Tag: Motley Fool

There has been only one certainty this year — uncertainty.

With fears about inflation, interest rates, energy prices, and recessions scaring off investors, no one knows how many more downward slides the market has left before the clouds clear.

But there is one industry that one could buy into right now without worrying about what might happen in the world or the markets.

“​There is one sector that will fare well in this environment regardless of the macro outcome, and that is healthcare,” Tribeca portfolio manager Jun Bei Liu told Livewire last week. 

Many experts point out that health is spending that continues through difficult economic times and high interest rates. That’s because consumers still need to be healthy even if they don’t buy those flash new shoes.

So if that’s piqued your interest, here are two ASX shares that have been staples in many portfolios that are priced right for entry at the moment:

This company ‘dominates the market’

For Shaw and Partners senior investment advisor Jed Richards, CSL Limited (ASX: CSL) is the classic health investment.

“This blood products company has demonstrated for more than 25 years that it can generate a high rate of return,” Richards told The Bull.

“It’s been leading the global plasma industry and dominates the market.”

The CSL share price has fallen 6.4% since 8 September, opening up a buying opportunity.

“The company’s research and development program will enable CSL to retain its market leading position in innovation,” said Richards.

“The healthcare sector performs well during various economic conditions, as it’s a non-discretionary expense.”

Medallion Financial managing director Michael Wayne last week told The Motley Fool that CSL is one stock he’d buy and just put away for years.

“Essentially, it’s a company which has a plethora of different biotech type projects under the one umbrella. You’re getting exposure to a whole range of potential kickers in growth.”

Forecast to grow market share in the long term 

Richards also picked sleep respiratory device maker Resmed CDI (ASX: RMD) for praise.

“The popularity of this respiratory device company has grown after competitor Koninklijke Philips NV (AMS: PHIA) announced a product recall last year.”

The ResMed share price has rocketed 23.6% since late May.

“The Philips recall has been factored into ResMed’s share price,” said Richards.

“But, longer term, we still expect the impact from the recall to enable ResMed to increase and sustain market share in the respiratory devices market.”

The Motley Fool reported last week that Goldman Sachs also has a buy rating on ResMed, as do 14 out of 23 analysts surveyed on CMC Markets.

The post 2 classic healthcare ASX shares priced to buy now: expert appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 3 ASX 200 shares that turned a $5,000 investment into $1 million
• Why is the CSL share price dropping today?
• Which ASX All Ords shares could perform well in a recession?
• Could CSL shares capitalise on the next pandemic?
• Here are 2 blue chip ASX 200 shares to add to your portfolio: brokers

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

from The Motley Fool Australia https://ift.tt/PKrd9jn

If you’re a regular The Motley Fool reader, you’d already know this year has been a scary rollercoaster.

The S&P/ASX 200 Index (ASX: XJO) is currently 11% down year to date, but at various times in 2022 it has swung up or down 15% in a matter of weeks.

If you don’t hold many mining stocks, this volatility is likely to have been even greater. Your face will be pretty green by now.

If you hold or are interested in buying ASX shares, you may be wondering when all this uncertainty and anxiety might settle down.

AMP Ltd (ASX: AMP) senior economist Diana Mousina this week explained what’s going on right now and took a stab at answering that question.

Why has 2022 been so stressful?

While there have been many factors pushing and pulling the share market, the predominant force in 2022 seems to be the aggressive rise in interest rates — and the fear of more.

In Australia, the Reserve Bank of Australia cash rate has now risen every monthly board meeting since May.

“94% of developed market central banks are lifting rates along with 86% of emerging market central banks,” said Mousina in a memo to AMP clients.

“Interest rate rises and expectations of further hikes have been negative for equity markets — along with other factors like high inflation, especially in commodities, rising geopolitical tensions and elevated recession risks.”

So when will we see the Reserve Bank give the stock markets and mortgage holders a break?

To answer that, one must understand the concept of the “neutral” interest rate.

“The neutral interest rate is a concept referred to by economists which is the level of the cash rate when the economy is in equilibrium,” Mousina said.

“At this point, domestic investment and domestic savings are equal and the labour market is at full employment.”

Mousina reckons that Australia is now actually pretty close to the neutral rate.

While the RBA targets a range between 2.5% to 4.5%, the AMP team thinks it’s more like 2% to 2.5% because of the high debt levels of Australian households.

“With the rate hike in October, the level of the cash rate is now at 2.6% and is slightly above neutral in our view, which should put downward pressure on economic growth and inflation.”

