Tag: Motley Fool

If you’re on the lookout for a combination of strong gains and a big dividend yield, then Super Retail Group Ltd (ASX: SUL) shares could be the answer.

That’s the view of analysts at Morgans, which are feeling very positive about the ASX 200 retail stock.

Why is Super Retail an ASX 200 retail stock to buy?

According to a note from last month, the broker was pleased with the company’s performance during the first half of FY 2024. It said:

The strength of Super Retail Group’s (SUL) portfolio was apparent in a strong 1H24 result in which sales increased 3% despite cycling strong comps.

The broker also highlights that the company is outperforming the competition, such as fellow ASX 200 retail stock JB Hi-Fi Ltd (ASX: JBH). It adds:

In our opinion, the business is outperforming the competition across most of its retail operations as it leverages its brand equity, strong omnichannel credentials, well subscribed loyalty programmes and extensive network of stores.

The good news for income investors is that Morgans believes this outperformance will put Super Retail in a position to declare a special dividend in FY 2024. The broker explains:

PBT was down only (5)% compared, for example, with JB Hi-Fi’s (20)% decline. Although there is some work to do at rebel, in particular, we believe SUL will continue to deliver strong returns and remains likely to declare a special dividend in August.

Morgans has pencilled in fully franked dividends per share of 96 cents in FY 2024. Based on the current Super Retail share price of $14.75, this equates to a 6.5% dividend yield.

Big gains ahead

As I mentioned above, the broker is also tipping big returns from the ASX 200 retail stock.

It currently has an add rating and $17.50 price target on its shares, which implies potential upside of approximately 19% for investors.

Throw in the potential dividends and you would have a total return of over 25% if Morgans is on the money with its recommendation.

The post Guess which ASX 200 retail stock is tipped to deliver 19% upside and a 6.5% yield in 2024 appeared first on The Motley Fool Australia.

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More reading

• Why does Morgans rate these ASX dividend stocks as buys?
• Buy Coles and these ASX dividend shares next week
• Brokers name 2 ASX 200 dividend shares to buy
• Why did Super Retail shares drop after going ex-dividend?
• 5 things to watch on the ASX 200 on Wednesday

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 Super Retail 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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On Tuesday, the S&P/ASX 200 Index (ASX: XJO) managed to record a small gain. The benchmark index rose 0.1% to 7,712.5 points.

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

ASX 200 expected to edge higher

The Australian share market looks set to rise again on Wednesday following a very positive session in the United States. According to the latest SPI futures, the ASX 200 is expected to open the day 13 points or 0.2% higher. In late trade on Wall Street, the Dow Jones is up 0.7%, the S&P 500 has risen 1.2%, and the Nasdaq is 1.5% higher.

Oil prices soften

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a subdued session after oil prices softened overnight. According to Bloomberg, the WTI crude oil price is down 0.15% to US$77.81 a barrel and the Brent crude oil price is down 0.1% to US$82.12 a barrel. This appears to have been driven by rate cut doubts following the release of inflation data.

Core Lithium results

The Core Lithium Ltd (ASX: CXO) share price will be on watch today after the lithium miner released its half-year results and reported a huge loss. Core Lithium revealed revenue of $134.8 million and a loss after tax of $167.6 million. The company also announced that its CEO, Gareth Manderson, is stepping down.

Gold price tumbles

ASX 200 gold shares Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a tough session on Wednesday after the gold price tumbled overnight. According to CNBC, the spot gold price is down 1.3% to US$2,160.4 an ounce. A hot U.S. inflation report reduced the prospects of the Federal Reserve cutting interest rates soon.

Treasury Wine gets China boost

All eyes will be on the Treasury Wine Estates Ltd (ASX: TWE) share price on Wednesday after the Chinese government revealed plans to remove its tariffs from Australian wine. Though, it has warned that the interim draft determination is not a final determination and is subject to change by MOFCOM. Treasury Wine expects a final determination in the coming weeks.

