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Once again, a large number of broker notes hit the wires last week. Some of these notes were positive and some were bearish.

Three sell ratings that caught my eye are summarised below. Here’s why top brokers think investors ought to sell these shares next week:

A2 Milk Company Ltd (ASX: A2M)

Analysts at Credit Suisse have retained their underperform rating but lifted their price target on this infant formula company’s shares to $5.50. The broker has lifted its price target to reflect slightly better than expected infant formula demand, which has resulted in an increase to its earnings estimates. Nevertheless, these estimates are still below consensus. UBS has concerns over the daigou channel and the lack of differentiation for its English label products. The A2 Milk share price was trading at $7.20 at Friday’s close.

Commonwealth Bank of Australia (ASX: CBA)

According to a note out of Morgans, its analysts have retained their reduce rating but increased their price target on this banking giant’s shares to $76.00. While Morgans is positive on the banking sector and is forecasting improvements in CBA’s return on equity and significant capital management, it isn’t enough for a change of rating. The broker continues to believe that the bank’s shares are expensive and therefore retains its reduce rating. The CBA share price ended the week at $98.59.

Macquarie Group Ltd (ASX: MQG)

A note out of Citi reveals that its analysts have retained their sell rating and $140.00 price target on this investment bank’s shares. This follows news that Macquarie has signed an agreement to acquire the global equities and fixed income business of AMP Ltd (ASX: AMP). Citi sees this as a signal that Macquarie is intending to build global scale in public markets. And while it sees positives from the deal and further opportunities to deploy excess capital, it feels its valuation is stretched and suspects the market is expecting too much from the company in respect to its earnings. The Macquarie share price was trading at $154.19.

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

More reading

• These were the best performing ASX 200 shares last week
• Why A2 Milk and Bega shares are looking so tasty now: analyst
• Brokers name 3 ASX shares to buy today
• ASX 200 midday update: Afterpay & CBA sink, Viva Energy jumps
• Why this leading fund manager is backing better times ahead for the Macquarie (ASX:MQG) share price

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 owns shares of and has recommended Macquarie Group Limited. 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 Bruce Jackson.

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It’s hard to believe another financial year has come and gone. Yet my calendar insists it’s so.

With that in mind, we bring you the 5 best performing ASX transport shares of the 2021 financial year (FY21).

As a benchmark to their performance, we use the All Ordinaries Index (ASX: XAO). From 1 July 2020 through to 30 June 2021, the All Ords gained 25%.

FY21 was a tough year for ASX transport shares, with many suffering from COVID driven border closures and social distancing measures. As you’ll see below, only 1 of our 5 top performers beat the benchmark.

Alliance Aviation Services Ltd (ASX: AQZ)

Topping the list – and the only ASX transport share to outperform the All Ords in FY21 – is Alliance Aviation Services. The company finished the year up 53.2% at $4.55 per share.

Based in Queensland, Alliance Aviation provides aircraft charter and group travel, including services to fly in, fly out (FIFO) workers in remote regions. Unlike larger airlines dependent on international and interstate travel, the company saw increased demand from the range of issues thrown up by the global pandemic.

With just under 160.5 million shares in circulation, Alliance Aviation has a market cap of $690.1 million. The company pays a 2.7% dividend yield, fully franked.

Qantas Airways Ltd (ASX: QAN)

The second best ASX transport share for the year, with a share price gain of 20.4%, is Qantas.

Founded in Queensland back in 1920, Qantas is the world’s third oldest airline still in operation. It runs 2 complementary airline brands – Qantas and Jetstar – offering regional, domestic and international services.

Despite international travel virtually grounded in FY21, and even much of its interstate routes jeopardised by rolling state border closures, investors appear to have faith in the airline’s longer-term value.

Qantas finished the year trading at $4.66 per share with a market cap of $9.1 billion. The airline pays a 3.1% dividend yield, 100% franked.

Air New Zealand Ltd (ASX: AIZ)

Coming in at number 3, we have Air New Zealand, which saw its share price lift 14.4% over the financial year gone by.