Already the pace of rate hikes slowed this month as the RBA chose to step it up in a 25-basis point increment, rather than 50 as it was in previous months.

This is when the pain might end

But it’s not just a matter of reaching neutrality then stopping.

Remember inflation? That was the whole point of 2022’s interest rate rises. 

There has to be a sign that inflation is under control before the RBA and its global counterparts contemplate pausing rate increases.

Unfortunately, spending in Australia has not yet slowed significantly.

“This is because consumers and businesses were in very good shape at the beginning of the tightening cycle and because there are lags from rate hikes to their impact on spending,” said Mousina.

“But, once interest rates lift above the neutral rate, monetary policy will have a contractionary impact on the economy and GDP growth will slow down considerably.”

Therefore, this is going to take a few more months to play out.

But even then, investors need to watch the economy carefully. Because if the rate hikes do too much damage then that won’t be good for company earnings.

“We are getting closer to a slowing in central bank rate increases before we see an eventual pause in the rate hike cycle — probably some time in early 2023 for most central banks,” said Mousina.

“This should be positive for share markets, unless the economic data deterioriates significantly off the back of the higher interest rate environment. So monitoring leading economic indicators and recession signals remains very important.”

Datt Capital portfolio manager Emanuel Datt pointed out that as the US interest rate bursts way ahead of Australia’s, demand will surge for ASX shares.

“For local investors, a weaker dollar makes Australian equities more attractively priced for international investors which may provide a measure of support for local market.”

The post This is what will get ASX shares rising again early 2023: economist appeared first on The Motley Fool Australia.

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Here are the top 10 ASX 200 shares today
• Why are these ASX 200 lithium shares smashing it on Monday?
• Star Entertainment share price halted amid $100m fine and casino license suspension
• 3 ASX 200 shares that turned a $5,000 investment into $1 million

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.

from The Motley Fool Australia https://ift.tt/V0lXb96

On Monday, the S&P/ASX 200 Index (ASX: XJO) started the week in a disappointing fashion. The benchmark index fell 1.4% to 6,664.4 points.

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

ASX 200 expected to rebound

The Australian share market looks set to rebound strongly today after a great start to the week on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 55 points or 0.8% higher. In late trade in the United States, the Dow Jones is up 2%, the S&P 500 is up 2.7%, and the NASDAQ is storming 3.4% higher.

Oil prices mixed

Energy shares Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) will be on watch today after a mixed night for oil prices. According to Bloomberg, the WTI crude oil price is down 0.1% to US$85.54 a barrel and the Brent crude oil price has risen 0.1% to US$91.69 a barrel. Recession fears were largely offset by optimism over loose monetary policy in China.

Rio Tinto update

The Rio Tinto Limited (ASX: RIO) share price will be in focus today when the mining giant releases its quarterly update. According to a note out of Goldman Sachs, its analysts are expecting Rio Tinto to report iron ore shipments of 83.4Mt. This is a touch lower than the consensus estimate of 84.5Mt. The market is sldo likely to be looking for commentary on cost inflation today as well.

Annual general meetings galore

A number of ASX 200 companies will be holding their annual general meetings today and are likely to provide trading updates. These include logistics solutions company Brambles Limited (ASX: BXB), hearing solutions company Cochlear Limited (ASX: COH), language testing company IDP Education Ltd (ASX: IEL), and wine giant Treasury Wine Estates Ltd (ASX: TWE).

Gold price rises

Gold miners such as Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) could have a decent day after the gold price pushed higher overnight. According to CNBC, the spot gold price is up 0.35% to US$1,654.7 an ounce. The precious metal rose after the US dollar and treasury yields pulled back.

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

(function() {
function setButtonColorDefaults(param, property, defaultValue) {
if( !param || !param.includes(‘#’)) {
var button = document.getElementsByClassName(“pitch-snippet”)[0].getElementsByClassName(“pitch-button”)[0];
button.style[property] = defaultValue;
}
}

setButtonColorDefaults(“#43B02A”, ‘background’, ‘#5FA85D’);
setButtonColorDefaults(“#43B02A”, ‘border-color’, ‘#43A24A’);
setButtonColorDefaults(“#fff”, ‘color’, ‘#fff’);
})()

More reading

• Here are the top 10 ASX 200 shares today
• Why are these ASX 200 lithium shares smashing it on Monday?
• Star Entertainment share price halted amid $100m fine and casino license suspension
• Own Rio Tinto shares? Here’s what to expect from the mining giant’s Q3 update
• 3 ASX 200 shares that turned a $5,000 investment into $1 million

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 Cochlear Ltd. and Idp Education Pty Ltd. The Motley Fool Australia has recommended Cochlear Ltd. and Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/du0qf9b

The BHP Group Ltd (ASX: BHP) share price was in a state of decline during the first trading day of this week.

