Are you looking for dividend shares to add to your income portfolio? If you are, then it could be a good idea to check out the two listed below.

These ASX dividend shares have been rated as buys by analysts. Here's what they are saying about them:

Aurizon Holdings Ltd (ASX: AZJ)

The first ASX dividend share for investors to look at is Australia's largest rail freight operator.

Aurizon connects miners, primary producers, and industry with international and domestic markets via its extensive national rail and road network.

Morgans is a fan of the company and currently has an add rating and $3.81 price target on its shares. It sees a lot of value in the Aurizon share price at the current level. The broker explained:

We are not yet convinced that the capital AZJ is deploying into the lower quality Bulk business (both One Rail Bulk acquisition and growth capex) to diversify its operations away from coal exports and tap into new growth avenues will deliver appropriate risk-adjusted returns over time. Nonetheless, we see value in the stock at current prices, supported by the far higher quality Network and Coal haulage businesses. ADD retained.

As for dividends, it has pencilled in partially franked dividends of 17 cents per share in FY 2023 and then 19 cents per share in FY 2024. Based on the latest Aurizon share price of $3.30, this will mean yields of 5.2% and 5.75%, respectively.

Rural Funds Group (ASX: RFF)

Another ASX dividend share that has been named as a buy is this agriculture-focused real estate property.

Rural Funds owns a diverse portfolio of properties across different geographies and sectors that are leased to some of the biggest names in the game.

Bell Potter is positive on the company and recently noted that its shares were trading at what could "be considered an attractive entry point."

The broker currently has a buy rating and $2.65 price target on its shares.

In respect to dividends, Bell Potter is forecasting an 11.7 cents per share dividend in FY 2023 and then a 12.2 cents per share dividend in FY 2024. Based on the current Rural Funds share price of $2.10, this represents yields of 5.6% and 5.8%, respectively.

The post Buy these ASX dividend shares right now for income: analysts appeared first on The Motley Fool Australia.

ASX 200 stock Aurizon Holdings Ltd (ASX: AZJ) finished the week in the green amid news it has attracted three new substantial holders.

The Aurizon share price rose by 0.61% this week to finish at $3.31 on Friday. By comparison, the S&P/ASX 200 Index (ASX: XJO) fell by 2.46% this week to finish at 7,144.7 points.

The freight railway operator lodged three new substantial holder notices with the ASX this week.

A substantial holder is any shareholder, company, or investment group with a 5% or higher stake.

The ASX requires companies to notify it each time a new substantial holder comes on board, or if there is a change in a substantial holder's position.

Let's take a look at the details.

The fund managers taking big positions in this ASX 200 stock

Aurizon lodged the first substantial holder notice on Monday. The notice revealed that London fund manager Mondrian Investment Partners took a 5% stake in the company on 2 March.

Mondrian purchased just over 92.1 million Aurizon shares.

On Tuesday came the second substantial holder notice. This one detailed a 5.83% position in the ASX 200 stock taken by First Sentier Investors Holdings Pty Limited on 3 March.

First Sentier purchased just over 107.3 million Aurizon shares.

First Sentier spread its investment over a number of subsidiaries in Australia, Hong Kong, and the United Kingdom.

The notice explained that the voting power attached to the holding was split about 60:40 between First Sentier and its ultimate parent company, Mitsubishi UFJ Financial Group Inc (NYSE: MUFG).

Aurizon lodged a third substantial holder notice the following day acknowledging Mitsubishi UFJ Financial's own purchase of Aurizon shares on 3 March.

The company bought just over 107 million shares in the ASX 200 stock to give it a 5.81% stake.

Mitsubishi also purchased 3,000 options.

What does this mean for the Aurizon share price?

Well, fund managers are only going to invest in ASX 200 stocks that they think are likely to rise in value.

Therefore, their purchases can be instructive for ordinary ASX investors trying to identify good investment opportunities.

Fund managers have advantages over ordinary investors. They employ professional analysts and research teams to thoroughly check out the ASX 200 stocks they are considering investing in.

Not only that, but fundies themselves are often able to meet with company managers in person to grill them on the company's plans and to help them assess the capacity of the management team.

Fund managers will often cite excellent management teams as a reason for buying certain ASX 200 stocks.

However, it's worth remembering that fund managers can get it wrong.

Even with all that access and research, they still make bad calls now and then.

So, investors may like to keep an eye on what fundies do, but ultimately, they must make decisions based on their own research and instincts.

Aurizon set for a takeover?

Late last month, Wilsons equities strategist Rob Crookston named Aurizon among several ASX 200 stocks that he thinks are appealing takeover targets.

Crookston surmised that private ownership might make Aurizon operate better.

In a memo, Wilsons explained its reasons for tipping Aurizon as a takeover target:

Infrastructure asset, monopoly, relatively steady (high) cash flows. Might benefit from being taken private from an ESG perspective.

The Aurizon share price is down 10% in the year to date.

It is currently trading not far off its 52-week low of $3.23. It has a 52-week high of $4.25 per share.

The post Guess which ASX 200 stock has landed 3 substantial shareholders in a week appeared first on The Motley Fool Australia.

The February earnings season saw plenty of ups and downs, as well as some insider buying among these S&P/ASX 200 Index (ASX: XJO) shares.

They've each seen directors trading in their company's stocks over the last week.

So, which ASX 200 directors were buying, and how much were they snapping up? Let's take a look.

