Tag: The Motley Fool Australia

Woodside Energy Group Ltd (ASX: WDS) shares closed up 1.9% on Tuesday but remain down 17.0% over six months.

Six months ago, shares in the S&P/ASX 200 Index (ASX: XJO) energy stock were trading for $33.54. At market close on Tuesday, those same shares were swapping hands for $27.84 apiece.

So, following on this hefty slide, are Woodside shares a buy right now?

I believe so.

Here’s why.

Is now the time to buy Woodside shares?

The pain for Woodside shares really began back in mid-September. Since the closing bell on 15 September, shares are down 27.5%.

There have been a few company-specific issues that have dragged on the share price over this time.

That includes some issues securing government approval for its flagship Scarborough offshore energy project, some shareholder issues with the company’s environmental action plans, and the failed discussions to secure a merger with rival Santos Ltd (ASX: STO).

However, those issues are now largely water under the bridge. Scarborough is now proceeding on track, and the botched Santos merger is fading into the woodwork.

As for the environmental plans, I’m confident that management will concoct a new plan that shareholders will support without throwing up excessive headwinds for the Woodside share price.

How about the oil price?

Oil and gas prices don’t move in lockstep, but they do tend to follow similar trends.

Back in September, when Woodside shares were some 28% higher than today, the Brent crude oil price reached US$97 per barrel. By mid-December, it had dipped to US$73 per barrel and has been on a bit of a rollercoaster this year, trading for US$84 per barrel on Tuesday afternoon.

This is another reason Woodside shares could be an excellent buy right now. After all, the time to buy these sorts of companies is near their cyclical lows.

And there are good reasons to believe that the oil price is more likely to head higher than lower from today’s levels.

According to Rebecca Babin, a senior energy trader at CIBC Private Wealth (courtesy of Bloomberg), “Over US$7 of geopolitical risk premium has been unwound over the past two weeks as the conflict [in the Middle East] avoided additional escalation.”

However, as much as we hope for an extended and permanent peace, sadly, I don’t think that’s very likely in the medium term.

Disruptions to oil shipments in the Red Sea are likely to continue. And Israel has rejected the latest cease-fire proposals in Gaza as entirely unacceptable. Israel now is pursuing its military operations against Hamas in the city of Rafah.

“Geopolitics is back in the driving seat for crude oil traders after last week’s drop. The demand outlook remains supported by expectations of Fed’s rate cuts,” Charu Chanana, an analyst at Saxo Capital Markets, said.

In other potential tailwinds for Woodside shares, the Organization of the Petroleum Exporting Countries and its allies (OPEC+) are also intent on supporting the oil price. The cartel is widely expected to extend its current supply cuts through the second half of 2024.

Even Iraq and Kazakhstan, two members who’ve been cheating on their pledged cuts, have indicated they’ll slash output enough to make up for their earlier overproduction.

Woodside shares and LNG

Another reason I’m optimistic that Woodside shares present a longer-term bargain at current levels is the growing realisation that natural gas (LNG) is crucial to Australia’s, and much of the world’s, transition to renewable energy sources.

Last week, Energy Minister Chris Bowen flagged the need for companies to source new gas supplies.

“Slogans like ‘gas-led recovery’ and ‘no new gas’ are equally catchy – and equally unhelpful to explaining the proper role of gas in our net zero energy mix,” Bowen said (quoted by The Australian Financial Review).

Bowen added:

Gas will play an important role in electricity by firming and peaking renewables… While technologies like green hydrogen will be vital – and I am very optimistic about Australia’s role in the global hydrogen supply chain – there are not yet substitutes for gas in many industrial settings.

Don’t forget the dividends

Woodside shares are also attractive for their juicy, fully franked dividends.

Despite coming down over the past 12 months, at the current share price, Woodside trades on a fully franked trailing yield of 7.8%.

But if oil and gas prices tick higher from here, as I expect, the dividends are likely to run higher again, too.

And investors buying at today’s much reduced Woodside share price would then be realising an even higher yield than 7.8%.

The post Woodside shares are down 17% in 6 months. Is now the right time to buy? appeared first on The Motley Fool Australia.

