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If you have room in your portfolio for some new additions in November, then you might want to consider the ASX growth shares listed below.

They have recently been named as buys by experts and tipped to climb meaningfully higher from current levels. Here’s what you need to know about them:

Cochlear Limited (ASX: COH)

The first ASX growth share that has been named as a buy is Cochlear. It is one of the world’s leading hearing solutions companies. It has been tipped to continue its growth long into the future thanks to its portfolio of world class products in an industry with high barriers of entry. Particularly given how the industry is benefiting from favourable tailwinds such as ageing populations and a growing middle class.

Goldman Sachs is bullish on Cochlear. Its analysts currently have a buy rating and $247.00 price target on its shares.

IDP Education Ltd (ASX: IEL)

Another ASX growth share that has been named as a buy is IDP Education. It is a language testing and student placement company and a co-owner of the IELTS test. This is the English test that is trusted by more governments, universities, and organisations than any other.

Goldman Sachs is a big fan of the company and is expecting strong underlying system demand to result its rapid earnings growth through to FY 2025. Goldman has a buy rating and $36.00 price target on the company’s shares.

Life360 Inc (ASX: 360)

A final ASX growth share that analysts have tipped as a buy is Life360. It is a technology company that operates in the digital consumer subscription services market, with a focus on products and services for digitally native families. The company’s flagship product is the Life360 app, which has a whopping 40 million+ active users. It offers families features such as communications, driver safety, and location sharing.

Analysts at Bell Potter are very positive on the company. This is due to its huge total addressable market and material cross selling opportunities. Bell Potter has a buy rating and $8.25 price target on its shares.

The post Experts name 3 of the best ASX growth shares to buy in November appeared first on The Motley Fool Australia.

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More reading

• Which are the best ASX 200 shares to buy now for 2023?
• Morgans names 2 fast-growing ASX 200 shares to buy now
• ‘Very bullish’: 3 small-cap ASX shares QVG is loving right now
• 5 reasons I would avoid BrainChip shares at all costs
• Leading fund manager names the 3 ASX stocks that drove its returns higher in October

Motley Fool contributor James Mickleboro has positions in Life360, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Cochlear Ltd., Idp Education Pty Ltd, and Life360, Inc. The Motley Fool Australia has recommended Cochlear Ltd. 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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After a year that absolutely hammered technology stocks, some investors are now starting to go bargain shopping with an eye on a possible turnaround.

Two such S&P/ASX 200 Index (ASX: XJO) shares that seem to be favoured by professional investors are Hub24 Ltd (ASX: HUB) and Altium Limited (ASX: ALU).

Hub24 shares are currently rated as a strong buy by nine out of 13 analysts surveyed on CMC Markets.

“Altium is aiming to achieve US$500 million in revenue by 2026. This will be more than double FY2022’s revenue of US$220.8 million,” wrote The Motley Fool’s James Mickleboro, who reported that Jefferies is “a fan of the company”. 

“It currently has a buy rating and $38.13 price target on its shares.”

The trouble is that many investors are short of cash in turbulent times.

So if you’re tempted by both Hub24 and Altium, which is the better investment if you have limited funds?

‘Like trying to pick a favourite child’

Shaw and Partners portfolio manager James Gerrish was asked this very question this week in a Market Matters Q&A.

He admitted it’s a tough one, as his team holds both of them and they “have performed stoically”.

“At this stage the answer is we like them both. It’s sort of like trying to pick a favourite child!”

Indeed, during a period when tech has really struggled to hold their valuations, Hub24 shares have done well to be only 9% lower year to date. Altium has been relatively resilient too, with the stock price down 20%.

This compares to a 32% drop for the S&P/ASX All Technology Index (ASX: XTX).

But which one to choose, if there was a gun to the head?

But if Gerrish absolutely had to pick one, it would be the financial platform provider over the electronic design software maker. 

“We do think there is probably more upside for Hub24 in the short term given its strong platform growth that was reported recently and the aggressive commercial model they run,” he said.