6 ASX 200 directors buying their company shares

Insider buying is often taken as a sign those working behind the scenes at an ASX 200 company are bullish on its share price's future.

Thus, a barrage of director trades in Dexus Property Group (ASX: DXS) stock might have pricked the ears of market watchers. Particularly the $216,794 trade made by director Paula Dwyer, who snapped up 25,000 shares last Wednesday.

And Dwyer's wasn't the only insider to buy. Directors Elana Rubin and Rhoda Phillippo forked out $50,052 and $21,357 respectively for parcels of 5,813 shares and 2,500 shares over the course of the week.

AGL Energy Limited (ASX: AGL) has also seen recent insider buying, with director John Pollaers buying 10,000 shares for around $6.92 apiece.

Over at ASX 200 financials giant AMP Ltd (ASX: AMP), director Michael Sammells was on a share-buying spree. He snapped up 50,000 stocks in the company for around $1.09 apiece – sneaking in before it traded ex-dividend.

Meanwhile, Ansell Limited (ASX: ANN) director Debra Goodin bought 486 shares in the personal protective equipment manufacturer for a total of $12,959.34.

Director of hauling company Aurizon Holdings Limited (ASX: AZJ), Lyell Strambi, also got in on the insider buying action over the last week. He bought 5,952 shares for $3.36 each – a total of approximately $20,000.

And finally, Bendigo and Adelaide Bank Ltd (ASX: BEN) director David Foster bought 1,021 shares in the regional bank for $9.79 apiece – forking out $9,996 for the additional parcel.

The post 6 ASX 200 directors buying up their company shares in the past week appeared first on The Motley Fool Australia.

Earlier this week, The Motley Fool reported Wilsons equities strategist Rob Crookston's seven ASX growth stocks to buy that could become takeover targets.

The idea behind that, according to the Wilsons team, is that acquisition bids are almost always favourable for the existing shareholders.

"Normally, companies are acquired at a significant premium to their latest share price," said Crookston in a memo to clients.

"Identifying companies that will make suitable takeover targets can make for very lucrative investments."

And the great thing for investors is that an actual transaction doesn't even have to materialise for their ASX shares to explode out of the gates.

"Any hint of a possible acquisition can trigger positive momentum even before a bid is announced."

'Infrastructure-like' ASX shares with free cash flow

One way to identify tempting takeover targets is to find companies that are asset-rich that have reliable incomes.

"We screened for infrastructure or 'infrastructure-like' stocks with low market betas, free cash flow yields (FY25) above 4% and companies that haven't seen a material re-rate over the last year."

Using these criteria, Crookston's team came up with six S&P/ASX 200 Index (ASX: XJO) shares that one could buy in anticipation of a takeover bid:

• AGL Energy Limited (ASX: AGL)
• Aurizon Holdings Ltd (ASX: AZJ)
• Ramsay Health Care Ltd (ASX: RHC)
• APA Group (ASX: APA)
• Cleanaway Waste Management Ltd (ASX: CWY)
• Lottery Corporation Ltd (ASX: TLC)

Crookston noted that Cleanaway and Lottery Corp both already feature in Wilsons' "focus portfolio".

"These look attractive acquisition targets due to their stable cash flows, relatively low debt balances and strong market positioning in their respective markets."

The Lottery Corporation also operates as a monopoly in every state except for Western Australia.

"Looks well priced versus other infrastructure-like assets."

Energy provider AGL was already the subject of a failed takeover attempt last year, as was Ramsay Health.

According to Crookston, the story might not be over for Ramsay.

"Cost out and real estate asset sales could be [an] opportunity for the right buyer. Earnings recovery after the pandemic could also be alluring."

Private ownership might actually help freight rail provider Aurizon operate better, read the Wilsons memo.

"Infrastructure asset, monopoly, relatively steady (high) cash flows. Might benefit from being taken private from an ESG perspective."

The post 6 asset-rich ASX 200 shares to buy for their takeover potential: expert appeared first on The Motley Fool Australia.

These ASX dividend shares have been rated as buys by analysts. Here's what the broker is saying about them:

Aurizon Holdings Ltd (ASX: AZJ)

The first ASX 200 dividend share for investors to look at is Aurizon.

It is Australia's largest rail freight operator and connects miners, primary producers, and industry with international and domestic markets via its extensive national rail and road network.

One leading broker that is positive on the company is Morgans. Its analysts currently have an add rating and $3.81 price target on its shares.

Its analysts "see value in the stock at current prices, supported by the far higher quality Network and Coal haulage businesses."

In addition, the broker is forecasting very generous dividends in the near term. It has pencilled in partially franked dividends of 17 cents per share in FY 2023 and then 19 cents per share in FY 2024.

Based on the latest Aurizon share price of $3.44, this will mean yields of 4.9% and 5.5%, respectively.

Rural Funds Group (ASX: RFF)

Another ASX dividend share to buy is Rural Funds.

It is an agriculture-focused real estate property trust that owns a diverse portfolio of properties across different geographies and sectors.

Rural Funds appears well-positioned for growth over the long term thanks to its lengthy tenancy agreements with major players and their periodic rental increases.

Bell Potter is a fan of the company. It notes that its shares are trading at what could "be considered an attractive entry point." The broker has a buy rating and $2.75 price target on its shares.