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More reading

• Morgans names the best ASX 200 stocks to buy in May
• 5 things to watch on the ASX 200 on Wednesday
• 3 ASX dividend stocks to buy for an income boost
• 5 things to watch on the ASX 200 on Monday
• Why are ASX 200 energy shares getting smashed in May?

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.

Telstra Group Ltd (ASX: TLS) shares have been well and truly out of form in recent times.

So much so, this week the telco giant’s shares hit a two-year low this month.

This weakness hasn’t gone unnoticed by analysts at Goldman Sachs.

In fact, the broker has been looking at its earnings forecasts to make sure it isn’t missing something. Particularly after New Zealand telco Spark New Zealand Ltd (ASX: SPK) downgraded its earnings guidance.

The good news is that Goldman remains confident that Telstra can deliver on expectations. As a result, it feels that its shares could be dirt cheap at current levels.

What did the broker say?

Commenting on the recent Telstra share price weakness, the broker said:

Following the underperformance of Telstra shares YTD (-8% vs. ASX200 +3%), alongside the recent downgrade in SPK FY24 guidance, we outline why we remain confident in our forecast $8.61bn in EBITDA (+$351mn yoy) for TLS in FY25E.

Goldman believes the key to achieving this will be increasing mobile phone plans in-line with inflation. And while there are doubts around doing this in the current environment, the broker feels it is the most likely outcome. It said:

The key uncertainty to this growth is whether a full CPI mobile price rise will be introduced in Jul-24. We think this is the most likely outcome, given (1) Strong operating trends and NPS through to Feb-24; (2) TLS price-premium vs. history provides some scope to increase; (3) The Government owned, monopoly NBN recently announced CPI price rises of +4.1%; (4) Telstra returns are significantly below supermarket peers WOW/COL (who have faced price gouging accusations).

As mobile makes up 70% of estimated earnings, that is the segment doing the heavy lifting. However, the broker also expects growth from other areas.

It expects the Fixed Enterprise business to add EBITDA of $30 million in FY 2025, which represents 9% of total EBITDA. This is being underpinned by the soon to be announced Fixed Enterprise restructure.

Goldman is also forecasting an $83 million increase from the InfraCo/Amplitel business, representing 24% of EBITDA. It highlights that this “growth is largely locked in, given it relates to CPI (NBN Recurring) and internal data/customer growth.”

Big returns on offer with Telstra shares

In light of the above, the broker has retained its buy rating and $4.55 price target on the company’s shares. This implies potential upside of 25% for investors over the next 12 months.

In addition, the broker is forecasting a 4.9% dividend yield in FY 2024 and then a 5.2% dividend yield in FY 2025. This boosts the total potential 12-month return to approximately 30%.

The post Why Telstra shares could be dirt cheap in May appeared first on The Motley Fool Australia.

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More reading

• 3 safe ASX dividend shares to own for the next 10 years
• 5 things to watch on the ASX 200 on Wednesday
• What does the latest 3G news mean for Telstra shares?
• The ASX 200 telco and energy stocks set to benefit from AI
• Almost ready to retire? I’d buy cheap ASX dividend shares for income

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 Goldman Sachs Group. The Motley Fool Australia has positions in and has recommended Coles Group and Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ANZ Group Holdings Ltd (ASX: ANZ) shares have been on a good run.

Since this time last week, the banking giant’s shares have risen 3.15%.

But can they keep rising from here? Let’s see what one leading broker is saying about the big four bank following the release of its half-year results.

Half-year results review

As a reminder, ANZ released its results on Tuesday and reported a cash profit of $3,552 million for the six months ended 31 March. This represents a 1% decline compared to the second half of FY 2023.

Despite this decline, the bank increased its partially franked interim dividend to 85 cents per share and announced a $2 billion on-market share buyback.

Are ANZ shares a buy?

This is harder to answer than normal.

That’s because Goldman Sachs has responded to the result by retaining its buy rating on the bank’s shares.

However, the broker’s improved price target of $28.15 (from $27.69) is a touch below the current ANZ share price of $28.79.

So, if you were looking for share price returns, you may not be seeing any over the next 12 months.

However, if you are looking for a source of income, then ANZ’s shares could be worthy of a closer look.

