Tag: Motley Fool

The Coles Group Ltd (ASX: COL) share price is seeking direction, flipping from small gains to small losses in early morning trade.

Shares in the S&P/ASX 200 Index (ASX: XJO) consumer staples retail giant closed yesterday trading for $18.46. Shares are currently changing hands for $18.43.

This comes following the release of the company’s third-quarter sales results, covering 2 January to 26 March (3Q23).

Read on for the highlights.

Coles share price wobbles despite strong sales growth

• Total group sales revenue of $9.67 billion, up 6.5% from 3Q22
• Supermarket sales revenue increased 7.0% to $8.60 billion
• Liquor revenue increased 2.6% year on year to $801 million
• 7% year-on-year eCommerce sales growth in supermarkets, 28.9% growth in liquor
• Own brand sales revenue growth of 11.4% exclusive to Coles

What else happened during the quarter?

Coles reported that total supermarket price inflation over the quarter came in at 6.2%. That was far higher than the 3.3% reported in 3Q22. But it came in below the 7.7% inflation recorded in the last quarter (2Q23).

In a nod to consumers pressured by that inflation, Coles doubled the size of its ‘Dropped & Locked’ value campaign. The price on more than 300 products has now been dropped and locked in. This helped drive the quarterly sales growth, which has yet to lift the Coles share price today.

Coles also continued with its tailored store format strategy, reporting 41 liquor store renewals.

And on 27 March, the retail giant achieved its first outbound delivery to store at its new Redbank, Queensland Automated Distribution Centre (ADC). That ADC officially opened yesterday.

Coles said progress is continuing with installation activities at its New South Wales ADS, in Kemps Creek.

During the quarter, Coles opened one new store and closed two stores. It currently has a total network of 841 supermarkets.

What did management say?

Commenting on the results that are seeing the Coles share price vacillate today, CEO, Steven Cain said:

At a time when cost of living pressures are mounting for many customers, the unique combination of Australia’s largest own brand range, hundreds of dropped and locked prices, thousands of weekly specials, free Masterchef cookware and Flybuys points has successfully driven sales and volume.

Pleasingly we saw some modest improvement in supply chain availability however there is still more to do.

On Monday Cain will hand the reins of the 109-year-old company over to incoming CEO, Leah Weckert.

“I know that the best is yet to come,” Cain said.

What’s next?

Looking at what might impact the Coles share price in the months ahead, the company expects supplier input cost inflation to keep easing in the fourth quarter. That’s mostly due to exceptionally high levels of inflation in the prior corresponding period.

Coles said it remains on track to deliver cumulative Smarter Selling benefits of $1 billion across the four-year program by the end of FY23. And the company also is on track to renew 40 supermarkets in FY23.

As for the sale of its Coles Express fuel and convenience business, Coles reported it has satisfied all closing conditions for the sale to Viva Energy. Management expects the transaction will be complete by the end of May.

Coles share price snapshot

The Coles share price has been a strong performer in 2023, up 12% year to date.

The post Coles share price wobbles despite 7% sales revenue growth appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 things to watch on the ASX 200 on Friday
• How Coles shares could help ‘recession proof’ your portfolio
• 2 strong and defensive ASX 200 shares to buy: analysts
• 5 dividend shares I think are among the safest on the ASX
• 3 things ASX investors should watch this week

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

from The Motley Fool Australia https://ift.tt/zRZAcDM

The ResMed Inc. (ASX: RMD) share price is on course to end the week on a positive note.

In morning trade, the sleep treatment company’s shares are up 1% to $34.19.

Why is the ResMed share price rising?

Investors have been bidding the ResMed share price higher today after the company released its third-quarter update.

For the three months ended 31 March, ResMed reported a 29% (31% in constant currency) increase in revenue over the prior corresponding period to US$1,116.9 million.

And while its gross margin contracted by 150 basis points to 55.3%, this couldn’t stop the company from delivering a 28% increase in income from operations.

This ultimately led ResMed generating operating cash flow of US$282.6 million and diluted earnings per share of US$1.58.

What were the drivers of its growth?

Management revealed that it significantly ramped up production and delivery of its cloud-connected flow generator devices to meet ongoing high demand from customers during the quarter. This resulted in strong device sales growth across its global markets. ResMed CEO, Mick Farrell, commented:

We now have full global availability of our connected AirSense 10 platform, while we continue to ramp production and availability across more geographies of our AirSense 11 platform. The bottom line is this: We can now support global customer demand for CPAP and APAP devices to serve the entire sleep device market. This is great news for physicians, providers, and especially for patients.

