Tag: Motley Fool

Looking for an ASX growth stock offering a healthy passive income stream? 

You may wish to run your slide rule over Adairs Ltd (ASX: ADH).

You’ve likely heard of Adairs. The company is one of Australia’s leading home furnishings specialist retail stocks. It has three store brands – Adairs, Mocka and Focus on Furniture.

The ASX growth stock has a strong record of value creation, with an experienced management team and a growing e-commerce footprint.

And Adairs has an admirable record of paying two, fully franked dividends per year.

So, how much stock do you need to buy for $1,5000 in annual dividends?

8,333 shares in this ASX growth stock for $1,500 in annual dividends

First, bear in mind we’re looking at trailing dividends here.

Future dividends from this ASX growth stock could be higher or lower.

With that said, Adairs reported some strong half-year results for the six months ending 31 December.

Highlights included record sales of $324 million, up 34% from the prior corresponding half-year. Statutory net profit after tax (NPAT) leapt 24% to $22 million, while net debts came down by 13% over the prior six months, to $81 million.

Looking ahead, management reaffirmed sales guidance of $625 million to $665 million for the full 2023 financial year.

Citing elevated supply chain costs, management reduced its earnings before income and taxes (EBIT) guidance by $5 million to the range of $70 million and $80 million.

The board also declared a fully franked, interim dividend of 8 cents per share, in line with the previous year.

Adding in the 10 cents per share final dividend (paid out on 23 September) and this ASX growth stock offers a fully franked trailing yield of 7.9% at the current share price of $2.27.

And to garner $1,500 in annual dividends, you’d need to buy 8,333 shares.

Adairs share price snapshot

When looking for ASX growth stocks to provide regular passive income, you ideally want to invest in companies that are also delivering capital gains.

As you can see in the chart below the Adairs share price has dropped 20% over the past year.

But the share price has stabilised in 2023. And Goldman Sachs, despite having a neutral rating on the stock, has a target price of $3.10. That’s almost 37% above the current share price.         

The post Buy 8,333 shares in this ASX growth stock for $1,500 in annual dividends appeared first on The Motley Fool Australia.

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

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

More reading

• Investing as little as $25 a week could help me retire with $104,000 a year in passive income!
• The highest-paying term deposit right now offers 4.5% interest. Here are 3 ASX dividend shares paying way more
• These 3 ASX 300 shares are dividend dynamos!
• I’d aim for $1 million, thanks to just a few ASX shares
• Invest in this 7%+ ASX 300 dividend stock for passive income

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 positions in and has recommended Adairs. The Motley Fool Australia has positions in and has recommended Adairs. 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/7KEzhgb

The S&P/ASX 200 Index (ASX: XJO) is back on form on Wednesday. In afternoon trade, the benchmark index is up 0.4% to 7,038.7 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are dropping:

29Metals Ltd (ASX: 29M)

The 29Metals share price is down almost 16% to $1.17. This follows the release of an update on its troubled Capricorn Copper operation. Last week, the company revealed that heavy rainfall was expected to take the operation offline for three-to-four weeks. However, things have been worse than feared and the disruption is “now expected to be more significant.” So much so, the operation could be out of action for upwards of four months.

Eagers Automotive Ltd (ASX: APE)

The Eagers Automotive share price is down 3.5% to $13.18. This has been driven by the auto retailer’s shares going ex-dividend this morning for its final dividend. Last month, Eagers Automotive declared a record fully franked final dividend of 49 cents per share. This will be paid to eligible shareholders on 31 March.

Northern Star Resources Ltd (ASX: NST)

The Northern Star share price is down almost 2% to $11.04. Investors have been selling gold shares on Wednesday following a pullback in the price of the precious metal overnight. Though, it is worth noting that Northern Star’s shares are still up 7% since this time last week.

Woodside Energy Group Ltd (ASX: WDS)

The Woodside share price is down 1.5% to $32.73. This follows a sharp decline in oil prices during overnight trade. Both Brent and WTI crude oil prices fell heavily after US inflation was in line with expectations. This means the US Federal Reserve is likely to follow through with its rate hike plans, which some fear could cause economic turmoil and hurt demand for oil.