As the electronic gates slammed shut on the Aussie share market this afternoon, BHP shares finished markedly lower. To be specific, the mining giant rolled its way 2.6% downhill to $39 apiece. For context, the S&P/ASX 200 Index (ASX: XJO) took a 1.4% walk into the red on Monday.

What can be attributed to this disappointing move for BHP shareholders?

Iron ore or iron snore?

The BHP share price took a back seat on Monday as investors went cold on commodity-exposed areas of the ASX. Overall, the materials sector slipped 2.3% lower, making it the worst-performing sector.

Today’s negative movement could be tied to the price of iron ore sinking to its lowest level since late 2021. According to Trading Economics, the steelmaking commodity is now fetching around US$96 per tonne, putting it on par with prices witnessed in November 2021 — as shown below.

Downward pressure on commodities, particularly iron ore, has been mounting amid tightening monetary policy. As global economies take action to try and curb inflation, commodities linked to economic growth have been caught in the crosshairs.

Notably, the fall in the BHP share price — and other ASX 200 mining shares — follows remarks out of China suggesting a sustained commitment to the zero COVID-19 policy. Hence, markets might have been nervous about the knock-on impacts on the likes of the steel industry.

Today’s further degradation in iron prices marks the fifth consecutive week of declines.

Could the BHP share price be attractive?

With BHP shares trading roughly at the same price they were a year ago, some investors might be wondering whether the could be value is dipping into the mining company now.

Well, analysts at Morgans tend to think so, with an add rating currently held on the $198 billion behemoth. Morgans believe BHP holds a low-risk profile and has strong free cash flow generation.

For those reasons, the team has a $47.40 share price target on the BHP share price.

The post Why did the BHP share price melt down on Monday? appeared first on The Motley Fool Australia.

More reading

• Opportunities across the mining sector: Expert names ASX 200 shares to buy
• Top brokers name 3 ASX shares to buy next week
• If I’d invested $5,000 in these 5 ASX shares five years ago, here’s what I’d have now
• Do you want the good news or the bad news on the iron ore price?
• Morgans names the best ASX resources shares to buy now

Motley Fool contributor Mitchell Lawler 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.

from The Motley Fool Australia https://ift.tt/0xafXhA

The All Ordinaries Index (ASX: XAO) share price struggled to gain traction on Monday, slumping 1.36% to close Monday’s session at 6,854.30 points. But not all All Ords shares suffered alongside the benchmark index.

Some posted gains of as much as 11%.

So, which ASX All Ords shares outperformed and what drove them to defy the market’s downturn? Keep reading to find out.

These ASX All Ords shares defied today’s downturn

The first ASX All Ords share posting a notable gain on Monday was Electro Optic Systems Holdings Ltd (ASX: EOS). The company’s stock soared 5.94% today to close at 53.5 cents.

Interestingly, there was no price-sensitive news from Electro Optic Systems on Monday. However, the market was informed of an S&P/ASX 200 Index (ASX: XJO) giant’s move to up its stake in the tech company.

Washington H Soul Pattinson and Co Ltd (ASX: SOL) has increased its holding in the company to 9.95%, according to an ASX release. The ASX 200 giant previously boasted 6.21% of the company’s voting power.

Fellow All Ords share Elmo Software Ltd (ASX: ELO) also posted a 1.67% gain on Monday. The cloud-based human resources and payroll software provider’s stock closed the day at $3.05.

Once again, there was no news from the company on Monday. However, only last week, Elmo revealed it had been approached by a party interested in striking an acquisition deal.

Finally, shares in ASX All Ords memory technology developer Weebit Nano Ltd (ASX: WBT) soared 11.32% to close Monday at $2.36.

As seems to be the pattern, there’s been no word to explain its upwards trajectory. Today’s gain sees it trading at its highest point since mid-September.

The post It wasn’t all bad news for ASX All Ords shares on Monday. Here are some big winners appeared first on The Motley Fool Australia.

