Tag: Motley Fool

You would be forgiven for never having heard of ASX consumer discretionary share MotorCycle Holdings Ltd (ASX: MTO).

The $125 million company tends to fly under investors’ radars despite being behind more than 40 motorcycle dealerships and accessories retail franchises across Australia.

And one of its newly instated insiders appears to have made the most of recent weakness in the stock.

The MotorCycle Holdings share price has tumbled more than 41% over the last 12 months to trade at $1.72 at the time of writing.

Let’s take a closer look at the insider buying going down at the ASX share this week.

Insider forks out $1m on embattled ASX share

MotorCycle Holdings director and executive Michael Poynton has topped up his stake in the ASX share – forking out more than $1.1 million to do so.

The insider snapped up 750,000 of the company’s shares for $1.53 apiece last Friday, leaving him with a 9% stake. And what a buy it’s proven to be – the parcel has already provided $150,000 of capital returns.

Interestingly, however, just a few months back Poynton didn’t have any position in the ASX share.

The now-insider was the co-founder of motorcycle wholesale business Mojo Motorcycles – which was snapped up by MotorCycle Holdings for $60 million last year.

Of the purchase price, $20 million was paid in cash, up to $10 million was deferred, and the rest provided as scrip with each share valued at $2.60. That left Poynton with a notable stake in the ASX-listed company.

And he isn’t the only insider buying up the stock this month.

MotorCycle Holdings founder, managing director, and CEO David Ahmet bought 50,000 shares for $1.72 each in an ASX market trade on 14 March. The following day, director Peter Henley snapped up 8,900 shares for $1.69 apiece.

What’s been dragging on MotorCycle Holdings shares?

So, what might be weighing the MotorCycle Holdings share price down lately? Well, the company operates in a cyclical environment.

When the cost-of-living rises – perhaps spurred by interest rate hikes – people tend to put a pause on non-essential purchases. Indeed, the company noted demand for motorcycles has tumbled in last month’s half-year earnings release.

Meanwhile, the cost of doing business is increasing, driven by higher wages, transport, and logistics costs.

MotorCycle Holdings posted $277.5 million of income last half – a 17% year-on-year improvement. Though, its net profit after tax (NPAT) slumped 17% to $10.5 million.

But management is confident it can turn things around – and recent buying suggests insiders might be too. Ahmet commented:

Despite the current economic challenges, the group has continued to invest for future growth including our people and digital capability, our dealer network, and our warehouse and supply chain management systems.

We are confident that the business improvements and capabilities we are investing in will strengthen our competitive position and generate long-term value for shareholders.

The post This little-known ASX share is down 40% in a year, and one insider just bought $1m worth 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

• Could this high-yielding dividend share be the best-kept secret on the ASX?

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.

from The Motley Fool Australia https://ift.tt/Hnb8G7r

The Zip Co Ltd (ASX: ZIP) share price is rocketing higher on Thursday morning.

At the time of writing, the buy now pay later (BNPL) provider’s shares are up 14% to 61.5 cents.

Why is the Zip share price racing higher?

Investors have been scrambling to buy Zip’s shares today after it released a very positive announcement.

According to the release, Zip has signed agreements to divest its wholly owned businesses in Central and Eastern Europe (Twisto) and South Africa (Payflex). In addition, it is on track with the wind-down of its business in the Middle East.

Management highlights that subject to closing conditions, including regulatory approval, it expects to receive aggregate net cash inflows of approximately $20 million during the second half of FY 2023.

Another positive is that these operations were operating at a loss and acting as a drag on its earnings. The company notes that its cash operating earnings for its EMEA businesses was -$10.2 million during the first half of FY 2023.

As a result, upon completion of these transactions and other actions, Zip will have successfully delivered on its objective of neutralising cash burn from its Rest of the World (RoW) footprint by the end of this financial year.

On target to achieve profit goals

The release also reveals that Zip continues to progress other activities in line with its strategic priorities.

All in all, management remains confident that it has sufficient available cash and liquidity to deliver on positive group cash EBTDA during the first half of FY 2024.

Zip’s co-founder and global CEO, Larry Diamond, commented:

Twelve months ago, in response to the changes in market conditions we pivoted our strategy from a focus on global growth to a focus on sustainable growth in our core markets, and accelerating our path to profitability. While we continue to see increased demand globally for our products from both customers and merchants, we made the decision to allocate resources to areas of our business that are either profitable or have a near and clear path to profitability.

