Tag: Motley Fool

BHP Group Ltd (ASX: BHP) shares are down 0.4% in afternoon trading.

Shares in the S&P/ASX 200 Index (ASX: XJO) mining company are currently changing hands for $48.12 apiece, down from Friday’s closing price of $48.32 per share.

That’s today’s price action for you.

Now here’s what BHP is looking for from the government.

What kind of action is the ASX 200 miner suggesting?

If you own BHP shares you may be aware that the miner covered a range of topics in its submission to the federal budget.

As we covered earlier today, what the mining giant certainly does not want is for the federal government to impose a Queensland-style tax on ‘super-profits’.

Should that come into play, BHP CEO Mike Henry warned it would lead to “reduced investment, fewer jobs and, in the long term, lower living standards for Australians”.

As for what BHP would like to see, the company pointed to the Inflation Reduction Act (IRA) recently enacted by the United States. Among the specifications, the IRA provides US$437 billion worth of subsidies for new energy projects.

“If Australia is to attract global capital and become a leader in the race for critical minerals, it needs to ensure it is globally competitive,” BHP stated (quoted by The Australian Financial Review).

“Australia is the dominant global player in the mining of battery materials, but plays a relatively narrow role focused on mining and distribution of raw materials,” the ASX 200 miner added. “The economic case for moving up the value chain is strong.”

Indeed, rival ASX 200 iron ore miner, Fortescue Metals Group Limited (ASX: FMG), is already increasing its focus on US opportunities via its off-shoot, Fortescue Future Industries (FFI).

With a focus on ‘green steel’, Mark Hutchison the head of FFI, returned to the US last Wednesday to discuss the opportunities presented by green hydrogen with government and business leaders.

How have BHP shares been performing?

As you can see in the chart below, BHP shares are down 4% over the past 12 months. Longer-term, shares in the ASX 200 miner are up 70% over five years.

The post Own BHP shares? Here’s what the ASX 200 miner wants from the government appeared first on The Motley Fool Australia.

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More reading

• BHP share price stumbles amid super-profit tax fears
• Why I don’t own BHP shares (yet)
• Have BHP shares always paid better dividends than Rio Tinto?
• 5 things to watch on the ASX 200 on Friday
• Here are the top 10 ASX 200 shares 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.

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With so many shares to choose from on the ASX, it can be hard to decide which ones to buy. The good news is that brokers across the country are doing a lot of the hard work for you.

Three top ASX shares that leading brokers have named as buys this week are listed below. Here’s why they are bullish on them:

Nufarm Ltd (ASX: NUF)

According to a note out of Citi, its analysts have retained their buy rating and $6.90 price target on this agricultural chemicals company’s shares. This follows an update from the U.S. Department of Agriculture (USDA) Chief Economist Seth Meyer on the outlook for U.S. agriculture. Citi notes that the USDA expects a 3% increase in corn, wheat, and soybeans acreage to 228 million acres in 2023. It feels this bodes well for Nufarm. The Nufarm share price is trading at $5.70 this afternoon.

Rio Tinto Ltd (ASX: RIO)

A note out of Goldman Sachs reveals that its analysts have put a conviction buy rating and improved price target of $140.40 on this mining giant’s shares. Goldman is bullish due to Rio Tinto’s iron ore production growth outlook and its potential free cash flow per tonne improvements. Combined with its compelling relative valuation versus peers, the broker feels the miner is a strong buy. The Rio Tinto share price is fetching $125.02 today.

Sonic Healthcare Limited (ASX: SHL)

Another note out of Citi reveals that its analysts have upgraded this healthcare company’s shares to a buy rating with an improved price target of $36.00. Citi sees value in Sonic Healthcare’s shares at the current level and highlights its strong balance sheet. With its net debt to EBITDA at 0.5x, this is well below its long-term average of 2.5x. Citi feels this gives Sonic plenty of capital to deploy on acquisitions/new contracts or share buybacks. The Sonic Healthcare share price is trading at $33.29 today.