More reading

• Top broker says opportunities abound for ‘high quality’ ASX shares
• 3 ASX All Ords shares smashing multi-year highs on Friday
• Why Atlantic Lithium, Elmo, Qantas, and Westpac shares are pushing higher
• Elmo share price explodes 29% on possible takeover
• 2 ASX defence shares soaring on big news today

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems Holdings Limited, Elmo Software, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Elmo Software and Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/DvEudV2

The S&P/ASX 200 Index (ASX: XJO) started the week out on the wrong foot. It fell 1.4% on Monday to close at 6,664.4 points.

It followed a similarly disappointing Friday on Wall Street wherein the Dow Jones Industrial Average Index (DJX: .DJI) fell 1.3%, the S&P 500 Index (SP: .INX) dumped 2.4%, and the Nasdaq Composite Index (NASDAQ: .IXIC) plummeted 3.1%.

The S&P/ASX 200 Materials Index (ASX: XMJ) led the Aussie bourse’s fall today, plunging 2.1%.

Meanwhile, oil prices likely weighed on the S&P/ASX 200 Energy Index (ASX: XEJ) today. It also fell 2.1% on Monday.

The Brent crude oil price fell 3.1% to US$91.63 a barrel on Friday while the US Nymex crude oil price dropped 3.9% to reach US$85.61 a barrel.

The S&P/ASX 200 Real Estate Index (ASX: XRE) was the market’s best-performing sector, falling just 0.6%. The S&P/ASX 200 Communications Index (ASX: XTJ) also outperformed most others, dumping 0.7%.

But which ASX 200 share topped all its peers on Monday? Keep reading to find out.

Top 10 ASX 200 shares countdown

The best-performing ASX 200 share on Monday was lithium favourite Core Lithium Ltd (ASX: CXO).

It gained 5.2% amid news its managing director is stepping down earlier than expected and reports that Chinese lithium prices reached a new high.

Today’s biggest gains were made by these shares:

ASX-listed company	Share price	Price change
Core Lithium Ltd (ASX: CXO)	$1.215	5.19%
Liontown Resources Limited (ASX: LTR)	$1.715	4.89%
News Corporation Limited (ASX: NWS)	$26.84	3.63%
Telix Pharmaceuticals Ltd (ASX: TLX)	$5.59	3.33%
Lake Resources N.L. (ASX: LKE)	$1.005	3.08%
Brickworks Limited (ASX: BKW)	$22.25	2.49%
Fisher & Paykel Healthcare Corp Ltd (ASX: FPH)	$17.11	2.46%
Pilbara Minerals Ltd (ASX: PLS)	$4.79	2.13%
Megaport Ltd (ASX: MP1)	$7.86	2.08%
Insurance Australia Group Ltd (ASX: IAG)	$4.89	1.56%

Our top 10 shares countdown is a recurring end-of-day summary to let you know which companies were making big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

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

More reading

• Why Baby Bunting, Brickworks, Core Lithium, and Dreadnought Resources are pushing higher
• Why are these ASX 200 lithium shares smashing it on Monday?
• Star Entertainment share price halted amid $100m fine and casino license suspension
• 3 ASX 200 shares that turned a $5,000 investment into $1 million
• IAG share price takes centre stage on $350 million buyback news

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

from The Motley Fool Australia https://ift.tt/TFndaiA

The Bank of Queensland Ltd (ASX: BOQ) share price ran out of steam on Monday. The regional bank’s shares ended the day almost 1% lower at $7.67.

Despite this, the Bank of Queensland share price is still up over 12% since this time last week.

Investors have been scrambling to buy the bank’s shares since the release of its full year results last week.

Although those results were softer than the market was expecting, its exit net interest margin (NIM) caught the eye and got investors excited.

Can the Bank of Queensland share price keep rising?

The good news is that the team at Citi believe there’s still plenty of upside ahead for the Bank of Queensland share price.

According to a note, the broker has put a buy rating and $8.75 price target on the bank’s shares. This implies potential upside of 14% for investors over the next 12 months.

And with Citi expecting a 58 cents per share fully franked dividend in FY 2023, which equates to a 7.5% yield, the total potential return stretches to over 21%.

Citi commented:

BOQ delivered FY22 cash earnings of $508m, ~2% below consensus estimates. However, despite the modest miss, the stock materially outperformed the index by ~1100bps. We think that this largely reflected commentary on rates leverage. In our view, consensus has been underestimating the extent of rates leverage across the sector, which coupled with a view that BOQ has less rates leverage than peers. This had left very modest NIM expectations for FY23.

