Tag: Motley Fool

S&P/ASX 200 Index (ASX: XJO) tech share Nextdc Ltd (ASX: NXT) is off to the races today.

Shares in the Australian data centre developer and operator closed yesterday trading for $11.12. Shares are currently changing hands for $12.17 apiece, up 9.4% in midday trading.

The ASX 200 is also in the green today, up a more modest 0.58%.

Here’s what’s driving investor in the blue-chip tech company on Wednesday.

Why is the ASX 200 tech share leaping higher?

The NextDC share price is surging after the company updated the market on its data centre utilisation capacity.

NextDC reported that in the wake of recent customer wins, its contracted utilisation has increased by 43%, or 35.9 megawatts (MW), to 120MW since 31 December.

The company’s new S3 data centre has been the biggest beneficiary of the new customer contracts, having now reached 46% of its total planned capacity.

Commenting to the customer wins driving the ASX 200 tech share higher today, NextDC CEO Craig Scroggie said, “It is very pleasing for the company to have secured this record level of incremental customer contract wins.”

Looking ahead, Scroggie added:

Having done significant work over recent years to deliver UI certified Tier IV metropolitan hyperscale data centres in S3, M2 and M3, the company is very well positioned to continue to take advantage of further customer growth across these critical digital infrastructure assets.

NextDC noted that it expects to progressively recognise revenue from most of the new customer contract wins from late FY24 through FY29. This will follow on the completion and commissioning of additional data halls over the coming years.

The ASX 200 tech share has already secured expansion land in the Macquarie Park availability zone for S5 Sydney. Subject to development approval, NextDC expects S5 will accommodate target IT capacity of 60MW+ once it’s constructed.

NextDC share price snapshot

As you can see in the chart below, the NextDC share price has been a stellar performer in 2023, up 32%. The ASX 200 tech share is up 9% over the past 12 months.

The post <strong>ASX 200 tech share NextDC just rocketed 9%. Here’s why</strong> appeared first on The Motley Fool Australia.

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More reading

• The broker community’s 3 best ASX 200 shares to buy for 2023
• These are the best ASX sectors to invest your money into this quarter: Morgans
• Morgans names 3 more of the best ASX 200 shares to buy in April
• Top brokers name 3 ASX shares to buy next week
• Here are the 10 most shorted ASX shares 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 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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Are you looking for some ASX dividend shares to buy for your income portfolio? If you are, then the two listed below could be worth considering.

Both have been named as buys and tipped to provide investors with good yields. Here’s what you need to know about them:

Charter Hall Long WALE REIT (ASX: CLW)

The first ASX dividend share that has been named as a buy is Charter Hall Long Wale REIT.

It is a property company focused on high quality assets that are leased to corporate and government tenants on very long leases. This includes industrial properties (such as supermarket distribution centres), telco exchanges, and agri-logistic properties.

The team at Citi is positive on company, highlighting its “low risk income stream with c. 12 year WALE and 99.9% occupancy.”

It expects this to support dividends per share of 28 cents in FY 2023 and 29 cents in FY 2024. Based on the current Charter Hall Long Wale REIT share price of $4.25, this will mean yields of 6.6% and 6.85%, respectively.

Citi currently has a buy rating and $5.00 price target on its shares.

National Australia Bank Ltd (ASX: NAB)

Another ASX dividend share that has been named as a buy is big four bank, NAB.

The team at Goldman Sachs is feeling very positive on the bank in the current environment. This is due to its exposure to commercial lending. The broker highlights that it sees “volume momentum over the next 12 months as favouring commercial volumes over housing volumes.”

This is good news for NAB, as Goldman believes it “provides the best exposure to this thematic.”

In respect to dividends, Goldman is expecting this to underpin fully franked dividends of $1.73 per share in FY 2023 and $1.76 per share in FY 2024. Based on the current NAB share price of $28.26, this implies yields of 6.1% and 6.2%, respectively.

Goldman Sachs has a buy rating and $35.42 price target on its shares.

The post Buy NAB and this ASX dividend share now: analysts appeared first on The Motley Fool Australia.

