If you're in the market for some ASX dividend shares, then you might want to check out the two listed below.

These ASX dividend shares are on Morgans' best ideas list for the month of March. Here's why it rates them highly:

Telstra Corporation Ltd (ASX: TLS)

Telstra is on the broker's best ideas list again in March with an add rating and price target of $4.70.

Morgans is very positive on the company due to the success of its turnaround and its recent restructure. It believes the latter could unlock value from asset divestments. It explained:

After a major turnaround, TLS has emerged in good shape with strong earnings momentum and a strong balance sheet. In late CY22 shareholders vote on Telstra's legal restructure, which opens the door for value to be released. TLS currently trades on ~7x EV/EBITDA. However some of TLS's high quality long life assets like InfraCo are worth substantially more, in our view. We don't think this is in the price so see it as value generating for TLS shareholders. This, free option, combined with likely reputational damage to its closest peer, following a major cybersecurity incident, means TLS looks well placed for the year ahead.

As for dividends, the broker is forecasting fully franked dividends of 17 cents per share in FY 2023 and FY 2024. Based on the current Telstra share price of $4.12, this will mean yields of 4.1%.

Transurban Group (ASX: TCL)

Toll road operator Transurban could be another ASX dividend share to consider. Morgans has it on its best ideas list with a $14.21 price target.

Its analysts believe the company is an attractive option for investors given the quality of its assets and growth potential. The broker explained:

TCL owns a pure play portfolio of toll road concession assets located in Melbourne, Sydney, Brisbane, and North America. This provides exposure to regional population and employment growth and urbanisation. Given very high EBITDA margins, earnings are driven by traffic growth (with recovery from COVID) and toll escalation (roughly 70% by at least CPI and approximately one-quarter at a fixed c.4.25% pa). We think TCL will continue to be attractive to investors given its market cap weighting (important for passive index tracking flows), the high quality of its assets, management team, balance sheet, and growth prospects.

Morgans is forecasting dividends per share of 57 cents in FY 2023 and then 64.5 cents in FY 2024. Based on the current Transurban share price of $14.24, this will mean yields of 4% and 4.5%, respectively.

The post These are the best ASX dividend shares to own: Morgans appeared first on The Motley Fool Australia.

Fund manager Matthew Haupt from Wilson Asset Management (WAM) has identified some of the most important factors that investors should consider in 2023 with their ASX share portfolio.

Last year saw a large change to the economic landscape as central banks in Australia, the United States and elsewhere ramped up interest rates to try to tame inflation.

In Haupt's view, the economy is likely to slow this year and that could end up having a damaging impact on "bad management teams and poor strategies", according to reporting by The Australian.

What's going on with the economy?

A month ago, the Reserve Bank of Australia (RBA) increased the Australian cash rate target by 25 basis points to 3.35%. It's expected to increase the interest rate again to 3.6% this week.

Households and ASX shares are now feeling the impact of those rate rises.

While the six months to 31 December 2022 saw "strong resilience" by many companies, the environment has "clearly turned", according to The Australian's reporting.

Inflation has helped the revenue side for some businesses, but costs are also going higher – wages, fixed costs, and borrowing costs are more expensive, Haupt noted.

Haupt said:

Best breed management will shine in this environment, whereas the weak will get shown up. If you've got the wrong management, wrong culture and wrong strategy, it all falls apart.

Now it is crunch time. Managers have two choices: cut jobs and increase productivity. Good ones will do a combination of both – bad managers will probably just cut jobs.

Time to be defensive?

The WAM Leaders portfolio is positioned defensively, with a strong allocation to infrastructure names like Atlas Arteria Group (ASX: ALX) and Transurban Group (ASX: TCL).

The idea is that infrastructure can, and tends to, perform well regardless of what's happening in the economy. At the moment, there are a number of negative indicators, including slowing business and consumer confidence.

Another name that Haupt pointed out was high-quality office owner DEXUS Property Group (ASX: DXS) which trades at a 40% discount to its net tangible assets (NTA). That one looks "compelling" despite the economic outlook.

Other names included packaging business Orora Ltd (ASX ORA), and insurer QBE Insurance Group Ltd (ASX: QBE), which is benefiting from rising interest rates and hiking insurance premiums.

However, Haupt is becoming more cautious about ASX bank shares. Not necessarily because of bad debts but due to strong competition that could hurt their margins.

Haupt suggested that interest rates could stay higher for years. He said:

We could be in for a (Alan) Greenspan era where you're cutting, raising and cutting rates as we navigate inflation. That's why it's prudent to have the slight defensive view.

Defensives do well when the economy goes bad, but defensives do well when interest rates fall too. The cash flows means you're going to get revalued up. That makes them a safe bet right now.

The post Why you need defensive ASX shares in your portfolio right now: WAM appeared first on The Motley Fool Australia.

Do you want a passive income boost? If you do, then the ASX dividend shares listed below that experts have named as buys could help you.

Here's why these could be passive income shares to buy now:

Harvey Norman Holdings Limited (ASX: HVN)

Goldman Sachs thinks investors should seize on recent weakness in the Harvey Norman share price. Especially if you want some big dividends!