Today, management dispelled these modest expectations, with bullish commentary on the exit NIM. While costs were a slight disappointment, proportionally they will be much less than revenue upgrades, and as a result we think consensus moves higher. We think BOQ’s metrics in its strategy day look challenged, reflecting the abnormally low starting point for BDDs, an uncertain outlook for macro factors as well as execution risk associated with sizable M&A transactions.

The post Here’s what Citi is saying about the Bank of Queensland share price appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy next week
• Why are ASX 200 bank shares having such a top run on Thursday?
• Who’s making money from higher rates? Scott Phillips on Nine’s Late News
• Brokers give their verdict on the Bank of Queensland share price
• 5 things to watch on the ASX 200 on Thursday

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.

from The Motley Fool Australia https://ift.tt/xFltM0d

The S&P/ASX 200 Index (ASX: XJO) has followed Wall Street’s lead and dropped deep into the red. In afternoon trade, the benchmark index is down 1.4% to 6,662.8 points.

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

Adbri Ltd (ASX: ABC)

The Adbri share price is down 21% to $1.45. Investors have been selling down this building materials company’s shares after it announced the exit of its CEO and released a disappointing trading update. The latter reveals that its profits will be down materially in FY 2022 due to higher costs.

Costa Group Holdings Ltd (ASX: CGC)

The Costa share price is down 13% to $2.01. This has been driven by news that Costa’s Citrus operations have been underperforming due to adverse weather. As a result, Costa currently expects its full year group EBITDA-S to be marginally ahead of last year’s results. This compares to strong first half EBITDA-S growth of 12.6%.

Hawsons Iron Ltd (ASX: HIO)

The Hawsons Iron share price is down a whopping 62% to 14 cents. This morning, Hawsons Iron revealed that escalating global costs and deteriorating economic conditions have necessitated a slowdown decision for the Hawsons Iron Project Bankable Feasibility Study. Management believes it would be prudent to preserve capital while examining all options to progress the project.

Medibank Private Ltd (ASX: MPL)

The Medibank share price is down 3.5% to $3.40. Investors have been selling this private health insurance giant’s shares after it was the latest victim of a cyberattack. The good news is that Medibank appears to have responded quick enough to prevent any customer data being taken or ransomware being installed. The company has now deployed additional security measures across its network, strengthening the integrity of its systems.

The post Why Adbri, Costa, Hawsons Iron, and Medibank shares are sinking today appeared first on The Motley Fool Australia.

More reading

• Why did the Hawsons Iron share price just nosedive 62%?
• What caused this ASX 200 share to crash 20% on Monday?
• Medibank share price sinks on cyber incident and trading update
• Why the Costa share price is crashing 14% to a 52-week low
• Medibank shares on ice as details of cyberattack emerge

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 recommended COSTA GRP FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/JvTH9NW

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.

The new inflation numbers that just dropped certainly have the markets worried about the depth of the recession we could be facing. With the S&P 500 index firmly in bear market territory, down 25% year-to-date, investors are rightly nervous about what it means for stocks.

Yet, history shows that bull markets always follow these corrections. And whereas bear markets are measured in months, bull markets are measured in years. That means sharp downturns are actually the best time to buy stocks for the long-term returns generated for your portfolio.  

As Warren Buffett once said, be fearful when others are greedy, and greedy when others are fearful. As long as investors have an appropriate investment horizon — 10 years is usually good — they should not fear bear markets, but look forward to them eagerly as a chance to buy good companies at discounted prices.

If you have $5,000 available, the following two growth stocks are excellent companies to own for years to come.

Apple

Apple (NASDAQ: AAPL) stock is down 22% in 2022 as investors worry about the economy’s impact on consumer spending habits. It’s estimated that App Store sales fell 5% in September, their biggest decline ever, and they are down 2% for the quarter. While that creates near-term headwinds, there is still strong demand for higher-priced iPhone 14 models, and a Piper Sandler survey of teens says Apple’s share of the smartphone market remains near record highs.

One short-term catalyst is Apple’s $90 million stock buyback program, which should help support any earnings weakness. And over the long haul Apple continues striving to  introduce new products, such as virtual reality headsets and the long-awaited Apple Car, which it would like to bring to market by 2025.

While some services like the App Store may see lower revenue in the coming quarters, others like iCloud, AppleCare, and even music ought to keep growing. Product sales are stable too, and because Apple has been able to keep its premium pricing intact as demand maintains its upward trajectory, the macroeconomic pressures on the company won’t be as great as they will be on its lower-end rivals.