Founded in 1940, the company operates domestic and international services. It listed on the ASX in 1997 and is dual listed on the New Zealand Stock Exchange under the ticker (NZE: AIR).

While underperforming the benchmark, as with Qantas, investors appear to believe the ASX travel share has a strong future ahead of it once the pandemic is finally brought under control.

Air New Zealand ended FY21 at $1.44 per share with a market cap of $1.7 billion. It pays a hefty 7.3% dividend yield, unfranked.

Auckland International Airport Ltd (ASX: AIA)

Making the list as the fourth best performing ASX travel share is Auckland Airport, with shares closing up 13.2% in FY21.

As with our number 3 performer, Auckland Airport is also dual listed on the New Zealand Stock Exchange under the ticker (NZE: AIA). The company listed on the ASX in 1999, and with a market cap of $10.5 billion, it is among the largest listed companies in New Zealand.

Auckland Airport closed on 30 June at $6.76 per share. It pays a dividend yield of 1.4%, 43% franked.

Qube Holdings Ltd (ASX: QUB)

Finally, coming in at number 5, is Qube Holdings, which finished off the year with shares up 10.5%.

Now Qube differs from our first 4 ASX travel shares as the company’s not primarily involved with moving people, but rather things. Among its activities, Qube handles road and rail transport, and it has a 50% holding of Patrick Terminals, among the largest container terminal operators in Australia.

Qube finished FY21 with a share price of $3.17 and a market cap of $5.7 billion. The company pays a 1.6% dividend yield, fully franked.

The post Here are the 5 best ASX transport shares of the 2021 financial year appeared first on The Motley Fool Australia.

More reading

• The ASX shares with the most to lose from a delayed COVID reopening
• 3 ASX shares looking pretty cheap right now: expert
• ASX travel shares slip as Sydney lockdown extends for another week
• Auckland Airport (ASX:AIA) share price jumps 6% on travel bubble news
• Qube (ASX:QUB) share price lifts on $1.67 billion asset sale update

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 Bruce Jackson.

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The weekend could be a good time to consider looking into some ASX shares.

Shares are often described as volatile. But that also means that investors are presented with different opportunities at different (sometimes lower) prices.

These two ASX shares might be two worthy of considering:

VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO)

As the name suggests, this investment is an exchange-traded fund (ETF) that aims to give investors exposure to the video gaming and e-sports sector.

There are only a total of 26 businesses in the portfolio. The largest ten positions make up almost 62% of the portfolio. Those names are: Nvidia, Advanced Micro Devices, Tencent, Sea, Nintendo, Activision Blizzard, Netease, Bilibili, Unity Software and Roblox.

This ETF actually has more of the portfolio allocated to Asia than any other region. Asian weightings include China (19.5%), Japan (18%), Singapore (6.7%), South Korea (4.6%) and Taiwan (1.7%). The US has a weighting of 43.2%, so it still has the largest single country weighting. Other countries include Sweden and France.

Two of the selling points of the ETF, according to VanEck, is that it’s a dynamic growth opportunity and it provides technology diversification. The ASX share invests in the future of sports and accesses companies that are positioned to benefit from the increasing popularity of video games and eSports. Its portfolio gives technology diversification away from the usual names like Apple, Amazon, Facebook, Alphabet/Google and Microsoft.

Past performance is not an indicator of future performance. Over the last three years, the index that VanEck Vectors Video Gaming and eSports ETF tracks has produced an average return per annum of 31%.

Volpara Health Technologies Ltd (ASX: VHT)

Volpara is a leading medical technology ASX share.

Its main focus is providing software to help analyse breast scans. The company has been investing (and acquiring businesses) to ensure its breast health platform has the best patient experience, easier integration of expanded patient pathways and provides support for customer reporting compliance, whilst also positioning the company for scale.

A particular focus of the business is ‘risk’ for the patient. It recently bought CRA Health to expand its best-in-class personalised risk offerings to all customers whilst also getting a better connection with genetics companies.