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More reading

• It’s official, the ASX 200 big four banks are the world’s most capitalised. Should you buy?
• Analysts reckon you should add these ASX dividend shares to your retirement portfolio
• Mortgage competition has never been hotter, so are NAB shares worth buying right now?
• How much do you need to invest to give up work and live only off dividend income?
• Could right now be a great time to buy ASX 200 bank stocks for passive income?

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

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S&P/ASX 200 Index (ASX: XJO) dividend shares are back on centre stage.

With bank deposit rates failing to keep up with inflation, more investors are turning to ASX 200 shares to secure valuable passive income streams.

But not all income stocks are created equal.

So, here are three handy tips to squeeze the most passive income from ASX 200 shares.

Steer clear of this trap

The first tip we’ll cover is a type of dividend share to do your best to avoid.

This is a company that’s quoting an attractively high trailing dividend yield, but one that is unlikely to be able to sustain that yield moving forward.

You may have heard these called dividend traps, or value traps.

Investors can stumble into these traps on several fronts.

First, an ASX 200 company may have seen its share price halve in value since its last dividend payout. This could happen due to a variety of company-specific, broader market-related, or legal reasons.

When the share price is halved, the trailing yield is doubled. While that looks good on paper, there’s a very good chance the upcoming dividend payouts will be significantly reduced.

Ideally, you want to invest in an income stock that’s been growing its market share and profits, and increasing its dividends consistently over the past several years.

Second, some ASX 200 shares operate in highly cyclical sectors, like resources. When the price of those resources is high, so are the profits and resulting dividend payouts.

These are good passive income stocks to hold during the rising part of the resource cycle. But you’ll likely find the dividends falling along with the price of those resources as the cycle enters its downturn.

ASX 200 shares with tax benefits

The second handy tip to get the most passive income from your investments is to focus on ASX 200 shares with fully franked dividends.

Australia is fairly unique in that investors receive credit for any taxes a company has already paid on its profits when it comes to dividend payouts.

That means if a company has paid its full 30% corporate tax rate down under, its dividends will be 100% franked. Come tax time, to avoid double taxation, that in turn means the investor won’t be liable for that part of the tax burden.

If your personal tax rate is less than 30%, you should even be eligible for a rebate on the difference.

But regardless of your personal tax rate, fully franked dividends will help you squeeze the most passive income from your ASX 200 shareholdings.

Reinvest and compound

Which brings us to our third handy tip to get the most passive income from your ASX 200 shares.

The dividend reinvestment plan (DRP).

Not all companies offer these. But it’s worth favouring those who do, so long as you don’t require access to your passive income payments straight away.

Participating in a company’s DRP is voluntary. And you can opt to fully or partly reinvest your dividend payment.

Opting for the DRP has several advantages.

First, you won’t have to pay any trading fees or transaction costs.

Second, you put the power of compounding to work for you. Meaning you’ll now be earning a yield on those reinvested dividends.

Over time, the power of that compounding can help you get a lot more passive income from your ASX 200 shares than you may have thought possible.

The post 3 handy tips to squeeze the most passive income from ASX 200 shares appeared first on The Motley Fool Australia.

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More reading

• Buy NAB and this ASX dividend share now: analysts
• Buy Rio Tinto shares ahead of BHP: Goldman Sachs
• Whitehaven share price tanks 7% on downgraded FY23 guidance
• Need passive income? Turn $6,000 into $100 every month
• Pilbara Minerals is one of the cheapest shares in the ASX 200. Am I buying?

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

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When it comes to the mining sector, there are two ASX mining shares that stand head and shoulders above the rest.

These are of course BHP Group Ltd (ASX: BHP) and Rio Tinto Ltd (ASX: RIO).

Collectively, these mining giants are bigger than the big four banks combined and distribute tens of billions of dollars in dividends each year.

But if you could only buy one of these ASX mining shares, which one would it be?

Well, according to analysts at Goldman Sachs, Rio Tinto shares are the ones to buy ahead of BHP right now.

Buy Rio Tinto shares ahead of BHP

According to the note, the broker has reiterated its conviction buy rating on Rio Tinto shares with a price target of $138.30.

