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The Pilbara Minerals Ltd (ASX: PLS) share price was smashed by 11% yesterday after the company revealed the result of its latest Battery Material Exchange (BMX) auction.

The ASX lithium share sold two cargoes for a combined total of 10,000 dry metric tonnes (dmt) for an average price of US$7,552 per dmt.

Why did that matter so much?

In November, the ASX lithium share sold 5,000 dmt for US$7,805 per dmt. This represents a fall of 3.25%.

On first look, an 11% decline in the Pilbara Minerals share price due to a 3% drop in the auction price may seems a bit excessive.

What direction is the lithium price headed?

A key factor, perhaps the key factor, for any commodity business is the price of that commodity.

When the resource price rises, this largely adds to the net profit after tax (NPAT) line because costs don’t move with as much volatility. That’s what we’ve seen over the last year for operating lithium miners – strong operating leverage.

But, it’s the opposite when the commodity price goes down – a fall in revenue results in a large fall in net profit.

If the lithium sector has seen the peak of the lithium price then there are concerns this could lead to further declines. The market often likes to be ‘forward-looking’, so the sell-off could be indicating an expectation of further falls in the lithium price.

The Pilbara Minerals share price had gone on an impressive run as the company revealed auction after auction of a higher lithium price.

Will the lithium price go all the way back down? That’s the key question for 2023.

In October 2021, Pilbara announced the sale of 10,000 dmt for a price of US$2,350 per dmt. If it went back down to that level it would be a fall of around 70%. I don’t think many investors were expecting the lithium price would keep going higher forever, but how likely is it that the lithium price will go through a steep and sustained fall?

My view on the Pilbara Minerals share price

Pilbara Minerals shares have benefited from the booming lithium price. But, I don’t think one slightly lower auction price necessarily suggests a huge decline is about to happen – there is still a longer-term imbalance between the expected supply and demand of lithium, according to the company, with demand expected to grow strongly in the coming years.

At the current lithium price, Pilbara Minerals is still generating an enormous amount of cash flow.

While the movement of the Pilbara Minerals share price is unpredictable from here, I think the company can generate stronger profits over the long term than some of the pessimists are thinking. I believe the move to grow into the lithium value chain will enable the business to earn higher profit margins.

While the ASX lithium share could go lower in the shorter term, I think it’s promising for the long term.

The post Make or break: the one metric I’ll be watching for Pilbara Minerals shares next year appeared first on The Motley Fool Australia.

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More reading

• Pilbara Minerals share price selloff ‘a significant over-reaction’: broker
• 5 things to watch on the ASX 200 on Friday
• Why did the Sayona Mining share price dive 7% on Thursday?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Why are ASX 200 lithium shares sinking like stones on Thursday?

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

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The last 10 years have been good to the Wesfarmers Ltd (ASX: WES) share price.

The S&P/ASX 200 Index (ASX: XJO) retailer is behind such names as Kmart, Bunnings, and Officeworks. In past years, the company was also charged with Coles Group Ltd (ASX: COL). The now near-$23 billion supermarket operator was spun-out of Wesfarmers in 2018.

Long-term investors have seen plenty of shakeups at the retail giant over the last decade, and they’ve been rewarded handsomely.

If you bought $1,000 of Wesfarmers shares in December 2012, you would have paid $26.56 apiece and walked away with 37 shares.

The Wesfarmers share price now trades at $47.66 – 79% higher than it was around 10 years ago. That gives our figurative parcel a value of $1,763.42 today.

But what kind of return can long-term shareholders enjoy when we factor in the company’s dividends? Let’s take a look.

How much have Wesfarmers shares paid in dividends in 10 years?