The completion of these RoW assets sales marks another step in Zip’s transition as we become a stronger and leaner business, focused on core products in core markets. With sale proceeds of approximately $20m, RoW cash burn neutralised and the up to 50% improvement in Core Cash EBTDA we are expecting in H2 FY23, we remain confident that we have sufficient cash and liquidity to deliver on our target of group positive cash EBTDA during H1 FY24.

The Zip share price is now up 20% since the start of the year.

The post Zip share price leaps 14% on $20 million windfall 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

• Zip share price dips amid Apple’s BNPL US launch
• Here are the 10 most shorted ASX shares this week
• Why is the Zip share price soaring 7% today?
• Why New Hope, Pilbara Minerals, Westpac, and Zip shares are pushing higher
• Here are the 10 most shorted ASX shares this week

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 Zip Co. 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/QRL5Npi

The ASX share market has gone through some seismic shifts over the last three years. I think this is a great time to be looking at fallen ASX growth shares as recovery buys.

It’s understandable why some e-commerce players have fallen substantially over two years. COVID lockdowns are over, life is essentially back to normal and bricks and mortar shops are open.

However, I believe that the long-term trend of online shopping growth will continue from this level of ‘new normal’.

Younger cohorts of shoppers are seemingly as digitally savvy as ever, so I think we’ll see a larger percentage of the population buy more things online as time goes on. Plus, I think Australia’s growing population is a useful tailwind for businesses because the potential customer base is increasing.

I think the higher interest rates and inflation situation have made the following two ASX growth shares very appealing.

Adore Beauty Group Ltd (ASX: ABY)

Adore Beauty describes itself as an “integrated content, marketing and e-commerce retail platform that partners with a broad and diverse portfolio of more than 270 brands and over 12,000 products.”

The Adore Beauty share price has fallen by around 80% over the past two years.

It seemed clear that the ASX growth share wasn’t going to be able to keep sustaining its COVID-period numbers once the lockdowns ended. The FY23 half-year result showed a fall in revenue of 17% to $93.6 million.

But, in that same result, returning customers grew by 10% to 481,000 and they contributed 78% of all revenue.

Despite the fall in revenue and inflationary pressures, the company still managed to achieve a positive earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 0.4% and grow the cash balance by $0.3 million to $30.1 million.

I think the company’s initiatives like its app and owned-marketing channels (such as podcasts) can help grow the margins of the business.

It’s also growing its portfolio of own-brand products. Adore Beauty currently has two owned brands – Viviology and AB Lab. The company says that “new brands and products support customer retention and acquisition.”

Once it’s not cycling against elevated COVID sales, I think it will start showing growth again.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster describes itself as Australia’s largest pure-play online retailer of furniture and homewares. It sells over 200,000 products, though a lot of those are from hundreds of suppliers and are directly shipped to customers by those suppliers.

The ASX growth share does have its own private label range, sourced from overseas suppliers.

While it was cycling against a comparative period of lockdown demand, Temple & Webster was able to generate $207.1 million of revenue and an EBITDA margin of 3.5% in the FY23 first half.

The Temple & Webster share price is down over 60% in the last two years.

However, I think the company has a very promising future. It’s investing to offer online shoppers very useful tools like augmented reality, so households can see an item in their space. It’s also developing an AI interior design service.

The business has big plans to expand with home improvement items (like painting, plumbing, flooring) with its Big Build website business, as well as expanding its exposure to commercial customers.

The company makes the point that the UK and the US have much higher levels of online shopping adoption than Australia. But Australia is following a similar trend, so there could be a natural boost for the ASX growth share’s customer numbers in future years simply by higher levels of e-commerce adoption for furniture shopping.

It’s expecting to earn higher profit margins in the future thanks to scale benefits, which I think will helpfully boost the Temple & Webster share price.

The post I think these 2 ASX growth shares have been heavily oversold, I’d buy them in April 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

• This ASX 300 stock has plunged 25% in 2023, and one director is going thrift shopping
• Want big returns? Buy these ASX growth shares: analysts
• Buy Pilbara Minerals and this exciting ASX growth share: analysts
• Want to invest $10,000 in great ASX shares? I’d pick these 3
• 2 undervalued ASX shares to buy this month: expert

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 Temple & Webster Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Adore Beauty Group. The Motley Fool Australia has recommended Adore Beauty Group and Temple & Webster 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/zVRmUkd

The Temple & Webster Group Ltd (ASX: TPW) share price is heading in the right direction again on Thursday.