Based on the current Rio Tinto share price of $121.66, this implies potential upside of almost 14% for investors over the next 12 months.

And with Goldman expecting a 7% fully franked dividend yield over the next 12 months, the total return stretches to approximately 21%.

As a comparison, the broker has retained its neutral rating and $50.40 price target on BHP’s shares.

Why Rio Tinto?

Goldman has a preference for Rio Tinto shares over BHP due to its valuation, free cash flow generation, and production growth outlook. It explained:

We prefer RIO over BHP on valuation & FCF and an expected operational turnaround in the Pilbara and copper (Oyu Tolgoi) driving higher Cu Eq growth over the next 2-years.

The broker is also expecting a strong quarterly update from Rio Tinto later this month, whereas it suspects that “weak results” could be coming from BHP. It adds:

Positive results from: RIO with Pilbara shipment data indicating a 13% YoY increase in Pilbara iron ore shipments to ~80Mt (see Exhibit 11) putting RIO well on track to hit the top end of the 320-335Mt guidance range for 2023 when seasonally adjusting for wet weather in 1H. […] Weak results from: BHP with lower YoY iron ore (safety, maintenance, port debottlenecking tie-in impacts) and met coal shipments (wet weather) and an expected decline in copper production from Spence in Chile due to plant tie-ins.

The post Buy Rio Tinto shares ahead of BHP: Goldman Sachs appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• If I buy BHP shares now, what could my return be in a year’s time?
• The BHP share price is taking off today. Could this be why?
• Buy these ASX dividend shares for a big passive income boost: Goldman Sachs
• How to start building a lifelong passive income with just $5 a day: Tips and Tricks

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

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The Whitehaven Coal Ltd (ASX: WHC) share price is tumbling this morning after the ASX coal miner downgraded its full-year guidance for FY23.

The Whitehaven share price dropped to $6.44 in early trading, a fall of 7.3% on yesterday’s closing price.

Labour shortages and bad weather have caused delays in production, resulting in a downgraded forecast for production and sales and increased unit costs for the full-year FY23.

Whitehaven previously expected managed run-of-mine (ROM) coal production of 19Mt to 20.4 Mt across its three key assets at Maules Creek, Narrabri, and Gunnedah.

The company is now guiding full-year production of 18Mt to 19.2Mt instead.

The coal miner previously guided managed coal sales of 16.5Mt to 18Mt but is now guiding 15.3Mt to 16Mt. It previously guided equity coal sales of 13.1Mt to 14.4Mt but is now expecting 12.3Mt to 12.9Mt.

Whitehaven has also revised its unit cost of coal (excluding royalties) expectations upward from a range of $95 to $102 per tonne to a range of $100 to $107 per tonne.

Why has Whitehaven downgraded its FY23 guidance?

In a statement, Whitehaven said production during the March quarter came in “below plan” at 4.3Mt.

The company said:

Labour shortages are being felt across the business, but the impact of several additional operational constraints at Maules Creek meant its production increased by only 9% relative to the December quarter.

This lower than planned increase reflects labour constraints, congestion arising from limited dumping locations while keeping manned and unmanned fleets separate, and intermittent weather interruptions in the month of March.

What’s next?

The company said overall production should get better in the June quarter. However, the problems at Maules Creek have pushed its overall forecasts below the bottom end of the previous guidance.

Lower production in the second half of FY23 “will result in some sales volumes being pushed into FY2024”, the company said.

During the March quarter, Whitehaven achieved an average coal price of about $400 per tonne.

On 31 March, its net cash position was $2.7 billion. It generated about $1.2 billion in cash from operations during the quarter.

Whitehaven Coal will release its official March quarter production report next Friday 21 April.

Whitehaven Coal share price snapshot

The Whitehaven Coal share price has been smashed in 2023. It is currently down 26% in the year to date.

Whitehaven shares shot the lights out in 2022, rising by more than 260% over the 12 months to 31 December due to booming commodity prices.