Here are all the dividends handed to those invested in Wesfarmers shares over the last decade: 

Wesfarmers dividends’ pay date	Type	Dividend amount
October 2022	Final	$1
March 2022	Interim	80 cents
October 2021	Final	90 cents
March 2021	Interim	88 cents
October 2020	Final	77 cents
October 2020	Special	18 cents
March 2020	Interim	75 cents
October 2019	Final	78 cents
April 2019	Interim	$1
April 2019	Special	$1
September 2018	Final	$1.20
April 2018	Interim	$1.03
September 2017	Final	$1.20
March 2017	Interim	$1.03
October 2016	Final	95 cents
April 2016	Interim	91 cents
September 2015	Final	$1.11
April 2015	Interim	89 cents
December 2014	Special	25 cents
October 2014	Final	$1.05
October 2014	Special	10 cents
April 2014	Interim	85 cents
September 2013	Final	$1.03
March 2013	Interim	77 cents
Total:		$20.43

Did you buy Wesfarmers shares in December 2012? If you did, you’ve likely received $20.43 per share in dividends over the life of your investment.

That means a $1,000 investment 10 years ago has yielded $755.91 in dividends.

It also means, between the stock’s capital gains and dividends, our figurative investor may have seen a whopping 152% return on their investment.

And that’s before considering further gains potentially realised through compounding using the company’s dividend reinvestment plan (DRP).

Additionally, all dividends paid out by the retailer in that time have been fully franked and, thus, could have brought extra benefits at tax time.

Right now, Wesfarmers shares trade with a 3.77% dividend yield.

The post Bought $1,000 of Wesfarmers shares 10 years ago? Here’s how much dividend income you’ve received appeared first on The Motley Fool Australia.

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More reading

• If I was 40 and had never invested, here’s how I’d aim to build a $500,000 ASX share portfolio
• Should you buy Wesfarmers stock before it pops?
• Morgans names 2 of the best ASX 200 dividend shares to buy in December
• Down 20% so far this year, are Wesfarmers shares now a no-brainer buy?
• Could the VAS ETF outperform the BHP share price in 2023?

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Coles Group and Wesfarmers. 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 ASX share market can be a great tool to grow wealth in my opinion. With how little work is needed to invest, and the historical track record of capital growth, ASX shares are my favourite type of investing. It could be a great way for someone in their 40s to build a six-figure portfolio.

Investing is a long-term task. It doesn’t matter if someone hasn’t built up much, or any, wealth yet.

Trying to get rich quickly would probably be a mistake, as this could lead to investing in stocks that are incredibly risky, with a low chance of it doing well.

Just look at how some of the hottest investments from the COVID era of cheap money have now dropped by more than 60%. A few of those names which could still generate big profits in the long term may be opportunities. But the valuation of some assets just didn’t make sense to me in 2021 and may never return to that level.

Having said that, I do think there are a number of excellent investments that can do well over the long term.

Decades of time left for compounding

A 40-year-old may have missed out on a decade or two of being invested. However, there are at least 25 years to a retirement age of 65. And wealth doesn’t necessarily stop building at retirement — there are hopefully many decades ahead of living.

If someone were to invest $1,000 a month into ASX shares, it would turn into $1.18 million over 25 years if it achieved the historical ASX share market average return of 10% per annum, according to the Moneysmart compound interest calculator. In 21 years it would reach more than $500,000.

Of course, we don’t know what the future returns will be. It could be worse than the average of 10% per annum, or it could also be better.

It will depend on what stocks investors choose and how they perform.

Which ASX shares to invest in?

The simplest way to achieve long-term returns could be to choose quality exchange-traded funds (ETFs) that are invested in quality businesses, such as Vanguard MSCI Index International Shares ETF (ASX: VGS) or VanEck Morningstar Wide Moat ETF (ASX: MOAT). The VanEck one is focused on companies with strong and enduring competitive advantages — it’s my favourite ETF.

Another option could be to pick ASX blue-chip shares that already have a good track record in achieving long-term returns, including Wesfarmers Ltd (ASX: WES), Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), Premier Investments Limited (ASX: PMV), and Xero Limited (ASX: XRO).

It could also be interesting to look at some beaten-up ASX shares with long-term growth potential, but I would only make each position a relatively small part of my portfolio compared to the ETFs or the blue chips. Some of the names I like include Temple & Webster Group Ltd (ASX: TPW), Adairs Ltd (ASX: ADH), Shaver Shop Group Ltd (ASX: SSG), Volpara Health Technologies Ltd (ASX: VHT), Universal Store Holdings Ltd (ASX: UNI), and Reece Ltd (ASX: REH).