Goldman Sachs is forecasting dividends per share of $1.66 in both FY 2024 and FY 2025. This equates to partially franked dividend yields of 5.75% for investors.

What did the broker say?

Goldman remains positive on ANZ and its shares due to potential productivity benefits, institutional business, and discount to the rest of the sector. It explains:

We reiterate our Buy on ANZ, given i) we are seeing evidence of ANZ’s ability to derive productivity benefits (A$201 mn in 1H24) and management noted there remains a large pipeline available which can be used to offset cost inflation. Furthermore, ii) the improving profitability of ANZ’s Institutional business remains a key driver of our positive investment thesis. We continue to see upside for Group returns due to accretive mix shifts in the Institutional business towards higher ROE Payments and Cash Management business. Finally, the stock still trades at a 30% discount to the sector (ex-dividend adjusted) versus a 15-yr average discount 13%.

Is anyone else bullish?

One leading broker that sees scope for ANZ shares to rise further is Jefferies.

This morning, the broker has responded to the bank’s results by retaining its overweight rating with an improved price target of $31.00 (from $29.00).

The post Analysts give their verdict on ANZ shares: Should you buy? appeared first on The Motley Fool Australia.

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More reading

• Hunting for passive income? Here’s everything you need to know about the boosted ANZ dividend
• ANZ shares tumble despite $3.5b half-year profit
• ANZ share price on watch amid first-half earnings beat and $2b buyback
• 5 things to watch on the ASX 200 on Tuesday
• Brokers say these ASX dividend stocks are buys

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 Goldman Sachs Group. 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.

If you have a low tolerance for risk but want better yields than those offered with term deposits and savings accounts, then it could be worth checking out the ASX dividend shares in this article.

These companies have defensive earnings, strong business models, and positive outlooks. This could make them safe options for income options to buy today. They are as follows:

APA Group (ASX: APA)

When looking for safe options, it is hard to look beyond utilities. In fact, many investors class them as safe haven assets and rotate funds into their shares when market volatility increases.

But APA Group has more to offer than just that. The energy infrastructure company’s growing cashflows as allowed it to increase its dividend each year for almost 20 years.

The good news is that analysts at Macquarie believe this strong run can continue. It is forecasting further dividend increases to 56 cents per share in FY 2024 and 57.5 cents per share in FY 2025. Based on the current APA Group share price of $8.55, this equates to 6.5% and 6.7% dividend yields, respectively.

Macquarie also sees room for its shares to climb higher. It has an outperform rating and $9.40 price target on them.

Coles Group Ltd (ASX: COL)

Another ASX dividend share that boasts defensive qualities is supermarket giant Coles.

As we saw through the pandemic, Coles is capable of growing its earnings through any part of the economic cycle. This bodes well for its dividends in the future.

Morgans is bullish on the company and is forecasting fully franked dividends of 66 cents per share in FY 2024 and then 69 cents per share in FY 2025. Based on the current Coles share price of $16.26, this implies dividend yields of 4% and 4.25%, respectively.

As well as a good yield, the broker highlights that “the stock is looking more attractive following the recent pullback in the share price.” It has an add rating and $18.95 price target on its shares.

Telstra Corporation Ltd (ASX: TLS)

A final safe ASX dividend share for income investors to look at is telco giant Telstra. As with the others, it has defensive earnings and a positive growth outlook.

In fact, it is for exactly these reasons that Goldman Sachs is tipping Telstra as a buy. It believes “the low risk earnings (and dividend) growth that Telstra is delivering across FY22-25, underpinned through its mobile business, is attractive.”

As for dividends, the broker is forecasting fully franked dividends of 18 cents per share in FY 2024 and then 19 cents per share in FY 2025. Based on the current Telstra share price of $3.64, this equates to yields of 4.9% and 5.2%, respectively.

Goldman has a buy rating and $4.55 price target on Telstra’s shares.

The post 3 safe ASX dividend shares to own for the next 10 years appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• Brokers say these high yield ASX 300 dividend shares are top buys
• What does the latest 3G news mean for Telstra shares?
• The ASX 200 telco and energy stocks set to benefit from AI
• Almost ready to retire? I’d buy cheap ASX dividend shares for income

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 Goldman Sachs Group and Macquarie Group. The Motley Fool Australia has positions in and has recommended Apa Group, Coles Group, Macquarie Group, and Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Market sentiment is often discussed as a reason for broad market gains or losses in a given trading day.