The post Whitehaven share price tanks 7% on downgraded FY23 guidance appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• 7 ASX dividend shares you can buy for under $10
• BHP share price dips as coal mines catch attention
• One of the most beaten-up ASX 200 shares of 2023 so far. Is it time to buy?
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Bronwyn Allen 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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There are a lot of options out there for readers that are wanting to generate passive income.

But when it comes to generating true passive income, the kind that is both sizeable and reliable, there’s simply no substitute for the power of compounding.

With compounding, you’re not just aiming to see growth today or tomorrow, or even a few years down the road. Rather, you’re looking at the bigger picture, with an eye towards where your investments might take you over the course of several decades.

The good news is that there are plenty of ASX shares that provide investors with regular income and have bright long-term growth prospects.

By investing a relatively modest $6,000 across these types of shares, investors could be generating decent income in time.

Income from ASX shares

Firstly, when it comes to which ASX shares to buy, you might want to channel your inner-Warren Buffett.

He looks for companies with fair valuations, strong business models, and competitive advantages. And given his investment track record at Berkshire Hathaway (NYSE: BRK.B), it would be hard to argue against this approach.

Once you have built your $6,000 ASX share investment portfolio, you can sit tight and let the magic of compounding do its thing.

Over the last 30 years, the Australian share market has generated an average annual return of 9.6%. And while there’s no guarantee that it will do the same in the future, we’re going to assume that it does for this exercise.

If your portfolio generated this return, in 15 years it would have grown to be worth approximately $24,000. That’s without lifting a finger or adding any extra funds.

Once you have reached that figure, if you can rebalance your portfolio so that it has a collection of dividend shares that average 5% yields, you will be earning $1,200 of passive income each year. This is enough to give you a monthly pay check of $100.

Want more?

If you want even more passive income, you have the option of adding to your portfolio each year.

Here’s a quick summary of how different annual contributions would impact the value of your portfolio at year 15:

• $1,000 a year = $57,500 and $2,900 of passive income
• $2,000 a year = $91,200 and $4,600 of passive income
• $3,000 a year = $125,000 and $6,250 of passive income
• $5,000 a year = $192,000 and $9,600 of passive income

As you can see, making annual contributions brings compounding to life and can give your portfolio (and passive income) a huge boost. Food for thought!

The post Need passive income? Turn $6,000 into $100 every month appeared first on The Motley Fool Australia.

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More reading

• Warren Buffett is doubling down on these Japanese stocks. How can ASX investors do the same?
• How to invest $300 a month using the Warren Buffett method
• How to start building a lifelong passive income with just $5 a day: Tips and Tricks
• How ASX investors can build a $1 million portfolio in 12 years
• I’d listen to Warren Buffett to grow my wealth with ASX shares

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 Berkshire Hathaway. The Motley Fool Australia has recommended Berkshire Hathaway. 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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Although lithium has been a hot S&P/ASX 200 Index (ASX: XJO) investment theme the last few years, just over the past six months, the commodity price has cooled off considerably.

That’s perfectly demonstrated in the Pilbara Minerals Ltd (ASX: PLS) share price, which has sunk more than 28.6% over that period.

So is it time to buy the dip, or have lithium producers passed their bull run?

Professional investors aren’t worried about dipping lithium prices

Lucky for The Motley Fool readers, a pair of experts this week had some opinions about the future of Pilabara shares.

They both rated it a buy.

Baker Young managed portfolio analyst Toby Grimm wasn’t too worried about the short-term crash in lithium prices, as the demand for the battery ingredient would not wane in the long run.

He cited Liontown Resources Ltd (ASX: LTR)’s rejection of Albemarle Corporation (NYSE: ALB)’s takeover bid as evidence that the industry itself is confident about the future of lithium.

“We believe Pilbara is worth adding to portfolios.”

eToro market analyst Josh Gilbert noted that Pilbara is increasing its output, which would cancel out the short-term dip in the commodity price. 

“Pilbara plans to increase production by 17% this year, with a target of doubling production by 2026.”

He urged investors to buy in with a long-term view.

“Electric vehicle adoption has really only just begun and has a long runway, with lithium demand only set to increase in the years ahead,” said Gilbert.