The post Why 29Metals, Eagers Automotive, Northern Star, and Woodside shares are dropping today 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

• Woodside share price sinks as oil remains under pressure
• What’s the forecast for the oil price in 2023?
• 5 things to watch on the ASX 200 on Wednesday
• Down 12% in a week, has the Woodside share price got further to fall?
• Why is everyone suddenly talking about ASX 200 gold stocks again?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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/gPvjQl9

If you haven’t heard of Warren Buffett, you’re either brand new to ASX shares investing, or you’re just not doing enough research.

He’s the most iconic global investing legend of our times, who has amassed a fortune worth more than US$100 billion over 80 years of investing.

Why should you care?

Because he’s living proof of successful investing and, as amateur investors, we don’t need to reinvent the wheel to achieve the same.

It’s far easier to just copy his strategy — or that of any other great investor who inspires you, right?

Helpfully, Buffett is willing to share his investing strategies and thoughts on the health of the markets. He does media interviews and writes an annual newsletter that is very instructive for us amateur investors.

Secondly, the investment company he runs, Berkshire Hathaway Inc, is listed, which means we get a regular look at the books, providing insights as to the investment decisions Buffett is making.

Berkshire Hathaway released its Q4 and full-year results late last month.

Some analysts are seeing a warning in them for ASX shares investors.

Let’s investigate.

What’s the warning for ASX shares investors?

Between 30 June 2022 and the end of the year, the value of Berkshire Hathaway’s cash, cash equivalents, and treasury securities (bonds) grew from US$105.4 billion to US$128.7 billion.

Translation: Buffett has just moved US$23.3 billion (AU$35 billion) from the market into cash.

This has prompted a lot of conjecture among analysts and commentators about whether this is a warning to investors all over the world.

Should ASX shares investors be doing the same?

There are a few ways to interpret Buffet’s movement into cash.

The scariest interpretation is that Buffett sees a market correction or crash coming.

Buffett is a value investor, and market downturns provide an opportunity to do what he likes doing best. That is, buying great quality companies below their intrinsic worth. To do that, you need cash reserves.

But Buffett likes to keep a good amount of cash on hand at all times, not just when corrections are coming, so I’m not sure we can draw any firm conclusions from this AU$35 billion move into cash.

In his annual newsletter released on 25 February, Buffett says:

As for the future, Berkshire will always hold a boatload of cash and U.S. Treasury bills along with a wide array of businesses.

We will also avoid behavior that could result in any uncomfortable cash needs at inconvenient times, including financial panics and unprecedented insurance losses.

Although Buffett primarily lists in US stocks and is therefore making decisions with that in mind, we all know that what happens to US shares flows on to ASX shares. Like, overnight.

Personally, I think Berkshire Hathaway’s recent increase in cash holdings simply provides a timely reminder of two important things.

Reminder no. 1 for ASX shares investors

Firstly, if you’re a long-term value investor like Buffett, then you want to buy companies that are going to do well in all sorts of macroeconomic conditions because your intention is to hold them for decades.

Buffett says:

… we own publicly-traded stocks based on our expectations about their long-term business performance, not because we view them as vehicles for adroit purchases and sales.

That point is crucial: Charlie and I are not stock-pickers; we are business-pickers.

Reminder no. 2 for ASX shares investors

It’s possibly not a bad idea to keep some cash on hand, so you can increase your holdings in the great companies you already own when the market goes south. That’s called dollar-cost averaging.

Or, you can buy other ASX shares that are trading down simply due to sentiment. That’s value buying.

Is a share market correction coming?

Tricked you with that heading. No one can answer that question, not even Buffett himself.

What we do know is that rising inflation and interest rates can be a recipe for a recession if central banks stuff up the management of these economic headwinds.

We’re yet to see how this current economic situation will play out and, meantime, ASX shares are volatile.

Check this out.

Last year, interest rates in Australia started rising for the first time since 2010 in May.

The market knew it was coming, so share prices were already volatile. In the six months from 1 January to 30 June 2022, the S&P/ASX 200 Index (ASX: XJO) lost 12%.

Then investors got used to the situation and started buying ASX shares at a great discount. Cue upswing.

In the seven months from 1 July 2022 to 31 January 2023, the ASX 200 went up by 13.8%.

Now, the market is on the way back down again.

As we reported yesterday, the ASX 200 began the year at about 6,950 points. It rose to about 7,560 in early February, and just six weeks later, ASX 200 shares are back down to 7,028 points.

In other words, not far off from where they started the year.

I guess the question here is, how stressed do you want to get over these short-term share price movements?

