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On Tuesday, the S&P/ASX 200 Index (ASX: XJO) had a subdued session and edged lower. The benchmark index dropped 0.1% to 7,887.9 points.

Will the market be able to bounce back from this on Wednesday? Here are five things to watch:

ASX 200 expected to sink

It looks set to be a difficult session for the Australian share market on Wednesday following a poor night in the United States. According to the latest SPI futures, the ASX 200 is expected to open the day 42 points or 0.5% lower. In late trade on Wall Street, the Dow Jones is down 0.9%, the S&P 500 has fallen 0.75%, and the Nasdaq is 1% lower. Interest rate cut doubts are behind these declines.

Oil prices surge

ASX 200 energy shares such as Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a great session after oil prices surged overnight. According to Bloomberg, the WTI crude oil price is up 1.8% to US$85.19 a barrel and the Brent crude oil price is up 1.8% to US$88.98 a barrel. Increasing geopolitical tensions sent oil prices to their highest levels since October.

Gold price breaks record

ASX 200 gold shares including Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a great session on Wednesday after the gold price stormed higher overnight. According to CNBC, the spot gold price is up 1.7% to US$2,295.6 an ounce. Concerns over rising tensions in the Middle East helped drive the precious metal to a new record high.

Paladin Energy rated as a buy

The Paladin Energy Ltd (ASX: PDN) share price is good value according to analysts at Bell Potter. This morning, the broker retained its buy rating on the uranium miner’s shares with an improved price target of $1.65. It said: “Our target price for PDN lifts slightly to $1.65/sh (previously $1.60/sh) on the restart of production. With a line-of sight to first revenue and cashflow we have removed the speculative rating and maintain our Buy recommendation.”

Dividend payday

A number of ASX 200 shares will be rewarding their shareholders with dividend payments on Wednesday. Among the companies paying dividends are biotechnology giant CSL Ltd (ASX: CSL), financial services company Insignia Financial Ltd (ASX: IFL), job listings giant Seek Ltd (ASX: SEK), wine company Treasury Wine Estates Ltd (ASX: TWE), and engineering company Worley Ltd (ASX: WOR).

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

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More reading

• Here are the top 10 ASX 200 shares today
• Happy Easter: ASX 200 hits another new record high
• ASX 200 gold shares surging as gold price hits new records. Now what?
• Leading brokers name 3 ASX shares to buy today
• What the latest US inflation data means for ASX 200 investors and interest rates

Motley Fool contributor James Mickleboro has positions in CSL, Seek, Treasury Wine Estates, and Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has recommended CSL, Seek, and Treasury Wine Estates. 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 Insurance Australia Group Ltd (ASX: IAG) shares worth buying right now? Good question.

Looking at the IAG share price over the past 12 months, you might be forgiven for instantly dismissing this proposition. After all, IAG has gained a whopping 35% over the past year, and 13% since the beginning of 2024 alone. That’s probably enough to give anyone who has heard the term ‘buy low, sell high’ some pause.

Yesterday this ASX 200 financial stock even hit a new 52-week high. Yep, IAG shares clocked a new high watermark of $6.48 in afternoon trading on Tuesday, nicely matching the S&P/ASX 200 Index (ASX: XJO)’s new record high.

The company then cooled off a little, finishing trade yesterday up 0.16% at $6.41.

We did get some news out of IAG shares on Tuesday morning, which may have contributed to investor optimism yesterday. The company told investors that Robert Cutler has been appointed as IAG’s new Group General Counsel (a top legal role), effective 4 April.

Cutler will replace Peter Horton in this role. Horton left IAG in December last year, after which the role went to Karen Ingram in an interim capacity.

IAG CEO Nick Hawkins told investors that Cutler has “extensive governance experience as a member of various boards, and has advised on regulatory and risk management matters for private and public organisations”.

So this might be what was boosting investor sentiment yesterday. Either way, no doubt investors will be cheering IAG’s new 52-week high with gusto.

Are IAG shares a buy at new 52-week highs though?

But that gets us back to the question of whether IAG shares are still a buy after their impressive runup over the past 12 months.

Well, ASX broker Goldman Sachs seems to think the company is in a good spot right now. As reported by The Australian, Goldman analysts Julian Braganza and Brian Kim reckon IAG, as well as its rival insurer Suncorp Group Ltd (ASX: SUN), will “benefit from a positive reinsurance market at their upcoming mid-year renewals”.

