Tag: Motley Fool

Qantas Airways Limited (ASX: QAN) shares are on course to start the week with a small decline.

In afternoon trade, the airline operator’s shares are down slightly to $6.49.

Where next for Qantas shares?

While the Qantas share price may be having a subdued session on Monday, the team at Morgans believe that it could soon take off.

According to a recent note out of the broker, its analysts have named the flying kangaroo as its top pick in the travel sector.

Thanks to its much-improved performance, Morgans believes that Qantas shares can fly notably higher from here.

The note reveals that Morgans has an add rating and $8.50 price target on them. Based on where they are trading today, this implies over 30% upside for investors over the next 12 months.

Why is the broker bullish?

Morgans elevated Qantas shares to the top of its travel picks due to its belief that the company’s near term earnings have the most momentum. It explained:

QAN is now our preferred pick out of our travel stocks under coverage given it has the most near-term earnings momentum. Looking across travel companies globally, airlines are now in the sweet spot given demand is massively exceeding supply.

In addition, the broker believes the Qantas share price is too cheap to ignore at current levels. Particularly given how its business is significantly stronger than pre-pandemic. It adds:

QAN is trading at a material discount compared to pre-COVID multiples, despite having structurally higher earnings, a much stronger balance sheet, a better domestic market position, a higher returning International business and more diversification (stronger Loyalty/Freight earnings).

And thanks to pent up demand, Morgans believes Qantas is well-placed for growth and further capital management initiatives in the coming years. In respect to the latter, Morgans suspects that a $400 million on-market share buyback could be announced this month. It said:

The strong pent-up demand to travel post-COVID should result in a healthy demand environment for some time, underpinning further EBITDA growth over FY24/25. QAN’s balance sheet strength positions it extremely well for its upcoming EBIT-accretive fleet reinvestment and further capital management initiatives (forecasting a A$400m on-market share buyback to be announced at 1H23 result). There is also likely upside to our forecasts and consensus if QAN achieves its FY24 strategic targets.

The post Buy Qantas shares today for 30% upside: Morgans appeared first on The Motley Fool Australia.

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More reading

• These are the best ASX 200 travel shares to buy right now: broker
• 4 top ASX 200 shares to pounce on for reporting season: Wilsons
• Why Morgans just added these ASX 200 shares to its best ideas list
• What’s going on with the Qantas share price today?
• Why experts say these ASX 200 blue chip shares are buys

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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Arguably the most anticipated earnings result of the season is Commonwealth Bank of Australia‘s (ASX: CBA) FY23 half-year on Wednesday. Investors will be looking to see if the banking giant can continue to deliver sizeable dividends to CBA shareholders.

Today, shares in Australia’s biggest bank are tracking lower after crossing the $110 barrier last week. At the time of writing, the CBA share price is sitting at $109.35 — down 0.6% from its previous closing point.

In a stellar start to 2023, CBA shares have returned more than 8% so far this year. While the capital growth is exceptional, those relying on the big four bank for income will be hoping for a juiced-up interim dividend.

Will income investors be able to celebrate?

Rising interest rates have been a major headache for mortgage holders, but they might have set the stage for a stupendous result from CBA on Wednesday.

One of the key metrics for banking revenue is the net interest margin (NIM). The bigger the difference between interest earned (loans) and interest paid (deposits), the more revenue we can expect to see.

Many analysts are expecting a tremendous half from CBA for the December ending period fuelled by a widening NIM.

According to Bloomberg, the consensus revenue estimate sits at $5.2 billion. Meanwhile, the accompanying dividend per share estimate is pegged at $2.10. However, some analysts — including Jarden’s Carlos Cacho — are forecasting an even strong result.

Cacho thinks the yellow-branded bank could deliver revenue in excess of $5.2 billion thanks to wider margins and minimal bad debts.

Those bad debts that Cacho mentions will be critical to the size of the CBA interim dividend. Any need to provision for credit losses could tighten the belt around cash available to shareholders. However, this is not a concern at this stage according to Cacho, stating:

I really doubt we are going to see any signs of deterioration on the bad debt front yet.

Why CBA dividends could grow

Last week, my colleague James Mickleboro covered CBA earnings estimates from Goldman Sachs. Much like others, they too are expecting a rosy result for the first half of FY23. Though, Goldman reckons $5.108 billion is a more likely cash-earnings outcome.