The broker believes the market is undervaluing Harvey Norman and notes that its shares are trading at just 6x FY 2024 estimated earnings ex-property. This compares to 14.5x earnings for its rival JB Hi-Fi Limited (ASX: JBH).

Goldman currently has a buy rating and $4.70 price target on the retailer's shares.

As for dividends, the broker is expecting fully franked dividends per share of 36 cents in FY 2023 and then 30 cents in FY 2024. Based on the current Harvey Norman share price of $3.71, this will mean yields of 9.7% and 8.1%, respectively.

Transurban Group (ASX: TCL)

Another ASX dividend share for investors to consider buying next week is toll road operator Transurban.

The team at Citi is positive on the company. It was pleased with its half-year results last month and expects the company to build on this in the second half and FY 2024. Particularly given its positive exposure to inflation. It commented:

We believe TCls' 7.5% FY23 DPS guidance beat was driven by a range of one-off factors, along with improved traffic recovery. While this is positive for near term, longer term estimates remain largely unchanged. However, CPI-linked increases come through with a delay indicating a strong growth path ahead and we forecast c.6% p.a. DPS CAGR from FY23-FY26.

Citi has a buy rating and $16.00 price target on its shares.

In respect to dividends, the broker is forecasting dividends per share of 58 cents in FY 2023 and then 60 cents in FY 2024. Based on the current Transurban share price of $13.94, this will mean yields of 4.2% and 4.3%, respectively.

The post Give yourself a passive income boost with these ASX dividend shares: experts appeared first on The Motley Fool Australia.

With an economy slowing to a grind after nine consecutive months of interest rates rises, picking ASX shares to buy has never been more hazardous.

If the underlying business does not have growth drivers that can withstand consumers closing their wallets, earnings could be significantly impacted.

Considering this dilemma, here are three ASX shares that experts have declared as a buy this week:

Growing through economic cycles

While Australians might have less disposable income to spend, with employment still at historically high levels, toll roads are seeing high usage.

This is where Transurban Group (ASX: TCL) comes in.

"Transurban owns and operates toll roads in Australia and the US," Marcus Today equity analyst Damien Shaw told The Bull.

"Its latest financial half-year report revealed record traffic volumes, with average daily traffic exceeding 2.5 million trips. This resulted in record proportional toll revenue of $1.658 billion."

The Transurban share price has already risen more than 10% this year, all while paying out a dividend yield of 3.7%.

But Shaw would buy now for even further potential.

"Transurban continues to grow and achieve its strategic goals through economic cycles," he said. 

"This reflects the quality of its asset portfolio."

'Dominant market position'

Online classifieds site Carsales.com Ltd (ASX: CAR) doesn't quite have a monopoly, but it is the biggest player in its field.

According to Shaw, its half-yearly results "mostly met market expectations". 

"Strong revenue growth across all divisions was assisted by Carsales' dominant market position and investment in technology."

For a technology-related growth company, the share price hasn't done too badly. It is up 13.5% over the past year and 10.8% year to date.

Carsales.com's business is one that benefits from the network effect.

"Appealing to a huge audience of online automotive buyers and sellers lifts inventory, to the detriment of competitors."

According to CMC Markets, seven out of 15 analysts currently agree with Shaw that Carsales is a buy.

'We expect continuing strong demand'

Quite different from critical infrastructure and dominant market position, but still a tailwind, is the demand for copper.

For Red Leaf Securities chief John Athanasiou, Sandfire Resources Ltd (ASX: SFR) is the best stock to buy to play that theme.

"Copper is a dominant revenue stream for Sandfire," he said.

"It produced more than 48,000 tonnes of copper in the first half of fiscal year 2023."

Athanasiou reminded investors that copper is "a critical element in producing batteries for electric vehicles". 

"We expect continuing strong demand for copper moving forward." 

The Sandfire share price has gained 5.4% since the start of the year.

The post 3 'quality' ASX shares to buy now before they rocket: experts appeared first on The Motley Fool Australia.

Here's why these could be passive income shares to buy now:

South32 Ltd (ASX: S32)

The first ASX dividend share that has been named as a buy is mining giant South32.

Morgans was impressed with its recent half-year result and notes that its earnings came in comfortably ahead of expectations. The broker commented:

Broad cost pressures remain for S32, but not as much as the market expected, with the company comfortably beating earnings expectations in 1H23. Lower FX was a key driver for the beat, while some further moderation in cost pressures could help 2H23. S32 remains confident that the quantum of development capex for the Taylor's Deposit has not changed since its mid-2021 PFS.

In response, the broker maintained its rating and $5.60 price target.

Its analysts expect this to underpin fully franked dividends per share of approximately 17.4 cents in FY 2023 and 22 cents in FY 2024. Based on the current South32 share price of $4.41, this will mean yields of 3.9% and 5%, respectively.

Transurban Group (ASX: TCL)

Another ASX dividend share for investors to consider is toll road operator Transurban.

Citi was pleased with its half-year results earlier this month and believes there's more to come. Particularly given its positive exposure to inflation. It explained:

We believe TCls' 7.5% FY23 DPS guidance beat was driven by a range of one-off factors, along with improved traffic recovery. While this is positive for near term, longer term estimates remain largely unchanged. However, CPI-linked increases come through with a delay indicating a strong growth path ahead and we forecast c.6% p.a. DPS CAGR from FY23-FY26.