Reinsurance is an important component of IAG’s business model, and these Goldman analysts point out that “mid year renewal discussions were taking place earlier and reinsurers were ‘willing to secure capacity’”.

Even so, last month, my Fool colleague covered Goldman retaining a neutral rating on IAG shares, with a 12-month share price of $6.

However, other ASX brokers in Macquarie and Citi were more bullish. Macquarie gave the company a ‘buy’ rating and a share price target of $6.40, while Citi expects IAG shares to climb to $6.75 over the next 12 months.

The post Are IAG shares worth buying right now? appeared first on The Motley Fool Australia.

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More reading

• $19 billion in ASX dividends is being paid out this week. Are you getting your share?
• Here’s the IAG dividend forecast through to 2026

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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 positions in and has recommended Goldman Sachs Group and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie 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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Turning $100,000 into a million bucks might sound like magic.

But no one needs supernatural powers if they use ASX shares and compounding to their advantage.

Allow me to introduce you to three stocks that I reckon could do the trick:

Temporary glitch, with long-term tailwinds still there

Johns Lyng Group Ltd (ASX: JLG) is an insurance claims repairer that has been a favourite of professional investors for years now.

And why not? The stock price has gained an astounding 366% over the past five years for an incredible compound annual growth rate (CAGR) of 36%.

With the world unfortunately seeing more extreme weather events due to global warming, building repair demand from insurers is on an upward trend.

The great news for those who haven’t bought Johns Lyng yet is that the stock is in a bit of a dip right now.

The company put out a half-year result in February that didn’t quite meet expectations, so the stock tumbled more than 13% in a single day.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA)  were up, but sales revenue and net profit after tax (NPAT) both dipped.

Professional investors aren’t panicking, though. They have their eyes on the prize in the long run.

Nine out of 11 analysts currently surveyed on the broking platform CMC Invest still reckon Johns Lyng is a buy. Eight of those recommend it as a strong add.

Look past the fear for these ASX shares

Similar to Johns Lyng, healthcare stock Neuren Pharmaceuticals Ltd (ASX: NEU) is also in a funk of late.

After snatching the crown as the S&P/ASX 200 Index (ASX: XJO)’s best performer in 2023, the stock has dived more than 16% to start 2024.

Much of that market fear has been driven by a short seller report that criticised the effectiveness of its Daybue drug.

But again, similar to Johns Lyng, the professional community is ignoring the noise. In fact, many analysts say the claims in the short report are just plain incorrect.

For example, the team at Blackwattle told its clients that the fear-mongering was “at odds with trial data and the real-life experience of medical specialists, patients, and their carers”.

The analysts at Elvest Fund have also told its clients that their “thesis for Neuren Pharmaceuticals is unchanged”.

“New CY24 Daybue sales guidance of US$370 to US$420 million (+120%) underpins another solid year of royalty and milestone revenue for Neuren.”

Neuren shares are roughly an 18-bagger over the past half-decade, equating to a crazy CAGR of 78%.

The ASX shares riding high on AI

The investment case for data centre operator Nextdc Ltd (ASX: NXT) is straightforward.

Artificial intelligence (AI) is in hot demand. AI requires huge computing power. Those computers need to be housed somewhere.

This tailwind has already been recognised, with NextDC shares rocketing 75% over the past 12 months.

But many experts believe the world is at the start of its AI journey.

Fifteen analysts out of 18 currently surveyed on CMC Invest recommend buying NextDC shares.

Over the past five years, the stock has realised a 23% CAGR.

Of course, not all shares you buy will do as well as the above trio. 

But with proper diversification, it’s not out of the question that your portfolio could achieve an average of 15% CAGR with the help of such massive winners.

So if you start with a $100,000 portfolio and then keep adding $1,000 to it each month, after 13 years, the nest egg will have expanded to $1,027,501.

And there it is, a million to your name.

Best wishes for your investments.

The post 3 ASX shares to help turn $100,000 into $1 million appeared first on The Motley Fool Australia.

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More reading

• 7 ASX All Ords shares elevated to ‘strong buy’ status in March
• Top ASX shares to buy in April 2024
• Experts name 4 top ASX artificial intelligence shares
• 2 ASX shares I have been buying in 2024!
• 1 secretly cheap ASX 200 stock I’m buying for the long run

Motley Fool contributor Tony Yoo 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. The Motley Fool Australia has recommended Johns Lyng 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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It’s been a hellacious past year for Core Lithium Ltd (ASX: CXO) shares. Despite reaching production in early 2023, the lithium miner’s share price has fallen 82% over the past 12-month period.