Despite the less optimistic earnings expectation, Goldman analysts foresee an interim dividend of $2.12 per share. If this were to be the case, it would represent an increase of 21% compared to the prior corresponding period.

The current trailing 12-month dividend yield on CBA shares is 3.5%. Notably, this places it as the lowest-yielding big four bank at present.

The post Is a bigger CBA dividend on the cards this week? appeared first on The Motley Fool Australia.

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More reading

• The CBA share price is trading near all-time highs. Should you cash in?
• With no savings at 35, I’d buy this ASX 200 dividend stock to start earning monthly passive income
• I’m listening to Warren Buffett and buying ASX shares at deep discounts
• With interest rates heading higher again, the risk is to the downside for these popular blue chip ASX shares
• Should I buy CBA shares for 2023 dividend potential?

Motley Fool contributor Mitchell Lawler has positions in Commonwealth Bank Of Australia. 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 Coles Group Ltd (ASX: COL) share price could be in for a good run in the near future, as could the supermarket operator’s dividends.

That’s despite the stock already having posted an 8% gain in 2023. After ending last year at $16.72, the Coles share price has leapt to trade at $18.02 today.

For comparison, the S&P/ASX 200 Index (ASX: XJO) has risen around 5% since the end of 2022.

So, what might bolster the supermarket stock and its dividends this year? Let’s take a look.

Invested in Coles shares? You could be in for a good year

Broker Morgans is among those bullish on the Coles share price. It tips the stock could outperform in what looks to be a rough year for others.

Many experts are forecasting the impacts of interest rate hikes, implemented in an effort to control inflation, to catch up in 2023. That could see consumer demand softening.

Fortunately, Coles’ defensive characteristics could put it on the front foot, the broker says, as my Fool colleague James reports.

It also likes the look of the company’s balance sheet and thinks it could benefit from the unwinding of local shopping.

It’s likely no surprise then, that Morgans has a $19.50 price target on Coles shares. That represents a potential 8.2% upside.

And that’s not all. It also forecasts Coles’ dividends to grow to 64 cents per share this financial year and 66 cents per share next financial year.

For comparison, the supermarket operator offered investors 63 cents per share in financial year 2022.

Citi is even more bullish on the ASX 200 constituent’s dividends, James reported last month.

The broker predicts Coles will offer 72 cents per share this fiscal year and 77 cents per share next. It also tipped the stock to rise 4.9% to $18.90.

However, not all experts are so hopeful. Goldman Sachs has a sell rating and a $14.90 price target on Coles shares, representing a potential 17% downside.

The post Can Coles shares deliver 8% upside AND tasty dividends in 2023? appeared first on The Motley Fool Australia.

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More reading

• Get an income boost with these ASX dividend shares: broker
• With interest rates heading higher again, the risk is to the downside for these popular blue chip ASX shares
• 2 ASX stocks I’d buy in February for lifelong passive income
• Does the Coles dividend forecast make it a great buy for income?
• Here’s how I’d start building a second income this February, for $30 a week

Citigroup is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Coles Group. 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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Reporting season is now getting into the full swing of things. We’ve already heard from some of the leading S&P/ASX 200 Index (ASX: XJO) dividend shares.

While share prices have already moved in response to the results reported by these companies, investors can still grab shares before it’s too late to be entitled to the dividend.

If investors are interested in the business and the dividend payment, they need to invest before the ex-dividend date. Investors who buy shares on or after that date will miss out on the dividend.

JB Hi-Fi Limited (ASX: JBH)

JB Hi-Fi reported its result today, revealing that total sales grew by 8.6% to $5.3 billion and earnings per share (EPS) went up 20.4% to $3.018.

The company’s board decided to grow the dividend by 20.9% to $1.97 per share. The ex-dividend date is 23 February 2023, so that’s not far away.

With the incoming $1.97 dividend, that payment alone amounts to a fully franked dividend yield of 4.4%, with a grossed-up dividend yield of 6.3%.

However, there may not be much dividend growth in the second half of the year. For January 2023, the ASX 200 dividend share said that total sales growth for JB Hi-Fi Australia was 2.5%. JB Hi-Fi New Zealand’s total sales growth was 20%. The Good Guys’ total sales growth was 0%.