The broker has a buy rating and $16.00 price target on its shares.

In addition, Citi is now forecasting dividends per share of 58 cents in FY 2023 and then 60 cents in FY 2024. Based on the current Transurban share price of $14.12, this will mean yields of 4.1% and 4.25%, respectively.

The post Want an income boost? Buy these ASX dividend shares: experts appeared first on The Motley Fool Australia.

Anyone who has searched for inflation-beating passive income from ASX shares in recent times has at one stage or another likely considered BHP Group Ltd (ASX: BHP) and its dividends.

The resource titan has long been a provider of decent dividends. More so over the past five or so years. Although, if the company's recent 40% interim dividend slashing is anything to go by, the days of near double-digit yields could be disappearing right before our eyes… at least for now.

That's why I'd personally look elsewhere for large and growing dividends.

Where I'd go to find defensive dividends

A weakened economy induced by additional interest rate hikes could mean further deterioration in commodity prices. If so, this could put BHP's dividend yield under further strain.

While the current yield of ~8% is still juicy as a passive income source, there's every chance that it could trend back toward its pre-pandemic average of around 4.7%. The same could be said for other companies that are more influenced by the degree of consumer spending, including ASX retail shares, travel, etc.

Instead, I would look to companies operating in markets that are less sensitive to consumer sentiment. Some sectors that meet this condition in my eyes are transport, healthcare, and consumer staples. From there, it's a matter of finding fundamentally strong businesses.

These ASX shares offer yields above 5%

The first two companies I'd consider buying instead of BHP for defensive passive income are Healius Ltd (ASX: HLS) and Metcash Limited (ASX: MTS).

Neither of these two will necessarily knock your socks off in terms of growth. However, both companies operate in industries that are relatively insulated from economic weakness.

Firstly, Healius is a provider of pathology and radiology services. Regardless of the state of the economy, if someone feels sick or breaks an arm they'll need to make use of services made available by Healius. The ASX share currently offers a dividend yield of 5.5%, and if profits persist, there is potential for this to grow considering the modest payout ratio of 32%.

In a similar fashion, Metcash has a low reliance on the ebbs and flows of the economy. The $3.95 billion company operates food, liquor, and hardware stores; typically products that people 'need' rather than 'want'.

Right now, Metcash provides a passive income of 5.5% as well. Though, this might mediate somewhat in the near term as its forecast payout ratio exceeds 100%. Nevertheless, a constant demand for food gives Metcash a level of protection for its future payments.

Trading off yield for defensiveness

The third and final ASX share I'd latch onto for income instead of BHP is Transurban Group (ASX: TCL). Unlike the others, I don't foresee Transurban offering a better dividend than BHP any time soon. But what it lacks in yield it makes up for in its low risk.

In my opinion, Transurban is an incredibly defensive company. High upfront cost infrastructure is a quality moat, and Transurban's toll roads are exactly that. It can cost billions to build these assets, but once constructed, a well-planned toll road has little in the way of competition.

Furthermore, this type of business is less sensitive to economic cycles — though some suggest otherwise. During the GFC, Transurban reported underlying growth as drivers continued to seek a shorter route.

At present, a 3.7% dividend yield is up for grabs in Transurban shares. This is still above the percentage available in the S&P/ASX 200 Index (ASX: XJO) when excluding the top 20 which is dominated by the banks and miners.

The post 3 ASX shares I'd buy for passive income instead of BHP's declining dividend appeared first on The Motley Fool Australia.

WAM operates several listed investment companies (LICs), including WAM Capital Limited (ASX: WAM) and WAM Research Limited (ASX: WAX).

There's also one called WAM Leaders Ltd (ASX: WLE) that looks at the larger businesses on the ASX, often referred to as ASX blue-chip shares.

WAM says WAM Leaders actively invests in the highest quality Australian companies. But does WAM have a good reputation for picking stocks?

The WAM Leaders portfolio has delivered gross returns (before fees, expenses, and taxes) of 15.2% per annum since its inception in May 2016. This compares to the S&P/ASX 200 Accumulation Index average return of 9.2% over the same period.

The fund manager commented that infrastructure is a key theme in the WAM Leaders' investment portfolio given the "high-quality names" with defensive, inflation-linked cash flows sheltered from the full severity of the economic downturn.

It also said that infrastructure names are yield sensitive and will benefit from central banks pausing rate hikes. The fund manager said, "This is the economic environment we believe we are facing over the coming years."

WAM outlined these ASX 200 shares in its recent monthly update.

Transurban Group (ASX: TCL) and Atlas Arteria Group (ASX: ALX)

Both of these businesses are toll road companies, which are involved with developing, operating, and maintaining toll road networks.

Transurban is mostly Australian-based, with roads such as CityLink in Melbourne and WestConnex in Sydney.

Meanwhile, Atlas Arteria operates in France, Germany, and the US. The most recent Atlas investment is the Chicago Skyway, a 12.5km transport link in the US's third largest metropolitan area, with a concession life of more than 80 years.

WAM said that the investment team believes both ASX 200 shares will offer "strong earnings growth over the coming years as well as significant dividend yields".