The post Leading brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 healthcare shares just upgraded by Citi analysts
• Strong buy: Why Goldman Sachs just added Rio Tinto shares to its conviction list
• 5 things to watch on the ASX 200 on Monday
• Have BHP shares always paid better dividends than Rio Tinto?
• Buy Rio Tinto and this ASX dividend share: Goldman Sachs

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 Sonic Healthcare. 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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It’s been a very positive start to the trading week so far this Monday for the S&P/ASX 200 Index (ASX: XJO). At this point of the trading day, the ASX 200 has gained a healthy 0.8%, putting the index at just over 7,340 points. But ASX 200 tech stocks like Xero Limited (ASX: XRO) are putting that gain to shame. 

The ASX 200 tech sector is currently leading the market in terms of gains. And the top ASX 200 gainers today are almost all tech shares. Xero is in the vanguard here, recording a very pleasing gain of 4.88% so far this session to $79.31 a share:

But it’s not just Xero. Block Inc (ASX: SQ2) has notched a 5.4% rise to $120.42 a share. Megaport Ltd (ASX: MP1) is just behind with a 5.1% gain to $5.78 a share. WiseTech Global Ltd (ASX: WTC) has just hit a new record high. And Brainchip Holdings Ltd (ASX: BRN) has rocketed by a whopping 17.65% to 60 cents a share.

So what’s going on with ASX 200 tech stocks today that have yielded such stellar performances?

Why are ASX 200 tech stocks on fire this Monday?

Well, Brainchiop has had some specific developments which seem to be boosting the company’s share price. As we covered this morning, Brainchip has announced the launch of its second-generation Akida platform, which seems to be getting investors hot under the collar.

But apart from that, there are no other specific announcements from these ASX 200 tech stocks that seem to be a factor here.

As such, we can probably thank the performance of the US tech markets on Friday night (our time) for the strong start to the week that the tech sector is currently enjoying.

The ASX is usually quite receptive to the movements of the US markets, given their dominance of global financial markets. If US shares have a good run, it’s unusual not to see ASX shares follow suit (and vice-versa). And ASX 200 tech stocks seem to be particularly sensitive to the movements of their American counterparts.

Last Friday, the tech-heavy NASDAQ-100 Index had an exceptionally strong session, rising by 2.04% by the end of the trading day. US shares like Amazon, Apple, Microsoft and Tesla all shone, with Amazon, Apple and Tesla rising by more than 3% each. It was a similar story with other prominent US tech shares like Adobe, PayPal and Intuit.

So given the magnitude of these gains enjoyed by US tech investors last week, ASX 200 tech stocks were always going to have a strong day back across the Pacific.

The post Why are ASX 200 tech stocks like Xero having such a stellar start to the week? appeared first on The Motley Fool Australia.

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More reading

• Why Block, BrainChip, Core Lithium, and Life360 shares are racing higher
• Guess which ASX 200 tech stock has rallied 30% in 2023 and just hit an all-time high
• BrainChip share price jumps 10% on Akida platform news
• Here are the 10 most shorted ASX shares this week
• Buy this punished ASX 200 tech stock when it’s forced into a capital raise: expert

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Adobe, Amazon.com, Apple, PayPal, Microsoft, and Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adobe, Amazon.com, Apple, Block, Intuit, Megaport, Microsoft, PayPal, Tesla, WiseTech Global, and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2024 $420 calls on Adobe, long March 2023 $120 calls on Apple, short April 2023 $70 puts on PayPal, short January 2024 $430 calls on Adobe, and short March 2023 $130 calls on Apple. The Motley Fool Australia has positions in and has recommended Block, WiseTech Global, and Xero. The Motley Fool Australia has recommended Adobe, Amazon.com, Apple, Megaport, and PayPal. 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 S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a strong gain. In afternoon trade, the benchmark index is up 0.8% to 7,341.8 points.

Four ASX shares that are climbing more than most today are listed below. Here’s why they are racing higher on Monday:

Block Inc (ASX: SQ2)

The Block share price is up 5.5% to $120.71. This follows a strong session for this payments company’s shares on the NYSE on Friday night. Investors were piling into the tech sector on easing rate hike concerns. This led to the tech-focused NASDAQ index charging 2% higher at the end of last week.