If you’re a long-term investor like Buffett, and you own great quality businesses, then you probably shouldn’t be too perturbed by recent fluctuations in the value of your ASX shares.

That’s a comforting message for uncomfortable economic times.

We’ll get some more investing insights from Buffett at Berkshire’s annual general meeting on 6 May.

The post Warren Buffett’s $35 billion warning to investors 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

• Woodside share price sinks as oil remains under pressure
• 5 things to watch on the ASX 200 on Wednesday
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why has the Newcrest share price leapt 7% in under a week?
• ASX 200 dives 2%, wiping out last of 2023 gains

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 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.

from The Motley Fool Australia https://ift.tt/tOI3jd8

CSL Limited (ASX: CSL) shares have been one of the stronger performers over the past five years in the S&P/ASX 200 Index (ASX: XJO), rising by around 70%. But, can the ASX healthcare share generate attractive dividend income for investors?

The business has been paying dividends to investors for a number of years, with strong dividend growth.

In 2010 the business paid 80 cents per share for the whole financial year. In 2022 the annual dividend was more than $3 per share.

But, while the dividend growth has been good, the CSL share price growth has been so strong that it has pushed down the CSL dividend yield.

Dividend breakdown

At the current CSL share price, the ASX biotech share has a trailing dividend yield (excluding franking credits) of around 1.2%.

Even before interest rates rose, that would count as a low dividend yield. So, investors are going to need to apply a good amount of money to achieve the target.

CSL shares don’t pay a dividend every month – they pay every six months. So, I think it’s better to think of the $300 monthly target as an annual goal of $3,600.

To generate a $3,600 annual income with a 1.2% dividend yield would require a $300,000 investment.

However, there is potentially a way where less money would be needed. I’m referring to that strong dividend growth, which is predicted to continue over the next few years.

According to Commsec, CSL is predicted to pay an annual dividend per share of $4.72 in FY25. That’s 34% higher than what the FY23 dividend is projected to be.

This means the FY25 dividend yield is expected to be 1.7% at the current CSL share price.

At that yield, investors would need to invest $212,000 in CSL shares for the target. While that’s substantially less than $300,000, it’s certainly still a large commitment.

Why is it such a large investment?

The problem is that CSL shares have a high price/earnings (P/E) ratio. According to Commsec, it’s valued at 34 times FY23’s estimated earnings.

It also has a fairly low dividend payout ratio, meaning that it doesn’t pay out much of its profit each year.

The combination of those factors means that CSL has a low dividend yield.

With that in mind, I wouldn’t invest in CSL with dividend income in mind. It’s much more about whether the company’s profit, growth and impressive research and development pipeline are good enough, which is a different question.

The post Here’s how much I’d need to invest in CSL shares to generate a $300 monthly income appeared first on The Motley Fool Australia.

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

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

More reading

• 5 ASX 200 shares that inflation can’t touch: expert
• Here’s how I would secure monthly dividends in the 2024 financial year with these ASX stocks
• Morgans names 3 more of the best ASX shares to buy in March
• Why is the CSL share price on the slide today?
• Should I buy CSL shares while they’re under $300?

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. 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/gcXOzM9

The S&P/ASX 200 Index (ASX: XJO) is staging a tentative recovery so far this Wednesday after the carnage we saw on the share market yesterday. At the time of writing, the ASX 200 has gained a decent 0.33%, putting the Index back over 7,030 points. 

However, this optimism is not entirely reflected in the share prices of some of the big ASX bank shares.

The main loser is Commonwealth Bank of Australia (ASX: CBA). CBA shares are currently in the red, down by 0.27% at just over $95 each.

Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB) and ANZ Group Holdings Ltd (ASX: ANZ) shares are all doing better. But they are still being eclipsed by the share price performances of some of their smaller, regional banking rivals.

The regional ASX 200 banks are on fire today. Take Bendigo and Adelaide Bank Ltd (ASX: BEN) for example. Bendigo Bank shares are currently smashing the market, up a pleasing 2.1% at present to $9.08 a share:

 It’s a similar story with Bank of Queensland Ltd (ASX: BOQ). Bank of Queensland shares are only just behind Bendigo, currently up by 2.09% at $6.60 a share right now.

So why are these smaller banks smashing both their larger ASX 200 banking share rivals and the broader market, this Wednesday?

Why are the smaller ASX 200 regional banks smashing the big four today?