APA Group (ASX: APA)

The fund manager described APA as an energy infrastructure business playing a "key role" in Australia's energy transition. This includes a range of opportunities from "expanding the East Coast Grid to bring gas to southern markets ahead of forecast shortfalls as well as building new renewable energy solutions".

The investment team at WAM Leaders explained:

We remain positive on this business with 85% of its revenue guaranteed through its take-or-pay revenue agreement, positive inflation exposure and 100% interest cost hedging over the next six years.

The post 3 ASX 200 shares that could drive strong returns in an inflationary world: expert appeared first on The Motley Fool Australia.

Well, two ASX shares that tick these boxes are listed below. Here's why analysts rate them as buys:

Charter Hall Long WALE REIT (ASX: CLW)

The first ASX share for investors to consider for a retirement portfolio is the Charter Hall Long Wale REIT.

This is a property company that invests in high quality real estate assets that have long weighted average lease expiries (WALEs). These properties are leased mainly to corporate and government tenants and had a WALE of 11.8 years and a 99.9% occupancy rate when it reported its half year results this month.

That result went down well with analysts at Citi. In response, the broker has retained its buy rating with a $5.00 price target. It commented:

We re-iterate our Buy rating on CLW, with rising inflation providing a tailwind to revenue, a 6.1% FY23 dividend yield, and a- 25% discount to NTA (book value), despite c. 50% of income linked to inflation (meaning some protection to book values).

Citi expects this to underpin dividends per share of 28 cents in FY 2023 and 29 cents in FY 2024. Based on the current Charter Hall Long Wale REIT unit price of $4.59, this will mean yields of 6.1% and 6.3%, respectively.

Transurban Group (ASX: TCL)

Another ASX share for investors to consider for a retirement portfolio is Transurban.

It is a leading toll road operator with a portfolio of important roads in Australia and North America, as well as a significant project pipeline. The latter could be very supportive its growth in the future.

It also recently released its first half results and revealed that its roads are booming again after a difficult time during the pandemic. The company commented:

Record traffic volumes with Average Daily Traffic (ADT) exceeding 2.5 million trips for the first time in November 2022. Traffic volumes were supported by record traffic in Sydney and Brisbane, freight traffic and weekend travel

Macquarie was pleased with what it saw and retained its outperform rating with an improved price target of $14.51.

In addition, the broker is now forecasting dividends per share of 57 cents in FY 2023 and then 61 cents in FY 2024. Based on the current Transurban share price of $13.93, this will mean yields of 4.1% and 4.4%, respectively.

The post 2 excellent ASX shares to buy for a retirement portfolio: experts appeared first on The Motley Fool Australia.

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

Liontown Resources Ltd (ASX: LTR)

According to a note out of Macquarie, its analysts have retained their outperform rating and $2.60 price target on this lithium developer's shares. This follows the commencement of open pit mining at the Kathleen Valley lithium project. And while Macquarie continues to expect production to commence in the middle of 2024, it sees revenue-generating opportunities from direct shipping ore (DSO) before then. This revenue is not included in its estimates, which poses upside risk to them and its valuation. The Liontown share price ended the week at $1.44.

Suncorp Group Ltd (ASX: SUN)

A note out of Goldman Sachs reveals that its analysts have retained their buy rating on this insurance giant's shares with an improved price target of $14.47. Goldman was pleased with Suncorp's half year results and has increased its underlying margin estimates for FY 2023 to reflect a stronger than expected performance. Goldman suspects that Suncorp could be benefiting from earlier repricing, stronger yields, and better management of claims inflationary pressures. The Suncorp share price was fetching $12.82 at Friday's close.

Transurban Group (ASX: TCL)

Analysts at Citi have reiterated their buy rating on this toll road operator's shares with an increased price target of $16.00. This follows the release of the company's half year results. Citi remains positive on Transurban's future. Particularly given that inflation-linked toll increases come through with a delay. It feels this indicates a strong growth path ahead and expects it to underpin a ~6% per annum dividends per share compound annual growth rate (CAGR) from FY 2023 to FY 2026. The Transurban share price ended the week at $13.97.

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

Both have been named as buys by analysts recently and tipped to provide attractive yields. Here's what you need to know about them:

Transurban Group (ASX: TCL)

The first ASX 200 dividend share for income investors to consider buying is Transurban.

It is a toll road operator that owns a world-class portfolio of toll roads in Australia and North America. This includes CityLink in Melbourne, Cross City Tunnel in Sydney, AirportlinkM7 in Brisbane, and 95 Express Lanes in Greater Washington, United States.

It also has a sizeable project pipeline, including the West Gate Tunnel, which looks set to support its growth in the coming years.

Citi is a fan of the company. In response to Transurban's half year results this week, the broker has retained its buy rating with a $16.00 price target.

It has also bumped its dividend forecasts up to 57.5 cents per share in FY 2023 and 59.6 cents per share in FY 2024. Based on the current Transurban share price of $14.03, this will mean yields of 4.1% and 4.25%, respectively.

Wesfarmers Ltd (ASX: WES)

Wesfarmers could be another ASX 200 dividend share to buy.