In morning trade, the ASX 300 stock is up 1.5% to $3.49.

Though, this is little consolation for longer term shareholders that have watched the Temple & Webster share price lose a quarter of its value in 2023.

Why is this ASX 300 stock rising today?

Investors have been buying this ASX 300 stock on Thursday after it revealed that an insider has been buying shares.

According to a change of director’s interest notice, the online furniture and homewares retailer’s independent non-executive director, Belinda Rowe, has added to her position.

The release notes that Rowe picked up 8,600 shares through an on-market trade on 27 March.

The director paid a total of $30,000 for this parcel of shares, which equates to an average of $3.49 per share.

This more than tripled Rowe’s holding to a total of 12,100 Temple & Webster shares.

Should you be buying?

Analysts at Goldman Sachs would approve of Rowe’s purchase of shares.

Its analysts are very bullish on this ASX 300 stock and have a buy rating and $6.50 price target on its shares.

Based on the current Temple & Webster share price, this implies potential upside of 86% for investors over the next 12 months.

Goldman is positive on the company’s outlook due to its structural growth opportunity. It explained:

The long term structural growth opportunity is unchanged: we forecast a 21% 10-yr EBITDA CAGR driven by consolidation of market share and growing online penetration. TPW is early in its maturity cycle which supports long term sustainable growth. Market share gains are driven by a favourable market structure (with a long tail of small, less well-capitalised competitors), growing online penetration, and TPW’s sustainable competitive advantages (scale; dropship inventory; brand; tech capabilities).

The post This ASX 300 stock has plunged 25% in 2023, and one director is going thrift shopping 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

• Want big returns? Buy these ASX growth shares: analysts
• Buy Pilbara Minerals and this exciting ASX growth share: analysts
• Want to invest $10,000 in great ASX shares? I’d pick these 3
• 2 undervalued ASX shares to buy this month: expert
• Brokers name 3 ASX shares to buy now

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 Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster 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/vtwFMZA

The All Ordinaries (ASX: XJO), or All Ords, stock Pact Group Holdings Ltd (ASX: PGH) could be a strong opportunity in 2023, according to the broker Credit Suisse.

Firstly, let’s talk about what the business actually does.

Pact describes itself as a leader in the circular economy, with its packing, re-using and recycling solutions. It aims to create “smarter ways of reducing waste through reusing and recycling resources, therefore keeping them in circulation well into the future.”

The re-use segment aims to eliminate single-use products. It offers a number of solutions including retailer garment hangers, fresh produce crates, steel drums, household wheelie bins and water tanks.

With its packing, it locally sources recycled materials for various categories like dairy, drinks, food, industrial, health and personal care.

Is the ASX All Ords stock an opportunity?

Over the past year, the Pact Group share price has dropped over 50%. That means it’s now much cheaper than in 2022.

The broker Credit Suisse recently slapped an outperform rating on the business, with a price target of $3.70, according to the Australian Financial Review.

Outperform essentially suggests that the broker believes it’s a buy.

A price target is where the broker thinks the share price will be in 12 months after the target was issued.

At the current Pact share price, that suggests the broker believes the ASX All Ords stock could rise by 235%.

Firstly, just remember that just because an expert says a share price is going to rise doesn’t mean it’s going to happen. It’s just their opinion.

However, the fall of the Pact share price does present an exciting opportunity, if the recovery occurs. If a share price falls 50%, a recovery back to the former value is a rise of 100%. Credit Suisse is suggesting the price can recover back to September 2021 levels.

How is the business performing?

The latest result was the FY23 half-year result, which showed an 8% increase in revenue, while underlying earnings before interest and tax (EBIT) fell 8% to $75 million, though EBIT was higher than guidance.

The All Ords ASX stock is working on “cost recovery and removing costs” in the business.

However, the materials handling and pooling business was “significantly impacted by a downturn and destocking in the US and Europe garment retail sector, in addition to reduced demand from China because of COVID lockdowns. Volume in the pooling business was impacted by “adverse weather conditions impacting growing regions in Australia and New Zealand.”