Well, to understand what’s going on, let’s first look at the week that these smaller banks have had. As most of us would be aware of, Monday and Tuesday’s sessions this week were rather brutal affairs.

Yesterday, for instance, saw the Bank of Queensland share price hit a new multi-year low. In fact, both Bendigo Bank and Bank of Queensland fared far worse than the major banks earlier this week.

As we discussed yesterday, this was probably due to fears that these banks are less resilient to financial shocks as the major ASX 200 banks, simply due to their reduced size and scale.

To illustrate, CBA shares fell by 0.41% on Monday. But Bank of Queensland shares dopped by a far more dramatic 1.91%.

So now that investors clearly feel the worst has passed with the market jitters (at least so far this Wednesday), it makes sense that Bank of Queensland and Bendigo Bank shares are rising by more than the big four banks today.

The post Why are the smaller ASX 200 banks rebounding so strongly on Wednesday? appeared first on The Motley Fool Australia.

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

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

More reading

• Why did the Bank of Queensland share price just hit a multi-year low?
• Why Bank of Queensland, Brainchip, Pilbara Minerals, and Yancoal shares are sinking today
• ASX 200 bank shares: Are they better prepared than Silicon Valley Bank?
• 5 things to watch on the ASX 200 on Monday
• Why are ASX 200 bank shares like CBA being annihilated today?

Motley Fool contributor Sebastian Bowen has positions in National Australia Bank and Bank of Queensland. 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 Bendigo And Adelaide Bank. The Motley Fool Australia has recommended Westpac Banking. 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/DcmRev8

The Woodside Energy Group Ltd (ASX: WDS) share price is in the red today.

Woodside shares are currently down 1.39%, fetching $32.74 apiece. For perspective, the S&P/ASX 200 Energy Index (ASX: XEJ) is sliding 0.39% today. In contrast, the S&P/ASX 200 Index (ASX: XJO) is climbing 0.29%.

Let’s take a look at what could be impacting the Woodside share price today.

What’s going on?

Shares in the major oil and gas producer have shed 13% in the past week alone.

As my Foolish colleague James reported this morning, the WTI crude oil price fell 4.7% to US$71.29 a barrel overnight and the Brent Crude oil price fell 4.2% to US$77.39 a barrel.

A supply update from the Organization of the Petroleum Exporting Countries (OPEC) as well as broader economic concerns appeared to weigh on the oil price. In a research note, ANZ economist Kishti Sen said:

Crude oil remained under pressure as concerns of weaker economic activity sparked by Silicon Valley Bank’s failure reverberated through the market.

The negative sentiment was aided by OPEC forecasting a modest surplus to remain in place during Q2. The producer group said it will pump around 28.92mb/d, or about 300kb/d more than it expects will be needed. 

Commenting on the recent oil price slide, Oanda senior market analyst Ed Moya said “energy traders can’t find a reason to buy this dip until we get past the next round of inventory data”. According to Bloomberg, he added:

Rising stockpiles are expected and that could keep oil vulnerable over the next 24 hours.

However, the oil price has since recovered this morning. Brent Crude is now up 0.65% to US$77.95 a barrel, while WTI Crude Oil is lifting 0.81% to US$71.91 a barrel, according to Bloomberg Energy.

Woodside reported a record underlying NPAT of US$5.23 billion for the 2022 calendar year. The company lifted its final dividend by 37% to US$1.44 per share. This is due to be paid on 5 April.

Woodside share price snapshot

Despite the heavy losses of the past week, the Woodside share price has climbed almost 6% in the last year.

For perspective, the ASX 200 has dropped 0.9% in the past 12 months.

Woodside has a market capitalisation of about $62 billion based on the current share price.

The post Woodside share price sinks as oil remains under pressure 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

• What’s the forecast for the oil price in 2023?
• 5 things to watch on the ASX 200 on Wednesday
• Here are the 3 most heavily traded ASX 200 shares on Tuesday
• Why has the Newcrest share price leapt 7% in under a week?
• Down 12% in a week, has the Woodside share price got further to fall?

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

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

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) on course for a much-needed gain. At the time of writing, the benchmark index is up 0.3% to 7,029.4 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are rising:

Atlantic Lithium Ltd (ASX: A11)

The Atlantic Lithium share price is up 11% to 45.5 cents. This may have been driven by short sellers closing positions or investors believing that the lithium developer’s shares have been unfairly punished following a short attack. Its shares are still down by over a third since the start of the year.