But, if I were trying to keep things simple with a smaller number of names, my favourite idea for long-term capital growth would be VanEck Morningstar Wide Moat ETF.

The post If I was 40 and had never invested, here’s how I’d aim to build a $500,000 ASX share portfolio appeared first on The Motley Fool Australia.

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More reading

• 2 explosive ASX growth shares to buy for 2023: analysts
• Should you buy Wesfarmers stock before it pops?
• 3 ASX 200 dividend shares with payouts that jumped more than 10% this year
• Looking for bear market bargains? 3 ASX shares to buy before 2023
• Stock market millionaire: I’d put $500 a month into the ASX 200 to aim for 7 figures

Motley Fool contributor Tristan Harrison has positions in Washington H. Soul Pattinson And. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adairs, Temple & Webster Group, Vanguard Msci Index International Shares ETF, Volpara Health Technologies, Washington H. Soul Pattinson And, and Xero. The Motley Fool Australia has positions in and has recommended Adairs, Volpara Health Technologies, Washington H. Soul Pattinson And, Wesfarmers, and Xero. The Motley Fool Australia has recommended Premier Investments, Temple & Webster Group, VanEck Morningstar Wide Moat ETF, and Vanguard Msci Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re wanting to build a strong portfolio, then having a few blue chips in there could be a good starting point.

Blue chips are typically large companies that have been operating for many years, have stable cash flows, and experienced management teams. This can make them lower risk options and a good foundation of a portfolio.

But which blue chip ASX 200 shares could be in the buy zone? Here are three to consider:

CSL Limited (ASX: CSL)

The first blue chip ASX 200 share to consider is CSL. It is one of the world’s leading biotechnology companies, comprising the CSL Behring, CSL Vifor, and Seqirus businesses. It appears well-placed for growth over the long term thanks to strong demand for its immunoglobulins and its lucrative research and development pipeline.

Citi is a fan of the company and has a buy rating and $340.00 price target on its shares.

Goodman Group (ASX: GMG)

Another blue chip ASX 200 share that experts are tipping as a buy is Goodman Group. It is a leading integrated commercial and industrial property company that has been growing at a strong rate over the last decade. This impressive form has been underpinned by the success of its strategy of developing high quality industrial properties in strategic locations. These locations are close to large urban populations and in and around major gateway cities globally.

Goldman Sachs is positive on the company’s outlook thanks to strong demand for industrial property. It has a buy rating and $24.20 price target on its shares.

South32 Ltd (ASX: S32)

Finally, another ASX 200 blue chip share to consider for 2023 is South32. It is a diversified mining and metals company producing a range of commodities including alumina, aluminium, copper, manganese, metallurgical coal, nickel, silver, and zinc. Thanks to its exposure to the decarbonisation megatrend, the company has been tipped to generate strong earnings and pay big dividends for the foreseeable future.

Morgans is positive on the miner and currently has an add rating and $5.30 price target on its shares.

The post Experts say these strong blue chip ASX 200 shares are buys for 2023 appeared first on The Motley Fool Australia.

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More reading

• Bell Potter says these are some of the best ASX shares to buy for 2023
• Here’s why the South32 share price is shooting north today
• Stock market millionaire: I’d put $500 a month into the ASX 200 to aim for 7 figures
• CSL share price slumps as new CEO appointed
• CSL share price on watch as CEO announces retirement

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.

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S&P/ASX 200 Index (ASX: XJO) shares can be some of the leading names in their industry. Companies that can achieve good growth during this difficult period ahead may be able to outperform the market.

Wilson Asset Management (WAM) is one of the fund managers that likes to look for undervalued ASX growth shares. The investment team usually tries to identify a catalyst, or an event, that could boost the share price of the business.

In an update for investors, WAM named these two ASX 200 shares as opportunities.