“According to Bloomberg, lithium-ion battery demand is expected to more than double in 2023 from 2020 levels, whilst EV sales look set to increase by more than 30% in 2023.”

Plenty of Gilbert and Grimm’s peers agree with their bullishness on Pilbara.

According to CMC Markets, 10 out of 17 analysts currently rate the stock as a buy. Nine of those even recommend Pilbara as a strong buy.

The post <strong>Pilbara Minerals is one of the cheapest shares in the ASX 200. Am I buying?</strong> appeared first on The Motley Fool Australia.

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More reading

• ‘Attractive value’: 2 ASX 200 mining shares ‘worth adding’ right now
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why are ASX lithium shares leaping ahead today?
• EverGreen Lithium share price rockets after IPO: everything you need to know
• 50% fall: Are ASX 200 lithium shares a bargain buy right now?

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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 have a higher than average risk appetite, then investing at the small end of town could be worth considering. Especially given the potentially strong returns that are on offer with small cap ASX shares.

But which small caps could be buys? Two that brokers rate as buys are listed below. Here’s what they are saying about them:

Maas Group Holdings Ltd (ASX: MGH)

The first small cap ASX share to look at is construction material, equipment and service provider, Maas.

Goldman Sachs is a fan of the company and believes it could be a small cap share to buy. This is due to its ongoing transition, which the broker believes will underpin higher quality earnings in the future. It explained:

We believe MGH is in a transition phase and will see higher quality real estate income become the largest source of earnings in the next 3-5 years. We believe the market is mispricing how MGH’s civil and construction capabilities support the property development business to deliver best-in-class margins and asset turnover. In our view the value created through the development of quality annuity revenue from Build-to-Rent (BTR), Land Lease (potentially generating a 4.5x ROIC annuity income stream) and commercial real estate projects could re-rate the stock.

Goldman has a buy rating and $4.00 price target on its shares. This compares to the latest Maas share price of $2.70.

Volpara Health Technologies Ltd (ASX: VHT)

Another small cap ASX share that has been tipped as a buy is Volpara. It provides software that uses artificial intelligence imaging algorithms to assist with the early detection of breast and lung cancer.

Morgans is very positive on the company’s outlook, particularly given recent regulatory changes in the massive US market. It said:

After a long wait, the FDA finalised federal legislation for mammography centers to report breast density to patients. This is positive for VHT’s FDA cleared AI volumetric density software. VHT also announced a further contract win with Sutter Health for their Risk Pathways product, with an additional TCV of US$900k over 3 years. This expands their existing relationship with Sutter. […] We view both of these announcements as incrementally positive for the company. We see VHT at a critical turning point in the company’s trajectory to profitability with improving investor sentiment.

Morgans has an add rating and $1.21 price target on its shares. This compares favourably to the latest Volpara share price of 77 cents.

The post Brokers say these small cap ASX shares are buys with huge upside potential appeared first on The Motley Fool Australia.

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More reading

• Brokers say these small cap ASX shares are buys
• How to make passive income for life with just $5 a day
• Brokers name 2 small cap ASX shares to buy now
• 3 ASX All Ordinaries shares I’m watching like a hawk in March

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 Volpara Health Technologies. The Motley Fool Australia has positions in and has recommended Volpara Health Technologies. 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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Warren Buffett is reportedly doubling down on Japanese stocks, bolstering his company’s holding in the nation’s five largest trading houses.

The man behind US$692 billion conglomerate Berkshire Hathaway (and arguably the face of value investing) told Nikkei that he’s “very proud” of the company’s stakes in Itochu Corp, Marubeni Corp, Mitsubishi Corp, Mitsui & Co, and Sumitomo Corp.

Berkshire Hathaway first snapped up shares in the trading houses – otherwise known as sogo shosha – in 2020, walking away with slightly more than 5% of the businesses, and has returned for more in the years since.

Buffett has now bolstered Berkshire’s stake in each of the Japanese shares to 7.4%, CNBC reports. And that might not be the last of the investing great’s buying action.