The company is seeing a rising gross profit margin, an increasing group average revenue per user (ARPU) and improving scalability.

In FY21, the gross profit margin increased to 91%. The group ARPU increased from US$1.16 at the FY21 half-year result to US$1.40 in the FY21 result. In FY21, total revenue increased 57% and gross profit went up 67%, whilst operating costs only increased by 8%.

In FY22, the ASX share is expecting higher ARPU, new customers, upselling existing customers, acquisitions and a high retention rate.

Most new sales are now for two or three of Volpara’s products, representing significantly increased ARPU and the relationship with genetics companies is expected to increase that further.

The post 2 ASX shares that could be worth looking at this weekend appeared first on The Motley Fool Australia.

More reading

• 3 growing small cap ASX shares to watch
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• 2 ASX tech shares that might be buys in July 2021
• 2 top small cap ASX shares that might be buys
• Why Afterpay (ASX:APT) and this ASX share could be top growth options

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. owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia owns shares of and has recommended VOLPARA FPO NZ. The Motley Fool Australia has recommended VanEck Vectors ETF Trust – VanEck Vectors Video Gaming and eSports ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Shares in AGL Energy Limited (ASX: AGL) have plummeted this year as the stars align against the energy giant. Right now, the AGL share price is 32.96% lower than it was at the beginning of 2021.

The AGL share price closed at $12.12 on the first trading day of 2021. It finished Friday’s trade at $8.13.

In that same period, the S&P/ASX 200 Index (ASX: XJO) has gained 8.49%.

Let’s take a look at what’s been dragging on AGL’s performance on the ASX.

AGL‘s 2021

2021 hasn’t been a great year so far for AGL.

Since the year began, it’s lost a court battle against Greenpeace, spruced a 10% dividend yield for all the wrong reasons, and had its CEO walk out.

However, those aren’t the likeliest reasons the AGL share price has been falling this year.

AGL’s plan to split into two separate businesses has been weighing on its share price since March.

Under AGL’s proposal, one of the resulting businesses would focus on renewable energy, and the other would take control of AGL’s fossil fuel businesses.  

The company announced the plan in March.

The last we heard of the split was on 30 June, when AGL outlined how it will go ahead.

First, AGL will become Accel Energy, an electricity generation business. Then, Accel Energy will demerge a new entity named AGL Australia. AGL Australia will focus on energy-led retailing, flexible energy trading, storage and supply.

AGL shareholders will end up with 1 security in each company for every security of AGL they hold at the time of the split.

The second weight dragging down the AGL share price is continuous drops in wholesale electricity prices.

Wholesale electricity prices have been falling as a result of the availability of solar and wind-generated electricity increasing.

Unfortunately, this means the AGL share price is likely to be partly driven by happenings outside the company’s control.

AGL share price snapshot

Beyond 2021, the AGL share price hasn’t been performing at its best for a number of years now.

It fell 16% over the course of 2018, gained 2.7% in 2019, and fell 42% over 2020.

Since this time last year, the AGL share price has fallen 52%.

The company has a market capitalisation of around $5 billion, with approximately 623 million shares outstanding.

The post It hasn’t been a great 2021 so far for the AGL (ASX:AGL) share price appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to sell today
• How did ASX renewable energy shares perform in FY21?
• Best and worst performing ASX sectors of financial year 2021
• AGL and Zip shares were among the most traded ASX shares last week
• ASX 200 Weekly Wrap: ASX finishes FY21 on a high

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 Bruce Jackson.

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If you’re looking to beat low interest rates in 2021, then you might want to look at the dividend shares listed below.

Both shares offer investors generous yields that are vastly superior to those offered with term deposits and savings accounts. Here’s what you need to know about these dividend shares:

Mineral Resources Limited (ASX: MIN)

The first high yield ASX dividend share to consider is Mineral Resources. It is a mining and mining services company.

Mineral Resources has been tipped by analysts at Macquarie to reward shareholders with some big dividends over the next couple of years. This is thanks to its exposure to iron ore and lithium.