While there are many measurable financial factors that feed into sentiment, such as economic growth, there are also softer factors like human emotions, and we can’t always count on them being rational!

In an article published on the ASX, two experts discuss how emotion plays into ASX shares investing.

How emotion drives the market

Karl Siegling, chief investment officer of listed investment company (LIC) Cadence Capital, says human emotions such as hope, fear, and greed can determine whether ASX shares become cheap or expensive.

He says:

The collective emotions of individuals, which is ‘the market’, play an extremely important role in investing.

The sooner that investors understand how important emotion is, and how likely we are as individuals to make decisions based on emotion, the sooner they will become better investors.

After a lifetime of investing, Siegling says it’s “a myth” that stock prices are based purely on value, saying:

Investors are always told to ‘buy low and sell high’.

So, we study finance or accounting at university and learn different techniques to value companies.

There’s this myth that all we need to do is learn the correct formula to value companies and we can lead a rich, healthy and wealthy life.

ASX shares investors need to understand that industry cycles can take years to play out. This means they could be waiting for a long time to see substantial price gains.

In the movies, everything in the share market happens very quickly. In real life, when you buy a share, you are buying part of a company.

Companies move much slower than people realise. When a business starts improving, that improvement can play out over many years.

It sometimes takes years for a stock to go from being unloved to being loved.

How emotion influences ASX shares trading decisions

Felicity Thomas, a senior private wealth advisor at Shaw and Partners, says emotion can drive rash investment decisions.

For example, the fear of missing out (FOMO) can prompt people to buy ASX shares that are rapidly rising instead of buying them based on fundamental analysis.

She says:

Emotional investing often leads to poor investment decisions, like buying shares during euphoric phases [for the market] and selling low during panic phases.

A lot of investors want quick wins but it is important to maintain a long-term perspective.

Despite short-term volatility, history has shown that the share market tends to grow over time.

Thomas says patience and a disciplined approach can help ASX shares investors stick to their investment plans.

As a young investor, Thomas only invested money she did not need for living expenses.

She also kept some cash on the sidelines.

There are pros and cons to keeping some cash in your investment portfolio.

Today’s high interest rates mean cash is certainly earning better returns than in previous years. However, inflation — which erodes the buying power of cash — also remains high.

The post Why emotion is key to becoming a wealthy ASX shares investor: Experts appeared first on The Motley Fool Australia.

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More reading

• Morgans names the best ASX 200 stocks to buy in May
• At 14 cents, has the Core Lithium share price become a bit of a joke?
• 3 reasons CSL stock is a great long-term investment
• 5 things to watch on the ASX 200 on Wednesday
• This ASX 200 gold stock can rise 30% and could be a takeover target

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 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.

Every month, analysts at Morgans pick out their best ASX stock ideas.

These are the ASX stocks that the broker thinks offer the highest risk-adjusted returns over a 12-month timeframe. Morgans notes that they are supported by a higher-than-average level of confidence.

Among its best ideas for May are the two ASX 200 stocks listed below. Here’s what the broker is saying about them:

Nextdc Ltd (ASX: NXT)

Morgans thinks that this data centre operator could be an ASX 200 stock to buy this month.

The broker is expecting another strong result from the company in FY 2024 and then expects more of the same in the coming years thanks to structural tailwinds. The broker explains:

NXT should deliver another good set of results in FY24 with some upside risk to guidance, in our view. Structural demand for cloud and colocation remains incredibly strong. NXT’s new S3 and M3 data centres are now open. Consequently, we expect significant new customer wins over the next six-to-twelve months (including CSP options being exercised). Sales should drive the share price higher. NXT looks comfortably on-track to generate over $300m of EBITDA in the next three to five years.

Morgans has an add rating and $19.00 price target on the company’s shares. Based on the current NextDC share price of $17.09, this implies potential upside of 11% for investors over the next 12 months.

Woodside Energy Group Ltd (ASX: WDS)

Another ASX 200 stock that Morgans has on its best ideas list is energy giant Woodside.

