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One prominent economist has declared S&P/ASX 200 Index (ASX: XJO) shares may have passed the bottom.

The ASX 200 has indeed risen 10.6% since the start of October, and now sits only 5.9% lower than where it started in 2022.

While recession and geopolitical risks still loom large, AMP Ltd (ASX: AMP) chief economist Dr Shane Oliver thinks there’s a chance the recent rebound might not be just a bear market bounce.

“There is a rising chance we have seen the low in shares,” Oliver said in an AMP blog post.

“We have seen two bear market rallies into March and August that proved short lived. But this time there’s been more fundamental improvement.”

Oliver shared why he thinks this time it could be different:

Fight between inflation and central banks could be winding down

The big one for Oliver is that the inflation spike in the US finally seems to be decelerating.

“Headline inflation in October dropped to 7.7% year-on-year (well down from a peak of 9.1% in June) but more importantly core (ex food and energy) inflation came in at a slower than expected 0.3% month-on-month,” he said.

“Prices for used cars, household furnishings, medical care and airfares fell.”

The implication for Australia is that the inflationary effects lag the US by about six months.

“So it should start to decline here from early next year as well,” Oliver said.

“And Australian shares take their directional lead from the US most of the time anyway.”

The economist also cited the slowing down of interest rate rises as a positive sign for ASX 200 shares.

“Of course, central banks are still hawkish as inflation is too high and jobs markets [are] still too tight, so more rate hikes are likely. But a slowing in the pace reduces the risk of hard landings.”

Let’s put 2022 behind us

Another difference from previous rallies is that the market is now in a traditionally bullish part of the year.

“US, global and Australian shares [tend] to rally from October/November into year end and out to the middle of the next year, reflecting an end to tax loss selling in the US, new year cheer and a lack of capital raising over the Christmas/New Year period.”

Geopolitically, two major events of uncertainties are now behind us. That provides certainty and stability, which the stock market loves.

“Post US midterm election returns tend to be strong… with an average 17% fall in midterm years followed by an average 33% gain 12 months from the low,” said Oliver.

“With the party congress over, China is focussing on boosting its economy… It looks likely to exit from zero-COVID around March next year.”

All this means that Oliver’s team at AMP are bullish on stocks for the coming period.

“At last, it seems some of the bad news for shares appears to be abating,” he said.

“We remain optimistic on shares on a 12-month horizon as investors will start to focus on monetary easing from late next year and then economic recovery.”

Dangers still lurk

Of course, there are risks that could force the market to dip yet again.

Inflation certainly could surprise again and Europe is likely to fall into recession over a cold northern winter.

Geopolitics could also plunge into further crisis, as shown by Wednesday morning’s Russian missile strikes on Polish territory.

“China could move on integrating Taiwan,” said Oliver.

“Problems in the Middle East could also escalate, given the failure to return to the 2015 nuclear agreement with Iran, social unrest in Iran and the return of Netanyahu as Israeli PM increasing the risk Israel will take action against Iran’s nuclear capability.”

The economist also worried about a Republican-controlled lower house in the US leading to brinkmanship on the federal government debt ceiling.

The post ASX 200 shares may have just hit the bottom: AMP economist appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Stressed about your ASX share portfolio? I’d take these 3 dead-simple steps to sleep easy
• Why did the Treasury Wine share price crack a new multi-year high on Tuesday?
• Here are the top 10 ASX 200 shares today
• It’s not all bad news for ASX All Ords shares on Tuesday. Here are some major winners

Motley Fool contributor Tony Yoo 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 Medibank Private Ltd (ASX: MPL) share price has gone down heavily over the past month – it’s down 20%.

Investors have punished the business after it was revealed that the company had been hacked, with millions of customers’ data being accessed.

According to Medibank, the cybercriminal has accessed the name, date of birth, address, phone number and email address of around 9.7 million current and former customers and some of their authorised representatives. This figure represents around 5.1 million Medibank customers, around 2.8 million AHM customers and around 1.8 million international customers.

Medibank decided not to pay a ransom, because that could encourage more cyber attacks. Further, it may not have done anything to protect customers or their data.

Customer data starts being published

The private health insurer confirmed that the cybercriminal is releasing files onto a dark web forum containing customer data.