Brainchip Holdings Ltd (ASX: BRN)

The Brainchip share price is up 18% to 60.2 cents. This follows news that the semiconductor company has released a new version of its Akida platform. Management says the new platform was designed in response to customer feedback. If the sales don’t start rolling in now, then perhaps they never will.

Core Lithium Ltd (ASX: CXO)

The Core Lithium share price is up 6% to $1.02. Investors have been buying this lithium miner’s shares following the release of a mineral resource estimate update. According to the release, Core Lithium has more than doubled the resource estimate of the Finniss Lithium project from 4.37Mt at 1.53% lithium oxide to 10.1Mt at 1.48% lithium oxide.

Life360 Inc (ASX: 360)

The Life360 share price is up 13% to $5.42. As well as benefiting from a booming tech sector, this location technology company’s shares have taken off today after it was added to the ASX 200 index. Life360 is one of four ASX shares that will join the benchmark index at the next quarterly rebalance on 20 March.

The post Why Block, Brainchip, Core Lithium, and Life360 shares are racing higher appeared first on The Motley Fool Australia.

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More reading

• This ASX tech share is leaping 13% today as it readies for an entrance into the ASX 200
• Why is the Core Lithium share price soaring 11% today?
• BrainChip share price jumps 10% on Akida platform news
• These ASX shares are being dumped from the ASX 200 index this month
• Here are the 10 most shorted ASX shares this week

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 Block and Life360. The Motley Fool Australia has positions in and has recommended Block. 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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In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a solid gain. At the time of writing, the benchmark index is up 0.75% to 7,338.9 points.

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

Fortescue Metals Group Ltd (ASX: FMG)

The Fortescue share price is down 2.5% to $22.22. Investors have been selling Fortescue and other mining shares today amid concerns that demand for iron ore from China may not be as strong as hoped. This follows the release of China’s GDP target for 2023. It is targeting 5% growth with less of a focus on the infrastructure and property sectors.

Lynas Rare Earths Ltd (ASX: LYC)

The Lynas share price is down over 5% to $7.38. This rare earths producer’s shares have come under pressure recently after Tesla announced plans to shift away from using rare earths in its cars in the near future.

Myer Holdings Ltd (ASX: MYR)

The Myer share price is down 4% to 86 cents. This is despite there being no news out of the department store operator today. However, it is worth noting that Myer is scheduled to release its half-year results later this week. And with its shares up over 100% since this time last year, some investors may be taking a bit of profit off the table.

New Hope Corporation Limited (ASX: NHC)

The New Hope share price is down 4.5% to $5.51. This appears to have been driven partly by the release of a broker note out of Ord Minnett this morning. According to the note, the broker has downgraded the coal miner’s shares to hold rating with a $6.50 price target. It made the move on valuation grounds.

The post Why Fortescue, Lynas, Myer, and New Hope shares are dropping today appeared first on The Motley Fool Australia.

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More reading

• This ASX 200 dividend share failed to be one of the world’s biggest payers in 2022. Could it get worse?
• What’s moving the Fortescue share price this week?
• Here are the top 10 ASX 200 shares today
• Why is the Lynas share price being thumped on Thursday?
• Has this ‘completely changed the landscape’ for the future of Fortescue 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 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 latest expert views on two S&P/ASX 200 Index (ASX: XJO) healthcare shares have just come in.

It’s positive news for shareholders of both companies because the broker has improved the rating of those businesses.

Healthcare is an interesting sector for investing in. It’s seen as defensive because many of them can benefit from ongoing patient demand, regardless of the economic situation – most people don’t choose when to get sick. I’d imagine being alive and healthy is a priority for most people, so they’d be willing to spend on healthcare services.

But, there are also some positive tailwinds for the sector, including an ageing population, a growing population and increasingly advanced healthcare treatments.

Let’s look at two of the latest ratings.