As for dividends, Bell Potter is forecasting an 11.7 cents per share dividend in FY 2023 and then a 12.7 cents per share dividend in FY 2024. Based on the current Rural Funds share price of $2.35, this represents yields of 5% and 5.4%, respectively.

The post Boost your passive income with these ASX shares: analysts appeared first on The Motley Fool Australia.

Although the world is preoccupied with inflation and interest rates, the ASX reporting season is chugging along in earnest.

Fortunately, Morgans equity strategy analyst Andrew Tang has been keeping an eye on the action.

In his "best calls to action" column this week, Tang has helpfully picked out four ASX shares that investors should jump on right now on the basis of their financial reporting this month:

'Business performing well'

Liquor retail and hospitality provider Endeavour Group Ltd (ASX: EDV) understandably struggled during COVID-19 lockdowns and restrictions. 

But, according to Tang, the latest update showed it was "getting back to normal".

"Endeavour's 1H23 result was comfortably ahead of expectations with retail margin performance the key standout," Tang said on the Morgans blog.

"Both segments delivered earnings and margins ahead of our expectations. Group ROFE [return on funds employed] increased 80 basis points to 12.2%."

The Endeavour share price has already rocketed 14% year-to-date. But Morgans was so impressed with the February report that it has upgraded its rating to "add".

"The result highlighted management's ability to control costs despite inflationary pressures," said Tang.

"While the regulatory environment remains uncertain, on balance, we think the risks lie to the upside with the underlying business performing well."

'Both potential price upside and reasonable yield'

Freight rail operator Aurizon Holdings Ltd (ASX: AZJ) has opposite fortunes, with the share price dropping more than 10% over the past few days.

Tang reported that its results were not flattering.

"1H23 earnings (EBITDA -7% on pcp, earnings per share -34%), cashflow, and dividend per share (-33% on pcp) were below expectations, and FY23 EBITDA guidance was downgraded 4%."

But the lower share price now means "attractive valuation metrics" and a chance of a rebound "as the market digests the one-offs affecting FY23". 

"We think there is both potential price upside and reasonable yield at the current share price — more attractive looking into FY25F."

'Sufficient upside' to buy

Electronics retailer JB Hi-Fi Limited (ASX: JBH)'s reporting had no surprises, as it largely revealed what was to come in a preannouncement in January.

But with the share price now down slightly since late last month, Tang reiterates the add rating from his team.

Tang reported that Beach Energy Ltd (ASX: BPT) released a "soft" first-half result due to "cost increases and production declines". 

"Guidance for FY23 has been downgraded with production reduced by 7% and field operating costs up by 12%."

But the Morgans team still has a buy rating on the oil and gas producer.

"We still see sufficient upside," he said.

"FY24 production guidance [is] to be provided at the full year result."

The Beach Energy share price is 4% lower than it was a year ago.

The post Stop mucking about and buy these 4 ASX shares right now: Morgans appeared first on The Motley Fool Australia.

The Aurizon Holdings Ltd (ASX: AZJ) share price has landed on the unfavourable side of shareholders today following its first-half results.

In the first hour of trade, shares in the freight rail company are being exchanged at $3.43 — a 7% thumping. If Aurizon shares close around their current level today it will be their worst performance since 20 March 2020.

Aurizon share price suffers amid dismantled earnings

• Revenue up 12% compared to the prior corresponding period (pcp) to $1,694 million
• Earnings before interest, tax, depreciation, and amortisation (EBITDA) down 7% to $673 million
• Net profit after tax (NPAT) down 34% to $169 million
• Interim dividend down 33% to 7 cents per share fully franked
• Above-rail coal volumes and network volumes down 8% and 2% respectively

The first half was a mixed bag, but ultimately the detractors prevailed.

Record grain haulage and the completed acquisition of One Rail meant Aurizon benefited from a strong result under its Bulk unit. This portion of the business contributed $521 million in revenue (up 51%) and $100 million in EBITDA (up 33%).

Meanwhile, the Coal unit weighed heavily on Aurizon's EBITDA — contributing only $230 million, down 20% pcp. This subdued performance was attributed to a reduction in volume due to wet weather and lower contract rates.

What else happened in the first half?

During the first half, Aurizon announced the sale of its East Coast Rail business. The Aurizon share price rallied 4% on 16 December last year as shareholders were informed of the sale for $425 million in cash. It was stated that proceeds were initially used to repay debt.

Speaking of debt, Aurizon increased its debt by a total of $70 million during the half to fund its One Rail acquisition. The enlarged debt profile increased the company's interest expense to $104 million.

What did management say?

Aurizon managing director and CEO, Andrew Harding, highlighted the major acquisition of One Rail during the period. The potential to expand into growing areas such as copper, lithium, and rare earths was noted by Harding.

Consistent with our strategy, we delivered strongly on key initiatives to diversify and expand the business in rapidly growing markets and regions. These were substantial steps in our aspiration to double the size of the Bulk business over the decade through organic growth and acquisitions.

Furthermore, the freight company's CEO explained the challenges faced in the first half, stating:

These achievements were accomplished during a challenging period operationally, with prolonged flooding on the East Coast together with a number of significant third-party derailments and incidents that resulted in reduced volumes and revenue.

What's next?

The Aurizon share price is likely feeling the effects of the company's FY23 EBITDA guidance being reduced today.