Farrell also revealed that its mask and patient interfaces businesses performed well, as did its outside-hospital software-as-a-service business. He added:

We also saw very strong growth in our mask and patient interfaces businesses globally, demonstrating a sustainable focus on patient adherence and resupply. Our outside-hospital software-as-a-service business achieved high-single-digit growth organically and reached well into double-digit growth with a full quarter of contribution from our MEDIFOX DAN acquisition that we closed last November.

How does this compare to expectations?

Goldman Sachs has taken a quick look at the result and notes that the company’s revenue growth was comfortable ahead of expectations. This may explain why the ResMed share price is rising as it is today. The broker said:

3Q23 revenue of $1,117m was up +31% cc, an acceleration from +20% in 2Q and +9% in 1Q23, and a solid beat to consensus +23%.

Pleasingly, it was the same for the company’s earnings, with ResMed beating on the bottom line. Goldman adds:

Earnings beat +3% as revenue growth compensates for material gross margin contraction.

Goldman currently has a buy rating and $38.00 price target on ResMed shares.

The post ResMed share price higher on Q3 ‘solid beat’ appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Better ASX 200 healthcare share: CSL vs. Resmed
• 2 ‘undervalued’ ASX 200 shares to ‘beat market’ before everyone else wakes up
• Here are the top 10 ASX 200 shares today
• These world-class ASX 200 growth shares are buys according to brokers
• CSL shares dip despite new FDA approval

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

from The Motley Fool Australia https://ift.tt/As5YRiO

The Betashares Nasdaq 100 ETF (ASX: NDQ) has underperformed the broader market over the last three years.

The exchange-traded fund (ETF), which aims to mirror the NASDAQ-100 Index (NASDAQ: NDX), has surged 32% in that time.

An investor sinking $5,000 into the NDQ ETF in April 2020 likely would have walked away with 218 units, paying $22.86 apiece.

Today, that parcel would be worth $6,572.70. The Betashares Nasdaq ETF last traded at $30.15.

Unfortunately, that leaves the NDQ ETF having underperformed the All Ordinaries Index (ASX: XAO). The benchmark index has risen 41% over the last three years.

But what about the dividends Betashares Nasdaq ETF investors have received in that time? Let’s take a look.

All dividends paid to those invested in NDQ ETF since 2020

Here are all the dividends paid to those invested in the NDQ ETF over the last three years, rounded to the nearest tenth of a cent:

NDQ dividends’ pay date	Dividend value
January 2023	3.1 cents
July 2022	84.2 cents
July 2021	$1.175
January 2021	2.6 cents
July 2020	64.9 cents
Total:	$2.723

As the chart shows, each Betashares Nasdaq 100 ETF unit has brought in $2.723 of passive income over the last three years. That means our figurative parcel could have provided $593.614 in dividends.

Considering that, and the ETF’s capital gains, an investor might have boasted a return on investment (ROI) of 44% _­­

Not to mention the compounding benefits an ASX investor might have realised had they reinvested their passive income, using it to buy more NDQ units.

However, unlike many ASX-listed shares and funds, dividends offered by the ETF don’t come with franking credits.

Considering its two most recent dividends, the Betashares Nasdaq 100 ETF currently trades with a respectable (but not quite mind-blowing) 2.89% dividend yield.

The post Sunk $5,000 into the Betashares Nasdaq 100 ETF (NDQ) in 2020? Here’s how much passive income your investment has provided appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 3 highly rated ETFs for ASX investors to buy in May
• I think this underrated reason is key to why ETFs can be great investments
• Buy and hold these 3 ASX ETFs for a decade
• Up 20% in 2023 so far, is it too late to buy Betashares Nasdaq 100 ETF (NDQ) units?
• 2 of the best ETFs for ASX investors to buy this month

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 positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/ra5t4RZ

S&P/ASX 200 Index (ASX: XJO) healthcare shares could be a good source to find opportunities that can deliver solid returns. There are a number of strong businesses in the space such as CSL Limited (ASX: CSL), ResMed Inc (ASX: RMD), Cochlear Limited (ASX: COH), Ramsay Healthcare Limited (ASX: RHC) and Pro Medicus Ltd (ASX: PME).

I think ResMed and CSL are two of the strongest within that list, so I’m going to do a little comparison between them in this article.

For readers that haven’t heard of these two names, I’ll provide a brief summary of what they do.