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

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More reading

• Core Lithium share price on watch amid $167m half-year loss and CEO exit
• Here are the top 10 ASX 200 shares today
• How much passive income will I get from shares vs. property?
• How Woodside shares can ‘thrive through the energy transition’
• 5 things to watch on the ASX 200 on Tuesday

Motley Fool contributor James Mickleboro has positions in Treasury Wine Estates and Woodside Energy Group. 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 Treasury Wine Estates. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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With the ASX 200 index recently reaching a record high, investors may not see today as being the most opportune time to make investments in ASX growth stocks.

However, that isn’t necessarily the case.

That’s because a number of high-quality companies have failed to join the ASX 200 index in its recent rally and remain down meaningfully from their highs.

But as we know, the cream always rises to the top. So, while these ASX growth stocks are out of favour at the moment, that is unlikely to be the case over the next decade.

And if history repeats itself, some very strong gains could be generated from their shares in the future.

But which high-quality shares? Three to look at are listed below:

CSL Ltd (ASX: CSL)

The first ASX growth stock to look at is biotechnology giant CSL. Over the last decade, its shares have delivered an average return of 15.5% per annum. However, due to some temporary headwinds and a disappointing clinical trial result, its shares are broadly flat since last year.

Analysts at UBS see this as a buying opportunity. Last month the broker put a buy rating and $330 price target on its shares. This implies potential upside of approximately 17%.

Domino’s Pizza Enterprises Ltd (ASX: DMP)

This pizza chain operator has been struggling with operational mishaps and inflationary pressures recently. And while this is disappointing, these problems are only likely to be temporary and have already shown signs of easing.

It is for this reason that Morgan Stanley put an overweight rating and $68.00 price target on this ASX growth stock last month. If this price target proves accurate, it will mean a return of greater than 55% for investors.

ResMed Inc. (ASX: RMD)

A final ASX growth stock that could be a top long-term option is sleep treatment company ResMed. Its shares have rebounded strongly recently but remain down more than 20% from their 52-week high. This has been driven by concerns that weight loss wonder drugs will reduce its market opportunity.

However, Morgans doesn’t believe these drugs will have an impact on the company’s growth. As a result, it put an add rating and $32.82 price target on its shares last month. This suggests potential upside of 15%.

The post A once-in-a-decade chance to get rich buying ASX growth stocks? appeared first on The Motley Fool Australia.

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More reading

• 2 ASX 200 shares to buy in the most ‘interesting’ sector right now
• How much passive income will I get from shares vs. property?
• Bell Potter names the best ASX shares to buy in March
• Why are CSL shares falling today?
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro has positions in CSL, Domino’s Pizza Enterprises, and ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Domino’s Pizza Enterprises, and ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool Australia has recommended CSL and Domino’s Pizza Enterprises. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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With the S&P/ASX 200 Index (ASX: XJO) rocketing 13.7% since the start of November, investors need to be careful they don’t buy stocks that are overvalued.

In fact, some experts reckon there are whole sectors right now that have been pumped up way too much.

Selective picking has become paramount for stock buyers now more than ever.

SG Hiscock & Company head of equities Hamish Tadgell recently mentioned a sector that his team is looking at that’s gone unloved for years.

“Healthcare looks interesting to us,” he said Tuesday at a media briefing in Sydney.

“That [sector]’s idiosyncratic and it’s around stock stories.”

Still 16% discount to last year

Tadgell mentioned how Resmed CDI (ASX: RMD) had a tough time of it last year.

The stock for the sleep apnoea device maker fell off a cliff during the August reporting season from fears that new GLP-1 weight loss drugs could eliminate obesity around the world.

Experts, both financial and medical, said at the time those concerns were unfounded.

Although it has slowly recovered some of those losses, the ResMed share price still remains 16% below its early August peak.

That’s perhaps why Tadgell and other professionals are bullish on the healthcare stock.

Broking platform CMC Invest suggests a whopping 19 out of 26 analysts rate ResMed shares as a buy at the moment.

The ASX 200 stock that plunged despite ‘very strong result’

Pro Medicus Limited (ASX: PME) is another standout for Tadgell.

Shares for the medical imaging technology provider have been outstanding in recent times, rising more than 70% over 2023.

But the stock had a little hiccup during last month’s reporting season, dropping 13% on the day of its results.