According to reporting by The Age, Medibank customer data may be migrating into more “publicly available” places.

A Medibank Private spokesperson said:

The Australian Federal Police are aware of data on new sites and will be addressing it.

The Australian Federal Police have said they will take swift action against anyone attempting to benefit, exploit or commit criminal offences using stolen Medibank customer data.

We continue to work closely with the Australian Federal Police who are focused, as part of Operation Guardian, on preventing the criminal misuse of this data.

Is the Medibank share price an opportunity?

A key question is – will the economic damage to Medibank be more or less than 20% of its long-term value?

I’m not sure that it will. The broker Ord Minnett agrees, it thinks the main problem could be damage to the reputation of the business. However, its growth may be hurt and some policyholders may leave.

Ord Minnett rates the business as accumulate, with a price target of $3.20. That implies a possible rise of more than 10%. It could also pay a grossed-up dividend yield of 7% in FY23.

The broker Citi rates Medibank as neutral, noting that the private health insurer withdrew its policyholder growth for FY23. The broker also reduced its policyholder growth expectations for the medium-term.

Credit Suisse, another broker, rates Medibank Private as outperform, with expectations of higher costs and damage to Medibank’s brand.

My view on the opportunity

The Medibank share price has fallen a lot. At this stage it’s hard to say how this will affect the potential growth rate of the business.

I don’t think it will ‘bounce’ back quickly unless the business is able to say that it hasn’t lost many policyholders and that growth hasn’t really been affected.

Using Ord Minnett’s numbers, Medibank is valued at 17x FY23’s estimated earnings and 15x FY24’s estimated earnings.

I wouldn’t say it looks like a cheap buy, but it definitely looks cheaper than it was before. In the meantime, investors can receive a decent dividend yield until this event (hopefully) fades into history for policyholders and the company alike.

The post Down 20% in a month, can things get any worse for the Medibank share price? appeared first on The Motley Fool Australia.

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More reading

• Considering buying the dip in Medibank shares? Here’s the latest on the company’s data hack woes
• Medibank share price sell-off ‘excessive’: expert
• 5 of the craziest things making news on the ASX this week
• ‘Use the volatility’: QVE reveals 3 ASX shares it just bought
• Do Medibank shares now represent a buying opportunity?

Citigroup is an advertising partner of The Ascent, a Motley Fool company. 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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Regular readers will know that it is simply not possible to reliably pick the bottom of the market.

In fact, even if you tried, you won’t even know whether you’re right or wrong until that point has well and truly passed. 

That’s the nature of bottoms — you can only define them in retrospect.

However, many experts reckon you can have better luck picking the bottom for individual ASX shares.

That’s because investors can carefully study the business’ performance, outlook and the market forces that could dictate its future.

Here’s one such stock that Wilson Asset Management is bullish on: 

Quality ASX share at rock bottom now

With interest rates now a whopping 275 basis points higher than six months ago, 2022 has been a poor year for real estate and real estate ASX shares.

Dexus Property Group (ASX: DXS), for example, has seen its share price drop in excess of 32% since early May when the Reserve Bank kicked off the rate resurgence.

But Wilson equity analyst Anna Milne, in a recent memo to clients, reckoned the real estate investment trust (REIT) has now been oversold.

“The valuation implied at the current share price is close to a worst-case scenario,” she said.

“Trading at a 30% discount to its asset backing, Dexus is at its lowest levels since the global financial crisis.”

Why this time it’s different

Milne explained, though, that the current situation is very different to the GFC trough.

“In 2009 the market was impacted by high debt margins, capital constraints and forced sellers. Today, demand for high-quality assets remains strong.”

Dexus has traditionally owned office properties, but these days its holdings are more diverse.

“Dexus continues to move up the quality spectrum by recycling its lower quality office assets into high-quality development projects,” said Milne.

“Additionally, growth in Dexus’ industrial and funds management businesses is impressive and diversifies the business from its pure office exposure.”

In any case, the office business also seems to be close to turning a corner.

“While the outlook for the office industry has been challenged in the last few years with the rise of working from home and now expectations for a recession, recent feedback suggests office market rents, occupancy and incentives have stabilised.”

The company has “a strong balance sheet“, added Milne, with borrowings comfortably lower than its target range.

“The current valuation has presented a good opportunity for us to increase our position in Dexus, and it is now a core holding of the fund.”