Due to prolonged adverse weather, management is now forecasting group underlying EBITDA between $1,420 million and $1,470 million in FY23. This reflects a guidance cut of 4% compared to previous expectations.

Lower EBITDA from Coal and Network are the detractors in the forecast. Whereas, Aurizon is anticipating increased revenue and earnings under its Bulk banner.

Aurizon share price snapshot

Despite their blue-chip stature, Aurizon shares have not been the place to be so far in 2023. While the S&P/ASX 200 Index (ASX: XJO) has marched 6.7% higher year-to-date, the freight company's shares have fallen 8.2%.

However, the company has provided its shareholders with an above-industry-average dividend yield. Currently, Aurizon is yielding around 5.8% before factoring in today's interim payment.

The post Aurizon share price tumbles 7% as profits are derailed appeared first on The Motley Fool Australia.

Earlier this week, The Motley Fool readers heard IML portfolio manager Michael O'Neill declaring 2023 as the time to double down on dividend shares.

His theory was that a global economic slowdown this year will force investors to rely on the consistency and reliability of income-producing stocks.

Even longer term, with the era of near-zero interest rates behind us, capital growth will be anaemic, according to O'Neill.

This means that investors will have no choice but to turn to shares that pay dividends for decent returns.

"While markets may or may not perform well in 2023, what is very unlikely is that we'll enter another long bull market with a similar amount of capital growth," O'Neill said on the IML blog.

"For us, with capital growth likely to be lower in the medium-long term, it's the right time to place greater focus on income."

Helpfully, he named four specific ASX dividend shares that his team loves at the moment:

High dividends with pricing power and market dominance

In general, the IML team prefers industrials for "long-term, consistently high dividends". 

"We are also looking at which sectors and stocks are likely to perform well, and so provide a steady or growing dividend in a high inflation environment."

All four of his picks are "currently trading at reasonable valuations":

O'Neill's stocks each have slightly different strengths, which demonstrate the range of qualities that his team seeks in income-producing shares.

Suncorp is a classic example of a business that has pricing power.

"Their strong market position gives them the ability to pass on rising costs to their customers."

Explosives maker Orica is an example of a company operating in a "rational" industry.

"The main players are motivated by profit and act 'rationally' to maximise long-term profits – not spending large amounts of capital at the top of the cycle, or chasing market share at all costs through unprofitable discounting."

Grocery wholesaler Metcash is in the great position of selling goods that are considered "essential", which will not see waning demand due to a lagging economy or inflation.

Finally, O'Neill loves rail operator Aurizon due to the nature of its client agreements.

"Ideally, contracts are structured with adjustments for inflation and pass-through of essential input costs such as fuel," he said.

"Aurizon benefits from such contractual protections."

The post 4 best ASX dividend shares to buy right now: expert appeared first on The Motley Fool Australia.

Michael O'Neill of Investors Mutual reckons it's "time to double down" on ASX dividend shares because lower capital growth is likely not just this year but over the next decade.

Amid global recession forecasts for 2023, it's best for investors to look for income opportunities with good quality stocks that are worth holding over the long term, he says.

This is a better strategy than trying to buy shares at their bottom in the hope of capital gains.

In an article published on the Investors Mutual website, O'Neill says:

…it's incredibly difficult to time the market – so you're usually better off not trying.

Dividends are always important, right now they're critical. … in times like these … it's best to minimise your risks and invest your money where you have the best chance of healthy returns.

For us that means buying and holding shares in quality industrial companies, at attractive valuations, that pay strong dividend yields.

Why will ASX 300 share price gains be lower?

O'Neill explains:

Capital growth in the next decade is likely to be lower than the last decade.

Ultra-low interest rates and readily available, cheap, money drove a very long bull market. With high inflation and rising rates, that time has passed.

While markets may, or may not, perform well in 2023, what is very unlikely is that we'll enter another long bull market with a similar amount of capital growth.

Dividends 'remarkably reliable'

O'Neill says dividends are particularly important now because they provide more reliable returns than capital gains [and] can act as a safety net during a volatile market.

O'Neill says data from 1998 to 2021 inclusive shows ASX dividend shares provided 51% of overall returns from the S&P/ASX 300 Index (ASX: XKO).

While outperforming capital growth only slightly, annual dividend returns were vastly more stable.

He said:

… the return on capital fluctuates significantly, but dividend returns are remarkably reliable…

[Dividends are] generally a reflection of the company's overall profitability – its financial performance.

So, in periods where the overall sharemarket goes down, an investor's dividends should stay much the same if they have a diversified portfolio made up of quality companies.

Which ASX dividend shares are the best buys?

The upside of a volatile market is "a great chance to pick up high-quality companies at bargain prices".

In a high-inflation environment, O'Neill says stocks with pricing power and rational, low-risk strategic management are good options.

His ASX 300 dividend shares picks include Suncorp Group Ltd (ASX: SUN). The insurance giant is trading on a forward price-to-earnings (P/E) ratio of 12.1 times FY24 earnings (as at 14 December 2022). Its forecast dividend yield for FY24 is 6.8%.

He also likes explosives company Orica Ltd (ASX: ORI) on an FY24 P/E of 16.1 times and a dividend yield of 3.4%.

Businesses that sell essential products and services are also good inflation hedges. O'Neill tips IGA shopping chain owner, Metcash Limited (ASX: MTS) at an FY24 P/E of 11.9 times and a dividend yield of 5.9%.