It was all a little bit odd, considering The Motley Fool’s James Mickleboro called the numbers “a very strong result from the high-flying company”.

Revenue was up 30%, net profit was 33% higher, and it even paid out a small dividend.

This pullback could be a time to get in on a hot stock.

“The good news is that this strong growth looks set to continue,” said Mickleboro.

“Pro Medicus won four key contracts during the six months. These have a total contract value of $200 million at committed minimum exam volumes and contract terms ranging from 7 to 10 years.”

The post 2 ASX 200 shares to buy in the most ‘interesting’ sector right now appeared first on The Motley Fool Australia.

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More reading

• Bell Potter names the best ASX shares to buy in March
• Here are the top 10 ASX 200 shares today
• Up 37% from their low: Can ResMed shares keep rising?
• 3 reliable ASX shares you can buy at a discount
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Tony Yoo has positions in ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Pro Medicus and ResMed. The Motley Fool Australia has positions in and has recommended ResMed. The Motley Fool Australia has recommended Pro Medicus. 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 growth shares that are soaring rapidly are obviously exciting and rewarding to own.

But, of course, one must always remember with reward comes risk. Not every hyper-growth stock you buy will end up a 10-bagger. Probably not even the majority of them.

If it were easy, then everyone would be doing it, and we’d all be billionaires.

But if you keep the risks in mind and do careful research then you can make some educated guesses as to which stocks will end up much higher in a few years.

Then you diversify by buying a few of these and see which ones work out.

Here are three high-growth ASX shares that I like at the moment:

A fast recovery from tough times

Megaport Ltd (ASX: MP1) is one that I sold off last August. I am embarrassed to say it’s gone from strength to strength since.

In fact, the share price has rocketed 42% since I offloaded it seven months ago.

If you go back to April last year, though, Megaport has returned a stunning 268% for its investors.

The performance is amazing, considering it was only this time last year when the chief executive resigned suddenly, and the market punished the stock.

With a new boss at the helm, the virtual networking provider has convinced investors that it’s successfully cutting costs, increasing profits and expanding its customer base.

A massive 10 out of 15 analysts covering Megaport currently rate it as a strong buy, according to broking app CMC Invest.

All up, Megaport shares are 257% higher now than they were five years ago.

ASX growth shares with all the right signals

One I’ve pleasingly held onto is Telix Pharmaceuticals Ltd (ASX: TLX).

The cancer drug company has consistently kicked goals over the last five years, showing in its share price returning an incredible 1,578% over that time.

Despite its meteoric rise, the professionals are banking on even more to come.

The analysts at Bell Potter love the Melbourne company’s recently revealed acquisition of Canadian outfit ARTMS Inc.

“The acquisition is crucial for the supply of 89Z and the pending rollout of Zircaix for renal cancer imaging,” the team said in a memo.

“Telix is validating multiple production locations for 89Zr in the US using the ARTMS core technology. The company also owns significant quantities of ultra-pure 89Y, being the raw material for production of 89Zr.”

Tellingly, all eight analysts surveyed on CMC Invest insist Telix is a buy.

Hit the jackpot 

A growth stock that’s caught my attention recently is Light & Wonder Inc CDI (ASX: LNW), which is dual-listed here and on the Nasdaq.

As a poker machine maker, the Las Vegas company is a competitor to Australia’s own Aristocrat Leisure Limited (ASX: ALL).

Light & Wonder was only listed on the ASX last May, but shares have soared 68% from its first-day price.

With a December year-end, the company revealed its 2023 results during reporting season, and its metrics were bullish:

• Revenue up 16% to $2.9 billion
• Net income turned around from a $176 million loss to $180 million gain
• Net cash from operating activities turned around from a $381 million loss to $590 million gain

All eight analysts currently surveyed on CMC Invest rate the stock as a buy.

The post 3 hypergrowth ASX shares to buy in 2024 and beyond appeared first on The Motley Fool Australia.