The post Priced for ‘worst-case scenario’: Fundie names ASX share that can’t get any cheaper appeared first on The Motley Fool Australia.

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More reading

• Looking to buy AMP shares? Here’s the latest blow to the company’s major divestment
• Broker names 2 ASX dividend shares to buy next week
• Morgans names 2 ASX dividend shares to buy with big yields
• 4 battered ASX 200 shares that are ‘obvious M&A targets’: expert

Motley Fool contributor Tony Yoo 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 wanting to add some high quality ASX dividend shares to your portfolio, then you may want to check out the giants listed below.

Here’s why these ASX dividend giants have been named as buys:

BHP Group Ltd (ASX: BHP)

The first dividend giant to consider buying is mining behemoth BHP.

It has been tipped as a buy by analysts at Morgans, who have an add rating and $47.40 price target on its shares.

The broker likes the miner due to its strong balance sheet and the diversity of its operations across both commodities and geographies. Morgans feels this makes it a “relatively low risk” option in the resources sector.

All in all, its analysts see “BHP as holding an attractive combination of upside sensitivity, balance sheet strength and resilient dividend profile.”

Speaking of dividends, the broker expects BHP to pay fully franked dividends per share of $2.95 in FY 2023 and $2.98 in FY 2024. Based on the current BHP share price of $43.94, this will mean yields of 6.7% and 6.8%, respectively.

Westpac Banking Corp (ASX: WBC)

Another ASX dividend giant that has been named as a buy is Westpac.

Australia’s oldest bank has been tipped as the top option in the banking sector right now by analysts at Goldman Sachs. They recently reiterated their conviction buy rating with an improved price target of $27.60

The broker likes Westpac due to its positive net interest margin (NIM) trajectory, its cost reduction target, and attractive valuation.

In respect to its margins, Goldman highlights that “management’s guidance on its FY23 NIM trajectory was better than we had previously anticipated.” This bodes well for its earnings and dividends in the coming years.

In respect to the latter, the broker is forecasting fully franked dividends of 148.4 cents per share in FY 2023 and 160 cents per share in FY 2024. Based on the current Westpac share price of $23.96, this will mean yields of 6.2% and 6.7%, respectively.

The post 2 ASX dividend giants to buy now: brokers appeared first on The Motley Fool Australia.

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More reading

• ASX 200 bank shares: fundie picks winners and losers of the big four
• How I’d aim to generate a growing passive income from dividend shares
• 3 reasons the Westpac share price is great value: Goldman Sachs
• Why are ASX 200 mining shares going nuts on Monday?
• Why is the BHP share price having such a ripper day?

Motley Fool contributor James Mickleboro has positions in Westpac Banking Corporation. 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 Westpac Banking Corporation. 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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Ask A Fund Manager

The Motley Fool chats with the best in the industry so that you can get an insight into how the professionals think. In this edition, 1851 Capital portfolio manager Martin Hickson analyses what he would do right now with four small-cap ASX shares.

Cut or keep?

The Motley Fool: Let’s take a look at three ASX shares that have plunged this year, and see if you think they’re a bargain to buy now or if you’d stay away like the plague.

First up is Frontier Digital Ventures Ltd (ASX: FDV).

Martin Hickson: FDV, share price down just over 50% so far this calendar year. What they do is they own a number of real estate portals through southeast Asia, Latin America, and Pakistan… They’re basically the realestate.com of a lot of those emerging markets. They’ve got a number of portals in emerging markets.

The reason why the share price has been so weak is it’s been caught up in that overall [slide of] technology stocks. We like it. We’ve been buying more recently. 

They’ve recently announced to the ASX that they plan to list both their Pakistan asset, which is Zameen, and their Latin American assets they plan to list on the NASDAQ. Our valuation for those two assets alone gives a valuation north of $1. Their shares are trading at 70 cents, and you’ve got those catalysts in terms of potentially listing or spinning out those assets and IPOing them separately, which should provide a strong readthrough for the overall valuation of Frontier Digital. 

Again, it’s trading at a very cheap price, and with catalysts, it could potentially rerate the current share price.

MF: Let’s get your thoughts on DGL Group Ltd (ASX: DGL), which has also roughly halved this year?