Pinnacle Investment Management Group Ltd (ASX: PNI)

Funds management business Pinnacle has seen its share price drop by around 50% since November 2021 as investors lost confidence in asset markets amid rising interest rates.

In its FY23 half-year result, the company reported a 24% fall in net profit after tax (NPAT) to $30.5 million.

However, the interim dividend was only decreased by 11% to 15.6 cents per share. That dividend from the business amounts to a fully franked dividend yield of 1.65%, or a grossed-up dividend yield of 2.4%.

Despite all of the market volatility hurting sentiment about the ASX 200 share, the funds under management (FUM) of the fifteen Pinnacle affiliates ended December 2022 at $83.2 billion, which was only a decrease of 1% during the first half.

The ex-dividend date for the Pinnacle payment is 2 March 2023.

Amcor PLC (ASX: AMC)

Amcor is one of the world’s largest plastic packaging companies. When walking around the supermarket, there are plenty of products that have been packaged by the business.

It recently announced its FY23 second quarter and first-half result.

The ASX 200 share announced that its net sales increased by 6% to $7.35 billion, while adjusted earnings before interest and tax (EBIT) and adjusted EPS grew by 8% on a comparable constant currency basis.

It announced a quarterly dividend of 12.25 US cents per share, up from 12 US cents per share. The 12.25 cents per share dividend equates to 17.3 cents per share in Australian dollar terms. This quarterly dividend amounts to 1.1%.

The ex-dividend for this upcoming quarterly dividend is 28 February 2023.

The post Deadline coming: 3 ASX 200 shares to buy now before dividend payouts appeared first on The Motley Fool Australia.

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More reading

• JB Hi-Fi share price slumps on half-year results
• This ASX 200 share is one of my top ideas to rake it in on a recovery
• Here’s why I’d buy this ASX 200 share with conviction if there’s a recession
• Down 30% since its peak, is this a great time to buy this ASX 200 share?
• Why this ASX 200 share smashed the market with a 5% rally 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 Pinnacle Investment Management Group. The Motley Fool Australia has positions in and has recommended Amcor Plc and Pinnacle Investment Management Group. The Motley Fool Australia has recommended Jb Hi-Fi. 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) has started the week in a subdued fashion. In afternoon trade, the benchmark index is down 0.2% to 7,417.3 points.

Four ASX share that are not letting that hold them back are listed below. Here’s why they are charging higher:

Audinate Group Ltd (ASX: AD8)

The Audinate share price has jumped 11% to $7.96. Investors have been buying this media networking solutions provider’s shares after it delivered a record half year result. Audinate reported a 39.3% increase in revenue to US$20.6 million and a 30% lift in gross profit to US$14.5 million. Management also revealed that its sales backlog remains at record levels.

Endeavour Group Ltd (ASX: EDV)

The Endeavour share price is up 3.5% to $7.06. This follows the release of the drinks giant’s half year update. Endeavour reported a 2.5% increase in sales to $6.5 billion and a 17% jump in profit after tax to $364 million. The latter came in ahead of Goldman Sachs’ estimate of $346 million, which itself was ahead of consensus expectations.

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price is up 5% to $4.96. Investors have been buying this insurance giant’s shares after the release of its half year results. IAG reported gross written premium growth of 7.5% to $7.06 billion and a 171% jump in net profit after tax to $468 million.

Vitura Health Ltd (ASX: VIT)

The Vitura Health share price is up 8.5% to 57 cents. This follows the release of the cannabis company’s half year results. Vitura, formerly known as Cronos Australia, reported record gross revenue of $57.6 million and a record net profit of $7.7 million. Both were more than double compared to the prior corresponding period.

The post Why Audinate, Endeavour, IAG, and Vitura Health shares are charging higher appeared first on The Motley Fool Australia.

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More reading

• 3 ASX All Ordinaries shares going gangbusters on Monday
• IAG share price marching higher on 25% profit boost
• Audinate share price jumps 13% on record half
• Endeavour share price jumps as sales reach $6.5b
• 5 things to watch on the ASX 200 on Monday

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 Audinate Group. The Motley Fool Australia has positions in and has recommended Audinate Group. 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 decline. At the time of writing, the benchmark index is down 0.2% to 7,421.2 points.