The performance is incredibly disappointing when given context. Over this time, the S&P/ASX 200 Index (ASX: XJO) has gone from strength to strength, rising 9.2% to set fresh all-time highs, as depicted in the comparison below.

Now at 15.5 cents a pop, could Core Lithium shares be a glaring opportunity? After all, lithium prices have been holding above recent lows for around a month.

Mo lithium mo problems

Few considerations are more important to a mining company’s viability than the supply and demand dynamics for its mined material.

Some argue lithium’s fall from grace stemmed from an oversupply, others point the finger at inadequate demand. Either way, the last year was marred by more lithium than needed — sending the battery commodity into freefall.

The important question for investors is: has the situation changed for Core Lithium shares?

Interest rates are still elevated, dissuading new electric vehicle purchases. Some miners have dialled down production, yet other lithium majors are determined to ramp up capacity.

According to Bloomberg, Tianqi Lithium and Ganfeng Lithium Group have both indicated they will look to acquire additional reserves and grow lithium production capacity. This could spell trouble for lithium companies that cannot achieve similarly low production costs.

To buy, or not to buy Core Lithium shares

Last month provided a glimpse into how Core Lithium is faring lately. The company disclosed revenue of $134.8 million and a loss after tax of $167.6 million in its half-year results on 12 March.

It can be said rather objectively that those are some ugly numbers. Put another way, the Finniss Lithium Project operator lost $1.24 for every $1 product sold. Such figures are simply not sustainable in the long run.

I believe something must change for Core Lithium shares to be investable. Either lithium prices find equilibrium at a higher price, or the company begins monetising its other projects in gold, uranium, and base metals.

It would appear short sellers think the same. As shared yesterday, short interest in Core Lithium shares is around 8.3%, ranking in the top 10 most shorted companies on the ASX this week.

The post Down 80%, are Core Lithium shares finally worth buying in April? appeared first on The Motley Fool Australia.

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More reading

• Why has the lithium price quietly risen 20% in 2024?
• These are the 10 most shorted ASX shares
• ASX mining in April 2024: The best stock to buy right now
• The Core Lithium share is down 27% in March: What’s next?
• Why Telstra and these ASX 300 stocks just hit 52-week lows

Motley Fool contributor Mitchell Lawler 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 always buy the same ASX growth stocks as everyone else, your portfolio will never do better than the market.

Yet some people wait to see others piling onto a stock before buying it themselves.

If you want to branch out a bit, I have one buy suggestion that has struggled in recent times, but could be in for a bull run in the years to come:

Why this ETF is an ASX growth stock

Global X Battery Tech & Lithium ETF (ASX: ACDC) may be an exchange-traded fund (ETF), but it displays growth stock characteristics.

Firstly, its investment theme is very much a forward-looking one. 

Electric cars, renewable energy and mobile devices all require high-powered batteries to store power. The demand for such hardware will be enormous in the coming years as the globe battles to reduce carbon emissions.

Secondly, while the fund includes some miners, which can be notoriously cyclical, many of its holdings are growth companies further down the supply chain.

For example, at the time of writing the Global X Battery Tech’s largest investments were:

• HD Hyundai Electric Co Ltd (KRX: 267260)
• Sumitomo Electric Industries Ltd (TYO: 5802)
• Renault SA (EPA: RNO)
• ABB Ltd (SWX: ABBN)

And thirdly, the fund has shown itself to be less volatile than the commodity market. 

For example, the lithium carbonate price tumbled from almost 600,000 CNY per tonne in November 2022 to now just over 100,000 CNY. In the same period, the ETF has only fallen 0.78%.

Buy it then lock it away

This is why I feel ACDC is an under-the-radar stock to buy right now.

Growth investors aren’t necessarily looking at it because of the depressed lithium market, and is trading at around a 10% discount from June last year.

But long-term visionaries could pounce on this with a goal to hold it for five to ten years. The economic cycle will have played itself out by then and the world will be scrambling even more for sorely needed batteries.

Moreover, you are not having to pick the winners of the battery revolution. The automatic diversification of an ETF renders that dilemma irrelevant.

Despite the 18-month lithium market malaise, the ACDC share price has doubled over the last half-decade.

This ETF has much going for it.

The post 1 under-the-radar ASX growth stock to consider buying now appeared first on The Motley Fool Australia.