It the conglomerate behind a range of businesses such as Bunnings, Catch, Covalent Lithium, Kmart, Officeworks, and Priceline.

The team at Morgans is positive on Wesfarmers and believes it is well-placed to grow its dividend in the coming years.

For example, its analysts are forecasting fully franked dividends per share of $1.82 in FY 2023 and then $1.89 in FY 2023. Based on the current Wesfarmers share price of $49.31, this will mean yields of 3.7% and 3.9%, respectively, over the next two financial years.

Morgans also sees room for its shares to climb from current levels. It has an add rating and $55.60 price target on them.

The post Analysts say these growing ASX 200 dividend shares are top buys for income investors appeared first on The Motley Fool Australia.

The S&P/ASX 200 Index (ASX: XJO) might have another passive income winner this financial year, with toll road operator Transurban Group (ASX: TCL) on track to post a notable full-year dividend.

The company upgraded its financial year 2023 dividend guidance earlier this week as it returned to profit in the first half.

Despite all that, the Transurban share price has slumped this week. Right now, the stock is trading for $14.085, 0.7% lower than it was at Friday's close.

Though, that's a better performance than the ASX 200's 0.9% drop over the course of this week so far.

So, how much might the ASX 200 giant offer investors later this year? Let's take a look.

Transurban to pay 57 cents of dividends per share in FY23

Owners of shares in ASX 200 giant Transurban may have had a happy surprise earlier this week when the company revealed it's aiming to payout 57 cents per share this financial year.

That's significant passive income and up from just 41 cents per share last fiscal year – marking a potential 39% year-on-year improvement.

That would see the stock boasting a 4% dividend yield at its current share price.

Transurban was previously planning to offer investors 53 cents per share for the period but boosted its expectations following a period of record revenue and traffic volumes. CEO Scott Charlton commented:

With positive traffic growth across our key markets, embedded inflation-linked protection on the majority of revenue, and the continued progress on key project milestones, we are well-placed to deliver on growth in future cash flow.

The company declared its 26.5 cents per share interim dividend independently of its half-year earnings in December. That means investors can likely expect a further 30.5 cent per share offering later this year.

If that turns out to be the case, it will mark the ASX 200 company's second-highest dividend offering ever, bested only by its 31 cents per share interim financial year 2020 payout. And it might not be long until that record is beaten.

What's next for the ASX 200 dividend share?

Citi has tipped an approximate 6% per annum dividend per share compound annual growth rate (CAGR) between now and financial year 2026, my Fool colleague James reports.

Meanwhile, Goldman Sachs expects Transurban's dividend to come in at 58 cents per share this fiscal year, 63 cents per share next financial year, and 67 cents per share in financial year 2025.

The post Guess which ASX 200 giant is aiming to grow its dividends by 39% in FY23 appeared first on The Motley Fool Australia.

That's because the ASX traditionally provides investors with an average dividend yield of approximately 4%.

However, you don't have to settle for that yield. If you look around, you can find ASX 200 shares that are forecast to provide even greater yields.

For example, two high yield ASX 200 dividend shares that have been rated as buys are listed below. Here's what you need to know about these shares and their forecast yields:

Westpac Banking Corp (ASX: WBC)

The first ASX 200 dividend share that could provide investors with a big yield this year is Westpac.

According to a note out of Goldman Sachs, its analysts are expecting the big four bank to reward shareholders with a fully franked dividend of 148.4 cents per share in FY 2023.

Based on the current Westpac share price of $23.90, this will mean an attractive 6.2% dividend yield for investors.

Goldman also sees a lot of value in the shares of Australia's oldest bank. It has a conviction buy rating and $27.68 price target on them.

Woodside Energy Group Ltd (ASX: WDS)

Another ASX 200 share that analysts are expecting a big dividend yield from in 2023 is Woodside Energy.

A note out of Morgan Stanley reveals that its analysts are expecting the energy giant to pay a fully franked $2.72 per share dividend in FY 2023. Based on the current Woodside share price of $36.39, this equates to a sizeable 7.5% dividend yield for investors.

Morgan Stanley also sees plenty of upside for the Woodside share price over the next 12 months. It currently has an overweight rating and $41.00 price target on the energy producer's shares.

The post Expect big yields from these ASX 200 dividend shares in 2023: analysts appeared first on The Motley Fool Australia.

Three ASX shares brokers have named as buys this week are listed below. Here's why they are bullish on them:

Macquarie Group Ltd (ASX: MQG)

A note out of Morgans reveals that its analysts have retained their add rating on this investment bank's shares and lifted their price target on them to $214.50. This follows a third quarter update which was well ahead of expectations. Morgans was expecting financial year to date earnings to be down 6% on the prior corresponding period, but they were up slightly. This was driven by an exceptional performance from the Commodities and Global Markets business and has led to Morgans bumping its full year earnings estimates by 4%. The Macquarie share price is trading at $195.57 this afternoon.

Qualitas Ltd (ASX: QAL)

According to a note out of Goldman Sachs, its analysts have retained their buy rating and lifted their price target on this investment company's shares to $3.90. The broker has also added Qualitas to its coveted conviction list. Goldman made the move on the back of its positive view on the opportunities for the company to deploy funds under management and grow earnings over the coming years. The Qualitas share price is fetching $2.86 on Wednesday.