Companies that can put well-structured contracts in place, ideally with adjustments for inflation, are also good options. Examples include railway owner, Aurizon Holdings Ltd (ASX: AZJ). It has an FY24 P/E of 12.3 times and a dividend yield of 7.3%.

He recommends avoiding overweight positions in commercial property, resources, and other cyclicals.

The post Why ASX dividend shares are so 'critical' right now: fundie appeared first on The Motley Fool Australia.

Term deposit interest rates have jumped higher thanks to the interest rate hikes by the Reserve Bank of Australia (RBA).

One of the main attractions of salary earnings is that it's consistent. Boring dividends may not be exciting, but they may be what some people need if they're relying on the dividend income.

Fund manager Michael O'Neill from Investors Mutual points to evidence that dividends can provide more reliable returns than capital gains because dividend income is "decided by the company's board and is generally a reflection of the company's overall profitability".

He suggested that "an investor's dividends should stay much the same if they have a diversified portfolio made up of quality companies."

Which ASX 200 dividend shares can provide resilient income?

The fund manager said that Investors Mutual prefers industrial businesses for long-term, consistently high dividends, while also trying to find ones that can provide a steady or growing dividend in this high inflation environment.

There are a few different things that the fund manager suggests could mean good performance during high inflation:

One factor is pricing power – "their strong market position gives them the ability to pass on rising costs to their customers e.g. home and motor insurance companies like Suncorp Group Ltd (ASX: SUN)."

Another suggestion was that the potential dividend players should be in a rational industry – "the main players are motivated by profit and act 'rationally' to maximise long-term profits – not spending large amounts of capital at the top of the cycle, or chasing market share at all costs through unprofitable discounting. The explosives industry for example has rationalised significantly and is at a strong point in the capital cycle, benefitting companies like Orica Ltd (ASX: ORI)."

The third idea was related to businesses that sell essential products and services – "people need to buy them, no matter how high prices go e.g. consumer staples companies like Metcash Limited (ASX: MTS)."

Finally, O'Neill suggested that potential ASX 200 dividend shares need to have "capable, proactive management that can put well-structured contracts in place that make difficult conversations about passing on inflationary costs easier. Ideally, contracts are structured with adjustments for inflation and pass-through of essential input costs such as fuel. Aurizon Holdings Ltd (ASX: AZJ) benefits from such contractual protections."

Financial estimates

Seeing as we're currently in the 2023 financial year, let's have a look at the FY23 projections on Commsec.

Suncorp shares are valued at under 12 times FY23's estimated earnings, with a possible grossed-up dividend yield of 9%.

Orica shares are valued at 19 times FY23's estimated earnings with a potential dividend yield of 2.75%.

Metcash shares are valued at 13 times FY23's estimated earnings with a possible grossed-up dividend yield of 7.8%.

Aurizon shares are priced at under 14 times FY23's estimated earnings with a potential grossed-up dividend yield of 7.7%.

The post When it comes to ASX 200 dividend shares, is boring better? appeared first on The Motley Fool Australia.

The fund manager Michael O'Neill from Investors Mutual has suggested that capital growth in the next decade is "likely to be lower than the last decade".

With the end of ultra-low interest rates and available money, the very long bull market has been ended by high inflation and rising interest rates. He suggested that it's "very unlikely" that we are going to enter another long bull market with a similar amount of capital growth.

The fund manager suggested that volatility is going to stay elevated in the near term, but also suggested that it's a good time for stock picks, with "a great chance to pick up high-quality companies at bargain prices."

We can see that volatility with the exchange-traded fund (ETF) Vanguard Australian Shares Index ETF (ASX: VAS).

Time for dividends?

O'Neill suggested that the importance of dividends is increasing during times like these because they "provide more reliable returns than capital gains."

He noted that over the past 20 years, income returns made up just over half of total returns from ASX 300 shares. On top of that, while capital returns can be very volatile, the dividend returns are "remarkably reliable – making them particularly valuable when returns on capital are low, or negative."

The fund manager pointed out that capital returns rely on movements in individual share prices, but the level of dividends is decided by the company's board and the company's overall profitability. He concluded this point by saying:

In periods where the overall share market goes down, an investor's dividends should stay much the same if they have a diversified portfolio made up of quality companies.

He also suggested that dividend yields can act as a safety net at times of volatility. O'Neill suggested the Investors Mutual investment team have observed over many years of investing that "once sentiment starts to turn, companies with sustainable earnings that support a healthy, consistent dividend stream are often the shares that recover the most quickly."

Regardless of what happens with the share price, O'Neill said that when quality companies drop and the dividend yield is attractive and sustainable, long-term investors buy them so they can 'lock in' high-income levels.

Which ASX 300 dividend shares to buy?

The fund manager said investors should be cautious about risky sectors like commercial property, resources and other cyclical sectors. Instead, they prefer industrials, including ones that can perform well when inflation is high.

They look for names that have pricing power that can pass on rising costs to customers.

The investment team also want to find businesses that operate in a 'rational' industry where the main players are motivated by profit and act rationally to maximise long-term profit (not spending large amounts of capital at the top of the cycle, or chasing market share at all costs through unprofitable discounting).

Investors Mutual wants to look at businesses that sell essential products and services. It also wants to find companies that have good management, that can put "well-structured contracts in place that make difficult conversations about passing on inflationary costs easier."