The broker believes that the market is undervaluing its shares at present and that this has created a buying opportunity for investors. Particularly given its high-quality earnings and healthy balance sheet. It said:

A tier 1 upstream oil and gas operator with high-quality earnings that we see as likely to continue pursuing an opportunistic acquisition strategy. WDS’s share price has been under pressure in recent months from a combination of oil price volatility and approval issues at Scarborough, its key offshore growth project. With both of those factors now having moderated, with the pullback in oil prices moderating and work at Scarborough back underway, we see now as a good time to add to positions.

Increasing our conviction in our call is the progress WDS is making through the current capex phase, while maintaining a healthy balance sheet and healthy dividend profile. WDS still has to address long-term issues in its fundamentals (such as declining production from key projects NWS/Pluto), but will still generate substantial high-quality earnings for years to come.

Morgans has an add rating and $36.00 price target on the ASX 200 stock. This suggests potential upside of 29% for investors. A 5.8% dividend yield is also expected.

The post Morgans names the best ASX 200 stocks to buy in May appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Wednesday
• 3 ASX dividend stocks to buy for an income boost
• Here are the top 10 ASX 200 shares today
• 4 ASX shares exposed to the ‘largest technological change ever seen’
• 5 things to watch on the ASX 200 on Monday

Motley Fool contributor James Mickleboro has positions in Nextdc 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 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.

Depending on who you ask, the recent movements of the Core Lithium Ltd (ASX: CXO) share price might be described either as tragic or as a joke (or perhaps even both).

For long-term shareholders of this ASX lithium stock, there’s probably not much to laugh about, considering Core Lithium has lost a brutal 48.15% of its value over 2024 to date alone. That’s going off the current Core Lithium share price of 14 cents.

Over the past 12 months, those losses extend to an even more savage 86.41%. The company is also down around 92% from its last all-time high of around $1.70 per share which we saw back in late 2022.

If one doesn’t own Core Lithium shares, this dramatic drop might make the idea of investing in Core Lithium today appear to be some kind of joke.

Indeed, imagine if one had told investors back in late 2022 when Core Lithium was going for close to $2 a pop, that the company was destined for a 14-cent share price. They would have probably thought you were joking.

Core Lithium’s woes have stemmed from a few factors. Lithium prices have dramatically come off the boul over the last 12 months. Producers like Core have had to battle with an excess of supply in the rechargeable battery ingredient.

Core Lithium’s flagship Finniss project was even forced to suspend production earlier this year thanks to falling prices.

It also didn’t help sentiment when Core Lithium posted a net loss of $167.6 million for the six months to 31 December 2023. A recent quarterly update has done nothing to sway opinions to date.

But is the current Core Lithium share price still a joke at its current levels?

Are Core Lithium shares laughably cheap or comically expensive?

Unfortunately for Core Lithium investors, at least one ASX expert doesn’t seem to think there’s any value to be found in this lithium stock right now.  Earlier this month, my Fool colleague looked at ASX broker Goldman Sachs’ views on Core.

Whilst Goldman predictably didn’t call Core Lithium shares a joke, the broker still gave the company a ‘sell’ rating, along with a 12-month share price target of just 11 cents. If realised, that would see Core shares dip down to new five-year lows.

Goldman cited valuation concerns compared to its peers as one of the reasons its analysts are bearish on Core. The brokers also suspect the company won’t be able to restart production at Finniss for at least the remainder of 2024.

Foolish takeaway

Whilst it might seem harsh to call Core Lithium shares a joke, this company’s experience over the past 12 months has been a textbook disastrous investment.

But if Core Lithium can recover from its recent lows and survive until the next rebound in lithium prices (whenever that may come), perhaps the joke will be on Core’s detractors and short-sellers. We’ll have to wait and see.

The post At 14 cents, has the Core Lithium share price become a bit of a joke? appeared first on The Motley Fool Australia.

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More reading

• These are the 10 most shorted ASX shares
• The Core Lithium share price sank 12% in April: Time to pounce?
• Why Betmakers, Brainchip, Core Lithium, and Megaport shares are sinking today
• Core Lithium share price tumbles to multi-year low following quarterly update
• These are the 10 most shorted ASX shares

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 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.