The trading houses operate businesses in a multitude of industries, ranging from finance and banking to chemicals and textiles. Commenting on their appeal, Buffett told Nikkei:

We feel that these five companies are a cross section of not only Japan but of the world.

They are really so much similar to Berkshire. They own a lot of different things.

So, how might ASX investors follow in Buffett’s footsteps? Here are two avenues one might take.

How can ASX investors follow in Buffett’s footsteps?

Unfortunately, none of the Japanese shares snapped up by Buffett is also listed on the ASX.

However, there are two ways in which I think one could take inspiration from the billionaire’s latest move without leaving the Aussie bourse.

Invest in Japan-focused ETFs

The first is to invest in exchange-traded funds (ETFs) tracking the Tokyo Stock Exchange.

One listed on the ASX is the iShares MSCI Japan ETF (ASX: IJP). Each of the five Japanese stocks recently bought by Buffett make up between 1.35% and 0.59% of the ETF.

Look to ASX-listed investment houses

Another way to take inspiration from Buffett’s latest buy may be to look to the investment houses’ Aussie counterparts.

One such ASX-listed investment house is Washington H Soul Pattinson and Co Ltd (ASX: SOL). It boasts a diversified portfolio of assets across a range of industries, with some of its major holdings operating in the energy and building sectors.

The post Warren Buffett is doubling down on these Japanese stocks. How can ASX investors do the same? appeared first on The Motley Fool Australia.

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More reading

• How to invest $300 a month using the Warren Buffett method
• Blue chip beat-down: 5 huge ASX 200 shares cementing new 52-week highs today
• How to start building a lifelong passive income with just $5 a day: Tips and Tricks
• How I’d invest $5,000 today for long-term passive income
• How I’m building more passive income to retire early

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 Berkshire Hathaway and 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 Australia has recommended Berkshire Hathaway. 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 world – and the ASX – was a different place in April 2020. Most of us were likely locked down that month as the COVID-19 pandemic took hold around the world. Meanwhile, units in the Vanguard Australian Shares Index ETF (ASX: VAS) were trading for just $68.16 in the midst of the uncertainty.

If you were quick thinking enough to sink $10,000 into the exchange-traded fund (ETF) tracking the S&P/ASX 300 Index (ASX: XKO) at that point in time, you likely would have walked away with 146 units.

Today, that parcel would be worth $13,268.48. The Vanguard Australian Shares Index ETF last traded at $90.88 – 33% higher than it was this time three years ago.

For comparison, the S&P/ASX 200 Index (ASX: XJO) has gained 36% in that time.

But what about the dividends on offer from the ETF? Let’s factor them into the fund’s returns.

All dividends paid to those invested in the VAS ETF since 2020

Here are all the quarterly offerings paid by the Vanguard Australian Shares Index ETF in the last three years, rounded to the nearest cent:

VAS dividends’ pay date	Dividend value
January 2023	75 cents
October 2022	$1.45
July 2022	$2.16
April 2022	$2
January 2022	70 cents
October 2021	$1.41
July 2021	56 cents
April 2021	77 cents
January 2021	43 cents
October 2020	57 cents
July 2020	21 cents
April 2020	67 cents
Total:	$11.68

As readers can see, each of the ETF’s units has yielded $11.68 since April 2020.

That means our figurative $10,000 investment has provided $1,705.28 in passive income over its lifetime – bringing its total return on investment (ROI) to 50%.

And that’s before considering the franking credits also provided by the ETF. They may have provided tax benefits for some investors.

The Vanguard Australian Shares Index ETF’s next dividend is worth approximately 58 cents and will be paid later this month.

Taking that payout into account, the ETF currently boasts a 5.4% dividend yield.

The post Sunk $10,000 in the Vanguard Australian Shares ETF 3 years ago? Here’s how much passive income you’ve earned appeared first on The Motley Fool Australia.

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More reading

• 3 reasons to start buying ASX shares this week
• How I’m building more passive income to retire early
• Why is the Vanguard Australian Shares Index ETF (VAS) tumbling on Monday?
• Here are the ASX shares I was buying and selling in March
• Hoping to bag the next Vanguard Australian Shares Index ETF dividend? You’d better hurry

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

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