In terms of which ASX 300 dividend shares could be good ideas, O'Neill picked out four names with relatively low price/earnings (P/E) ratios and high dividend yields:

• Rail infrastructure business Aurizon Holdings Ltd (ASX: AZJ)
• The food and liquor supplier, and hardware business, Metcash Limited (ASX: MTS)
• Explosives business Orica Ltd (ASX: ORI)
• Insurance business Suncorp Group Ltd (ASX: SUN)

The post How to minimise risk using ASX 300 dividend shares: fundie appeared first on The Motley Fool Australia.

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

Appen Ltd (ASX: APX)

The Appen share price is down 3.5% to $2.41. Investors have been selling Appen and many other ASX tech shares on Monday following a poor night for the Nasdaq index on Friday. Investors were selling tech shares amid global recession concerns.

Arafura Rare Earths Ltd (ASX: ARU)

The Arafura share price is down over 6% to 48.2 cents. This appears to have been driven by profit taking after some stellar gains in recent sessions. For example, even after today's decline, the rare earths explorer's shares are up a sizeable 24% since 8 December. They are now also up 110% since the start of the year.

Aurizon Holdings Ltd (ASX: AZJ)

The Aurizon share price is down 2.5% to $3.78. The catalyst for this is likely to have been a broker note out of Morgans this morning. According to the note, the broker has downgraded the rail freight operator's shares to a hold rating and cut the price target on them to $4.00. Morgans was a touch disappointed with the price Aurizon received for the East Coal Rail business.

Star Entertainment Group Ltd (ASX: SGR)

The Star share price is down 11% to $2.29. Investors have been selling this casino operator's shares amid concerns over potential reforms to the New South Wales casino tax regime. New South Wales Treasurer, The Honourable Matt Kean MP, is proposing gaming tax increases for the two casinos in New South Wales. These are anticipated to commence on 1 July 2023 and forecast to raise an additional $364 million in taxes over the next three years.

The post Why Appen, Arafura, Aurizon, and Star shares are sinking today appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) tumbled into the weekend on the back of a dire session on Wall Street. The index closed 0.78% lower at 7,148.7 points today. That marks a 0.89% week-on-week fall.

Fears of a recession following the recent rate hike from the US Federal Reserve appeared to drive New York indices lower overnight. The Dow Jones Industrial Average Index (DJX: .DJI) fell 2.2%, the S&P 500 Index (SP: .INX) dropped 2.5%, and the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) plunged 3.2%.

With that in mind, I doubt it's a surprise to anyone that Aussie tech stocks were among those suffering the most today. The S&P/ASX 200 Information Technology Index (ASX: XIJ) plummeted 2%. The Block Inc (ASX: SQ2) share price led the sector's fall with a 6.2% tumble.

On the other hand, the S&P/ASX 200 Energy Index (ASX: XEJ) posted the biggest gain, rising 0.3% despite falling oil prices.

The Brent crude oil price fell 1.8% to US$81.21 a barrel and the US Nymex crude oil price dropped 1.5% to US$76.11 a barrel.

All in all, two of the ASX 200's 11 sectors closed in the green today. But which stock outperformed all others to end the week on the highest high? Keep reading to find out.

Top 10 ASX 200 shares countdown

Today's top-performing ASX 200 share was Aurizon Holdings Ltd (ASX: AZJ).

It gained 4% on news the company has found a buyer for its East Coast Rail business. The competition watchdog declared the business' sale a condition of Aurizon's previous acquisition of One Rail Australia.

Today's biggest gains were made by these shares:

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.

The All Ordinaries Index (ASX: XAO) is tumbling on Friday, but not all shares that call the index home are suffering.

Right now, the All Ordinaries is down 0.61% following a rough night on Wall Street.

Major New York indices tumbled overnight amid concerns about further rate hikes. The Dow Jones Industrial Average Index (DJX: .DJI) fell 2.25%, the S&P 500 Index (SP: .INX) plunged 2.5%, and the Nasdaq Composite Index (NASDAQ: .IXIC) plummeted 3.2%.  

Fortunately for ASX fans, there are plenty of pockets of green on the Aussie bourse today.

We've rounded up three that are positively outperforming – beating the index by as much as 4.6%.

3 ASX All Ordinaries shares taking off today

The All Ordinaries is tumbling today, but its downturn hasn't upset the Catapult Group International Ltd (ASX: CAT) share price.

The sports analytics technology company's stock is leaping 2.7% to trade at 76 cents at the time of writing.

It's the second day in a row the stock has posted a notable gain. It lifted 4.2% in Thursday's session. There's been no news from the company since November.

Meanwhile, the 4.03% gain posted by the Aurizon Holdings Ltd (ASX: AZJ) share price is easier to explain. The All Ordinaries company announced it's found a buyer for its East Cost Rail business – and it's expecting to walk away with $425 million cash.

The sale of the business was a condition imposed by the competition watchdog on Aurizon's acquisition of One Rail Australia earlier this year.

Right now, the Aurizon share price is $3.87.

Finally, the share price of All Ordinaries mineral developer BCI Minerals Ltd (ASX: BCI) is outperforming the broader market, gaining 1.92% to trade at 26.5 cents.

Like Catapult before it, there's been no news from the stock to explain its Friday rise.

However, it's worth mentioning the minerals share has been relatively volatile lately. It gained on Monday and Wednesday this week and posted falls on Tuesday and Thursday.