Webjet Limited (ASX: WEB)

The fund manager describes Webjet as a global travel booking business spanning both wholesale and retail markets.

Last month, Webjet revealed its FY23 half-year result, which included its performance of generating $72.5 million of earnings before interest, tax, depreciation, and amortisation (EBITDA), which beat market expectations.

WAM put the performance down to WebBeds, which is Webjet’s business-to-business travel wholesaler division. WebBeds’ bookings and EBITDA margins beat pre-COVID levels.

The business-to-business segment benefited from a return to travel over the northern hemisphere’s summer and the “substantial” market share it gained during the summer.

Webjet shares have risen 13% since 16 November 2022.

Seven Group Holdings Ltd (ASX: SVW)

Another ASX 200 share that the fund manager currently likes is this diversified company that has both operations and stakes in other businesses. It’s exposed to industrial services, media, and energy.

Last month, the company held its 2022 annual general meeting (AGM). At the meeting, it maintained its earnings guidance for 2023, which can be a positive sign considering some areas of the economy may see more uncertainty.

The fund manager said Seven’s businesses of WesTrac and Coates Hire are “outperforming previous guidance” presented in the FY22 result in August. Management upgraded the guidance for underlying earnings before interest and tax (EBIT).

In concluding its optimistic views on the business, WAM said:

We see further potential for growth for Seven Group Holdings’ portfolio of industrial businesses driven by a favourable outlook for mining and civil infrastructure spending in Australia.

Over the last month, the Seven Group Holdings share price has risen by around 10%.

The post 2 ASX 200 shares that have ‘further potential’ for good returns: experts appeared first on The Motley Fool Australia.

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More reading

• Lithium and travel: Goldman Sachs names the ASX growth shares to buy now
• I’d aim for $1 million, buying just 10 cheap ASX shares
• Should you buy yourself Webjet shares for Christmas?
• Thank you Mr Powell! 7 ASX 200 shares cracking new 52-week highs on Thursday
• The Webjet share price hit a new 52-week high today. What’s going on?

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

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I really need you to read this. No, I’m not selling anything.

But a really important part of our financial system is at risk, and I need you to know what’s going on.

They say if you want to announce something that’s unpopular, or you don’t want scrutinised, you should do it late on a Friday.

Or just ahead of Christmas.

Which feels pretty much like… today.

Now, I make no allegations on timing, but I do know that an inquiry into financial advice, initiated by the former Federal government, will deliver its final report to the new Financial Services Minister, Stephen Jones, today.

And while that report’s contents are unknown, we do know what the draft report included, when it was released earlier this year.

And the clanger?

The draft proposal recommended doing away with an obligation to provide advice that’s in the client’s best interest.

Yes, you read that right.

Instead, the draft report recommended that it merely be ‘good advice’ instead.

Now, I’m all for ‘good advice’.

But let me ask you: How ‘good’ can that advice be if it’s not in a client’s best interest?

And, if the ‘good’ advice actually is in the client’s best interest, why change the standard?

I think we all know the answers to those questions.

An advisor wouldn’t need to make sure advice was right for you, or your circumstances, and could instead rely on some amorphous definition of ‘good’, instead.

Imagine a lawyer who didn’t have to act in your best interest.

Imagine a doctor whose treatment needed to be merely ‘good’, but not in your ‘best interest’.

It is, clearly, a nonsense.

Now, I’m the first to agree that the current ‘best interests duty’ is horribly bureaucratic.

It’s almost as if the rules were designed by a government department!

But there is too much ‘binary’ stuff in public life already.

If the ‘best interests duty’ is causing undue cost and red tape, don’t throw it out altogether… just change the cost and red tape!

You don’t throw out your car if the air-con stops working. You get it fixed.

You don’t give up on investing because you have one dud investment. You replace it with something else.

And so it should be with changes to — rather than a repeal of — the best interests duty.

But here’s the bottom line: If the report recommends – and the government implements – the repeal of the bests interests duty for financial advice, we should all have a very simple question:

Whose interest is that ‘good advice’ really in?

Which isn’t to say the very good advisers will suddenly turn bad.