ResMed provides continuous positive airway pressure (CPAP) machines, equipment and digital health to help treat sleep apnea. The business also offers cloud-connected ventilators as well as out-of-hospital healthcare management software.

CSL is one of the world’s largest biotechnology businesses. It’s involved in things like blood plasma collection and plasma-derived products, vaccines and iron deficiency treatments.

Recent performance

The ResMed share price growth has been impressive over the past five years, with a rise of around 160%. That’s thanks to the growth of its core sleep apnea offering, as well as expansion in the software side of things.

The CSL share price hasn’t done quite as well, with a rise of close to 80% in the past five years. It has seen growth in areas like its plasma division, the vaccine division and the recent acquisition of Vifor.

Which valuation looks better?

One of the main ways to compare these two ASX 200 healthcare shares is to see which price/earnings (P/E) ratio is better value.

Using the profit forecast on Commsec, which is as good as any, the ResMed share price is valued at 35 times FY23’s estimated earnings.

The CSL share price is valued at 37 times FY23’s estimated earnings.

CSL is priced slightly more expensively than ResMed, despite its market capitalisation being substantially higher. Investors may consider a very large business like CSL as having fewer growth prospects because it’s already massive, so it could be surprising it’s trading on a higher valuation.

But, profit growth expectations can play a part.

CSL’s earnings per share (EPS) could grow by 45% to FY25, which would put it at 25 times FY25’s estimated earnings.

Meanwhile, ResMed’s EPS could rise by 28% to FY25, which would put the business at around 27 times FY25’s estimated earnings.  

By the time FY25 finishes, CSL could be the better value choice if it’s able to deliver on profit growth.

I should mention that CSL is spending huge amounts on research and development. This cuts into the company’s profit for that year, but then helps the business unlock new earnings streams from the new products they’ve made.

In FY22, CSL said that it spent $1.16 billion on research of development, so its profit could be boosted significantly if it were to suddenly stop spending. But it’s better that it does keep spending for the long term.

Having looked at the projected direction of earnings, and CSL’s ongoing heavy investment in research and development, it would be my ASX 200 healthcare share pick.

What about the dividend?

Neither business has a high dividend yield, and I don’t think it’s a deciding factor. But, it’s worthwhile to look at the yields of these ASX 200 healthcare shares.

Commsec numbers suggest CSL could pay a dividend yield of 1.1% in FY23 and ResMed could pay a dividend yield of 0.8% in FY23. There’s not a lot in it, so I’m sticking with my preference for CSL shares.

The post Better ASX 200 healthcare share: CSL vs. Resmed appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here’s why analysts rate these strong blue chip ASX 200 shares as buys
• 2 ‘undervalued’ ASX 200 shares to ‘beat market’ before everyone else wakes up
• The CSL share price is a sleeping dividend giant. Here’s why
• Here are the top 10 ASX 200 shares today
• These world-class ASX 200 growth shares are buys according to brokers

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 positions in and has recommended CSL, Cochlear, Pro Medicus, and ResMed. The Motley Fool Australia has positions in and has recommended Pro Medicus and ResMed. The Motley Fool Australia has recommended Cochlear. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/Jdn6Rt7

Mineral Resources Ltd (ASX: MIN) shares could offer investors huge returns over the next 12 months.

That’s the view of analysts at Morgans, which have been running the rule over the mining and mining services company’s quarterly update.

What did the broker say?

According to the note, Morgans wasn’t blown away by the company’s performance during the last quarter. The broker summarised things, saying:

MIN posted a softer-than-expected 3Q’FY23 result. Disappointing volume from lithium (sales) and mining services, combined with weaker lithium prices, and delays to Mt Marion and Wodgina growth. A key theme in the result was the slow speed of various typical approvals across its WA operations (affecting Wodgina, Onslow and mining services). MIN reduced FY23 guidance for Mt Marion (volumes/costs) and mining services (tonnes). Iron ore unit costs are expected to be at the upper end of guidance.

Nevertheless, its analysts continue to see significant value in Mineral Resources shares at the current level, even after cutting its valuation slightly. This is due to its positive long term outlook. Morgans said:

We have adjusted our estimates for today’s 3Q23 result and guidance updates, leading to our valuation-based Target Price reducing to A$103ps (from A$106). While a disappointing 3Q, the result does not impact our longer-term investment view on MIN. We maintain our ADD recommendation.