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

Appen Ltd (ASX: APX)

The Appen share price is down 16% to $2.79. This morning, the artificial intelligence data services company revealed that it expects to report full year revenue at the high end of its guidance range but EBITDA at the low end of its range. Appen also announced a non-cash, pre-tax impairment charge of $204.3 million relating to its new markets business.

Lendlease Group (ASX: LLC)

The Lendlease share price is down 7% to $7.69. Investors have been selling this engineering company’s shares after its first half results disappointed. Lendlease reported a statutory loss of $141 million for the half. A key driver of this was a $200 million provision due to action by the United Kingdom government.

Nuix Ltd (ASX: NXL)

The Nuix share price has crashed 29% to $1.08. This appears to have been sparked by fears that the investigative analytics and intelligence software provider could be about to lose a major customer. According to the AFR, the Australian Securities and Investments Commission (ASIC) is planning to dump the company and use alternative software. There is also speculation that other government departments could follow suit.

Star Entertainment Group Ltd (ASX: SGR)

The Star share price is down a massive 20% to $1.50. Investors have been selling this casino operator’s shares after it released a disappointing earnings update. Star revealed that competition in Sydney was weighing on its performance and is expected to lead to a small decline in first half revenue compared to pre-COVID levels. This is also expected to weigh on its full year earnings.

The post Why Appen, Lendlease, Nuix, and Star shares are sinking today appeared first on The Motley Fool Australia.

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More reading

• Could 2023 be the year these ASX AI stocks come roaring back?
• Why did the Nuix share price just crash 27%?
• Lendlease share price tumbles 5% on $141 million loss
• Why did the Star Casino share price just dive 19% to an all-time low?
• Why is the Appen share price diving 10% on Monday?

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 Appen. 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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No doubt many ASX investors begin their journey on the share market with the aim to make enough passive income so they can sit back and earn cash without all the fuss of a nine-to-five.

But what would it take to fund my entire lifestyle with dividend income? Let’s take a look.

How much do I need to live off?

Of course, how much passive income one needs to live off is dependent on many factors, including lifestyle. Let’s assume it’s an average one.

According to the latest Australian Bureau of Statistics (ABS) data on the topic, collected in 2015-2016, a single person household typically spends $712 per week. That equals around $3,100 a month, or approximately $37,000 each year.

A decent-sized portfolio of ASX shares would likely be capable of offering that much dividend income. And building one from the ground up needn’t be an unaffordable exercise.

Investing in ASX shares for $37k of annual passive income

Right now, the SPDR S&P/ASX 200 (ASX: STW) – an exchange-traded fund (ETF) tracking the S&P/ASX 200 Index (ASX: XJO) – offers a 4.39% dividend yield.

At that rate, an investor would need a portfolio worth around $842,000 to recognise $37,000 of annual passive income.

Of course, the higher the average (sustainable) yield, the smaller a portfolio would need to be to provide such income.

For instance, a $528,000 portfolio consistently offering a generous 7% dividend yield would be able to provide nearly $37,000 of passive income annually.

Still, that’s hardly pocket change. Here’s how I’d aim to grow such a portfolio by investing just $300 a week in ASX shares.

Building a $500k+ portfolio by investing $300 a week

I think I could easily commit to investing $300 every week.

By doing so, I could invest around $374,400 over the next 24 years. That’s nowhere near my envisioned passive income portfolio.

However, imagine my portfolio was paying dividends at an average 7% yield while I grew it. And imagine I took those dividends and used them to buy more ASX shares.

By doing that, I could boast a portfolio worth more than $534,000 in 24 years’ time. And that’s before considering any potential capital gains. The magic of compounding, folks.

Thus, by investing just $300 each week, I could potentially be earning enough passive income to retire by 2047.

Of course, investing more each week could get me to my goal faster, while realising a lower yield could delay my arrival.

While that’s certainly a long-term investing horizon, I think it would be worthwhile getting started this year if my goal was to fund my lifestyle on passive income alone.  

The post How much do I need to invest in ASX shares to make an income I can live off? appeared first on The Motley Fool Australia.

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More reading

• How I’d generate a $10,000 second income from CSL shares
• Could 2023 be the year these ASX AI stocks come roaring back?
• 3 Warren Buffett tips to remember when buying ASX shares
• Carsales share price marches higher on profit and dividend boost
• Why did the Nuix share price just crash 27%?