Life360 Inc (ASX: 360)

The Life360 share price is up 6% to $5.15. This morning, analysts at Goldman Sachs labelled the location technology company’s shares as “materially undervalued.” The broker has reaffirmed its buy rating and $7.90 price target, which implies material upside from current levels. Goldman highlights the resilience of Life360’s business model and strong growth outlook as reasons to buy.

Neuren Pharmaceuticals Ltd (ASX: NEU)

The Neuren Pharmaceuticals share price is climbing yet again and up over 15% to $11.53. Investors have been scrambling to buy this biotech share this week after its treatment for Rett’s Syndrome was granted US FDA approval. Bell Potter still sees decent upside ahead for its shares. This morning, it retained its speculative buy rating with an improved price target of $13.67.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven Coal share price is up 3.5% to $6.99. This could also be down to a bullish broker note. This morning, analysts at Morgans retained their add rating with a $10.35 price target on the coal miner’s shares. It is also forecasting a fully franked 10% dividend yield on top of this.

The post Why Atlantic Lithium, Life360, Neuren, and Whitehaven Coal shares are charging higher 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 200 tech share is ‘materially undervalued’: Goldman Sachs
• This ASX 300 healthcare stock is up 48% in 3 days. Broker says buy
• Analysts warn of future earnings downgrades for ASX 200 coal shares
• 3 ASX 200 coal shares to buy for big gains and huge yields: Morgans
• Why Kingsgate, Neuren, Newcrest, and Pushpay shares are rising today

Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360. 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/OWaMlUJ

The Fortescue Metals Group Limited (ASX: FMG) share price is up 1.4% as we head into the lunch hour.

That’s in line with the broader rally we’re seeing with S&P/ASX 200 Index (ASX: XJO) iron ore stocks today.

The Fortescue share price closed yesterday at $21.45. Shares are currently changing hands for $21.75 apiece.

That’s Wednesday’s market action for you.

Now, here’s the latest development with Fortescue’s green hydrogen ambitions.

A $593 million green hydrogen plant

In an ambitious project that could potentially boost the Fortescue share price longer-term, South Australia is forging ahead with its plans to splash $593 million on a green hydrogen plant.

As The Australian Financial Review reports, the plant, located in Whyalla, is slated for completion by December 2025. The rapid pace of development is intended to give the state and its yet to be determined operator “first mover” advantage.

On completion, the project will deliver a 250-megawatt hydrogen production facility, a 200-megawatt hydrogen power plant as well as a hydrogen storage facility.

The project sounds almost tailor-made for Fortescue’s green arm, Fortescue Future Industries (FFI).

Indeed, FFI is believed to be -among several prospective companies to put in a bid to develop the project.

A spokesman for FFI did not confirm whether or not the company had submitted a bid.

However, they did say (quoted by the AFR):

FFI believes South Australia has a great opportunity to be a leader in renewable energy production. South Australia has an abundance of readily available natural resources for a renewable energy industry, including some of the best wind and solar resources in the country.

The spokesman added that South Australia’s government is “proactive in setting ambitious but achievable targets for a renewable and green hydrogen industry”.

Fortescue share price snapshot

As you can see in the chart below, the Fortescue share price has been a strong performer over the past 12 months, up 27%.

The post Fortescue share price marching higher as green hydrogen plans heat up 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

• Are Fortescue shares back on the menu amid job cuts?
• Could buying Fortescue shares at under $22 make me rich?
• How can I hope to retire rich when the share market is falling?
• Will the Fortescue share price crash in 2023?
• Why Fortescue, Lynas, Myer, and New Hope shares are dropping today

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.

from The Motley Fool Australia https://ift.tt/JqXV1E3

While recent weakness in the tech sector has been disappointing, it could have created some excellent buying opportunities for investors.

With that in mind, one of the biggest bargains in the sector right now could be Life360 Inc (ASX: 360) shares.

The location technology company, which joins the ASX 200 index on Monday, has been labelled as ‘materially undervalued’ by analysts at Goldman Sachs this morning.

A dirt cheap ASX 200 tech share

Ahead of the release of the company’s quarterly update later this week, Goldman has reiterated its buy rating and $7.90 price target on the tech share.

Based on the current Life360 share price of $5.17, this implies potential upside of almost 53% for investors over the next 12 months.