The post 3 ASX All Ordinaries shares smashing the market on Friday appeared first on The Motley Fool Australia.

Four ASX shares that have not let that hold them back today are listed below. Here's why they are rising:

Aurizon Holdings Ltd (ASX: AZJ)

The Aurizon share price is up 4% to $3.87. This morning this rail freight operator announced the sale of the East Coast Rail (ECR) business. Aurizon expects to receive cash proceeds of approximately $425 million, which represents the equity value of ECR. The purchaser, Magnetic Rail Group, will also assume ECR's existing debt facilities. This divestment was required to gain approval for the acquisition of One Rail Australia.

Norwest Energy NL (ASX: NWE)

The Norwest Energy share price is up 33% to 6 cents. Investors have been buying this energy explorer's shares after Mineral Resources Ltd (ASX: MIN) announced plans to make a takeover offer. Mineral Resources intends to make an all-scrip offer that equates to 6 cents per share. The two parties own the Lockyer Deep joint venture.

Rio Tinto Ltd (ASX: RIO)

The Rio Tinto share price is up 2% to $115.85. This follows a rise in iron ore prices overnight. In addition, this morning, Goldman Sachs retained its buy rating on the mining giant's shares with an improved price target of $119.20. Goldman notes that Rio Tinto's shares have a "[c]ompelling valuation: trading at c. ~0.95x NAV."

Strike Energy Ltd (ASX: STX)

The Strike Energy share price is up 2% to 35.2 cents. Investors have responded positively to news that the energy developer plans to test the Southwest Erregulla and Erregulla Deep prospective resource. Management believes this has high impact and low risk upside resource potential.

The post Why Aurizon, Norwest, Rio Tinto, and Strike Energy shares are rising today appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) ended a disappointing week on a high today. It lifted 0.53% to close at 7,213.2 points on Friday. That marks a 1.21% week-on-week loss.

Leading today's gains was the S&P/ASX 200 Materials Index (ASX: XMJ). It rose 1.9% on the back of commodity prices.

Gold futures lifted 0.2% overnight to US$1,801.50 an ounce and iron ore futures improved 2.2% to US$109.49 a tonne. Meanwhile, copper added 0.6% amid Goldman Sachs' bullishness.

The S&P/ASX 200 Information Technology Index (ASX: XIJ) also recovered 1% following a dire four-session-long losing streak that saw it dump 5.7%.

On the other side of the coin, the S&P/ASX 200 Utilities Index (ASX: XUJ) fell 0.8%, weighed down by the APA Group (ASX: APA) share price.

All in all, seven of the ASX 200's 11 sectors closed higher today. But which share outperformed all others? Keep reading to find out.

Top 10 ASX 200 shares countdown

Today's top-performing share was Champion Iron Ltd (ASX: CIA). It gained 5.15% today.

Today's biggest gains were made by these shares:

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.

1) Growth stocks have taken a pummeling these last 12 months, with seemingly no let-up in sight. As witnessed by the fall in the Xero Limited (ASX: XRO) share price today, a high-quality stock that was down 50% over the past 12 months (before today), can still tumble another 11%… and potentially more.

Xero reported revenue grew 31% over the past six months, but that translated into only an 11% increase in earnings before interest, tax, depreciation, and amortisation (EBITDA). Free cash flow was just $NZ15.6 million as the company continues to reinvest to drive long-term shareholder value.

Problem is, when your market capitalisation is close to $10 billion, and in these times of higher interest rates when the market wants to see a decent level of cash generation, a few million dollars of free cash flow isn't going to pass muster.

To some, Xero may offer value, given the lifetime value of a customer is around seven times its cost of acquisition. But it's going to take a long time for the company to grow into its valuation, and in this market, patience is not a strong point. It will likely be many years before the Xero share price gets back to the heady days of $150.

2) If ASX growth shares are on the nose, value shares must be the way to go.

There's no shortage of companies that look like great value, trading on single-digit earnings multiples and very attractive dividend yields.

Data from S&P Capital IQ, P/E multiple based on last twelve months earnings. Dividend yield is historical, not forecast.

If only stock picking was this easy… 

Looking forward, each company has its challenges. When it comes to investing, there's always a catch.

Commodity prices are hard to predict, and typically the time to buy mining stocks is at the bottom of the cycle, not near the top, as is the case now due to booming oil, iron ore and coal prices.

Retailers have some serious headwinds ahead as sharply higher interest rates start to put a bite on retail spending. As to what extent, we're all just guessing at this stage.

By lengthening your time horizon, you put the odds more in your favour. 

Will JB Hi-Fi be generating higher profits in five years' time than now? You'd imagine so, but how much higher? Only 20% higher translates into a less than 4% compound annual growth rate (CAGR). But 50% higher is a much more attractive 8.5% CAGR, with dividends on top. Any expansion in its earnings multiple would be jam on top of the cake.

Obviously, Magellan Financial Group will not be trading on a forecast dividend yield of anything like 18.5%. Its forward dividend yield could be closer to 0%. Will we look back five years from now at Magellan's enterprise value of around $700 million versus its funds under management of $50 billion and think this is a value stock? Maybe.

3) Even legendary value investor Anton Tagliaferro is struggling to find obvious value.

Interviewed by Livewire Markets, the founder of Investors Mutual said with the recent stock market rally, it's become more difficult to uncover the value gems.