Big returns ahead for Mineral Resources shares

As mentioned above, Morgans has an add rating and $103.00 price target on the company’s shares.

Based on its current share price of $72.05, this implies potential upside of 43% for investors over the next 12 months.

But it gets better! The broker is also forecasting a $5.79 per share fully franked dividend in FY 2024. This represents a sizeable 8% forward dividend yield for investors that buy shares at today’s price.

Combined, this suggests that a total return of over 50% will be on offer from Mineral Resources shares if Morgans is on the money with its recommendation.

The post Mineral Resources shares could have 40%+ upside and an 8% dividend yield appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why A2 Milk, Mesoblast, Mineral Resources, and Synlait shares are sinking
• Mineral Resources share price tumbles 9% despite record quarterly lithium shipments
• Here are the top 10 ASX 200 shares today
• Why are ASX lithium shares powering higher today as the resource sector bleeds?
• Invested $3,000 in Mineral Resources shares in 2018? Here’s how much dividend income you’ve received

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.

from The Motley Fool Australia https://ift.tt/qmZ9ftW

There is a common trap that investors fall into of not buying ASX shares that have reached a year-long peak.

Perhaps the logic is that the stock has “exhausted” its good run, so there can’t be much upside.

But that would be false reasoning.

Shares have no memory of where they have been in the past. The only thing that matters is how the business will perform in the future, and how that will be received by investors.

As such, Shaw and Partners portfolio manager James Gerrish gave his thoughts on whether two particular S&P/ASX 200 Index (ASX: XJO) shares that are currently on fire are still worth buying:

Buy this stock now for exposure to a commodity in hot demand

The Washington H Soul Pattinson and Co Ltd (ASX: SOL) share price hit a 52-week high about a fortnight ago and has hovered around there since.

Gerrish admitted that the investment company stock has been wild in recent times, but with good reason.

“It’s certainly been a volatile stock over the last few years, which is a reflection of the volatility in New Hope Corporation Limited (ASX: NHC), where Soul Pattinson holds a 37.6% stake, a whopping ~$1.7 billion investment,” he said in a Market Matters Q&A.

Indeed the New Hope share price has swung up and down within a massive range of $3.14 to $7.46 in the past year.

But because Gerrish’s team is “long and bullish” on New Hope and fellow coal miner Whitehaven Coal Ltd (ASX: WHC), Soul Pattinson is worth a buy as a proxy.

“Whitehaven Coal… rallied strongly on Friday because the market came to appreciate just how much cash they are producing,” he said.

“Hence we would be accumulating Soul Pattinson now if we were looking for some additional quasi-coal exposure.”

‘Strong earnings growth’ justifying high share price

Pallet provider Brambles Limited (ASX: BXB) this week celebrated a 52-week peak in its share price.

“Brambles has indeed been a top performer over the last 12-months rallying 58% from its April 2022 low, with the most important question being ‘Can it continue’?”

Earlier this month the company provided a positive update.

“They delivered a strong 3Q23 update, plus they also upgraded FY23 guidance,” said Gerrish.

“There is a shortage of pallets globally which means they can charge more while the cost of new ones has dropped as the price of lumber has fallen. This has driven a return to positive free cash flow.”

While this anomaly will not last forever, Gerrish reckons the current share price is still decent value.

“While things will go back to normal as supply chains pick up and pallet availability improves, Brambles is in a good position, and on 20x estimated FY23 earnings we are adopting a mildly bullish stance at this point in time,” he said.

“Bramble’s current price can be justified, as it’s underpinned by strong earnings growth.”

The post 2 popular ASX 200 shares trading near 52-week highs. Is it too late to buy? appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Investing 15% of my salary could yield $500 in a monthly second income
• An ASX 200 share I’d buy with my last $2,000!
• 5 dividend shares I think are among the safest on the ASX
• ‘Nearing inflection point’: The ASX 200 stock that Wilson’s backing to go to the moon
• 3 ASX 200 shares making big moves following quarterly updates

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

from The Motley Fool Australia https://ift.tt/O0HkCqf

It has been a tough week for the A2 Milk Company Ltd (ASX: A2M) share price.

Since this time last week, the infant formula company’s shares have lost 9% of their value.

This leaves them trading at $5.41, which means they are now down over 20% since the start of the year.

Why is the A2 Milk share price sinking this week?

Investors have been hitting the sell button this week after the company released a trading update.