But, it did say that it’s expecting an improvement in the materials handling and pooling segment, with its Sulo bins business expected to report growth on the back of “significant local council contract wins.” The pooling business is expecting a recovery with a return to stable weather and growing conditions.

While debt is higher than the company would like, it decided not to pay a dividend so that it could reduce debt.

FY23 underlying EBIT is expected to be ahead of FY22’s underlying EBIT.

Pact share price valuation

According to Commsec, the business is expected to generate 16.1 cents of earnings per share (EPS). This would put the ASX All Ords stock at just 7 times FY23’s estimated earnings.

Commsec numbers suggest that the business could then generate 19.4 cents of EPS in FY24 and 19.8 cents of EPS in FY25. So, if those projections are correct, it’s on a very low forward price/earnings (P/E) ratio.

The post Top broker tips 230% upside for this ASX All Ords stock you’ve probably never heard of 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

• 2 ASX 200 mining shares just upgraded by Macquarie, one with 20% upside
• The trimmed-down BHP dividend will be paid today. What’s next?
• $1,600 annual dividend income from a $20,000 ASX share portfolio? Here’s how
• Forget term deposits and buy these high-yield ASX dividend shares instead: experts
• The biggest ever interim CBA dividend is being paid today. Here’s the latest

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

from The Motley Fool Australia https://ift.tt/SEe26kD

The materials sector – hosting many of the market’s favourite mining shares – makes up nearly a quarter of the entire S&P/ASX 200 Index (ASX: XJO). No doubt, then, some big winners can likely be found among its ranks.

Fortunately, broker Macquarie has done some digging recently, upgrading its outlook for two ASX 200 materials stocks. Let’s take a look at which materials giants have the top broker feeling bullish this week.

2 ASX 200 mining shares leaving top broker Macquarie bullish

Champion Iron Ltd (ASX: CIA)

The first ASX 200 mining share on the broker’s radar is Champion Iron. It posted record iron ore production from its Canada-based assets last quarter.

The company’s also looking into producing a direct reduction pellet food iron ore able to be used in electric arc furnaces, thereby halving steelmaking emissions.

The Champion Iron share price closed Wednesday’s session at $6.80, but Macquarie thinks it can go far higher.

The broker hit the stock with an outperform rating and an $8 price target, according to reporting by the Australian Financial Review. That marks a potential 17.6% upside.

South32 Ltd (ASX: S32)

Joining Champion Iron in being upgraded is ASX 200 diversified miner South32.

The BHP Group Ltd (ASX: BHP) spin-out produces alumina, aluminium, copper, silver, lead, zinc, nickel, manganese, metallurgical coal, and bauxite, many of which are critical to the energy transition.

Thus, the company’s products will likely be in demand in the coming years and decades. That could be a good sign for its bottom line.

Shares in the ASX 200 diversified mining company last traded at $4.23.

Considering Macquarie’s reported new outperform rating and $5.10 price target, the stock could offer more than 20% upside.

The post 2 ASX 200 mining shares just upgraded by Macquarie, one with 20% 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

• Here are the top 10 ASX 200 shares today
• Buy BHP and this ASX 200 mining share now: analysts
• Analysts say these ASX dividend shares can boost your passive income
• Want to boost your portfolio with ASX blue chips? Analysts say buy these shares
• ‘Increasing demand’: Expert picks 2 ASX 200 mining shares to buy (not BHP)

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

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

It’s a good day to be an owner of BHP Group Ltd (ASX: BHP) shares.

That’s because today is the day that the BHP dividend is being paid to eligible shareholders.

The BHP dividend

Last month, the Big Australian released its half-year results and, as was widely expected, posted a decline in revenue.

For the six months ended 31 December, BHP reported a 16% reduction in revenue to US$25,713 million. This reflects lower average realised prices for iron ore, copper, and hard coking coal, which was partially offset by higher prices for weak coking coal, thermal coal, and nickel.

It was a similar story for its earnings, with BHP posting a 28% decline in underlying EBITDA to US$13,230 million. This was driven by a combination of weaker commodity prices and inflationary pressures.

In light of this profit decline, the BHP board unsurprisingly elected to cut its interim dividend.