Macquarie is expecting Mineral Resources to pay fully franked dividends of $3.32 per share in FY 2021 and then $3.05 per share in FY 2022. Based on the latest Mineral Resources share price of $57.18, this will mean fully franked yields of 5.8% and 5.3%, respectively, over the next two financial years.

The broker currently has an outperform rating and $73.00 price target on the company’s shares.

Telstra Corporation Ltd (ASX: TLS)

Another ASX dividend share for income investors to look at is Telstra. It could be a good option due to its increasingly positive outlook.

This is due to sizeable cost cutting, restructuring, rational competition, and a positive growth outlook in the key mobile business driven by its 5G leadership.

One broker that is positive on Telstra is Ord Minnett. It has a buy rating and $4.10 price target on its shares at present. The broker also continues to forecast 16 cents per share fully franked dividends for the foreseeable future.

Based on the current Telstra share price of $3.75, this will mean attractive yields of almost 4.3% over the coming years.

The post 2 high yield ASX dividend shares that could be buys appeared first on The Motley Fool Australia.

More reading

• These 3 ASX 200 shares were the most heavily traded today
• It’s been a big month for the Mineral Resources (ASX:MIN) share price
• The Telstra (ASX:TLS) share price is now up 24% so far in 2021
• Why the Mineral Resources (ASX:MIN) share price hit an all-time high today
• Expert says more ASX shares to follow Sydney Airport (ASX:SYD) takeover trend

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 owns shares of and has recommended Telstra Corporation Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Is now a good time to consider buying Webjet Limited (ASX: WEB) shares despite all of the COVID-19 impacts? The Webjet share price has been volatile over the last 16 or so months.

It’s down around 6% from Thursday. Webjet has fallen 21% since 18 March 2021. The ASX travel share is still down around 50% from its pre-COVID-crash price.

A recovery halted in its tracks?

Less than two MONTHS ago, the business released its FY21 result.

In that REPORT, the company said that the financials reflected the continued impact of COVID-19 on the global travel industry.

But the company pointed to some shorter-term and longer-term positives.

It said that cost reductions were underway in all businesses and are expected to deliver 20% lower costs across the group once the business returns to scale.

Webjet also said that its online travel agency (OTA) profitability continues to improve which underscored the scalability of the business model, according to management. Its market share continued to increase and the FY21 second half earnings before interest, tax, depreciation and amortisation (EBITDA) margin was back above 30%.

As markets reopened, businesses were rebounding quickly. As at April 2021, Webjet OTA Australian domestic bookings were 95% of the level of April 2019 levels. WebBeds USA total transaction volume (TTV) was at 83% of April 2019 levels. Online Republic bookings were 48% of April 2019 levels.

Management also said that WebBeds is committed to emerging as the number one global business to business provider, taking advantage of new revenue opportunities. Transformation initiatives are on track to reduce costs by at least 20% when back at scale. It’s now targeting revenue to be 8% of TTV, costs to be 3% of TTV and EBITDA to be 5% of TTV. That translates to an EBITDA margin on revenue of 62.8%.

But Sydney and NSW are now being impacted by restrictions and lockdowns. Sydneysiders are limited to exercise within 10km or within their local government area (LGA). There have also been restrictions imposed in recent weeks in Melbourne, Perth and Brisbane.

Time to look at the Webjet share price?

One of the latest brokers to have their say on Webjet is Morgan Stanley. It has a price target of $4.30 on the business, which suggests a potential decline of more than 10% over the next 12 months if the broker is proven right. But the rating is currently a hold.

Morgan Stanley said that Webjet is being hurt by these COVID restrictions and it delays the domestic recovery. The summer in the northern hemisphere is also being impacted.

The post Is it now a good time to buy Webjet (ASX:WEB) shares? appeared first on The Motley Fool Australia.