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

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One of the most popular shares on the ASX 200 is CSL Limited (ASX: CSL).

The biotherapeutics company is found in countless investor portfolios across the country.

And if you don’t own it directly, you’re probably holding it indirectly in your superannuation fund.

Why CSL shares are popular

CSL, which was previously known as the Commonwealth Serum Laboratories, was established in Australia all the way back in 1916.

It certainly has come a long way since then. Over the last century, CSL has become one of the leading biotherapeutics companies in world.

It now comprises CSL Behring, a global leader in rare and serious diseases; CSL Seqirus, one of the largest influenza vaccine providers in the world; CSL Plasma, the world’s largest plasma collection company; and CSL Vifor, a leader in iron deficiency and nephrology.

Since listing on the Australian share market back in 1994, CSL shares have generated big returns for investors. This has continued over the last decade, with the company’s shares outperforming the market with an average total return of 18.96% per annum.

This means that a $10,000 investment in 2013 would now be worth almost $57,000.

CSL has also rewarded its shareholders with a growing stream of dividends over the years.

With that in mind, let’s take a look to see what it would take to generate $10,000 of passive income from CSL shares.

A $10,000 passive income

According to a note out of Goldman Sachs, its analysts are expecting a dividend of US$2.39 (A$3.46) per share in FY 2023.

Based on the latest CSL share price of $303.56, this equates to a modest 1.15% dividend yield.

Clearly, with a yield as slim as that, $10,000 is going to take a significant investment. In fact, you’re looking at an investment of close to $900,000 to be able to generate that level of income in FY 2023.

It’s not hard to argue that there are probably more efficient investment options out there if you’re looking for income.

But that doesn’t mean you should completely discount CSL.

That’s because it is a prime example of a company that rewards you the longer you hold onto its shares.

For example, if you were lucky enough to buy CSL shares 20 years ago when they were fetching $15.00. Your yield on cost (yield on the price you paid for the shares) would be a massive 23%.

That means that a $45,000 investment back in 2003 would provide dividend income of just over $10,000 in 2023.

Whether CSL can grow the same amount over the next 20 years is debatable given its size now. But the key takeaway from this example is that investing in high quality companies with strong long term growth outlooks has the potential to generate big dividends in the future.

The post How I’d generate a $10,000 second income from CSL shares appeared first on The Motley Fool Australia.

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More reading

• 5 ASX 200 shares I would buy if I was starting from scratch: expert
• Brokers name 3 ASX shares to buy now
• 4 top ASX 200 shares to pounce on for reporting season: Wilsons
• Why Morgans just added these ASX 200 shares to its best ideas list
• These ASX 200 shares are top picks in Macquarie’s growth portfolio

Motley Fool contributor James Mickleboro has positions in CSL. 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://www.fool.com.au/2023/02/13/how-id-generate-a-10000-second-income-from-csl-shares/

ASX artificial intelligence (AI) stocks haven’t had a great run over the past 12 months.

To say the least.

Atop some company-specific issues, AI companies came under selling pressure as global interest rates shot up from historic lows to combat fast-rising inflation.

That’s because ASX AI stocks, like the three we look at below, are priced with future earnings growth in mind. And as interest rates ratchet up, so too does the present cost of investing in those future earnings.

So, after a rough 2022, could 2023 be the year these ASX AI stocks come roaring back?

Tailwinds ahead?

As well as potentially seeing their share prices gain from increasing revenue, stronger forward guidance, or technology improvements within their business models, ASX AI stocks could receive some helpful tailwinds on several fronts.

First, as mentioned, interest rates.

Should inflation in Australia and the developed world cool down, we could see the RBA and other global central banks pause their current tightening cycle and even begin to lower rates. That would offer a welcome boost to growth shares, like ASX AI stocks.

Second, we have ChatGPT and Bard.

You’ve probably been reading about ChatGPT, or are even making use of it.

ChatGPT is a product of OpenAI, which is largely backed by global tech powerhouse Microsoft Corporation (NASDAQ: MSFT). And it can write essays and text on a wide range of subjects, spurring a huge amount of media attention.

Then there’s Bard, a chatbot with similar goals developed by Alphabet (NASDAQ: GOOG), or Google to you and me.