BHP declared an interim dividend of 90 US cents per share, which was down from US$1.50 per share a year earlier. Nevertheless, this still equates to a massive return of US$4.6 billion and is the equivalent to a 69% payout ratio.

Eligible shareholders can now look forward to receiving BHP’s interim dividend, which equates to A$1.36 in local currency, in their nominated bank accounts today.

What’s next for its dividends?

Thanks to recent strength in iron ore prices, Goldman Sachs is expecting the BHP final dividend to be larger.

It has pencilled in a fully franked final dividend of US$1.21 per share. This brings its full-year dividend to US$2.11 per share.

This equates to A$3.16 in local currency and is the equivalent of a generous fully franked 7% yield based on the current BHP share price of $45.00.

The post The trimmed-down BHP dividend will be paid today. What’s next? 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

• Buy BHP and this ASX 200 mining share now: analysts
• BHP share price dips as coal mines catch attention
• Why these 3 ASX 200 shares could be leading picks for dividends and growth
• Want $10,000 of passive income? Check out these ASX shares
• Own BHP shares? Here’s how the iron ore giant is cleaning up steelmaking’s act

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/5mua6dN

ASX dividend shares are capable of producing a high level of dividend income if investors choose ones with a good enough yield.

But, investors shouldn’t chase a high dividend yield just for the sake of it. If a business isn’t able to maintain (or even grow) earnings, then I think that the dividend is in danger of being cut.

So, with that in mind, I’d only want to choose businesses that look like they can achieve earnings per share (EPS) growth. This would achieve both good dividend income and hopefully some share price growth over the long term as well.

I think businesses that are in a good industry, with consistent demand, and are re-investing for growth, can lead to attractive dividend returns.

ASX dividend shares that could make $1,600 of dividend income from a $20,000 ASX share portfolio

To get that sort of income level, we’re talking about an average yield of 8%. So, let’s split the money across four investments.

I’d start with the ASX share Shaver Shop Group Ltd (ASX: SSG), one of the largest retailers of all things related to hair removal. Even in a downturn, I think the company will still see decent demand – our hair doesn’t stop growing just because the economy is faltering. An ongoing store rollout can help earnings grow.

The ASX share’s EPS and dividend are expected to rise in FY24 and FY25, while the FY23 grossed-up dividend yield is predicted to be 14.3%, according to Commsec.

Pacific Current Group Ltd (ASX: PAC) is an investment manager that invests in other fund manager businesses and helps them grow. Its portfolio of managers around the world is diverse, and it includes a stake in GQG Partners Inc (ASX: GQG). Pacific Current is expecting to make more investments, while its current fund managers could see further funds under management (FUM) growth.

According to Commsec, the ASX dividend share could pay a grossed-up dividend yield of 8.7%.

Next, it’s hard to miss Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) as a dividend-focused investment. It has grown its ordinary dividend every year since 2000, thanks to its defensively-positioned investment portfolio. But, that portfolio keeps growing as the business re-invests some cash flow into more opportunities.

Its last two ordinary dividends amount to a grossed-up dividend yield of 3.8%.

Wesfarmers Ltd (ASX: WES) is the parent business of a number of Australia’s leading businesses including Bunnings, Kmart, Officeworks and Wesfarmers chemicals, energy and fertilisers (WesCEF). It is building platforms of growth, and it’s opening new growth avenues including in lithium, and beauty and health.

It aims to grow the dividend over time for shareholders, and Commsec numbers suggest it’s going to pay a dividend yield of 5.3%.

Foolish takeaway

Between these four ASX share names, the average yield is just over 8%, generating the required $1,600 of passive dividend income from a $20,000 investment.

I think these names can produce growing dividend income, growing earnings and hopefully some long-term share price growth as well.

But, they’re not the only ones that could deliver good dividends.

The post $1,600 annual dividend income from a $20,000 ASX share portfolio? Here’s how 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

• 2 ASX 200 stocks smashing new 52-week highs on Wednesday
• Why I continue buying shares of this magnificent ASX dividend stock hand over fist
• How to make passive income for life with just $5 a day
• Is time running out to buy high-yield ASX dividend shares?
• The whopper Wesfarmers dividend is being paid today. Here’s what you need to know

Motley Fool contributor Tristan Harrison 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 and Wesfarmers. 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/M4F7GE6

While rates are rising fast, savings accounts and term deposits still can’t compete with the yields on offer with ASX dividend shares.