More reading

• The ASX shares with the most to lose from a delayed COVID reopening
• ASX travel shares slip as Sydney lockdown extends for another week
• These are the 10 most shorted shares on the ASX
• ASX 200 Weekly Wrap: ASX finishes FY21 on a high
• Webjet (ASX:WEB) share price jumps on new four-step COVID-19 plan

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 owns shares of and has recommended Webjet Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Looking for some ASX 200 shares to add to your portfolio? Then take a look at the three listed below.

Here’s why they are rated as buys currently:

Aristocrat Leisure Limited (ASX: ALL)

The first ASX 200 share to look at is Aristocrat Leisure. It is one of the world’s leading gaming technology companies. The last 12 months have been difficult for Aristocrat but it has bounced back strongly and looks well-positioned for growth. Especially now both its pokie machine and digital businesses are pulling together again. Citi is a fan of the company. It has a buy rating and $46.00 price target on its shares.

REA Group Limited (ASX: REA)

REA Group could be an ASX 200 share to consider. It is the leading player in real estate listings in the Australian market. This is a great position to be right now thanks to the housing market boom, which is underpinning solid listings growth. In addition to this, cost cutting, new revenue streams, price increases, and acquisitions look set to give its sales and earnings a boost in the coming years. Goldman Sachs is very bullish on REA Group. It recently put a buy rating and $198.00 price target on its shares.

ResMed Inc. (ASX: RMD)

Another ASX 200 share to look at is ResMed. It is one of the world’s leading medical device companies with a focus on sleep disorders. ResMed has been tipped for further strong growth over the 2020s thanks to its enormous addressable market, its industry-leading technology, and its digital health ecosystem. In respect to the latter, the company’s investment in digital health have given it an advantage over much of the competition and puts it in a strong position to benefit from the shift to home healthcare. Macquarie currently has an outperform rating and $34.85 price target on its shares.

The post 3 ASX 200 shares named as buys appeared first on The Motley Fool Australia.

More reading

• 3 blue chip ASX 200 shares named as buys
• Leading broker names 3 blue chip ASX shares to buy
• Why Zip (ASX:Z1P) and this ASX growth share could be buys
• Top broker tips REA Group (ASX:REA) share price to hit $198
• The ResMed (ASX: RMD) share price was up 20% in June. Here’s why

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 recommended ResMed. The Motley Fool Australia has recommended REA Group Limited and ResMed Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It was a disappointing five days for the S&P/ASX 200 Index (ASX: XJO) last week. The benchmark index ended the period 35.3 points or 0.5% lower at 7,273.3 points.

While a good number of ASX 200 shares tumbled last week, some fells more than most. Here’s why these were the worst performers on the benchmark index:

PolyNovo Ltd (ASX: PNV)

The PolyNovo share price the worst performer on the ASX 200 last week with a 13.4% decline. This was despite there being no news out of the medical device company. However, the PolyNovo share price has been under a lot of pressure in 2021 due to concerns over slowing sales late in the first half. This latest decline means its shares are down 40% since the start of the year.

Nine Entertainment Co Holdings Ltd (ASX: NEC)

The Nine share price wasn’t far behind with a 10.8% decline. This decline may have been driven by a broker note out of Macquarie. Last week the broker downgraded the entertainment company’s shares to a neutral rating and slashed the price target on them to $3.00. The broker made the move on valuation grounds and due to concerns over short term headwinds.

Clinuvel Pharmaceuticals Limited (ASX: CUV)

The Clinuvel share price was a poor performer and sank 10.1% over the five days. Investors were selling this biopharmaceutical company’s shares following the release of a change of director’s interests notice. That notice reveals that the company’s CEO, Philippe Wolgen, has sold 122,675 shares on-market recently. Dr Wolgen received a total consideration of approximately $3.75 million.

Appen Ltd (ASX: APX)

The Appen share price was out of form and dropped 9% last week. This decline appears to have been caused by news that a major shareholder has been selling down its holding shortly after building it up. According to a ceasing to be a substantial holder notice, the Capital Group Companies has been selling a significant number of shares just a month after buying them. Its most recent sale involved 583,170 shares for just a touch over $8 million on 1 July.

The post These were the worst performing ASX 200 shares last week appeared first on The Motley Fool Australia.