Investors might also take comfort in knowing that buying Apple stock at these prices means they will be buying the tech giant at prices cheaper than Warren Buffett got when he made the company 41% of Berkshire Hathaway‘s (NYSE: BRK.A)(NYSE: BRK.B) portfolio.

Costco

Another stock buffeted by consumer spending worries is Costco (NASDAQ: COST), whose stock is down 18% this year, and fell again last month despite reporting financial results that beat Wall Street expectations.

Inflation is taking its toll, with September’s numbers coming in hotter than expected. Particularly in the pocketbook items that matter most to consumers — food and fuel — inflation is even higher than the headline print. Utility gas is up 33% over last year, eggs are 30% higher, gas prices are up 18%, chicken 17%, coffee and milk 15% higher, and so on.

Costco has chosen not to raise its membership fees at this time, much to the consternation of some, but that is actually helping drive shoppers to its warehouse clubs and helping to grow sales by double-digit rates. Comparable store sales growth dipped to 8.5% in September, the first time in 28 months they were below 10% (they were still up over 11% in the U.S.). It proves bulk buying of goods is a smart choice in this high-cost period, even if it doesn’t fully insulate the retailer from the ravages of inflation. Gross margins, for example, were 10.5%, down from 11.1%, in fiscal 2021.

However, memberships remain a source of strength for Costco, and consumers are still flocking to the warehouse club. It ended its fiscal fourth quarter last month with 118.9 million cardholders, of which 53.1 million were household members, up 6.5% from last year.

While the economy can always get worse, Costco’s results show the soundness and stability of its business model. It should carry the retailer through the tough times, which makes its stock a solid choice for an investor willing to buy and hold for the long haul. 

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

The post $5,000 invested in these US stocks could make you rich over the next 10 years appeared first on The Motley Fool Australia.

More reading

• 2 top Warren Buffett stocks to buy and hold for the long haul
• Here’s how Meta Platforms plans to disrupt Apple’s and Google’s smartphone empires
• Will Amazon stock be worth more than Apple by 2025?
• The no. 1 quality that top stocks share (and it’s not even close)
• Why Apple stock plunged today

Rich Duprey 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 Apple and Costco Wholesale. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool Australia has recommended Apple. 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.

from The Motley Fool Australia https://ift.tt/gWS3ZiB

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to start the week with a sizeable decline. At the time of writing, the benchmark index is down 1.4% to 6,662.8 points.

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

Baby Bunting Group Ltd (ASX: BBN)

The Baby Bunting share price is up over 2% to $2.74. This appears to have been driven by a broker note out of Morgans today. According to the note, the broker believes that recent share price weakness has created a buying opportunity. Morgans has retained its add rating with a reduced price target of $3.60.

Brickworks Limited (ASX: BKW)

The Brickworks share price is up 2.5% to $22.25. Investors have been buying this building products company’s shares after it was the subject of a bullish broker note. According to a note out of UBS, its analysts have upgraded Brickworks’ shares to a buy rating with a $25.30 price target. The broker made the move after increasing its earnings estimates materially for FY 2023.

Core Lithium Ltd (ASX: CXO)

The Core Lithium share price is up 5% to $1.21. This morning Core Lithium revealed that its managing director Stephen Biggins will step down with immediate effect. With the recent official opening of the Finniss Lithium Mine and appointment of Gareth Manderson as CEO, Biggins has decided it is the appropriate time to exit. Rising lithium prices have also given its shares a boost.

Dreadnought Resources Ltd (ASX: DRE)

The Dreadnought Resources share price is up 5% to 10 cents. This follows the release of an update on drilling activities at the 100% owned Mangaroon project. According to the release, the company has intersected thick rare earth mineralisation in both fresh and weathered material. Managing Director, Dean Tuck, commented: “We are already off to a good start so the next few months should be extremely exciting.”

The post Why Baby Bunting, Brickworks, Core Lithium, and Dreadnought Resources are pushing higher appeared first on The Motley Fool Australia.

More reading

• Why are these ASX 200 lithium shares smashing it on Monday?
• Leading brokers name 3 ASX shares to buy today
• Why is Core Lithium share price outperforming the ASX 200 today?
• Dividend beasts: Experts name 3 ASX dividend shares that could deliver 50% returns next year
• What’s the outlook for ASX battery metals shares in Q2?

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 Brickworks. The Motley Fool Australia has positions in and has recommended Brickworks. The Motley Fool Australia has recommended Baby Bunting. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia https://ift.tt/JYK3PTl