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More reading

• 5 ASX ETFs to buy and hold for 10 years
• 3 reliable ASX shares you can buy at a discount

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Global X Battery Tech & Lithium ETF. The Motley Fool Australia has recommended Global X Battery Tech & Lithium ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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The Pilbara Minerals Ltd (ASX: PLS) share price went down by around 9% in March 2024. Is the outlook more optimistic for the ASX lithium share?

There are two key parts of the story for Pilbara Minerals in the shorter term – how much lithium (spodumene concentrate) it produces and what price it gets for that production.

Production is growing

In the first half of FY24, the business delivered a 4% increase in its production to 320.2kt.

The company is aiming for a 70% increase in production as it constructs two projects.

The first project is the P680 expansion, the primary rejection facility is operational while the crushing and ore-sorting facility is under construction.

Pilbara Minerals’ second project is the P1000 expansion which aims to take the production to 1mt per annum. Earthworks and foundations have commenced.

Growth of production will hopefully be supportive of the Pilbara Minerals share price.

The company recently announced two expanded offtake agreements, growing its supply relationship with leading battery chemical companies Ganfeng Lithium and Chengxin Lithium. Between those two companies, they have customers that include Volkswagen, Hyundai, Tesla, BYD, CATL, Umicore, LG Chem and BMW.

In the calendar years 2025 and 2026, those two companies could take between 410k to 460k of spodumene concentrate.

Lithium price

The FY24 first-half’s financial performance was impacted by lower lithium prices – the realised price (CIF China) was down 67% to US$1,645 per tonne.

Is there going to be a recovery of the lithium price? It’s difficult to say – a key part of the situation will be supply and demand.

Pilbara Minerals revealed numbers from Benchmark Mineral Intelligence which showed there were 13.8 million global electric vehicle sales in 2023 and this is predicted to grow to an estimated 36.1 million in 2028 and 59.1 million in 2033.

The annual lithium demand is projected to grow at a compound annual growth rate (CAGR) of 24% between 2023 and 2028. Of course, supply is also growing, with Pilbara Minerals adding to that.

Pilbara Minerals recently accepted a pre-auction offer for a 5,000 dry metric tonne (dmt) lithium spodumene concentrate cargo ahead of a scheduled digital auction of the Battery Material Exchange (BMX). The offer equated to an approximate price of US$1,200 per dmt on a SC6.0 China equivalent basis.

The company is going to review a variety of sales avenues including offtake contracts, closed tenders, auctions and other commercial opportunities.

UBS, a broker, recently suggested the average realised for the 2024 calendar year could be US$600 per tonne. It still sees the market in a surplus, though shrinking. Due to that, UBS has a sell rating on Pilbara Minerals shares.

But, of course, it’s possible that the lithium price could positively surprise if demand is stronger than the pessimist expectations. In the longer term, Pilbara Minerals may be able to get exposure to more of the lithium supply chain.

The post What is the outlook for Pilbara Minerals shares in April? appeared first on The Motley Fool Australia.

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More reading

• Why has the lithium price quietly risen 20% in 2024?
• These are the 10 most shorted ASX shares
• Buy Pilbara Minerals and these ASX lithium shares for big returns
• Why Mesoblast, Newmont, Pilbara Minerals, and Platinum shares are jumping
• ASX mining in April 2024: The best stock to buy right now

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

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The lithium price for carbonate is currently US$14,859 per tonne, up 10% in 2024.

In the year to date, the highest price it has reached is US$15,965 per tonne.

It got there mid-last month, and that was 20% above its starting value on 1 January.

This is nice to see after the lithium price plummet of 2023 when carbonate’s value fell by a whopping 80%.

But does this price bump signal a fundamental change in the outlook for lithium prices?

Unfortunately not.

The lithium carbonate price remains at its lowest level since August 2021 due to supply and demand dynamics that are going to take years to work their way through.

Top broker Goldman Sachs reckons lithium prices won’t bottom til 2025.

This has led to some Australian lithium miners scaling back production. For example, IGO Ltd (ASX: IGO), which co-owns the Greenbushes mine, is stockpiling lithium to sell when commodity prices rebound.

On Thursday, ASX lithium shares were a mixed bag.