That update revealed that the company has lowered its total forecast production volume needs for English label consumer-packaged infant milk formula by ~1,650 metric tonnes for the period March through to June. This is due to significant daigou weakness, inventory build-up, and distribution model adjustments.

And while the company reaffirmed its guidance for FY 2023, it admitted that its sales growth may be at the very low end of its previous range.

Is this a buying opportunity?

The team at Morgans has been looking over the update and has given its verdict on the A2 Milk share price. In respect to the update, the broker commented:

A2M has responded to SML’s profit downgrade (another one) today with a slight revision to its own sales guidance largely due to continued weakness in the ANZ Daigou market (its highest margin IF product). With uncertainty around SAMR approval and challenging market conditions, the fact that A2M has only slightly revised its revenue guidance, is potentially not as bad as feared.

However, due to the increased uncertainty, the broker is holding firm with its hold rating and a trimmed price target of $6.05, which implies 12% upside. It said:

While we think SML/A2M should eventually get SAMR approval, we retain a Hold rating. A2M is trading on full multiples and earnings uncertainty remains heading into FY24 given the challenging market conditions are likely to persist while industry participants await SAMR approval and China’s birth rate remains weak.

The post Here’s what this top broker thinks of the A2 Milk share price after recent weakness appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why A2 Milk, Mesoblast, Mineral Resources, and Synlait shares are sinking
• A2 Milk share price on watch following worrying update
• The A2 Milk share price has fallen 16% in around two months: Time to buy?
• Here are the top 10 ASX 200 shares today
• Why have A2 Milk shares come off the boil again?

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 A2 Milk. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/mUgEBHt

BHP Group Ltd (ASX: BHP) shares have been having a tough time in recent sessions.

For example, since this time last week, the mining giant’s shares have lost 5.5% of their value.

This has been driven by a combination of the release of its quarterly update, falling iron ore prices, and concerns over global economic growth.

Will BHP shares rebound?

While the recent pullback by BHP shares is disappointing for shareholders, it could have created a buying opportunity for others.

Particularly given that a number of brokers believe the Big Australian’s shares could rise beyond the $50 mark again in the coming months.

For example, Morgans has just reiterated its add rating with a $50.40 price target. Based on the current BHP share price of $44.33, this implies potential upside of almost 14% for investors over the next 12 months.

It is a similar story over at Goldman Sachs. While its analysts only have a neutral rating on the mining giant’s shares, they have a price target slightly higher than Morgans’ at $50.50. This suggests 14% upside for investors from current levels.

A third broker that sees scope for the miner’s shares to climb beyond $50.00 is Macquarie. Its analysts responded to BHP’s quarterly update by retaining their outperform rating with a $52.00 price target. If BHP shares were to climb to this level, it would mean a sizeable 17% return for investors.

But the returns won’t stop there. All three brokers are expecting an attractive fully franked dividend yield in FY 2023. Morgans expects a 6.5% yield, Goldman is forecasting a 7% yield, and Macquarie is anticipating a yield of approximately 7.6%.

This boosts the total return on offer with BHP shares to over 20% in all cases, which could make it well worth considering if you’re looking for mining sector exposure.

The post Top brokers predict BHP shares to surge past $50 again in 2023 appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Morgans says ‘attractive buying opportunity’ coming for BHP shares
• 3 ASX 200 stocks brokers just upgraded to ‘buy’
• Top brokers name 3 ASX shares to buy today
• Down 8% in a week, is the BHP share price facing more headwinds in 2023?
• Investing in ASX 200 mining stocks? Here’s Citi’s latest iron ore price forecast

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.

from The Motley Fool Australia https://ift.tt/ioQgHmy

Santos Ltd (ASX: STO) shares have descended over the past year, but is now the time to buy?

The oil and gas producer’s share price has slid 10% in a year to $7.09. For perspective, the S&P/ASX 200 Energy Index (ASX: XEJ) has climbed 7.34% in the past 12 months.

Let’s check the outlook for the Santos share price.

What’s ahead?

Analysts at Macquarie have retained a “buy” rating on Santos shares with an upgraded price target.

Macquarie is tipping the Santos share price to hit $9.95, a 40% upside on its last closing price.

The team at Morgans was impressed with Santos’ latest quarterly results and believes the company’s shares are undervalued at their current price.

Santos delivered its first-quarter 2023 results to the market last week. Sales revenue and production both fell 13% compared to the prior quarter.

However, Santos maintained its full-year 2023 production guidance of 86 to 96 mmboe production.