MH: It’s gone from $4.50 to $1.50 over the last six months. 

Despite that strong share price fall, we’re still not a buyer of DGL. We think that since listing, they’ve grown too quickly, they’ve made too many acquisitions too fast. From the outside, it’s hard to understand how much integration has gone on with a lot of those acquisitions. 

If you look at their FY22 results, as well, there’s a couple of big one-offs that drove their earnings. They were a big beneficiary of the higher AdBlue prices around Christmas time. They were also a big beneficiary of the lead price through FY22. We think some of those things won’t repeat this financial year. 

The most recent result, they delivered a very poor cash flow outcome. There’s been high staff turnover. They’ve been through three CFOs since listing 18 months ago. There’s a few reasons there that’s really keeping us on the sidelines at this point.

MF: The third one is familiar to a lot of people, Beacon Lighting Group Ltd (ASX: BLX), which is down about a third this year.

MH: Yeah. As the name suggests, they’re a retail lighting company. The share price has been weaker around fears of a potential slowdown or a recession in Australia. That will obviously impact their retail lighting business. 

The reason why we like it is they’ve also got two other parts of the business, which we think can support their earnings in a potentially overall weaker consumer environment. 

They’ve got a trade business which represents around a quarter of the company’s earnings, and that’s growing very strongly. What they’re doing there is they’re selling lighting but also electrical products to electricians in that trade space, and they’ve got offers like free three-hour delivery for tradies. 

That’s a point of difference, something that can take share in that trade space. They’ve also said that, in three years’ time, they’re targeting that trade business being half their earnings. If they can get to that outcome, from 25% today to 50% in three years, that will be a very strong tailwind for the overall earnings of the company. 

They’ve also got an international business where they’re selling products internationally, particularly into the US, and again, that’s growing quite strongly. They’re taking share in the American market. Again, that will support the company’s earnings in a potentially weaker consumer environment.

MF: Fantastic. Is that one you hold?

MH: We do. We hold Frontier Digital and Beacon.

The ASX share for a comfortable night’s sleep

MF: If the market closed tomorrow for four years, which stock would you want to hold?

MH: It has to be something with defensive earnings, given the current volatility and uncertainty across the world, so something like an insurance broker, like PSC Insurance Group Ltd (ASX: PSI), that’s very well-managed, high levels of insider ownership, and they’re obviously benefiting from the higher insurance premium rates cycle that we’re seeing. 

The cyberattacks that we’ve seen here in Australia in recent times [are] only going to be a further tailwind for insurance premiums, and PSC Insurance are likely to be a beneficiary of that. That’s one that I’d be comfortable holding over that four-year period.

The post 3 small-cap ASX shares to add to your portfolio right now: fundie appeared first on The Motley Fool Australia.

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More reading

• It’s not all bad news for ASX All Ords shares on Tuesday. Here are some major winners
• Why CBA, DGL, Incitec Pivot, and Readytech shares are pushing higher

Motley Fool contributor Tony Yoo 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 DGL Group Limited, Frontier Digital Ventures Ltd, and PSC Insurance Group. The Motley Fool Australia has recommended DGL Group Limited, Frontier Digital Ventures Ltd, and PSC Insurance 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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ASX 200 healthcare company CSL Limited (ASX: CSL) has a drug candidate in its pipeline that could be a ‘blockbuster’ in the future, Citi analysts believe.

The CSL share price climbed 1.47% today and closed at $290.75. For perspective, the S&P/ASX 200 Index (ASX: XJO) fell 0.07% today.

Let’s take a look at what could be ahead for this ASX 200 healthcare company.

What’s ahead

CSL is an ASX biotech giant that develops a huge range of biotherapies and vaccines to save and improve lives.

CSL’s drug candidate for reducing secondary heart attacks is a major positive for the company, according to analysts.

Commenting on CSL112, a drug currently at the phase three clinical trial stage, Citi analysts, quoted by The Age, said:

If approved, CSL112 has the potential to become blockbuster drug for CSL.

In an update in November, CSL said recruitment for this trial is on track for “Last Patient In” (LPI) by the end of the year.

Launch of CS112 is on track for the fourth quarter of 2025, according to CSL.