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More reading

• Guess which 3 ASX All Ords shares are up 60%+ in 2024
• Buy this ASX 200 biotech stock for a 20%+ return
• 5 things to watch on the ASX 200 on Monday
• Here are the top 10 ASX 200 shares today
• Brokers name 3 ASX shares to buy now

Motley Fool contributor Tony Yoo has positions in Telix Pharmaceuticals. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Light & Wonder, Megaport, and Telix Pharmaceuticals. The Motley Fool Australia has recommended Light & Wonder, Megaport, and Telix Pharmaceuticals. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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It’s a big call to say any ASX stock is a “must own”, but certainly there are some compelling shares out there worth consideration right now.

One that I think is a great candidate at the moment is US software maker Life360 Inc (ASX: 360).

The stock is on an absolute tear right now, rising a jaw-dropping 64% this year.

So what’s doing here?

Responding to market concerns

A couple of years ago, when technology and ASX growth shares were plunging from inflation fears, the management at Life360 decided to change the way it operated.

The team responded to market concerns and decided to burn less cash and focus on profitability.

The turnaround was appreciated by investors, with the latest yearly result released this month proving the climax so far.

“The highlight of the result was arguably Life360’s adjusted EBITDA. It was US$20.6 million for the year, which was comfortably ahead of its guidance range of US$12 million to US$16 million,” reported The Motley Fool’s James Mickleboro.

“While the company recorded a net loss of US$28.2 million, this was a massive US$63.5 million improvement from FY 2022.”

From its trough in June 2022, the Life360 share price has multiplied almost five times.

Amazing.

I’m not alone in my bullishness for Life360 stock

But of course, there is no point in buying these shares now if they’ve already had their run.

The great news for punters is that it may not be too late to grab a piece of Life360.

Seven out of eight analysts currently surveyed on CMC Invest are maintaining a strong buy rating for the tech stock.

The team at Goldman Sachs Group Inc (NYSE: GS) recently upgraded its share price target for Life360.

“The company is now scaling margins and earnings rapidly off a low base, with attractive unit economics and potential structural profitability tailwinds on the horizon from a reduction in effective app store fees.”

Life360 has flagged the possibility of introducing advertising into its popular smartphone app, which the Goldman Sachs analysts thought was an excellent idea. 

“Given our long-held view that Life360’s subscription business remains undervalued, we view the potential advertising upside as effectively a ‘free’ option.”

The app is now ranked 30th in the iPhone app store, and 5th in the social networking category.

“Life360’s subscription business currently trades at a discount to global subscription app peers when adjusting for its superior growth outlook.”

The post Buy alert: 4 reasons I think Life360 stock is a must-own now appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
• Guess which 3 ASX All Ords shares are up 60%+ in 2024
• Goldman Sachs says these ASX tech stocks are top buys
• Long-term investing: 3 top ASX stocks you can buy for under $20 a share

Motley Fool contributor Tony Yoo has positions in Life360. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Life360. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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Is it fanciful imagining how rich one could be if only they had invested in a particular ASX stock?

I say no, because it keeps you motivated to keep researching and investing.

It also reminds you that diversification can not only reduce risk from losers, it allows spectacular winners to carry the whole portfolio upwards.

On that point, there is one small-cap stock that’s been making waves in 2024.

In fact, it has almost tripled in share price so far this year.

Let’s check out what’s happening:

Cast your mind back to spring

Perth biotech PharmAust Limited (ASX: PAA) may only have a market capitalisation of around $129 million, but not so long ago it was even smaller than that.

Let’s go on a very short journey in the time machine — back to November.

At that time the PharmAust share price was hovering around 7 cents. In fact, it has been more or less at that mark for a good three years.

Hypothetically, let’s imagine you bought $30,000 worth of shares then.

At the start of December, the company presented some favourable results from a study of its monopetal product. The solution aims to treat motor neurone disease (MND), which is known as Lou Gehrig’s Disease in North America.

The market took notice and sent the stock shooting up.

But then just two weeks ago, more positive test results came out, that really put a rocket under the ASX stock.

The wash up is that the shares are 33 cents at the time of writing.

That $30,000 you invested just four months ago? That’s now worth a cool $141,428.

How does that compare to a term deposit?

This biotech stock and a bunch of losers = win

Now, no one is expecting that you’ll land this sort of winner every time.