“That said, Altium continues to go from strength to strength and we see at least 15% upside into Christmas, but more wouldn’t surprise.”

The post Hub24 or Altium: Which ASX 200 tech stock is the better buy right now? appeared first on The Motley Fool Australia.

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More reading

• ASX 200 tech shares jump 6%
• Here are the top 10 ASX 200 shares today
• ‘Very bullish’: 3 small-cap ASX shares QVG is loving right now
• Analysts name the ASX growth shares to buy
• US$10 billion was just wiped from the value of Atlassian. How are ASX 200 tech shares responding?

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 Altium and Hub24 Ltd. The Motley Fool Australia has positions in and has recommended Hub24 Ltd. 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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Last week saw a number of broker notes hitting the wires once again. Three buy ratings that investors might want to be aware of are summarised below.

Here’s why brokers think investors ought to buy them next week:

Allkem Ltd (ASX: AKE)

According to a note out of Macquarie, its analysts have retained their outperform rating on this lithium miner’s shares with an improved price target of $21.00. Macquarie has lifted its earnings estimates for Allkem in response to stronger lithium price forecasts. This is being supported by growing demand for the electric vehicle battery ingredient. The Allkem share price was trading at $16.18 on Friday.

Jumbo Interactive Ltd (ASX: JIN)

A note out of Goldman Sachs reveals that its analysts have retained their buy rating on this online lottery ticket seller’s shares with a trimmed price target of $15.20. Although Jumbo’s first quarter update was softer than Goldman was expecting, it remains positive. This is due to the company’s long term growth story through the SaaS business and its ability to improve market share within the growing digital lottery business. The Jumbo share price was fetching $14.30 at Friday’s close.

Suncorp Group Ltd (ASX: SUN)

Analysts at Credit Suisse have retained their outperform rating and $13.90 price target on this insurance giant’s shares. According to the note, the broker was pleased with Suncorp’s quarterly update and particularly its stronger than expected mortgage loan growth. Overall, it feels that this update supports its bullish view on the company. The Suncorp share price ended the week at $12.19.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

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More reading

• These ASX shares turned $20,000 into $100,000 in 10 years
• Top ASX dividend shares to buy in November 2022
• Analysts say these ASX growth shares are buys
• Why is the Core Lithium share price having such a top run on Friday?
• 3 ASX 200 lithium shares smashing all-time highs on Friday

Motley Fool contributor James Mickleboro has positions in Allkem Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Jumbo Interactive Limited. The Motley Fool Australia has recommended Jumbo Interactive 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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The Australian share market is home to a large number of dividend payers. However, some offer yields that are greater than average at present.

For example, two high yield ASX dividend shares that are rated as buys are listed below. Here’s what you need to know about them:

National Australia Bank Ltd (ASX: NAB)

The first ASX dividend share that could be a good option right now for income investors is this banking giant.

NAB appears well-placed to profit in the current environment thanks to its strong position in commercial banking. In fact, it is for this reason that Goldman Sachs recently reiterated its buy rating with a $35.41 price target.

The broker notes that NAB provides “the best leverage to the thematic that domestic volume momentum will favour commercial over housing volumes over both the short- and medium-term.”

Goldman expects this to underpin attractive dividend yields from NAB’s shares in the coming years. It is forecasting a $1.73 per share dividend in FY 2023 and then a $1.78 per share dividend in FY 2024. Based on the current NAB share price of $31.35, this will mean fully franked yields of 5.5% and 5.7%, respectively.

New Hope Corporation Limited (ASX: NHC)

This coal miner could be a dividend share to buy thanks to sky high coal prices.

A note out of Morgans this week reveals that its analysts have retained their add rating with a $7.00 price target.

Its analysts believe that New Hope will be positioned to pay a massive $1.20 per share in FY 2023. Based on the current New Hope share price of $5.16, this represents a whopping fully franked 23% dividend yield for investors.

But it may not even stop there with the returns. The broker has suggested that “plausibly +$1.5bn ($1.59ps) is available for distribution via the announced onmarket buyback and dividends.”