CSL Ltd (ASX: CSL) stock has been a strong performer over the long term with a rise of more than 300% over the past decade. Is the ASX healthcare share a good buy today?

The company is the largest biotech company in Australia, but the question is whether it can continue growing profit at a decent pace to push CSL stock higher. There are three factors I’ll look at to decide if CSL stock is appealing.

Investing for growth

The business continues to put a lot of money into investing for the future.

For example, the new RIKA blood plasma donation system is meant to deliver a number of benefits. This system completes one collection in less than 35 minutes, on average, which reduces the donation time by around 30%. There is a rollout plan for the next 18 months for CSL’s centres. The individualised Nomogram will reportedly improve the average donation yield by around 10%. There should also be a reduction in biohazard disposable waste by between 10% to 15%. The system will also help improve productivity and help boost the gross profit margin.

CSL continues to invest hundreds of millions of dollars in research and development across its various segments. That spending can unlock the newest healthcare treatments or vaccines, creating a new earnings stream, and helping CSL stock. In the FY24 half-year result, CSL said its R&D spending increased from US$593 million last year to US$669 million this year.

New Tullamarine site

CSL recently gave investors a site tour presentation, which included references to the new Tullamarine property, a state-of-the-art flu vaccine production facility.

The broker UBS said the Tullamarine building is under construction for CSL Seqirus, which will produce flu vaccines in cell culture. The new site is being built using a variety of techniques and facility configurations that will allow for “best in class” operational facility.

CSL will benefit from digital monitoring and release of batches, which UBS reported was described as “substantially labour saving”.

Another benefit of this Tullamarine site will be better clean room security by placing machinery parts that need cleaning outside the clean environment.

The third benefit suggested by UBS was the ability to scale production at this facility as needed.

Good earnings growth expected

Estimates by UBS suggest the business is expected to see excellent earnings per share (EPS) growth over the next few years.

In FY24, owners of CSL stock are currently expected to see EPS of US$6.29 in FY24, US$7.45 in FY25, US$8.91 in FY26, US$10.69 in FY27 and US$11.86 in FY28.

If those estimates were to become reality, it would mean the CSL profit could grow by around 90% between FY24 and FY28. If that occurs, it would be very supportive for CSL stock in my opinion. Profit growth is one of the reasons why UBS has a buy rating on CSL stock with a price target of $330.

The post 3 reasons CSL stock is a great long-term investment appeared first on The Motley Fool Australia.

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More reading

• 3 excellent ASX 200 blue-chip shares to buy in May
• 3 ASX shares to buy now that could help you retire a millionaire
• 2 ASX shares to buy in May 2024 and hold for the next 10 years
• Top broker predicts 14% upside for CSL share price
• 5 ASX shares to buy for turbulent times

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

On Tuesday, the S&P/ASX 200 Index (ASX: XJO) raced higher in response to the Reserve Bank’s meeting. The benchmark index rose 1.45% to 7,793.3 points.

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

ASX 200 expected to rise again

It looks set to be another positive day for the Australian share market on Wednesday following a relatively good session in the United States. According to the latest SPI futures, the ASX 200 is expected to open the day 19 points or 0.25% higher. On Wall Street, the Dow Jones rose 0.1% and the S&P 500 pushed 0.1% higher, but the Nasdaq eased 0.1% lower. This was the fifth session in a row that the Dow Jones has risen, which is its longest winning streak of the year.

Oil prices soften

ASX 200 energy shares such as Beach Energy Ltd (ASX: BPT) and Woodside Energy Group Ltd (ASX: WDS) could have a subdued session after oil prices edged lower overnight. According to Bloomberg, the WTI crude oil price is down slightly to US$78.46 a barrel and the Brent crude oil price is down 0.15% to US$83.20 a barrel. Oil prices fell despite Israel dismissing Hamas’ ceasefire.

Goodman Group update

All eyes will be on the Goodman Group (ASX: GMG) share price on Wednesday when the integrated industrial company releases its third quarter update. With the company’s shares hitting a record high on Tuesday, expectations clearly are high for Goodman. In February, management lifted its operating FY 2024 earnings per share growth guidance to 11% from 9%. Analysts at Citi see potential for another guidance upgrade.