But, as a consumer, how will you know?

How could you know?

There are too many horror stories, before and during the recent Royal Commission, of bad advice.

I’ve certainly heard my share, directly from people who’ve been dudded by dodgy financial advisors.

That’s precisely why the best interests duty exists!

It is incomprehensible to me that any serious report – or any serious government – could countenance an advice industry that didn’t, at the very bloody least, require its members to act in the best interests of their clients.

And, frankly, it beggars belief that the good people in that industry wouldn’t want their profession to be held up to the same ethical standard as other professions.

They should want the best interests duty.

They should be proud of the best interests duty.

And they should want the dodgy advisors run out of Dodge.

But here we are.

If this change goes through, we’ll be less protected, as consumers.

And we know what that has meant in the past.

So…

It’s time for the good planners to stand up.

It’s time for the industry to hold itself to a higher standard.

It’s time for the pollies to take a stand on behalf of consumers across the country.

And it’s time for the rest of us to hold our collective feet to the fire.

The ‘best interests duty’ must stay.

Now, maybe the final report will recommend exactly that.

But if it doesn’t, our elected representatives must ensure that it does.

Over to you, Minister Jones, Treasurer Chalmers and Prime Minister Albanese.

Don’t let us down.

(And if they do… you’ll hear from me again, and I’ll ask you to join me in campaigning for its retention. But let’s hope it doesn’t come to that!).

Fool on!

The post Are they about to open the door to dodgy advice? appeared first on The Motley Fool Australia.

More reading

• 3 ASX 200 shares in the spotlight for 2023 as consumer sentiment ‘bounces’
• Pilbara Minerals share price selloff ‘a significant over-reaction’: broker
• Buy ANZ Bank and this ASX 200 dividend share: brokers
• 5 things to watch on the ASX 200 on Friday
• Why did the Sayona Mining share price dive 7% on Thursday?

Motley Fool contributor Scott Phillips 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) shares reliant on discretionary consumer spending have faced some stiff headwinds amid this year’s fast-rising inflation and interest rates.

With wages growth lagging the increasing costs, consumer sentiment dropped 6.9% to one of the lowest levels recorded outside of a recession in November.

That’s according to the Westpac Melbourne Institute Consumer Sentiment Index, put together by Westpac Banking Corp (ASX: WBC), which reported sentiment has been tracking near the lows witnessed during the COVID pandemic and the GFC.

You can see how that could pressure ASX 200 shares in the discretionary sector.

If consumers are feeling the pinch, they may opt to delay that new TV or sofa purchase. And they may choose to make their own meals rather than ordering a pizza delivery to their doorstep.

What did the latest consumer sentiment index show?

In potentially good news for ASX 200 discretionary shares, the Westpac report showed that, while still near recessionary levels, consumer sentiment “bounced” 3% in December.

While inflation and the state of the Aussie economy remained a key concern for households, sentiment lifted as most of the RBA’s rate hikes are perceived to now be done with.

According to the report:

In the case of interest rates, there are even some signs that the news is becoming viewed as slightly less negative – consistent with the notion that the bulk of the interest rate tightening cycle is now behind us.

Job confidence also stabilised after plummeting 17% through October and November.

The report also notes that households do remain “deeply risk averse”, prioritising bank deposits and reducing debts over investing in shares and buying property.

3 ASX 200 shares in the spotlight for 2023

Despite that risk aversion, a turnaround in the recent steep falls in consumer sentiment could bode well for a number of ASX 200 shares in 2023.

On the discretionary dining front, we have Domino’s Pizza Enterprises Ltd (ASX: DMP).

The company holds exclusive master franchise rights and controls the Domino’s network in Australia and a range of Asian and European nations.

The Domino’s Pizza share price is down a painful 46% in 2022, giving the company a current market cap of $5.9 billion. At today’s share price, Domino’s pays a 2.4% trailing dividend yield, partly franked.

Should consumer sentiment continue to tick up in 2023, so too might the Domino’s share price.