More reading

• It has been a big past year for the ANZ (ASX:ANZ) share price
• These were the best performing ASX 200 shares last week
• These 3 ASX 200 shares were the most heavily traded today
• ASX 200 drops, Audinate booms, Humm falls
• The ASX shares with the most to lose from a delayed COVID reopening

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. owns shares of and has recommended Appen Ltd and POLYNOVO FPO. The Motley Fool Australia owns shares of and has recommended Appen Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It is possible to create a yearly income of $50,000 of dividends from ASX shares, if compound interest can be utilised.

Compound interest can help

One of the smartest people to ever live, Albert Einstein, once reportedly said the following quote about compound interest:

Compound interest is the eighth wonder of the world. He who understands it, earns it, he who doesn’t, pays it.

Compound interest can build and build like a snowball rolling down a hill. It’s where interest earns interest, which earns interest in the following year.

Here is an example of how compound interest can grow money:

If there is an interest rate of 5%, then $100 will give an investor $5 after the first year. But if the investor leaves that $100 for a decade and it grows at the 5% interest rate whilst re-investing, it would reach $163. If you’re wondering how long the $100 would take to double to $200, it would be less than 15 years.

But shares’ historical long-term returns haven’t been around 5%. It has been stronger. Over the decades the ASX’s average return per annum has been approximately 10% per annum.

According to Vanguard, Australian shares have produced returns of 9.8% per annum since 1970.

Compound growth

Investors can play around with a compound interest calculator to play out various scenarios with money. Moneysmart may have one of the leading calculators.

If an investor put $10,000 into the ASX share market and it returned 10% per annum over the next two decades then it would turn into just over $73,000 over the next 20 years. That is just with the initial $10,000 – no further additions of capital.

Plenty of people are regularly investing, even if they don’t think of it that way. Most employees make quarterly (or more regular) contributions into their superannuation fund. People are also able to make regular investments outside of their super fund.

If that same investor put in the $10,000 at the start and then invested $200 every month for the next two decades, with the ASX share market making returns of 10% per annum, then it turns into $225,000 over two decades.

Investors can play around with all the different potential scenarios – perhaps with a bigger upfront capital amount, or with higher monthly investing contributions.

If the investor put in $1,000 a month instead of $200 a month then they’d have $832,650 after that two decade period.

How does the $50,000 target of yearly dividends come in?

If an investor gives the portfolio a long enough time and makes regular contributions for a while, then the portfolio could grow into a large size. The portfolio can generate dividends each year.

For example, if a 25-year old decided to invest $1,000 a month into the ASX share market over the next 25 years until they were 50 and the share market returned 10% per annum then it would turn into a portfolio worth $1.18 million.

If the portfolio were invested in ASX shares that had an overall dividend yield of 4.5% then it would generate $53,107 of annual dividends (more than the $50,000 needed).

The Australian taxation system gives dividend investors a unique bonus with franking credits as a result of paying corporate tax.

The Australian Taxation Office (ATO) states:

Dividends paid to shareholders by Australian resident companies are taxed under a system known as imputation. This is where the tax the company pays is imputed, or attributed, to the shareholders. The tax paid by the company is allocated to shareholders as franking credits attached to the dividends they receive.

If you are an Australian resident, it will “reduce your tax liability from all forms of income (not just dividends) and from your taxable net capital gain” and/or “refund any excess franking to you after any income tax and Medicare levy liabilities have been met.”

What it means is that investors receive a higher after-tax dividend yield from ASX shares compared to international shares.

But investors would need to work out what yield and portfolio value they are looking for. A $1 million portfolio with a 5% yield would generate the $50,000 annual dividend target. However, a yield of 4% would need a larger portfolio yield.

The hardest decision might be finding which ASX shares to choose.

The post How to make a yearly income of $50,000 from ASX shares appeared first on The Motley Fool Australia.