But if you can manage one or two multi-baggers within a diversified portfolio, that’s all you need to grow your wealth.

Check this out. 

Say, at the time you bought PharmAust shares, you also bought four other stocks for $30,000 each.

Then in the four months that PharmAust was going crazy, the other four were having a miserable time to dive 25% each.

Your overall portfolio would still be a stunning 54% up in just one-third of a year.

Good luck with your investments.

The post If you’d put $30,000 in this ASX biotech stock 4 months ago, you’d have $140,000 now appeared first on The Motley Fool Australia.

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More reading

• This small-cap ASX stock just rocketed 39%. What’s doing?

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 Core Lithium Ltd (ASX: CXO) share price will be one to watch closely on Wednesday.

That’s because the lithium miner has released its half-year results after the market close.

Core Lithium share price on watch

• Revenue of $134.8 million
• EBITDA loss of $11.5 million
• Loss after tax of $167.6 million
• CEO to exit

What happened during the half?

For the six months ended 31 December, Core Lithium reported revenue of $134.8 million. This reflects spodumene concentrate production of 49.5kt with sales of 54.1kt and lithium fines sales of 46.3kt.

Core Lithium reported a 75% decline in its spodumene concentrate realised price to US$2,098 per tonne and cash operating costs of A$1,926 per tonne.

Unfortunately, this meant that the company posted a loss for the six months. It reported an EBITDA loss of $11.5 million and a loss after tax of $167.6 million. This includes a non-cash impairment of $119.6 million and provisions for onerous contracts of $27.6 million.

CEO exit

In response to operational changes put in place as a result of its strategic review and the revised near-term path forward for the company, its CEO, Gareth Manderson, will step down.

Commenting on his exit, Core chair, Greg English, said:

Gareth joined Core at a difficult time: the Grants open pit mine was underperforming and the mine infrastructure was not complete. He joined to provide the leadership and skills required as a developer and operator. He has delivered the Finniss project, established concentrate production, shipping and sales processes and developed the governance, practices and processes required of a listed mining company. [..] Gareth has made an outstanding contribution to the Company, and we wish him well in his other ventures.

Looking beyond lithium

With the lithium price tipped to stay lower for longer, Core Lithium has suggested that it may look beyond the white metal. It commented:

The Core exploration team is reviewing the local and regional prospectivity of the Company’s lithium tenements and the potential of the Company’s 100% owned gold, uranium and base metal projects. The Company has received multiple inbound enquiries about the Napperby and Fitton Uranium Projects. Updates will be provided as the review continues and the exploration plan is finalised.

Outlook

The company has yet to make a decision on the restart of the Finniss Lithium Project. However, it will continue to process existing ore stockpiles to produce spodumene in the meantime.

As a result, it has reaffirmed its revised FY 2024 production guidance of 90,000 tonnes to 95,000 tonnes of 4.77% spodumene concentrate production and sales of 80,000 tonnes to 90,000 tonnes.

Though, that may not be enough spodumene to fulfil its obligations, which could have consequences for Core Lithium and its share price. Its report highlights the following:

The Group has offtake agreements with Ganfeng Lithium and Sichuan Yahua for the supply of lithium spodumene concentrate. Within these agreements, there are annual shipment quantities that Core Lithium is contractually obligated to meet. Due to the suspension of mining at the Finniss operations, there is a possibility that Core Lithium may not meet this obligation. In respect of one of these agreements, if this obligation is not met, Core Lithium is obligated to pay the customer the difference between the price and the price the customer actually paid in procuring a replacement supply of spodumene concentrate.

The post Core Lithium share price on watch amid $167m half-year loss and CEO exit appeared first on The Motley Fool Australia.

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More reading

• Here are the top 10 ASX 200 shares today
• Why are short sellers shifting into ASX blue chips and out of lithium losers?
• These are the 10 most shorted ASX shares
• Down 19% this year! Is now the moment to buy Core Lithium stock?
• Could the big short of ASX lithium stocks be nearing its end?

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

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The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Life360. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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S&P/ASX 200 Index (ASX: XJO) mining stocks have had a tough start to 2024.