Gold price falls

ASX 200 gold shares Evolution Mining Ltd (ASX: EVN) and Northern Star Resources Ltd (ASX: NST) could have a poor day after the gold price fell overnight. According to CNBC, the spot gold price is down 0.4% to US$2,322.5 an ounce. This was driven by routine price corrections after Monday night’s gains.

Buy Telstra shares

The Telstra Group Ltd (ASX: TLS) share price is great value according to analysts at Goldman Sachs. This morning, the broker has reiterated its buy rating and $4.55 price target on the telco giant’s shares. It said: “Following the underperformance of Telstra shares YTD (-8% vs. ASX200 +3%), alongside the recent downgrade in SPK FY24 guidance, we outline why we remain confident in our forecast $8.61bn in EBITDA (+$351mn yoy) for TLS in FY25E.”

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

• Here are the top 10 ASX 200 shares today
• ASX 200 rocketing higher on RBA interest rate decision
• What does the latest 3G news mean for Telstra shares?
• This ASX 200 real estate stock has been flying ahead of tomorrow’s key update. Should you buy?
• Why the ASX 200 is predicted to leap higher in 2024 despite higher interest rates

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and Goodman Group. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Investors that are looking to add some gold exposure to their investment portfolio might want to consider the ASX 200 gold stock in this article.

That’s because if the team at Bell Potter are on the money with their recommendation, there could be some very big returns on the cards for investors.

Which ASX 200 gold stock is the broker bullish on?

According to a note from last week, the broker is tipping Regis Resources Ltd (ASX: RRL) as a top buy right now.

The note reveals that its analysts have reiterated their buy rating with an improved price target of $2.80.

Based on its current share price of $2.12, this implies potential upside of 32% for this ASX 200 stock over the next 12 months.

To put that into context, a $10,000 investment would become $13,200 by this time next year if Bell Potter’s recommendation proves accurate.

The broker also sees potential for further gains, noting that the gold miner could be an attractive takeover option for a larger player.

What did the broker say?

Firstly, let’s take a look at what the broker was saying about the ASX 200 gold stock’s recent quarterly update.

Its analysts note that production was softer than expected due to heavy rainfall. However, it is happy to overlook this as management has reaffirmed its FY 2024 guidance and the company is now benefitting from unhedged gold sales. It said:

RRL released its March 2024 quarterly report, which came in below our expectations as a result of the impacts of severe rainfall events during the quarter. RRL achieved production of 90.6koz at AISC of A$2,735/oz, vs BPe 104.1koz at AISC of A$2,081/oz and FY24 guidance 108.8koz at AISC of A$2,155/oz (midpoint basis). Tropicana was particularly hard hit, with attributable production dropping 40% from 38.8koz to 23.2koz qoq, as processing was forced to be suspended from 22 March to 1 April.

Despite this, FY24 guidance has been maintained at for production of 415koz – 455koz at AISC of between A$1,995/oz and A$2,315/oz. RRL enjoyed its first full quarter of unhedged gold sales and at quarter-end held cash and bullion of $186m (from $155m qoq) and drawn debt of $300m.

Why is it a buy?

Bell Potter believes the ASX 200 gold stock is undervalued at current levels. This is thanks to its unhedged gold sales, local operations, strong cash flow generation, and takeover appeal. It explains:

Earnings changes in this report are: FY24: +28%; FY25: +20% and FY26: +7% as our increased gold price forecast offsets the weaker than expected March 2024 quarter performance. RRL is the 5th largest ASX gold producer and the largest with an all-Australian asset portfolio. RRL offers unhedged exposure to the gold price and strong free cash flow growth over FY24 and FY25. These attributes also make RRL an appealing corporate target in the current M&A environment. Our NPV-based valuation is up 8% to $2.80/sh and we retain our Buy recommendation.

The post This ASX 200 gold stock can rise 30% and could be a takeover target appeared first on The Motley Fool Australia.

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More reading

• 5 things to watch on the ASX 200 on Tuesday
• Bell Potter names the best ASX 200 stocks to buy in May
• 5 things to watch on the ASX 200 on Tuesday
• Leading brokers name 3 ASX shares to buy today
• Here are the top 10 ASX 200 shares today

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