Here’s a snapshot:

• Core Lithium Ltd (ASX: CXO) shares closed steady at 15.5 cents, flat
• Pilbara Minerals Ltd (ASX: PLS) shares closed up 0.52% to $3.85
• IGO Ltd (ASX: IGO) shares closed up 0.71% to $7.12
• Arcadium Lithium CDI Def (ASX: LTM) shares closed down 0.89% to $6.72

What’s going on with lithium prices?

According to Trading Economics, the Chinese electric vehicle (EV) market remains oversupplied.

Government subsidies in China in 2022 encouraged greater production and consumer purchases of EVs.

This drove up demand for lithium and caused the commodity’s price to skyrocket. Meantime, a wave of new investment in lithium production led to higher global supply, which weakened commodity prices.

Slower adoption of EVs in the United States and European Union amid a cost of living crisis means car manufacturers and retailers are carrying higher inventories and are cutting prices to sell stock.

According to Trading Economics:

Sales of EVs rose by 18.2% in the first two months of the year in China, slowing from 20.8% in 2023 and the triple-digit growth rates commonly seen in late 2022.

Lower demand from consumers amid the end of subsidies from Chinese authorities drove major car manufacturers to cut EV prices further, with giant BYD decreasing prices by an average of 17%.

A reduction in Chinese demand for lithium is a big problem for Australia given it’s our biggest customer. In FY23, 98% of our spodumene was exported to China.

Latest Federal Government forecasts

Official forecasts for lithium prices can be found in the Federal Department of Industry’s March quarter resources and energy quarterly report released last week.

The report explains that last year’s tumble in lithium commodity prices led some miners, especially the high-cost producers, to reduce their production.

This is likely to support a “modest recovery in the lithium prices over 2024 and 2025”, according to the report.

In February 2024, the lithium spodumene price fell to an average of US$1,000 a tonne, while the lithium hydroxide price fell to an average of US$13,350 a tonne.

The lithium spodumene price is forecast to rise (in real terms) to about US$1,360 a tonne by 2026, before falling to about US$1,090 a tonne by 2029.

The department predicts a fall because, “From 2026, alternate battery chemistries could place some price pressure on lithium-ion EV batteries …”.

The lithium hydroxide price is forecast to rise (in real terms) to about US$18,330 a tonne by 2026, before falling to about US$13,890 a tonne by 2029.

The department forecasts a fall because, “Rising LFP battery adoption is projected to continue to put lithium hydroxide prices under pressure.”

The department reiterated that lithium price forecasts have a high degree of uncertainty.

This is because they hinge on how many producers enter the global market, and the uptake rate of EVs by consumers.

Lithium export earnings to fall…

Since the December 2023 resources and energy quarterly, the department has downgraded its forecast for Australia’s lithium earnings in FY25 by 38% (from $15 billion to $9.5 billion in nominal terms).

This is due to a lower price forecast for lithium spodumene, partially offset by higher production.

The post Why has the lithium price quietly risen 20% in 2024? appeared first on The Motley Fool Australia.

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More reading

• These are the 10 most shorted ASX shares
• Buy Pilbara Minerals and these ASX lithium shares for big returns
• Here are the top 10 ASX 200 shares today
• Why Mesoblast, Newmont, Pilbara Minerals, and Platinum shares are jumping
• ASX mining in April 2024: The best stock to buy right now

Motley Fool contributor Bronwyn Allen has positions in Core Lithium. 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 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 post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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More reading

• Happy Easter: ASX 200 hits another new record high
• ASX 200 gold shares surging as gold price hits new records. Now what?
• What the latest US inflation data means for ASX 200 investors and interest rates
• Why Austal, Mesoblast, Novonix, and Paladin Energy shares are racing higher
• These are the 10 most shorted ASX shares

Motley Fool contributor Sebastian Bowen has positions in Newmont. 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 on the lookout for some income options, then it could be worth checking out the ASX shares listed below.

That’s because they have recently been named as buys by brokers and are expected to provide investors with a good source of income in the coming years.

Here’s what analysts are saying about these ASX income shares:

Endeavour Group Ltd (ASX: EDV)

The first ASX income share for income investors to look at this week is Endeavour.

It is the drinks giant behind the BWS and Dan Murphy’s brands, as well as a large network of hotels.

Goldman Sachs is a fan of the company due to its “clear market leading position” and attractive valuation. It currently has a buy rating and $6.20 price target on the company’s shares.

As for income, the broker is forecasting fully franked dividends of approximately 22 cents per share in FY 2024 and FY 2025. Based on the current Endeavour share price of $5.35, this will mean yields of 4.1% for both years.