Looking further ahead, while the broker is forecasting a reduction in New Hope’s dividend to a fully franked 75 cents per share in FY 2024, this still equates to a sizeable 14.5% yield.

The post Analysts say these high yield ASX dividend shares are buys appeared first on The Motley Fool Australia.

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More reading

• Top ASX dividend shares to buy in November 2022
• 4 ASX 200 shares trading ex-dividend next week
• Why is the Whitehaven Coal share price falling in a hole on Friday?
• 5 of the craziest things making news on the ASX this week
• Why has the NAB share price had such a miserable week so far?

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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With the market rebounding, now might be a great time to look at adding some new ASX shares to your portfolio.

If you’re wanting to invest in the best shares, then you may want to consider the “champion stocks” listed below.

Here’s why Bell Potter rates them as some of the best shares to buy and hold:

Amcor PLC (ASX: AMC)

Bell Potter’s analysts are positive on this packaging giant due to its defensive earnings and exposure to emerging markets. It explained:

The global leader in consumer packaging with a footprint encompassing North America, Latin America, Asia Pacific, Europe, Middle East, and Africa. The group offers an attractive combination of defensive earnings in the developed countries with faster growth in emerging markets, which accounted for almost 25% of group sales in fiscal 2022.

Goodman Group (ASX: GMG)

The broker also expects Goodman’s shares to be strong performers over the coming years. This is thanks to robust demand for industrial property thanks partly to online shopping. It commented:

One of the world’s largest integrated industrial property groups with operations centred around development, management and ownership throughout Australia, New Zealand, Asia, Europe, United Kingdom, North America, and Brazil. The long term outlook for industrial and logistics properties is favourable given the continuing growth in ecommerce (or on-line retail sales) and the growing middle class in developing countries.

Sonic Healthcare Limited (ASX: SHL)

Finally, Bell Potter is a fan of this medical diagnostic services provider. The broker believes Sonic is well-placed to benefit from demand for pathology services and its ongoing international expansion. It said:

The world’s third largest pathology provider with significant operations in the USA, United Kingdom, Germany, Switzerland, Belgium, Australia and New Zealand. Against the backdrop of continuing growth in the demand for pathology services over the longer term, the group has further international expansion opportunities in both existing and new geographical markets.

The post 3 ‘champion’ ASX shares to buy and hold: Bell Potter appeared first on The Motley Fool Australia.

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More reading

• Top brokers name 3 ASX shares to buy next week
• Why I’m seriously considering investing $10,000 in these ASX 200 shares
• Why Amcor, Australian Strategic Materials, Goodman, and Pilbara Minerals are dropping
• Goodman share price drops 3% on Q1 update
• Dividends beasts: 3 ASX shares that kept the funds growing even during COVID

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 Amcor Limited. The Motley Fool Australia has recommended Sonic Healthcare 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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If you’re looking for a quick and easy way to build a diverse portfolio, then exchange traded funds (ETFs) could be the answer.

That’s because ETFs give investors the opportunity to invest in a large number of shares through just a single investment. In some cases, this provides instant diversification for a portfolio.

With that in mind, listed below are three ETFs that could be excellent options for investors next week. Here’s what you need to know about them:

BetaShares Global Energy Companies ETF (ASX: FUEL)

With oil prices trading in or around the US$90 per barrel level, energy producers are printing money at present. This bodes well for the companies included in the BetaShares Global Energy Companies ETF. This includes the leading players in the energy sector such as BP, Chevron, ExxonMobil, and Royal Dutch Shell. And with OPEC intent on not letting prices weaken, the coming years look positive for these companies and the ETF.

Vanguard Australian Shares Index ETF (ASX: VAS)

Another ETF for investors to look at next week is the Vanguard Australian Shares Index ETF. It provides investors with easy access to 300 of the largest companies on the Australian share market. This means you’ll be buying a highly diverse group of shares from a multitude of sectors. This includes miners such as BHP Group Ltd (ASX: BHP), banks like Commonwealth Bank of Australia (ASX: CBA), and retail giants including Woolworths Group Ltd (ASX: WOW). Another positive with the ETF is that it pays a decent dividend. At the last count, it was offering a trailing yield of ~7%.