Transurban Group (ASX: TCL)

Analysts at Citi have reiterated their buy rating on this toll road operator's shares with a $16.00 price target. Although the broker notes that Transurban's half year result was boosted by one-off factors, it was still pleased and remains positive on the future. Particularly given that CPI-linked increases come through with a delay, which it feels indicates a strong growth path ahead. So much so, Citi is forecasting a ~6% p.a. dividends per share CAGR from FY23 to FY26. The Transurban share price is trading at $14.03 today.

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

The Transurban Group (ASX: TCL) share price is in the green this morning after the company posted record earnings and traffic, and bolstered its full-year dividend guidance, as The Motley Fool Australia reported earlier.

However, market watchers might still be wary of a leadership reshuffle. The company today announced its long-term CEO and executive director Scott Charlton will step down at the end of the year.

Right now, the Transurban share price is trading 0.71% higher at $14.13.

Let's take a closer look at what's going on with the S&P/ASX 200 Index (ASX: XJO) toll road operator on Tuesday.

Transurban share price slumps on CEO exit

The Transurban share price has so far defied Citi's expectations of a slump today, instead gaining amid the planned exit of its CEO.

Charlton has held the company's top spot for 11 years. He stood at the helm as it grew its assets from six to 22 tollroads and its market capitalisation to over $43 billion, Transurban chair Craig Drummond commented.

Citi analyst Suraj Nebhani said Charlton's exit "will be seen as a loss for Transurban investors", The Australian reports. Though, the broker is said to still tip Transurban shares as a buy with a $15.70 price target.

Meanwhile, Goldman Sachs has retained its sell rating on the stock despite the company's free cash flow and dividend guidance surprising on the upside. The broker has a $13.50 price target on the stock.

Charlton didn't give a reason for his departure. However, he said he remains "confident in Transurban's future".

 A global search for a new CEO is underway, supported by recruitment firm Russell Reynolds.

Meanwhile, Transurban announced it will sell a 50% interest in its Canadian A25 asset to global investment group CDPQ for around $384 million ($355 million Canadian). Charlton said:

Both parties are aligned on the long-term aspirations for the North American market and we look forward to pursuing new opportunities together.

First-half earnings recap

In case you missed it, Transurban posted a $55 million profit for the first half of financial year 2023, up from a previous $106 million loss.

It also revealed record proportional toll revenue – coming in at $1.66 billion – and proportional earnings before interest, tax, depreciation, and amortisation (EBITDA) of $1.24 billion.

The company bumped its full-year dividend guidance to 57 cents per share – up from 41 cents per share last fiscal year.

The post Transurban share price gains on earnings, dividend guidance boost appeared first on The Motley Fool Australia.

The Transurban Group (ASX: TCL) share price is on watch after the toll road operator dropped its earnings for the first half of financial year 2023.

It also announced the upcoming departure of long-term CEO Scott Charlton and a new partnership with CDPQ.

The S&P/ASX 200 Index (ASX: XJO) infrastructure share last traded at $14.03.

Transurban share price surges on record earnings

• Proportional toll revenue reached a record $1.66 billion – up 42.6% on the prior comparable period (pcp)
• Proportional total revenue jumped 41.1% on the pcp to $1.72 billion
• Proportional earnings before interest, tax, depreciation, and amortisation (EBITDA) rose 53.7% to $1.24 billion
• Post-tax profit of $55 million– up from a $106 million loss in the pcp
• Free cash, including capital releases, increased 88% to $863 million
• Declared a 26.5 cents per share interim dividend – a 76.7% increase

Transurban saw record traffic volumes last half, with its average daily traffic (ADT) surpassing 2.5 million trips in November 2022.

The company's record revenue and EBITDA were supported by such traffic levels, as well as inflation-linked toll increases.

Transurban continued work at many of its developments last half, with Sydney's M4-M8 link opening last month. Work also continued at Melbourne's West Gate Tunnel Project. The tunnel excavation is expected to be done by the middle of the year.

Transurban announces CEO resignation and new partnership

Transurban also announced its CEO of 11 years will be stepping down at the end of 2023. The company has begun a global search for a new CEO. Commenting on Charlton's resignation, chair Craig Drummond said:

Scott has been a visionary in the industry … under his leadership, the company has grown to become an ASX 20 listed entity, increasing its market capitalisation by more than five times to over $43 billion and has delivered total security holder returns of 289%.

Meanwhile, it's again partnered with global investment group CDPQ, this time on its A25 asset in Montreal, Canada. The group was also a co-investor in Sydney's WestConnex. CDPQ will take on a 50% partnership in the asset for CAD$355 million (around $383.7 million).

What did management say?

Charlton commented on the earnings release likely to drive the Transurban share price today, saying:

Our roads have benefitted from freight volumes which achieved an all-time high, ongoing traffic growth in our core markets, and the continued investment in business capability to improve the experience for our more than 10 million customers.

We have seen record traffic in Brisbane, as well as in Sydney … This performance was underpinned by the urban nature of our roads, demonstrating that the diversity of everyday journeys across commuting, travel and leisure trips provides resilience throughout economic cycles

What's next?