Another ASX 200 share that could benefit from increasing consumer sentiment is Harvey Norman Holdings Limited (ASX: HVN).

The Australia-based retailer sells a range of discretionary goods including electrical, computer, furniture, entertainment, and bedding.

The Harvey Norman share price is down 17% in 2022, giving the company a current market cap of $5.3 billion. At today’s share price, Harvey Norman pays an 8.7% trailing dividend yield, fully franked.

The third ASX 200 share in the spotlight amid a turnaround in consumer sentiment as we head into 2023 is JB Hi-Fi Limited (ASX: JBH).

JB Hi-Fi is a specialty retailer of branded home entertainment products, with a focus on consumer electronics, electrical goods, and white goods.

The JB Hi-Fi share price is down 13% in 2022, giving the company a current market cap of $4.8 billion. At today’s share price, JB Hi-Fi pays a 7.1% trailing dividend yield, fully franked.

The post 3 ASX 200 shares in the spotlight for 2023 as consumer sentiment ‘bounces’ appeared first on The Motley Fool Australia.

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More reading

• 3 ASX 200 value shares I think could soar in 2023
• Here are the 10 most shorted ASX shares
• 3 top ASX 200 dividend shares I think are bargain buys right now
• Building a retirement income portfolio? I’d buy this unstoppable ASX dividend share
• The cheap ASX shares to buy for dividends: broker

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 Harvey Norman. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Domino’s Pizza Enterprises, Jb Hi-Fi, and Westpac Banking. 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 had a day to forget on Thursday.

The lithium miner’s shares crashed over 11% to $4.03.

As you can see below, this means the Pilbara Minerals share price has now pulled back by almost 30% from the record high it reached in November.

Why did the Pilbara Minerals share price tumble?

The key driver of yesterday’s weakness was the release of the company’s latest battery material exchange (BMX) digital auction results.

According to the release, the company sold two cargoes of lithium spodumene for a combined total of 10,000 dry metric tonnes (dmt) at an average price of US$7,552/dmt (SC5.5, FOB Port Hedland basis).

While this is still materially more than its cost of production, it is down 3.2% from the US$7,805/dmt it received last month.

This has sparked fears that lithium prices may now have peaked, which is something that Goldman Sachs warned could happen. Investors now appear concerned that Goldman’s prediction that prices will drop all the way down to US$800 by 2024 will also come true.

Is this a buying opportunity?

The team at Morgans believes that the weakness in the Pilbara Minerals share price was “a significant over-reaction” and has created a buying opportunity for investors.

As a result, just a day after initiating coverage on the lithium miner with a hold rating, it has upgraded its shares to a buy rating with a $4.70 price target. This implies potential upside of almost 17% for investors from current levels. It said:

Given the steep drop in the share price today, we see more opportunity than we did when we published our initiation yesterday. We upgrade our rating to ADD.

Sentiment towards the sector could weaken further in the very short term but we expect that strong 2Q cash flows and the potential for capital management may change investors’ minds.

The post Pilbara Minerals share price selloff ‘a significant over-reaction’: broker appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Friday
• Why did the Sayona Mining share price dive 7% on Thursday?
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• Why are ASX 200 lithium shares sinking like stones on Thursday?
• Why Australian Ethical, Breville, Iluka, and Pilbara Minerals shares are tumbling today

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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If you’re an income investor searching for new investments, then read on!

Listed below are two ASX 200 dividend shares that have been rated as buys by brokers.

Here’s what they are saying about these top dividend shares:

Australia and New Zealand Banking Group Ltd (ASX: ANZ)

The first ASX 200 dividend share that could be a buy is ANZ Bank. It is of course one of the big four banks with operations on both sides of the Tasman sea.

Analysts at Citi are positive on the bank and are forecasting some big dividend yields from its shares in the coming years. This is expected to be underpinned by net interest margin (NIM) improvements driven by rising interest rates. It said:

[T]he exit NIM of 1.80% is likely to drive material consensus revenue upgrades, and we think the street upgrades core earnings. We retain our Buy call, with core earnings momentum and benign asset quality.