Goldman believes its shares are undervalued based on the resilience of its business model and its strong growth outlook. It commented:

We continue to believe Life360 is being materially undervalued given its 1) resilient business model which has so far weathered the headwinds of price rises and macroeconomic turbulence; 2) upcoming shift from the pre-profit to profitable tech basket in 2Q23; 3) high growth profile, as implied by its +35% y/y revenue guidance and ongoing momentum from price increases; and 4) sound balance sheet and earnings outlook.

In addition, the broker notes that the way Life360 does its accounting differs from other ASX 200 tech shares. However, if you adjust for this, it would actually be profitable already and be looking extremely cheap compared to peers. It explains:

Life360 expenses all of its R&D; if the company capitalised 50% of R&D (same as TNE/XRO/WTC and other tech peers), we estimate the business would already be profitable in 2H22 and only trade on 10/15x FY24E EV/EBITDA (pre/post stock based comp), while growing the top-line at ~30% FY22-24E CAGR.

All in all, Goldman believes this makes Life360 an ASX 200 tech share to buy now.

The post This ASX 200 tech share is ‘materially undervalued’: Goldman Sachs 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

• These ASX tech shares are buys: Goldman Sachs
• These ASX tech shares have exposure to the Silicon Valley Bank collapse
• Why Block, BrainChip, Core Lithium, and Life360 shares are racing higher
• This ASX tech share is leaping 13% today as it readies for an entrance into the ASX 200
• These ASX shares are being dumped from the ASX 200 index this month

Motley Fool contributor James Mickleboro has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360. 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/5eOtU9R

The oil price has been falling hard.

Brent crude oil is currently trading for US$77.45 per barrel. That’s down from US$86.18 per barrel on 6 March and the lowest price in more than three months.

It’s a similar story for West Texas Intermediate crude, currently going for US$71.91. On 6 March that same barrel was trading for US$80.46.

As you’d expect, that’s put some pressure on S&P/ASX 200 Index (ASX: XJO) oil and gas stocks like Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS).

Since 6 March the Santos share price is down 1% while Woodside shares have tumbled a painful 12%.

So, what’s going on with the oil price?

Bank failures and excess supply

The oil price is facing a few headwinds lately.

First, crude supplies in the US and much of the world appear to be more than sufficient to meet immediate demand, with the Organization of the Petroleum Exporting Countries (OPEC) forecasting a moderate surplus in the next quarter.

Second, the demand side strength for oil is in question as investors mull a possible US recession. Those fears were stoked by last week’s collapse of Silicon Valley Bank, reportedly the eighth-biggest bank in the US.

Those fears look to have trumped the nascent optimism of a potential surge in energy demand based on China’s reopening.

Commenting on the big pullback in the oil price, Ed Moya, a senior market analyst at Oanda said (quoted by Bloomberg), “Energy traders can’t find a reason to buy this dip until we get past the next round of inventory data. Rising stockpiles are expected and that could keep oil vulnerable over the next 24 hours.”

“If buyers don’t show up soon and support oil at US$70, we can see an air pocket lower to US$62,” Jc O’Hara, the chief technical strategist at Roth Mkm added.

That’s the shorter-term outlook for you.

But what can ASX 200 investors expect from the oil price for the rest of 2023?

What’s the forecast for the oil price in 2023?

For some insight into that million-dollar question, we defer to CBA mining and energy analyst Vivek Dhar.

According to Dhar (courtesy of The Australian Financial Review), “We see upside risks to our outlook driven by a sustained fall in Russia’s oil and diesel exports.”

Dhar also doesn’t expect the currently ample supply situation to last, putting upward pressure on the oil price.

“We see deficit risks rising in H2 2023, as global oil supply growth, driven mainly by US, Norway and Brazil, fails to keep up with global oil demand growth,” he said.

With Dhar forecasting an uptick in oil demand from India and China, the world’s two most populous nations, he forecasts Brent oil futures will increase from $US82 per barrel in the first half of 2023 to $US88 per barrel in the second half.

That would put the oil price up some 14% in the second half of 2023 compared to today’s prices. Which would certainly be welcome news to Santos and Woodside shareholders.

The post What’s the forecast for the oil price in 2023? appeared first on The Motley Fool Australia.

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

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

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Down 12% in a week, has the Woodside share price got further to fall?
• 5 things to watch on the ASX 200 on Monday
• Here are the 3 most heavily traded ASX 200 shares on Friday
• 5 things to watch on the ASX 200 on Friday

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.

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