years. It expects this to see Westpac outperform peers in this relatively difficult inflationary environment. The Westpac share price is trading at $21.66 on Wednesday.

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

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More reading

• Hoping to bag the boosted Westpac dividend? You’ll need to buy shares today
• What are brokers saying about the CSL share price in May?
• The Westpac share price could offer a 20% return: Goldman Sachs
• 5 things to watch on the ASX 200 on Tuesday
• Why Lynas, Piedmont Lithium, Westpac, and Woodside shares are rising

Motley Fool contributor James Mickleboro has positions in CSL and Westpac Banking Corporation. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has positions in and has recommended Rural Funds 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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