Two and a half months into the new year sees the ASX 200 up 1.0% at market close on Tuesday.

Not shooting the lights out, perhaps. But respectable. Especially as this doesn’t include the dividends many of the blue-chip stocks have already paid out in 2024.

And the benchmark index certainly hasn’t gotten any help from Australia’s large-cap mining shares.

Here’s how these three leading ASX 200 mining stocks have performed so far this year:

• Fortescue Metals Group Ltd (ASX: FMG) shares are down 14.4%
• BHP Group Ltd (ASX: BHP) shares are down 15.4%
• Rio Tinto Ltd (ASX: RIO) shares are down 13.4%

Why are the big ASX mining shares getting smashed in 2024?

The biggest headwind facing the big three Aussie miners has been a sharp fall in the price of iron ore.

BHP, Fortescue and Rio Tinto all earn significant revenue from other commodities, including copper.

But iron ore is the top revenue earner for all three ASX 200 mining stocks.

At market close yesterday, iron ore was trading for US$107 per tonne. That was down almost 7% overnight. And it puts the price of the steel-making metal down some 26% since 2 January, when it was trading for US$145 per tonne.

Much of the retrace in the iron ore price can be pinned on weak demand from China, the world’s top iron ore consumer and number one export market for Aussie shipments.

As you’re likely aware, China’s once-booming economy has been struggling to meet the government’s scaled-back growth target of 5%.

The middle kingdom’s steel-hungry real estate sector has been a particularly underwhelming performer.

Over the latter months of 2023, investors had been banking on some significant stimulus measures from the Chinese government. Those expectations helped support the iron ore price and by connection the ASX 200 mining stocks.

To date, however, those stimulus measures have been more of a drip feed than the bazooka policies China’s economy appears to need to reignite economic growth.

And those drip feed policies were reinforced this week at the annual National People’s Congress in Beijing.

The lack of substantial new stimulus measures drove down the iron ore price to levels not seen since August.

But things could yet take a sharp turn for the better.

Why things could take a sharp turn-up for ASX 200 mining stocks

I believe ASX 200 mining stocks like BHP, Fortescue and Rio Tinto could be in for a significant rebound after the big retrace in early 2024.

First, take a look at copper prices.

The copper price has managed to actually edge up by 1% this calendar year, with the red metal currently trading for US$8,653 per tonne.

The copper price is less directly impacted by rising or waning demand from China. And the resilient price is a bullish sign for the growth outlook of the wider global economy.

‘Dr copper’ after all, is often used to gauge the health of the worldwide economy.

Second, I don’t believe that Chinese President Xi Jinping can afford to see China’s economy fall short of its 5% stated growth target.

That means either the economy, and the nation’s demand for iron ore, will pick up growth under the already announced measures. Or the government will have little choice but to up its stimulus measures.

Either outcome, if they eventuate as I expect, should prove bullish for ASX 200 mining stocks.

Commenting on the outlook for additional stimulus measures from China, Commonwealth Bank of Australia (ASX: CBA) analyst Vivek Dhar said (quoted by The Australian Financial Review):

The ultimate question will be the willingness of policymakers to defend China’s economic growth target of around 5% this year.

We think the goal will be challenging, but if growth undershoots even downside expectations of policymakers, it will likely open the door to more infrastructure-related stimulus.

That potential increased infrastructure-related stimulus out of China should lead to a boost in steel manufacturing and the accompanying demand for the iron ore to produce it.

Which is why I think ASX 200 mining stocks like BHP, Rio Tinto and Fortescue are looking cheap following this year’s sharp sell-off.

Now, as always, I encourage you to do your own thorough research before investing in any ASX shares. If you’re not comfortable with that or simply don’t have the time, then seek out some expert advice.

The post After a rough start to 2024 these 3 ASX 200 mining stocks are looking cheap to me appeared first on The Motley Fool Australia.

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• How much passive income will I get from shares vs. property?
• Why BHP, Brainchip, Lake Resources, and Yancoal shares are sinking today
• Why is the BHP share price getting hammered on Tuesday?
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• 5 things to watch on the ASX 200 on Tuesday

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

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