Pro Medicus Limited (ASX: PME)

Pro Medicus describes itself as a leading medical imaging IT provider. It provides a range of radiology IT software and services to hospitals, imaging centres and healthcare groups around the world.

The broker Citi has just increased its rating on the ASX 200 healthcare share to neutral. Citi’s price target on Pro Medicus was raised to $61. A price target is where the broker thinks the share price will be in 12 months from when the call was issued.

Therefore, the broker doesn’t think the Pro Medicus share price is going to move much from here.

In the company’s FY23 half-year result, it reported that revenue went up 28.3% to $56.9 million, while net profit after tax (NPAT) improved by 31.5% to $27.2 million.

The Pro Medicus boss Dr Hupert said that the company’s pipeline remains strong:

We have a very good spread of opportunities across different market segments, with opportunities in academic/IDN, corporate and private markets. Pretty much all of them are cloud-based with a growing number looking for our “full stack” solution which includes all three of our modules, namely Viewer, Archive and Worklist; a trend we see continuing.

Sonic Healthcare Limited (ASX: SHL)

The other ASX 200 healthcare share that Citi likes the look of is Sonic Healthcare, the global pathology business.

Citi increased its rating on Sonic Healthcare to buy. The price target on Sonic Healthcare is $36. That implies a possible rise of 8% for the business.

While the business saw the FY23 half-year earnings drop as COVID-19 testing slowed, its profit is still significantly higher than the FY20 first half – the pre COVID times. Compared to HY20, the FY23 half-year total revenue was up 22%, operating cash flow was up 47% and net profit after tax (NPAT) was up 50%.

Its non-COVID testing revenue and earnings continue to grow, as does the dividend. It has a progressive dividend policy, meaning that the board wants to grow the dividend each year.

The ASX 200 healthcare share is focused on automation and other efficiency gains, as well as procurement savings, which could help it maintain and grow its margins.

Sonic Healthcare is also hoping to win more outsourcing contracts from hospitals and other healthcare providers. It’s also progressing “additional acquisition opportunities to add to future growth.”

The post 2 ASX 200 healthcare shares just upgraded by Citi analysts appeared first on The Motley Fool Australia.

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More reading

• For $200 in weekly passive income, buy 10,300 shares of this ASX 200 stock
• 3 ASX dividend stocks to try and turn $10,000 into $1 million!
• Why I’m more eager than ever to buy Sonic Healthcare shares following earnings
• 2 ASX shares to buy with exciting global growth potential: fund manager
• Here are the top 10 ASX 200 shares today

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 Pro Medicus. The Motley Fool Australia has positions in and has recommended Pro Medicus. The Motley Fool Australia has recommended Sonic Healthcare. 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 S&P/ASX 200 Index (ASX: XJO) definitely didn’t have as good a month in February as it did in January. But even so, the ASX 200 still remains up a healthy 5.5% in 2023 so far. But one ASX 200 tech stock has beaten the Index’s solid return six-fold over the year so far.

That would be the WiseTech Global Ltd (ASX: WTC) share price.

WiseTech shares have been on fire in 2023. The logistics software company was only going for $49.17 at the start of January, a good 30% less than the $63.96 a share it is asking today.

What’s more, today has seen a new record share price for WiseTech. This morning, WiseTech shares climbed as high as $64.86 each. Not only is that a new 52-week high for this ASX 200 tech share, but a new, all-time record high to boot.

So what’s behind WiseTech’s latest high and the rather epic share price run it has gone on over 2023 thus far? Well, it could come down to a couple of reasons.

Why has this ASX 200 tech stock rocketed 30% in 2023 to a new record high?

The first (and probably most important) is WiseTech’s continuing growth. It was only last month that WiseTech gave investors its latest report card.

And this half-year earnings report contained some pretty impressive figures for shareholders to digest. For the six months ending 31 December 2022, the company reported revenues of $378.2 million, up a healthy 35% over the previous period.

Earnings before interest, tax, depreciation and amortisation (EBITDA) were up slightly more, rising by 36% to $187.3 million. Underlying net profits after tax (NPAT) came in 40% higher than 2021’s numbers at $108.5 million.