Timing on the company’s Barossa Project in the Northern Territory could also be weigh on investors’ minds. Drilling activity at the project remains on hold pending the submission and approval of an environmental plan.

In the quarterly report last week, management said drilling activities could recommence “before the end of the year”.

Of course, future oil and gas prices can significantly impact Santos shares. The price of crude oil has dropped 28% in a year, while natural gas has shed 67% in the last 12 months, Trading Economics data shows. The price of oil and gas impacts the company’s revenue and, in turn, net profit after tax (NPAT).

Commenting on the outlook for the oil and gas price in a research note last Friday, ANZ analysts Daniel Hynes and Soni Kumari said:

Diesel demand is showing bouts of weakness in key markets, while US gasoline remains resilient. China’s oil demand recovered to 14.5mb/d. US oil inventories are retreating, while supply growth remains muted. Meanwhile, ample inventories are weighing on gas prices.

LNG imports are rising in Asia ex-China. Falling renewable electricity generation in Europe is likely to stimulate demand for gas.

Share price snapshot

The Santos share price has descended 0.7% in the year to date. However, in the past month, it has climbed 3.5%.

Santos has a market capitalisation of about $23.3 billion based on the latest share price.

The post Macquarie says buy Santos shares now for 40% upside appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 things to watch on the ASX 200 on Thursday
• Are Santos shares worth buying following the oil giant’s latest results?
• 5 things to watch on the ASX 200 on Monday
• Top brokers name 3 ASX shares to buy next week
• Santos shares slide amid falling oil and gas prices

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.

from The Motley Fool Australia https://ift.tt/UKSTkFM

While receiving income from your ASX shares is great, receiving a lot is better!

Two shares that have been rated as buys and tipped to provide investors with big dividend yields are listed below.

Here’s what analysts are saying about these dividend shares right now:

Rio Tinto Ltd (ASX: RIO)

Goldman Sachs is forecasting a big dividend yield from this mining giant’s shares in FY 2023 and FY 2024.

The broker is expecting fully franked dividends per share of US$5.36 (A$8.08) in FY 2023 and then US$4.38 (A$6.60) in FY 2024. Based on the latest Rio Tinto share price of $112.17, this will mean yields of 7.2% and 5.9%, respectively.

In addition to a big dividend yield, Goldman also sees plenty of upside for its shares. The broker currently has a conviction buy rating and $136.20 price target on them. Its analysts explained the reason for their bullish view. They said:

We are Buy rated on RIO and add to the CL due to: (1) compelling relative valuation vs. peers (0.9xNAV vs. BHP 1.05xNAV and FMG 1.5xNAV), (2) strong FCF and Div yield with our bullish view on iron ore, aluminium and copper prices, (3) strong production growth from iron ore and copper (+8% Cu Eq terms in 2023E, +5% in 2024E), (4) the potential for FCF/t improvement in the Pilbara in 2023 with Guida-darri and over the medium to long run driven by Rhodes Ridge, and (5) World’s highest margin low emission aluminium business.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX share that has been tipped to provide a big dividend yield is Universal Store. It is a youth fashion retailer behind brands including Perfect Stranger, Thrills, and (of course) Universal Store.

Morgans is very bullish on the company and is expecting its strong earnings growth to underpin fully franked dividends per share of 30 cents in FY 2023 and 35 cents in FY 2024. Based on the current Universal Store share price of $4.70, this will mean dividend yields of 6.4% and 7.45%, respectively.

As with Goldman and Rio Tinto, Morgans also sees plenty of room for Universal Store’s shares to rise from current levels. It has an add rating and $7.00 price target on them. The broker commented:

UNI has opportunities to grow steadily through the rollout of bricks and mortar stores, increased digital penetration and expansion of wholesale channels. While we recognise the general risk around a decline in consumer expenditure on discretionary categories like apparel, we highlight that the youth demographic is likely to be more resilient.

The post Buy these ASX shares with big dividend yields: brokers appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#0095C8”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#0095C8”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Why Allkem, Blackmores, Helloworld, and St Barbara shares are charging higher
• How I’d invest $20k in ASX stocks today to target serious wealth
• Why has the Rio Tinto share price dived 9% in 5 days?
• Investing in ASX 200 mining stocks? Here’s Citi’s latest iron ore price forecast
• Want to buy ASX 200 mining shares? Goldman Sachs says these are top 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.

from The Motley Fool Australia https://www.fool.com.au/2023/04/28/buy-these-asx-shares-with-big-dividend-yields-brokers/