Charlton said around 68% of the company's toll revenue is linked to CPI escalations, but the timing of the escalations can be delayed.

As such, the flow through from recent higher inflation figures hasn't yet been recognised in some markets.

It also upped its previous full-year dividend guidance by 4% to 57 cents per share.

Transurban share price snapshot

The Transurban share price has been outperforming the ASX 200 as of late.

The stock has gained 9.5% year to date compared to the index's 8.5% increase.

Transurban shares have also risen 9.2% over the last 12 months. Meanwhile, the ASX 200 has lifted 6%.

The post Transurban share price in focus following record first half appeared first on The Motley Fool Australia.

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

ASX 200 expected to edge higher

The Australian share market looks set to edge ever so slightly higher on Tuesday following a poor night of trade on Wall Street. According to the latest SPI futures, the ASX 200 is poised to open the day 1 point higher. In late trade in the United States, the Dow Jones is down 0.1%, the S&P 500 is down 0.55%, and the NASDAQ is down 0.85%.

Oil prices rise

Energy shares Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could have a decent day after oil prices pushed higher overnight. According to Bloomberg, the WTI crude oil price is up 0.9% to US$74.05 a barrel and the Brent crude oil price is up 1.25% to US$80.92 a barrel. Traders appear to believe oil prices were oversold after dropping 8% last week.

RBA meeting

All eyes will be on the Reserve Bank of Australia this afternoon when the central bank makes its cash rate decision. According to the latest cash rate futures, there's a 80% probability that the RBA will lift the cash rate by 25 basis points to 3.35%. Anything more than this could spook investors and put pressure on the ASX 200 index.

Gold price rises

It could be a better day for gold miners Evolution Mining Ltd (ASX: EVN) and Regis Resources Limited (ASX: RRL) after the gold price rose overnight. According to CNBC, the spot gold price is up 0.4% to US$1,884.3 an ounce. Economic growth concerns boosted demand for the safe haven asset.

Transurban results

The Transurban Group (ASX: TCL) share price will be one to watch this morning. That's because the toll road giant is scheduled to release its half year results today, with the market expecting a net profit after tax of $144.7 million and an interim dividend of 26 cents per share.

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

Over several decades, through his Berkshire Hathaway business, the Oracle of Omaha has delivered stunning returns for investors.

The good news is that Buffett has achieved these feats without any fancy high frequency trading strategy. Instead, he has made long term investments in high quality companies and let compounding work its magic.

The even better news is that there's nothing to stop you from following Buffett's investment style to grow your own wealth.

But which ASX shares could be Buffett-style investments right now? Two that tick a lot of boxes are listed below. Here's what you need to know about them:

Transurban Group (ASX: TCL)

One quality that Buffett looks for when making investments is a competitive advantage or moat. This is something that this toll road operator has with its portfolio of key assets across Australia and North America. If you want to drive across Melbourne and Sydney quickly, you're probably going to have to use its roads. In fact, the company estimates that customers using Transurban roads (compared to alternative routes) saved a total of 323,000 hours of travel time each workday in FY 2022.

Citi is a fan of Transurban and has a buy rating and $15.70 price target on its shares. Its analysts are also forecasting consistent dividend growth through to FY 2025, which is likely to go down well with an investor like Warren Buffett.

VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)

Another (simple) way to invest like Buffett is to buy the VanEck Vectors Morningstar Wide Moat ETF. This is a Warren Buffett-inspired ETF that gives investors access to a diversified portfolio of companies with sustainable competitive advantages and fair valuations. At present, its holdings include businesses with strong moats such as Amazon, Intel, Microsoft, and Walt Disney.

Over the last 10 years, the index that the fund tracks has beaten the market with a total average return of 18.11% per annum. This would have turned a $10,000 investment into over $50,000.

The post Invest like Warren Buffett with these ASX shares appeared first on The Motley Fool Australia.

Two that have been tipped as buys are listed below. Here's what you need to know about them:

Transurban Group (ASX: TCL)

The first ASX 200 income share to buy is this leading toll road operator.

Transurban owns a world-class portfolio of toll roads in Australia and North America that cut travel times for millions of drivers each year. In addition, the company has a significant project pipeline that looks likely to underpin further solid growth in the coming years.

Another positive is the company's inflation exposure. As Transurban's toll road concessions are inflation linked, it stands to benefit greatly in the current environment.

It is partly for this reason that Citi is positive on the company. It currently has a buy rating and $15.70 price target on its shares.

In addition, the broker is forecasting dividends per share of 53 cents in FY 2023 and then 55.8 cents in FY 2024. Based on the current Transurban share price of $14.06, this will mean yields of 3.8% and 4%, respectively.

Westpac Banking Corp (ASX: WBC)

Another ASX 200 income share that could be a buy is Australia's oldest bank, Westpac.

With the banking sector benefiting from rising rates, the big four banks have been tipped to deliver solid earnings and dividend growth in the near term.

Westpac could potentially even grow even quicker thanks to its bold cost cutting plans.

It is because of this that Goldman Sachs has named it as the best big bank to buy right now. Its analysts have a conviction buy rating and $27.68 price target on its shares.