Like ChatGPT, Bard is designed to learn and improve its functionality without intervention from its human creators.

Both systems, backed by trillion-dollar companies, already have impressive capabilities. And as the rivalry between Google and Microsoft in this space heats up, funding and research into ramping up those capabilities is likely to soar.

That, alongside the buzz this is likely to create among investors, could well help ASX AI shares turn their fortunes around in 2023.

How have these three ASX AI stocks been performing?

Among the ASX AI stocks investors can consider is Bigtincan Holdings Ltd (ASX: BTH). The company provides an AI-powered, online sales enablement platform.

The Bigtincan share price, as you can see below, has been on a bit of a rollercoaster over the past 12 months, a ride that’s left shares down 38%.

2023 has been tracking somewhat better for the stock, with shares flat in the new year.

The next ASX AI stock in our crosshairs is AI data services company Appen Ltd (ASX: APX).

The Appen share price was a strong performer in 2023. At last close on Friday, shares were up 33% year to date.

A big part of those gains were delivered over the last four trading days of the week just past. That surge looks like it may have been driven by investor exuberance surrounding ChatGPT.

But after the company reported this morning that it expects to recognise a non-cash, pre-tax impairment charge of $204 million, investors are hitting the sell button, sending shares down 13.55% in intraday trading so far.

As you can see in the graph below, the Appen share price is down 66% over 12 months, but still remains up a healthy 15% in 2023.

Which brings us to our third ASX AI share, BrainChip Holdings Ltd (ASX: BRN).

BrainChip is involved in developing neuromorphic computing, a branch of AI that simulates the function of the human neuron.

And like the other two tech stocks above, the BrainChip share price, pictured below, has gotten hammered over the past 12 months, down 58%,

So far, 2023 hasn’t been much kinder to shareholders, with the ASX AI share down 18% year to date.

The post Could 2023 be the year these ASX AI stocks come roaring back? appeared first on The Motley Fool Australia.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. 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 Alphabet, Appen, Bigtincan, and Microsoft. The Motley Fool Australia has positions in and has recommended Bigtincan. The Motley Fool Australia has recommended Alphabet. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Warren Buffett is universally regarded as one of, if the, best investors of all time. Over his six decades-plus of running Berkshire Hathaway Inc (NYSE: BRK.A)(NYSE: BRK.B), Buffett has achieved investment returns that most of us can only dream of.

Fortunately for us mere mortals, Buffett has always been exceedingly generous with his wisdom and advice over the years. So here are three timeless pieces of Buffett wisdom to remember when buying ASX shares today.

3 tips on buying shares from Warren Buffett

Price and value

Many investors are taught that the markets are always efficient price makers, and they can never be wrong.

But Buffett’s whole investing philosophy revolves around the inherent defectiveness of this thesis. Buffett famously said in his 2008 letter to shareholders that “Price is what you pay. Value is what you get”.

We can all invest far better by following this simple piece of advice. If you wait until the markets send a good-quality company’s sales down for a flimsy reason, you can make a lot of money. Why do you think Buffett has always seemed to do most of his buying during market crashes?

Just ignore the crowd

Many of the worst mistakes an investor will make come from uneasiness in not following ‘the crowd’. If the markets are dumping one of your favourite shares, you can feel very silly by not following suit, perhaps because ‘someone knows something I don’t’.

In 2017, Buffett had this to say on this kind of heard mentality:

What investors then need instead is an ability to both disregard mob fears or enthusiasms and to focus on a few simple fundamentals. A willingness to look unimaginative for a sustained period – or even to look foolish – is also essential.

So if you want to invest successfully, you need to be able to invest on your own research, not on what others might think of your investments.

Play the ASX share, not the industry

Too often, investors invest in trends, not in companies. Just because lithium, for example, might play an important role in the electrification of the transport industry over the next few decades doesn’t mean every lithium miner is a screaming buy right now. In 1999, Buffett had this to say on that idea:

The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.

So it will probably pay off if you analyse the companies in your ASX share portfolio with this maxim, rather than what trend they may or may not be a part of.

The post 3 Warren Buffett tips to remember when buying ASX shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Berkshire Hathaway. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Berkshire Hathaway. The Motley Fool Australia has recommended Berkshire Hathaway. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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