As my Foolish colleague James reported recently, Citi has a buy rating and a $340 price target on the CSL share price. Analysts said:

Our $340 TP includes $22.40 for the R&D portfolio (down from $23 on delays) – the main asset remains CSL112 (cardiovascular) at $20/share on which we will get Phase 3 data in Q1 CY24. Maintain Buy, $340 TP.

Meanwhile, Morgans is also impressed with Citi’s research and development pipeline, including CSL112. Morgans placed an add rating and $312.20 price target on the company’s share price.

CSL share price snapshot

The CSL share price has fallen 6% in the past year, while it has climbed 0.1% in the year to date.

For perspective, the ASX 200 has fallen 4.40% in the past year.

CSL has a market capitalisation of about $140.2 billion based on the current share price.

The post The drug with the ‘potential to become a blockbuster’ for this ASX 200 healthcare company: Citi appeared first on The Motley Fool Australia.

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More reading

• Can the CSL share price crack $300 before the year’s out?
• 3 ASX shares to buy in a sector ready to explode: expert
• Why is the CSL share price smashing the ASX 200 on Thursday?
• Are CSL shares a good buy right now?
• 2 big name ASX companies ready for a ‘share price recovery’: experts

Motley Fool contributor Monica O’Shea has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL Ltd. 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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Australia may or may not plunge into a recession, but with steeply rising interest rates starting to bite there will be some sort of economic slowdown.

It’s not far-fetched to say that some businesses fare better than others when consumers start closing their wallets.

Two such sectors are fast food and healthcare.

With money tight, consumers will rely more on quick-service restaurants rather than their fancier white-table cloth rivals. 

Then maybe their tummy starts cramping after too many burgers and they will seek medical assistance. 

Healthcare is well known as an industry that still sees strong demand through economic slowdowns. Australians will consider health a priority spend, even when times are tough.

So considering this, here is a pair of ASX shares experts have picked to buy for the coming storm:

‘A cheap entry point for a quality defensive stock’

Catapult Wealth portfolio manager Tim Haselum admitted to The Bull that the COVID-19 testing boom has well and truly passed Healius Ltd (ASX: HLS).

But the post-pandemic era would bring its own tailwinds.

“We expect the pathology arm to perform well as elective surgery restrictions are ending.”

And Healius shares are currently ripe for the picking, with the price down 15.6% since early August.

“We believe the company offers a cheap entry point for a quality defensive stock with a decent yield,” said Haselum.

“The company’s share price has fallen from $5.17 on January 4 to trade at $3.355 on November 10.”

The dividend yield that Haselum referred to is now at a tidy 4.7%.

According to CMC Markets, only four out of 15 analysts currently rate Healius shares as a buy. Nine professionals recommend holding.

Growing sales while passing on higher costs

Kentucky Fried Chicken franchisor Collins Foods Ltd (ASX: CKF) is Wilsons investment advisor Peter Moran’s pick at the moment.

He especially likes the company’s pricing power in times of rampant inflation.

“The KFC owner is positioned to grow sales volumes while passing on higher costs and retaining margins,” he said.

“KFC Australia has recently increased prices and there’s room for more once new poultry contract pricing is set at a later date.”

Fried chicken isn’t the only game in town though, with a different part of the business also providing Collins Foods a possible catalyst.

“The continuing rollout of Taco Bell franchises in Australia provides an additional growth stream. We have an overweight rating.”

The Collins share price is down 23.7% year to date. But the stock has enjoyed a nice revival since 21 October, rocketing up more than 20%.

The dividend yield now stands at 2.6%.

The post Chicken and health: Experts reveal 2 ASX shares to pounce on now appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Thursday
• Which ASX All Ords shares could perform well in a recession?

Motley Fool contributor Tony Yoo 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 Collins Foods Limited. The Motley Fool Australia has recommended Collins Foods Limited. 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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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Amazon (NASDAQ: AMZN) has operated outside of North America for nearly 25 years, but the company is still losing tons of money abroad.

Its international segment, which is primarily made up of e-commerce sales outside of North America, has lost $5.5 billion through the first three quarters of 2022, and has been in the red for much of its history.

At a time when Amazon stock seems to be in freefall, it’s easy to place the blame on the international business and the other unprofitable businesses like it. The company has long prized growth above profitability, and founder Jeff Bezos instilled a culture of managing the business for the long term, placing relatively little value on short-term profits. 