All of this helped WiseTech to raise its 2023 interim dividend by a pleasing 39% to 6.6 cents per share.

So with these kinds of numbers on display, it’s perhaps no surprise that investors have been bidding up WiseTech shares over 2023 thus far.

ASX broker named WiseTech as a buy

But we’ve also seen ASX brokers give this ASX 200 tech share some love. Last month, we covered broker Morgan Stanley’s rating on the WiseTech share price. Morgan Stanley gave the company an overweight rating, as well as a 12-month share price target of $64 – almost exactly where the shares are today.

The broker continues to see WiseTech’s future as bright, so this buy rating last month could have helped investors push the WiseTech share price to the levels we are currently seeing.

So it’s likely that a combination of ASX broker love and the stellar earnings report WiseTech delivered last month are at least partly responsible for the stellar run the WiseTech share price has been on this year, and the record high prices we have seen for the company today.

No doubt investors will be very pleased with this news.

At the current WiseTech Global share price, this ASX 200 tech share has a market capitalisation of $21.12 billion, with a dividend yield of 0.2%.

The post Guess which ASX 200 tech stock has rallied 30% in 2023 and just hit an all-time high appeared first on The Motley Fool Australia.

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More reading

• These ASX shares are being dumped from the ASX 200 index this month
• Should I buy Flight Centre shares at $19?
• This ASX 200 dividend share failed to be one of the world’s biggest payers in 2022. Could it get worse?
• 5 things to watch on the ASX 200 on Monday
• 2 explosive ASX growth shares to buy this month: analysts

Motley Fool contributor Sebastian Bowen 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 WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. 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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A number of junior ASX lithium shares have been given some very good news.

Every three months, S&P Dow Jones Indices announces its quarterly rebalance of the S&P/ASX Indices. When this occurs, shares move into and out of particularly indices.

On Friday, the index solutions company released its latest rebalance and revealed that the All Ordinaries index will be welcoming some new additions.

Among the additions are a total of five ASX lithium shares.

Which ASX lithium shares are joining the All Ordinaries index?

The five ASX lithium shares that will join the widely followed All Ordinaries index at the rebalance on 20 March are as follows:

Anson Resources Ltd (ASX: ASN)

Anson Resources is a junior mineral resources company with a portfolio of minerals projects in key demand-driven commodities. Its core asset is the Paradox Lithium Project in Utah, United States.

Atlantic Lithium Ltd (ASX: A11)

Atlantic Lithium is an African-focused lithium exploration and development company aiming to deliver Ghana’s first lithium mine. The company’s flagship project is the Ewoyaa Project, which is a significant lithium spodumene pegmatite discovery.

Latin Resources Ltd (ASX: LRS)

Latin Resources is a mineral exploration company with projects in South America and Australia. It notes that it is developing mineral projects in commodities that progress global efforts towards net zero emissions. Its flagship project is the Salinas Lithium Project in the pro-mining district of Minas Gerais, Brazil.

Lithium Power International Ltd (ASX: LPI)

Lithium Power International is a pure-play lithium explorer focused on the development of Chile’s next sustainable high-grade lithium mine. It also has two hard-rock projects in Western Australia. One of which is adjacent to Greenbushes, the world’s largest hard rock Lithium mine owned by Tianqi and Albemarle.

Red Dirt Metals Ltd (ASX: RDT)

Red Dirt Metals is a Western Australian exploration and development company aiming to bring high-quality, lithium-bearing pegmatite deposits into production. It owns 100% of the Yinnetharra Lithium Project in the Gascoyne region of Western Australia.

The post 5 ASX lithium shares being added to the All Ordinaries in the latest rebalance appeared first on The Motley Fool Australia.

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More reading

• 4 ASX mining shares that have soared over 150% in a year
• At under 30 cents each, are these ASX lithium stocks cheap?

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) stocks offer investors a great opportunity to potentially build a reliable passive income stream.

If I had no savings at 50 and was looking at retiring on passive income I’d be running my slide rule over ASX 200 dividend shares. Especially fully franked shares, which can provide some handy benefits come tax time.