Tagliaferro says Aurizon Holdings Ltd (ASX: AZJ) continues to impress, saying the rail haulage company has very stable revenues with long-term contracts. 

"Obviously, the coal sector's doing very well, so its customers are doing very well, which helps when you're negotiating prices. And Aurizon has a very good management team."

While, on a trailing basis, not as cheap as the companies listed above, this ASX share trades on a modest 14.5 times earnings and a trailing franked dividend yield of 5.8%.

The post Amidst the ongoing tech stock wreck, value shares are everywhere. There's just one catch… appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) wobbled in and out of the green on Thursday before ultimately closing slightly higher. The index ended the day 0.03% higher at 6,817.5 points.

It followed a similarly choppy night on Wall Street. The Dow Jones Industrial Average Index (DJX: .DJI), S&P 500 Index (SP: .INX), and Nasdaq Composite Index (NASDAQ: .IXIC) each stumbled at the last hurdle on Wednesday to post respective losses of 0.1%, 0.2%, and 0.4%.

Higher oil prices likely buoyed the ASX 200 today. The S&P/ASX 200 Energy Index (ASX: XEJ) led the Aussie bourse, gaining 2.2%.

Its day in the green came amid news the OPEC+ agreed to drop oil production by two million barrels a day, thereby assumably increasing demand. Seemingly in response, the Brent crude oil price lifted 1.7% to US$93.37 a barrel overnight, and the US Nymex crude oil price rose 1.4% to US$87.76 a barrel.

The S&P/ASX 200 Materials Index (ASX: XMJ) also gained 0.5% today, while the S&P/ASX 200 Real Estate Index (ASX: XRE) weighed on the market, falling 0.9%.

All in all, five of the index's 11 sectors closed higher on Thursday, but which ASX 200 share outperformed all others? Keep reading to find out.

Top 10 ASX 200 shares countdown

The Whitehaven Coal Ltd (ASX: WHC) share price led the iconic index today, gaining 7% and reaching a new all-time high in intraday trade.

Today's biggest gains were made by these shares:

Our top 10 ASX 200 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.

The S&P/ASX 200 Index (ASX: XJO) posted a partial recovery today, led by energy shares. The index closed 0.21% higher at 6,842.90 points.

The market's day in the green came on the back of its worst session in three months which saw the ASX 200 tumble 2.58% yesterday.

Wall Street – which weighed heavily on the Aussie bourse yesterday – lifted overnight. The Dow Jones Industrial Average Index (DJX: .DJI) rose 0.1% and the S&P 500 Index (SP: .INX) increased 0.3%.  The Nasdaq Composite Index (NASDAQ: .IXIC), meanwhile, gained 0.7%.

Today, the S&P/ASX 200 Energy Index (ASX: XEJ) rallied, posting a 3.7% increase, with coal miners leading the way.

The S&P/ASX 200 Financials Index (ASX: XFJ) and the S&P/ASX 200 Industrials Index (ASX: XNJ) also gained 1.1% and 0.3% respectively.

Sadly, all other sectors closed lower, with the S&P/ASX 200 Real Estate Index (ASX: XRE) weighing heaviest, falling 0.9%.

But which share outperformed all others on Thursday? Let's take a look.

Top 10 ASX 200 shares countdown

The index's top performer on Wednesday was coal producer Coronado Global Resources Inc (ASX: CRN).

It's been on a roll lately amid rising coal prices and bullish brokers. Find out more about the company and what it's been up to here.

Today's biggest gains were made by these shares:

Our top 10 ASX 200 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.

The S&P/ASX 200 Index (ASX: XJO) is having a rough start to the week, sliding 0.76%, but these three ASX shares are still struggling to keep up with the market.

They've got a reasonable excuse for their underperformance right now, however. They're all trading ex-dividend today.

That means, from now on, anyone snapping up the stocks won't be eligible to receive their upcoming dividends.

Let's take a closer look at three ASX 200 shares passing the unfortunate milestone on Monday.

3 ASX 200 shares trading ex-dividend today

Vicinity Centres (ASX: VCX)

Shares in ASX 200 real estate investment trust (REIT) Vicinity Centres are trading ex-dividend today. The stock has slipped 1.54% to trade at $1.92 at the time of writing.

The company announced a 5.7 cent, unfranked final dividend last week, representing a portion of its $.2 billion full-year after-tax profit.

From today, those buying into the REIT's shares won't get their hands on the payout. It will start to hit investors' accounts on 12 September.

Magellan Financial Group Ltd (ASX: MFG)

ASX 200 funds management business Magellan is also in the red today. Its share price is down 10.77%, trading at $12.88, likely at least partially due to its ex-dividend date.

The company declared a 68.9 cent, 80% franked dividend within its financial year 2022 earnings, released last week. That left its stock trading with a whopping 12.4% dividend yield as of yesterday's close.

Those that were invested in the stock on Friday will receive the payout early next month.

Aurizon Holdings Ltd (ASX: AZJ)

The final ASX 200 share trading ex-dividend today is Aurizon. The rail freight operator's share price is currently falling 4.18% to trade at $3.785.

The company revealed a 10.9 cent, fully franked final dividend on 8 August, representing a 24% cut on its previous final payout.

That dividend will be paid out on 21 September to those on the company's registry as of Friday's close.

The post 3 ASX 200 shares trading ex-dividend today appeared first on The Motley Fool Australia.