Vanguard MSCI Index International Shares ETF (ASX: VGS)

A final ETF for investors to consider buying next week is the Vanguard MSCI Index International Shares ETF. This is arguably the most diverse ETF available today. That’s because the Vanguard MSCI Index International Shares ETF allows investors to buy a slice of approximately ~1,500 of the world’s largest listed companies. This means you’ll be owning many of the world’s biggest and best-known companies such as Amazon, Apple, AstraZeneca, Johnson & Johnson, JP Morgan, Nestle, Procter & Gamble, and Visa.

The post 3 excellent ETFs for ASX investors to buy next week appeared first on The Motley Fool Australia.

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More reading

• Are Vanguard Australian Shares ETF (VAS) dividends fully franked?
• 2 ETFs for ASX investors to buy for big dividends
• These 10 predictions could help you profit from the stock market regardless of inflation, interest rates or even another bear market
• How regularly does the Vanguard Australian Shares ETF (VAS) pay dividends?
• Is the Vanguard Australian Shares ETF fighting off inflation?

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Vanguard MSCI Index International Shares ETF. The Motley Fool Australia has recommended 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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The Origin Energy Ltd (ASX: ORG) share price currently doesn’t reflect the full offer price that it recently received. What’s going on?

Origin is an ASX share involved in energy generation and energy retailing. In other words, it sells energy to households and businesses.

But, its time as a company on the ASX may be numbered because it has received a hefty takeover offer.

Takeover bid

Earlier this week, it was announced to the ASX that Origin had received a non-binding, indicative offer at $9 per share.

This follows earlier proposals to acquire Origin at $7.95 cash per share on 8 August, and another in September to buy at an indicative price of between $8.70 and $8.90 per share.

The bid has come from Brookfield and MidOcean Energy. The offer values Origin at $18.4 billion on an enterprise value basis. Brookfield would buy the energy markets business, and MidOcean would buy the integrated gas business.

The offer of $9 per share represented a 54.9% premium to the closing price of $5.81 on 9 November 2022.

Origin has entered into a confidentiality and exclusivity agreement with the consortium. Under the terms of the agreement, either party can terminate the exclusivity provisions after five weeks and four days, with one week’s notice.

The Origin board intends to grant the consortium the opportunity to conduct due diligence to enable it to put forward a binding proposal.

Based on current information and market conditions, if the consortium makes a binding offer of $9 cash per share, then it is the “current intention of the Origin board to unanimously recommend that shareholders vote in favour of the proposal”.

Why is the Origin share price so far under the bid?

If Origin shares were to rise to the bid price, that would represent an increase of around 20%.

That’s a lot of money that investors are leaving on the table, if a binding bid comes through. Why is it so much lower?

Origin itself said “if” the consortium makes a bid. There is also the agreement that allows the consortium (and Origin) to walk away from the exclusivity agreement. Those sorts of disclosures aren’t the biggest indications that a deal is virtually certain to happen.

I think it’s also worth pointing out what happened with the Brookfield bid for AGL Energy Ltd (ASX: AGL). Brookfield eventually walked away from the process and a deal didn’t happen.

Perhaps some investors are thinking there’s a risk that Brookfield may not follow through with this takeover either.

Only Brookfield and its consortium partner know how motivated they are to make a deal happen. But, it’s worth noting that the consortium has made three bids for Origin. So, in my view, there seems to be a good chance that a deal could happen. The board have indicated they would accept a $9 per share bid.

The Origin share price closed on Friday down 3.19% at $7.58.

Foolish takeaway

Going for Origin shares isn’t the sort of (short-term) investment I’d personally go for. But, I’d understand if some investors thought that it was an opportunity, if they believed the deal was likely to go ahead.