Citi is forecasting fully franked dividends of $1.66 per share in FY 2023 and $1.76 per share in FY 2024. Based on the current ANZ share price of $23.90, this will mean yields of 6.95% and 7.35%, respectively.

The broker also sees plenty of upside potential with its buy rating and $29.25 price target.

Coles Group Ltd (ASX: COL)

Another ASX 200 dividend share that has been tipped as a buy for income investors is Coles. It is one of the big two supermarket operators with over 800 supermarkets and 900 liquor retail stores.

And while this is a very large footprint, Coles continues to see opportunities to expand. In addition, management is aiming to make its operations more efficient through cost cutting and its focus on automation. The latter includes the development of new distribution centres with automation giant Ocado.

As for dividends, Morgans is forecasting fully franked dividends per share of 64 cents in FY 2022 and 66 cents in FY 2023. Based on the current Coles share price of $16.99, this implies yields of 3.75% and 3.9%, respectively.

The broker also sees plenty of value on offer here. It has an add rating a d $19.50 price target on Coles’ shares.

The post Buy ANZ Bank and this ASX 200 dividend share: brokers appeared first on The Motley Fool Australia.

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More reading

• What’s with the ANZ share price on Thursday?
• The ANZ dividend is being delivered today. Here’s what you need to know
• Why is the ANZ share price marching higher on Tuesday?
• Brokers expect very big dividends from these ASX shares in 2023
• Could this help ANZ close the gap on its ASX 200 competitors?

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 positions in and has recommended COLESGROUP DEF SET .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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On Thursday, the S&P/ASX 200 Index (ASX: XJO) had a tough day and dropped into the red. The benchmark index fell 0.65% to 7,204.8 points.

Will the market be able to bounce back from this on Friday and end the week on a high? Here are five things to watch:

ASX 200 expected to tumble

The Australian share market looks set to end the week with another day in the red after a selloff on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open 85 points or 1.2% lower this morning. In late trade in the United States, the Dow Jones is down 2.35%, the S&P 500 has sunk 2.5%, and the Nasdaq has crashed 3.2%. Interest rate hike concerns weighed on the market.

Oil prices down

Energy producers Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a poor finish to the week after oil prices dropped overnight. According to Bloomberg, the WTI crude oil price is down 1.55% to US$76.10 a barrel and the Brent crude oil price is down 1.85% to US$81.15 a barrel. A stronger dollar weighed on prices.

Pilbara Minerals shares upgraded

The Pilbara Minerals Ltd (ASX: PLS) share price could have fallen too far on Thursday according to analysts at Morgans. A day after initiating coverage with a hold rating, the broker has upgraded the lithium miner’s shares to an add rating with a $4.70 price target. It commented: “Given the steep drop in the share price today, we see more opportunity than we did when we published our initiation yesterday. We upgrade our rating to ADD.”

Gold price falls

Gold miners including Newcrest Mining Ltd (ASX: NCM) and St Barbara Ltd (ASX: SBM) could have a difficult finish to the week after the gold price tumbled overnight. According to CNBC, the spot gold price is down 1.7% to US$1,788.2 an ounce. Traders were selling gold amid the prospect of interest rates going higher than expected.

Woolworths shares named as a buy

Goldman Sachs remains positive on the Woolworths Group Ltd (ASX: WOW) share price after the company announced the $586 million acquisition of a 55% stake in Petspiration Group, the second-largest player in the domestic specialty pet sector. In response, Goldman has reiterated its conviction buy rating and $41.70 price target on its shares. It sees the deal “as an incrementally positive step in the evolution of WOW’s eco-system strategy.”

The post 5 things to watch on the ASX 200 on Friday appeared first on The Motley Fool Australia.

More reading

• Why did the Sayona Mining share price dive 7% on Thursday?
• Should you buy Wesfarmers stock before it pops?
• 3 ASX shares to buy for a possible recession next year
• Here are the 3 most heavily traded ASX 200 shares on Thursday
• I’m 45 and have no investments. Could I still use the Warren Buffett method to build enough wealth for retirement?

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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