More reading

• 5 best ASX media shares of financial year 2021
• It has been a big past year for the ANZ (ASX:ANZ) share price
• These were the best performing ASX 200 shares last week
• The 5 best ASX real estate shares of the 2021 financial year unmasked
• 3 blue chip ASX 200 shares named as buys

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 Bruce Jackson.

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The ASX is home to a number of big and small-name media shares, and we’ve found the 5 best performers of the 2021 financial year.

Shareholders of these entertainment, marketing, and news companies, get ready to celebrate!

5 best ASX media shares of FY21

For simplicity’s sake, we’ve narrowed this list down to ASX media shares with market capitalisations higher than $100 million.

Seven West Media Ltd (ASX: SWM)

The Seven West Media share price was best in class in the 2021 financial year, gaining a whopping 365%.

Its share price started the financial year at just 9.1 cents but, by its end, it was trading at 46.5 cents.

Seven West owns the West Australian newspaper and Channel Seven free-to-air television stations.

Seven West was one of many ASX media companies hit hard by Facebook Inc‘s (NASDAQ: FB) ban on Aussie news.

However, Seven was the first media company to claw its way out of the social media-meet-government pit, quickly making deals with some of the internet’s biggest players. First, with Alphabet Inc (NASDAQ: GOOGL), and later with Facebook.

Nine Entertainment Co Holdings Ltd (ASX: NEC)

The Nine Entertainment share price also did well in the financial year just gone. It gained an impressive 110%.

Having opened the financial year at $1.38, shares in Nine finished it trading for $2.91.

Nine is the definition of a media conglomeration. It owns the Channel Nine network, the Macquarie Radio network, the Stan streaming platform, and former Fairfax newspapers including The Sydney Morning Herald, The Age, and the Australian Financial Review.

In February, Nine reported its profits had doubled, and then in March, it announced its new CEO.

Like many other media companies, Nine penned deals with Google and Facebook over the financial year. However, Nine didn’t announce the deals until June.

News Corporation Class B Voting CDI (ASX: NWS)

Despite a barrelling of bad news, the News Corp share price gained 87% in the financial year just been. Its shares began the period swapping hands for $17.11 and finished the year trading at $32.16.

The conglomerate owns a multitude of newspapers and media titles including The Australian, News.com.au, The Daily Telegraph, Herald Sun, and The Courier-Mail.

It started the financial year at a low point, recording a net income drop of 919% before its proposed buyout of Foxtel was rejected.

Luckily, a series of more positive quarterly reports kept the market feeling positive about the Murdoch-owned entity.

News Corp was quick to make its deal with Facebook in March, just 10 days before it announced it was to acquire Investor’s Business Daily for $361 million.

oOh!Media Ltd (ASX: OML)

Ooh!Media shares grew by 78% during the year ended 30 June 2021 – its share price went from 91 cents to $1.75.

Ooh!Media specialises in ‘out of home’ advertising products such as billboards, transport advertising, and digital media. It also holds media brands Junkee and Punkee, and clients such as American Express Company (NYSE: AXP) and Netflix Inc (NASDAQ: NFLX).

Impressive half-year and quarterly reports, as well as a positive trading update each saw oOh!Media shares increasing over the financial year.

IVE Group Ltd (ASX: IGL)

Finally, IVE Group’s share price made it onto this list after gaining 69% in the 2021 financial year.

On 30 July 2020, its share price closed at 80 cents. Exactly 12 months later, it finished at $1.45.

IVE Group is a print and marketing communications company that specialises in print, mobile, and interactive media. Examples of its work include catalogues, magazine printing, and marketing materials.

Over the financial year just been, the company lost between $35 million and $40 million of annual income when Coles stopped distributing its catalogues. Then, it divested its telemarketing business.

However, it also won a 5-year contract worth more than $100 million annually and began an on-market share buy-back.

Finally, it released a positive business update and earnings guidance in late May.  

The post 5 best ASX media shares of financial year 2021 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. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. American Express is an advertising partner of The Ascent, a Motley Fool company. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Alphabet (A shares), Alphabet (C shares), Facebook, and Netflix. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Facebook, Netflix, and oOh!Media Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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