Super Retail Group Ltd (ASX: SUL)

Another ASX income share that analysts at Goldman Sachs are positive on is Super Retail.

It is the owner of popular retail brands BCF, Macpac, Rebel, and Super Cheap Auto. Goldman has a buy rating and $17.80 price target on its shares. It believes that “SUL will display resilience in a softer economic environment that is built upon its competitive advantage of high loyalty.”

In respect to dividends, the broker is expecting the retailer to pay fully franked dividends per share of 67 cents in FY 2024 and then 73 cents in FY 2025. Based on the latest Super Retail share price of $15.86, this will mean good yields of 4.2% and 4.6%, respectively.

Universal Store Holdings Ltd (ASX: UNI)

A final ASX income share for investors to look at is Universal Store. It is the youth fashion retailer behind the Universal Store, Perfect Stranger, and Thrills brands.

The team at Bell Potter is very positive on the company and believe it is well-placed for growth in the coming years. As a result, it recently put a buy rating and $5.65 price target on its shares.

The broker is expecting Universal Store to pay fully franked dividends per share of 24 cents in FY 2024 and then 31 cents in FY 2025. Based on the current Universal Store share price of $5.39, this will mean attractive yields of 4.45% and 5.75%, respectively.

The post 3 ASX income shares to buy for a dividend boost appeared first on The Motley Fool Australia.

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More reading

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Motley Fool contributor James Mickleboro has positions in Endeavour Group and Universal Store. 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 positions in and has recommended Super Retail 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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Goodman Group (ASX: WOW) shares are $33.37, down 1.3% in late afternoon trading on Tuesday.

Goodman is Australia’s largest real estate investment trust (REIT).

The company specialises in industrial real estate. So, things like data centres, warehouses, logistics facilities, business parks, and so on.

That’s hot property right now given the expanding digital economy and rising use of artificial intelligence.

The stock is having a rocking year so far, up 33% already in 2024 and rising at nearly quadruple the rate of its property sector peers over the past 12 months.

The ASX REIT capped off this performance with a new 52-week high of $34.07 last Thursday.

So, shareholders are surely cheering these capital gains, but what about dividends (or distributions, in the case of REITs)? Are they rising, too?

How much will Goodman shares pay in 2024?

The consensus analyst forecast published on CommSec is for Goodman shares to pay 30 cents per share in total annual distributions this year and in 2025.

That’s what Goodman has paid shareholders every year since 2019.

The analysts expect a slight rise to 31.6 cents per share in 2026.

A $10,000 budget (minus a brokerage fee of $5) will buy you 299 Goodman shares at the current price.

Total spend = $9,977.63.

If we multiply 299 shares by 30 cents, we get a total annual distribution of $89.70 and a yield of 0.89%.

In 2026, the slightly higher payment will give us a total annual distribution of $94.50 and a yield of 0.95%.

Why aren’t Goodman distributions rising?

A significant reason is that Goodman prefers to use most of its retained earnings “to fund investment in the business to support the development growth in a financially sustainable manner”.

In its 1H FY24 results, Goodman Group reported a 29% year-over-year increase in operating profit to $1.13 billion. Development earnings were a strong contributor, increasing by 33.6% to $804.7 million.

In a statement, the company said many of its sites have been repurposed for larger scale and higher value projects. It has 85 property development projects worth $12.9 billion in the pipeline, with data centres making up 37%.

CEO Greg Goodman said:

Data centres will be a key area of growth and the acceleration of data centre activity is a
catalyst for the Group to consider multiple opportunities to enhance its returns.

We continue to assess the Group’s capital allocation to both existing and potential opportunities to provide the best risk-adjusted returns.

Key to this will be the active rotation of our capital to fund sustained earnings growth over the
long term.

This strategy means shareholders are more likely to see growth in their earnings per share (EPS) instead of their dividends per share (DPS).

The consensus analyst forecast for EPS is $1.07 per share in 2024.

This is forecast to rise to an EPS of $1.188 per share in 2025 and $1.321 per share in 2026.

The post If I invest $10,000 in Goodman shares, how much dividend income will I receive? appeared first on The Motley Fool Australia.

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More reading

• I think these 2 ASX shares could make strong long-term buys
• Top ASX shares to buy in April 2024
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• Here are the top five ASX 200 shares in Macquarie’s model growth portfolio

Motley Fool contributor Bronwyn Allen has positions in Goodman Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goodman Group. 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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