For example, Commonwealth Bank of Australia (ASX: CBA) is currently offering a respectable 3.95% per annum on 12-month term deposits, but the shares listed below could offer significantly better yields.

Here’s what you need to know about them:

Accent Group Ltd (ASX: AX1)

The first ASX dividend share for income investors to look at is footwear retailer Accent.

It has been tipped as a buy by analysts at Bell Potter. The broker has put a buy rating and $2.40 price target on its shares.

Its analysts were pleased with the company’s performance during the first half and its strong start to the second half. It also appears confident this positive form can continue thanks to its exposure to younger consumers that are less impacted by rising rates.

Bell Potter is expecting this to lead to fully franked dividends of 15.5 cents per share in FY 2023 and 12.2 cents per share in FY 2024. Based on the current Accent share price of $2.24, this would mean yields of 6.9% and 5.4%, respectively, over the next couple of years.

National Australia Bank Ltd (ASX: NAB)

Another ASX dividend share that could be a good option right now for income investors is this banking giant.

That’s the view of analysts at Goldman Sachs, that remain very positive on the banking giant. In fact, the broker highlights that the company’s recent first-quarter update indicates that its cash earnings are “run-rating 3% above what was implied by our previous 1H23E forecasts.”

Outside this, Goldman likes NAB due to its belief that volume momentum will favour commercial volumes over housing volumes over the next 12 months. It points out that “NAB provides the best exposure to this thematic.”

In light of this, the broker currently has a buy rating and $35.42 price target on its shares.

As for dividends, the broker is forecasting a $1.73 per share dividend in FY 2023 and then a $1.76 per share dividend in FY 2024. Based on the current NAB share price of $27.04, this will mean fully franked yields of 6.4% and 6.5%, respectively.

The post Forget term deposits and buy these high-yield ASX dividend shares instead: experts 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

• ASX 200 bank stocks: ‘No different’ or ‘extremely strong’?
• Bendigo Bank shares worst of the ASX 200 banks following UBS downgrade
• Why Bendigo and Adelaide Bank, Jervois Global, Megaport, and NAB are dropping today
• If I buy NAB shares today, what could my returns be in a year’s time?
• Is right now a once-in-a-decade opportunity to buy ASX 200 bank 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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Accent 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/ZB63Oij

It hasn’t been a fun month for bank shareholders in March. The banking crisis has weighed heavily on sentiment and dragged ASX 200 bank shares lower.

But Commonwealth Bank of Australia (ASX: CBA) shareholders have a reason to smile on Thursday.

That’s because today is payday for Australia’s largest bank’s interim dividend.

The CBA dividend

Last month, CBA released its half year results and reported a 12% increase in operating income to $13,593 million. Management advised that this was driven largely by volume growth in core products and a recovery in its net interest margin.

CBA’s net interest margin increased 18 basis points year over year to 2.10%. This reflects higher earnings on deposits, replicated products, and equity hedges in a rising rate environment, partly offset by increased competition.

On the bottom line, CBA’s cash net profit after tax came in 9% higher year over year at $5,153 million. This was driven by its strong operational performance, a rising rate environment, and higher loan loss provisioning.

This ultimately allowed the CBA board to increase its fully franked interim dividend by 20% to a record of $2.10 per share. This represents a 69% payout ratio and reflects the bank’s continued capital and balance sheet strength.

Today is payday for this record CBA interim dividend, with eligible shareholders due to receive it in their nominated accounts. Unless, of course, they elected to take part in the bank’s dividend reinvestment plan.

What’s next?

The good news is that an even larger dividend is expected from CBA in the second half of FY 2023.

According to a note out of Goldman Sachs, its analysts are forecasting a fully franked final dividend of $2.58 per share.

This will bring the FY 2023 CBA dividend to a total of $4.68 per share, which equates to an attractive 4.9% yield.

The post The biggest ever interim CBA dividend is being paid today. Here’s the latest 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

• ASX 200 bank stocks: ‘No different’ or ‘extremely strong’?
• Bendigo Bank shares worst of the ASX 200 banks following UBS downgrade
• Own CBA shares? Here’s the ASX 200 bank’s latest small business outlook
• Is time running out to buy high-yield ASX dividend shares?
• Stay away from this ASX sector (and buy this one instead): expert

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/uR3SibH