However, there’s more to the international business than meets the eye. Although the segment is losing money, it’s not as if Amazon is failing in every country it operates in. In fact, there’s an opportunity for the company to significantly boost its profitability by streamlining its business in international markets, and the market seems to be ignoring it.

A mix of markets

Amazon operates local sites in over a dozen countries, but some international markets are much more mature than others. 

For example, it has operated in the UK since 1998, but it just launched a local site in Belgium in the third quarter. On the earnings call, CFO Brian Olsavsky explained why the company is losing so much money this year in the international segment:

[I]nternational is always a mix of profitability in more established countries of Europe and Japan, offset by emerging countries and investments in Prime benefits. I think the biggest issue quarter over quarter, [is that] the increase in losses versus Q2 was tied to some additional operating costs in Europe. We’ve seen higher fuel costs there, even more certainly in the United States.

He also said that Prime Day sales tend to lead to losses, as the company sells a lot of devices for the shopping holiday, which it generally sells at cost to then create a profit stream through selling content on those devices.

But it’s worth taking stock of Olsavsky’s statement. Amazon isn’t profitable because it’s incapable of turning a profit abroad. Instead, the company continues to invest in growth by adding Prime benefits in these countries and pouring billions into emerging markets like India, which Bezos sees as a generational bet.

Is it time for restraint?

Although Amazon has more control over its international business than it might seem, that doesn’t change the fact that it has still lost more than $5 billion from the segment this year, and much more than that over its history.

With overall revenue growth slowing to single digits and its core e-commerce businesses losing money in both the North America and International segments, Amazon is tightening its belt like never before. The company has paused hiring in divisions, including corporate retail and Amazon Web Services. It’s also pulling the plug on experiments like Amazon Care, its telehealth and in-person healthcare initiative, and Scout, its delivery robot. 

With the international segment burning $2.5 billion in the most recent quarter, it may be time for some belt-tightening abroad as well. 

Amazon has built a huge business outside of North America, with revenue on track to top $100 billion this year, but it’s not worth much if it can’t turn a profit there. Whether its investments in countries like Belgium and India will pay off still remains to be seen.

It may not be so easy for Amazon to flip the profitability lever in the international sector, as it’s not going to pull out of the markets it’s already operating in. But finding a way to improve the bottom line in the international segment would go a long way toward improving the company’s overall financial picture.

The good news is the company is in the middle of a cost-cutting review that’s likely to slash at least some expenses in international markets, which seems ripe for such an opportunity. With Amazon already losing over $5 billion in that segment this year, cutting billions in expenses could send the stock soaring, especially as it’s down 50% from its peak last year.

With that in mind, investors would be wise to buy the stock now before the impact of those moves shows up on the bottom line.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Don’t be fooled. Amazon’s international business is more profitable than you think appeared first on The Motley Fool Australia.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Jeremy Bowman has positions in Amazon. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Amazon. The Motley Fool Australia has recommended Amazon. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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I think we’re very lucky to have a wide array of choice for ASX dividend shares that can help us make passive income in retirement.

For me, if I were in retirement, I’d be thinking about how reliant I am on that passive income cash flow. It’s no use if the dividends disappear precisely when I need them.

I’m not in retirement now. But, I am building a portfolio of ASX dividend shares that seem like they can maintain and grow their dividends over the long term.

Three of the below businesses are in my portfolio. Hopefully, one day my portfolio can generate $50,000 of annual dividends, or more.

Rural Funds Group (ASX: RFF)

Rural Funds is a real estate investment trust (REIT) that owns a diversified agricultural property portfolio across areas such as cattle, almonds, vineyards, macadamias, and cropping (sugar and cotton).

This business aims to grow its distribution by 4% each year, which I think is a solid growth rate and can compound nicely over time.

Rural Funds benefits from growing rental income. Some of the rent is linked to inflation (which is getting a boost), while most of the rest has a fixed annual increase. Plus, there are occasional market reviews.

The ASX dividend share is also able to grow rent by investing in its farms, either by making them more productive or changing them to another farm type, generating more rental profit.

It’s expected to pay a total distribution of 12.2 cents in FY23, translating into a forward yield of 4.9%.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

This is an investment company that has been operating for decades. It’s invested in sectors such as building products, telecommunications, property, financial services, agriculture, resources, and so on.