The post Why is the Origin share price not rising closer to Brookfield’s takeover price? appeared first on The Motley Fool Australia.

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More reading

• Why Computershare, Jervois Global, Origin, and Whitehaven Coal shares are sinking
• Here are the 3 most traded ASX 200 shares on Friday
• Elon Musk’s ‘Alan Bond’ moment?
• 5 of the craziest things making news on the ASX this week
• Here are the top 10 ASX 200 shares today

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Brookfield Asset Management. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Brookfield Asset Management Inc. CL.A LV. 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 searching for dividend shares, then it could be worth checking out the two that Morgans is tipping as buys.

Here’s what you need to know about them:

Dexus Industria REIT (ASX: DXI)

Morgans is tipping this industrial and office property company as a dividend share to buy.

That’s because it believes Dexus Industria is well-placed for growth thanks to strong demand in the industrial market.

The broker currently has an add rating and $3.25 price target on the company’s shares. It commented:

DXI’s key industrial markets remain robust with the outlook for solid rental growth backed by strong tenant demand. The development pipeline also provides near and medium term upside potential. A key focus will be the leasing up of the business park assets and a potential divestment could be a positive catalyst. While the portfolio remains well positioned we acknowledge there will be near-term uncertainty around interest rates.

As for dividends, the broker is forecasting dividends per share of 16.4 cents in FY 2023 and 16.9 cents in FY 2024. Based on the current Dexus Industria share price of $2.85, this will mean yields of 5.8% and 5.9%, respectively.

Santos Ltd (ASX: STO)

Another ASX dividend share that Morgans rates as a buy is Santos.

It is of course one of the region’s largest energy producers and the owner of a collection of high quality operations thanks to its recent merger with Oil Search. From these operations, it is aiming to deliver production of 103-106 million barrels of oil equivalent (mmboe) this calendar year.

Morgans is positive on the company due to its growth prospects and diversified earnings base. It has an add rating and $9.00 price target on its shares. The broker commented:

The resilience of STO’s growth profile and diversified earnings base see it well placed to outperform against a backdrop of a broader sector recovery. While pre-FEED, we see Dorado as likely to provide attractive growth for STO, while its recent acquisition increasing its stake in Darwin LNG has increased our confidence in Barossa’s development.

In respect to dividends, Morgans is expecting dividends per share of 22.8 cents in FY 2022 and 24.2 cents in FY 2023. Based on the current Santos share price of $7.50, this will mean yields of 3% and 3.2%, respectively.

The post Broker names 2 ASX dividend shares to buy next wee appeared first on The Motley Fool Australia.

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More reading

• Morgans names 2 ASX dividend shares to buy with big yields
• 4 battered ASX 200 shares that are ‘obvious M&A targets’: expert
• Experts name 2 high yield ASX dividend shares to buy

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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Medibank Private Ltd (ASX: MPL) shares were lifted by broader market momentum on Friday after the United States reported a softer-than-expected inflation number for October.

The Medibank share price finished the session on Friday up 1.79% to $2.84. The S&P/ASX 200 Index (ASX: XJO) finished the day up 2.79% to 7,158 points.

But Friday’s surge is likely little comfort to Medibank shareholders. They’ve seen their investments smashed by almost 20% following news of the cyberattack.

The saga got worse during the week with the cyber thieves publishing a sample of the data on the dark web.

The data includes names, birth dates, contact information, Medicare numbers, and in some cases, individual customer healthcare information.

One fundie says the market has overreacted. Let’s hear what he has to say.

Is Medibank a buy?

Martin Conlon, head of Australian equities at Schroders, says cybercrime is “likely to be an ongoing risk for all organisations”.

Conlon says:

We believe the scale of the share price reaction in the case of Medibank Private is likely to be excessive.

More broadly, we question whether many companies are accurately assessing the payoff for many technology investments. The cost savings, customer insights and supposed business efficiencies are nearly always highlighted by management in justifying spend.

The increasing reliance of many companies on external providers, vulnerability to price gouging and increasing business complexity receive less attention.