Here’s why.

What have ASX 200 stocks historically returned?

Over the past 10 years, ASX 200 stocks have returned an average of approximately 9% per year.

That’s the total return, mind you.

Share price gains, or capital growth, represented much of those gains.

But almost half those total returns were derived from income or yield. Which is why I’d be looking for companies with lengthy track records of reliably paying out franked dividends. And ideally, ones that have been growing their dividend payouts over time, with strong growth outlooks.

Now the future, by definition, is unknown. Meaning the returns delivered by ASX 200 stocks over the next 10 years could be higher or lower than 9%.

But sticking with history as our guide, if I were to invest $1,000 per month in blue-chip stocks, my initial $12,000 investment from this year would be worth $51,931 when I retire in 17 years. (Assuming I retire at 67 and reinvest the dividends.) That’s the magic of compound interest.

Of course, as I get closer to my retirement age, there’s less time for that interest to compound.

If I were still investing $1,000 per month at the age of 66, and ASX 200 stocks were still returning an average of 9% annually, my final year’s investment may only net me some $13,000 on the $12,000 invested.

Still, after 17 years of diligently investing in some of the top-income stocks in Australia, I would have built up a healthy passive income stream to bolster my retirement years.

Don’t forget to diversify

Investing across a range of ASX 200 stocks involved in a range of sectors is one of the best ways to reduce volatility and risk.

That’s especially important for older investors who will have less time to ride out any large, unexpected drops with a specific company or within a specific sector.

‘Don’t put all your eggs in one basket’ is an overused expression for good reason.

Happy investing!

The post No savings at 50? I’d buy ASX 200 stocks and aim to retire on a growing passive income appeared first on The Motley Fool Australia.

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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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The Pilbara Minerals Ltd (ASX: PLS) share price has started the week in a disappointing fashion.

Although the market is charging higher, it has well and truly left the lithium miner’s shares behind.

This has seen Pilbara Minerals shares fall over 2% to $4.08.

Is this a buying opportunity?

While opinion is divided on where lithium prices are heading, one leading broker that remains positive on the battery making ingredient is Macquarie.

In fact, it expects prices to remain strong enough for Pilbara Minerals to be swimming in cash in the next couple of years.

And with the company’s new dividend policy in place, the broker believes this will underpin dividends of 45 cents per share in FY 2023 and 34 cents per share in FY 2024.

Based on the current Pilbara Minerals share price, this equates to huge yields of 11% and 8.3%, respectively.

It’s no wonder then that Macquarie has the equivalent of a buy rating on its shares.

Pilbara Minerals share price tipped to climb

But the yields aren’t the only thing to get excited about.

Macquarie also has an outperform rating and lofty $7.70 price target on the lithium giant’s shares. This implies potential upside of almost 90% for the Pilbara Minerals share price over the next 12 months.

Which, combined with the broker’s dividend forecast, suggests a 100% total return from the company’s shares between now and this time next year.

It is also worth noting that Macquarie isn’t the only bullish broker. The team at Morgans has an add rating and $5.30 price target, whereas analysts at Citi have a buy rating and $4.80 price target on its shares.

Commenting on lithium prices, Citi said:

On lithium pricing, PLS says the sky is not falling in. Many options to get its uncontracted tonnes to market. PLS elected to do tolling, which was unequivocally driven by value. […] Domestic pricing is a function of the slowdown in China market but would remind everyone of the structural shift that’s underway: more EVS, more investment. Long game remains positive. PLS says customers are asking for more tonnes and enquiries for spodumene volumes continue.

The post Macquarie tips 100% total return from Pilbara Minerals shares appeared first on The Motley Fool Australia.

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More reading

• Big yields and even bigger gains lie ahead for these ASX 200 shares: analysts
• Here are the top 10 ASX 200 shares today
• Here are the 3 most heavily traded ASX 200 shares on Friday
• What’s happening with ASX 200 lithium stocks this week?
• Buy these ASX 200 mining shares before they boom: experts

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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