With its focus on defensive, uncorrelated assets, the ASX dividend share receives good (and growing) cash flow from its investment portfolio and then uses the majority of that cash flow to pay a growing dividend.

It has grown its dividend every year since 2000. This is the longest-running dividend growth record on the ASX.

Using the ordinary annual dividend of 72 cents per share from FY22, it has a grossed-up dividend yield of 3.6%.

Metcash Limited (ASX: MTS)

This business has three pillars.

The food pillar is about being the supplier to independent supermarkets, predominantly IGAs.

Metcash also has a liquor business, where it supplies independent liquor retailers such as Cellarbrations, The Bottle-O, IGA Liquor, Porters Liquor, Thirsty Camel, Big Bargain Bottleshop, and Duncans.

Finally, the third pillar is hardware. It owns the brands Mitre 10, Total Tools, and Home Timber & Hardware.

I like the defensive parts of the business – food and liquor – which can offer resilient earnings. Additionally, I think the hardware business offers the most potential to deliver higher margins and earnings growth.

Metcash aims to pay out 70% of its underlying net profit as a dividend. In FY22, it paid an annual dividend of 21.5 cents per share, which translates into a grossed-up dividend yield of 7.8%.

Brickworks Limited (ASX: BKW)

Brickworks is another ASX dividend share with an impressive record. It hasn’t cut its dividend for more than four decades.

It is one of the largest building product manufacturers in Australia, with a leading position in bricks, and it also has other divisions such as roofing. Brickworks has also managed to achieve a market-leading position in the northeast of the US through acquisitions.

Brickworks also owns a sizeable chunk of Soul Pattinson, so it’s benefiting from the diversification and growing dividends from the investment company.

Finally, it has investments in property, including a growing industrial property trust that it owns half of, along with Goodman Group (ASX: GMG). The property trust is building quality industrial properties on excess Brickworks land. This can help grow rental profit and help fund higher dividends.

The current Brickworks grossed-up dividend yield is 4.3%.

The post How I’d invest in ASX dividend shares now to make a $50k passive income in retirement appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Brickworks, RURALFUNDS STAPLED, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Brickworks, RURALFUNDS STAPLED, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Metcash Limited. 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 Tuesday, the S&P/ASX 200 Index (ASX: XJO) fought hard to stay in positive territory but ended the day in the red. The benchmark index fell 4.7 points to 7,141.6 points.

Will the market be able to bounce back from this on Wednesday? Here are five things to watch:

ASX 200 expected to fall

The Australian share market looks set to edge lower on Wednesday following a volatile night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 6 points or 0.1% lower this morning. In late trade on Wall Street, the Dow Jones is flat, the S&P 500 is up 0.7%, and the Nasdaq is up 1.4%. The Dow was up over 1% at one stage after US inflation came in softer than expected again.

Oil prices rise

Energy producers Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a good day after oil prices pushed higher overnight. According to Bloomberg, the WTI crude oil price is up 1.9% to US$87.47 a barrel and the Brent crude oil price has risen 1.5% to US$94.57 a barrel. Oil prices rose amid hopes that easing inflation could support demand.

Aristocrat results

The Aristocrat Leisure Limited (ASX: ALL) share price will be on watch today when the gaming technology company releases its full year results. According to a note out of Goldman Sachs, its analysts are expecting Aristocrat to deliver revenue of $5,654.2 million and a net profit of $1,072.0 million.

Gold price edges higher

Gold miners Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) will be on watch after the gold price edged higher overnight. According to CNBC, the spot gold price is up 0.1% to US$1,777.9 an ounce. Gold rose thanks to another softer than expected inflation reading.

CBA rated as a sell

Despite Australia’s largest bank delivering a stronger than expected first quarter update on Tuesday, Goldman Sachs still believes the Commonwealth Bank of Australia (ASX: CBA) share price is overvalued. This morning the broker reiterated its sell rating with an improved price target of $90.98. Goldman said: “Strong franchise not sufficiently differentiated to justify premium.”

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

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• Stressed about your ASX share portfolio? I’d take these 3 dead-simple steps to sleep easy
• Why did the Treasury Wine share price crack a new multi-year high on Tuesday?
• Here are the top 10 ASX 200 shares today
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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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