As my colleague Tony reported this week, QV Equities pounced on Medibank shares during the sell-off.

The company is “using the volatility” of today’s market to buy undervalued shares with “strong competitive advantage and recurring earnings”.

In a note to clients, QV Equities said:

We used the recent volatility to increase our holdings in high-quality companies at attractive prices including Lottery Corporation Ltd (ASX: TLC) and APA Group (ASX: APA).

We also took the opportunity to increase our holding in Medibank Private after its share price fell heavily after a well-publicised cyber-attack on its client database.

ASX investors take advantage of Medicare share price fall

Analyst Eliot Hastie from Australian brokerage platform Stake says their clients have been buying up big on Medibank shares.

As my colleague Bernd reports, Hastie said:

Stake customers have seen this as a buying opportunity, with a 1,426% increase in buys last month, suggesting that many are still positive about Medibank’s long-term outlook.

In fact, Medibank saw the biggest change from sales to buys of all Australian stocks in October when compared to September.

The post Medibank share price sell-off ‘excessive’: expert appeared first on The Motley Fool Australia.

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More reading

• 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?
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Motley Fool contributor Bronwyn Allen 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 APA 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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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, Maple-Brown Abbott portfolio manager Phillip Hudak digs up the ASX share that (somewhat) made up for his biggest mistake.

The ASX share for a comfortable night’s sleep

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

Phillip Hudak: The one that you’d want to hold is Generation Development Group Ltd (ASX: GDG). This is a financial services player specialising in tax-effective investment bonds. 

It’s a market leader with approximately half of the industry flow coming through for the company. It’s highly defensive with average investment terms greater than 17 years. In addition to that, they made a Lonsec acquisition, which has outperformed expectations, and they’ve just launched an annuity product recently that is gaining momentum off a low base with key product differentiation, including more investment options and greater flexibility versus other annuity products out there. 

The key risk for the company is potential changes on the regulatory side coming through there.

MF: I see the share price has lost about 30% since April. You’re not too concerned about that?

PH: Yeah, look, the medium-term outlook looks very strong there. The trajectory of fund flow has been building each year… and the opportunity set’s not only in the investment bonds part of the business. [The] Lonsec and the annuity upside potential there is reasonably positive.

Looking back

MF: Is there a move that you regret from the past? For example, a missed opportunity or buying a stock at the wrong timing or price.

PH: Look, there’s a lot of things you regret as a portfolio manager there and it’s very, very hard to get things right all the time.

MF: I’ve heard from many portfolio managers that if you get six out of 10 right then you’ve had a very good year.

PH: That’s right there. 

I’ll probably just use a recent example. Probably what I’d say is I’ve unappreciated the momentum behind the lithium trade, particularly at the smaller end of the market. I’ve probably underestimated the speed of the EV [electric vehicle] adoption and the result by governments around the world with subsidies for electric vehicle purchases. 

Many of the lithium stocks that are listed in the Australian small cap market are concept stocks or in the development stage and the path to earnings for many of these companies is outside our investment process and valuations for many of these stocks look stretched. We’ve remained sort of true to our investment process and avoided many of these stocks.

How we have got exposure to the EV trade is through graphite, and that has been through a company called Syrah Resources Ltd (ASX: SYR). Graphite is actually quite interesting and it makes up a significant portion of the cell components on the anode side of the EV battery. 

Graphite has strategic importance, with 80% of global production coming from China and a little bit less of that on the material processing side also comes from China. Syrah Resources has been a major beneficiary of the US Inflation Reduction Act, which has actually seen the US Department of Energy providing grants for downstream processing facilities in the battery material supply chain. Syrah Resources has been a beneficiary of a $220 million US grant for their Louisiana facility.

MF: Fantastic. It’s interesting to hear of another battery ingredient aside from lithium. 

PH: From our perspective, it’s a stock that actually fits our investment process.

The post EVs and bonds: Fundie picks 2 ASX shares to buy for the long run appeared first on The Motley Fool Australia.

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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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