As for dividends, Goldman is forecasting fully franked dividends of 148.4 cents per share in FY 2023 and 160 cents per share in FY 2024. Based on the current Westpac share price of $23.50, this will mean yields of 6.3% and 6.8%, respectively.

The post Buy Westpac and this ASX 200 income share: experts appeared first on The Motley Fool Australia.

Are you…

A) Contemplating retirement and worrying about whether you'll have enough income to live on?

B) Keen to help offset the soaring cost of living without having to work longer hours?

C) Hoping to benefit from franking credits like countless other Aussies have been doing over the past 30+ years?

D) Disillusioned by the interest rate your bank is offering in exchange for locking up your hard-earned cash? 

E) Not really sure but just love the idea of getting paid for doing not much of anything?

If you answered yes to any of the above, you may be in the market for some ASX dividend shares. These types of stocks regularly divvy out a portion of their profits to their owners — the shareholders! And, with any luck (as well as top-notch management!), will also deliver share price gains over the long term as well.

But the ASX is awash with dividend shares so the decision on what to buy can be daunting.

For their thoughts, we asked our Foolish writers which income-paying stocks they are loving the look of right now. Here is what they said:      

6 best ASX dividend shares for February 2023 (smallest to largest)

• Best & Less Group Holdings Ltd (ASX: BST), $238.82 million
• Nick Scali Limited (ASX: NCK), $967.95 million
• Transurban Group (ASX: TCL), $42.47 billion
• Rio Tinto Ltd (ASX: RIO), $47.01 billion
• ANZ Group Holdings Ltd (ASX: ANZ), $75.35 billion
• Commonwealth Bank of Australia (ASX: CBA), $185.83 billion

(Market capitalisation as of 1 February 2023)

Why our Foolish writers love these ASX passive-income stocks

Best & Less Group Holdings Ltd

What it does: Best & Less describes itself as a value apparel specialty retailer with around 250 stores and an e-commerce offering. It wants to be the number one choice for families buying baby and kids' value apparel in Australia and New Zealand through Best & Less in Australia and Postie in New Zealand.

By Tristan Harrison: The Best & Less share price is down around 50% since the start of February 2022. This has had the effect of boosting the company's possible payout ratio.

Commsec numbers suggest this ASX All Ords share could pay an annual dividend per share of 23.5 cents in FY24, translating into a FY24 grossed-up dividend yield percentage in the mid-teens.

While FY23 may be tricky for profitability, I think FY24 could be positive, particularly as Best & Less adds to its store network. Six new stores are scheduled for opening in the second half of FY23, and the company is also refurbishing some existing stores. It is committed to paying a dividend of 60% to 80% of net profit.

Motley Fool contributor Tristan Harrison does not own shares in Best & Less Group Holdings Ltd.

Nick Scali Limited

What it does: Nick Scali is a furniture retailer and owner of an eponymous brand as well as the Plush – Think Sofas brand. It has more than 100 stores across Australia and New Zealand as well as a successful e-commerce platform.

By Bronwyn Allen: The Nick Scali share price has had a great start to 2023, with a 15% gain already, so I reckon value investors are already onto this one. Despite this, I believe the trailing gross dividend yield is still very attractive at 8.3%.

Sales are increasing, partly due to the company's first major acquisition — the purchase of Plush in November 2021, with integration largely completed at the end of FY22.

I'm excited to see the FY23 first-half (1H FY23) numbers due out next Monday (6 February) to get a better picture of how Plush is growing the company's earnings. Nick Scali has guided a 57% to 66% increase in net profit after tax (NPAT) in 1H FY23 compared to 1H FY22.

Motley Fool contributor Bronwyn Allen owns shares in Nick Scali Limited. 

Transurban Group

What it does: Transurban is a large-scale operator of tolled roads. It has a near monopoly on Sydney's toll roads but also owns roads in other capital cities, as well as in North America.

By Sebastian Bowen: Transurban's reputation as one of the ASX 200's safest dividend shares was trashed during the pandemic years. But the company has bounced back steadily ever since the dark days of 2020.

What I believe makes Transurban such an attractive dividend share is its resistance to inflation.

Most of Transurban's toll roads are contractually permitted to increase their tolls in line with inflation, protecting the company's earnings base from erosion.

As such, I think this is a useful company to have in any income portfolio – especially with its dividend yield closing in on 4% at recent pricing.

Motley Fool contributor Sebastian Bowen does not own shares in Transurban Group.

Rio Tinto Ltd

What it does: Rio Tinto is one of the globe's largest miners with a portfolio of world-class operations across a range of commodities.

By James Mickleboro: I think Rio Tinto could be a top option for ASX income investors in February. That's because China's reopening looks set to support robust demand for copper and iron ore, which bodes well for commodity prices.

In fact, as things stand, Rio Tinto is generating significant free cash flow, which is expected to underpin some big dividends in the near term.

Goldman Sachs, for example, is currently forecasting fully-franked dividends per share of US$4.40 (A$6.25) in FY 2023 and US$5.70 (A$8.10) in FY 2024. This equates to yields of 4.9% and 6.35%, respectively, at the time of writing.

Goldman has a buy rating and a $134.40 price target on the mining giant's shares.

Motley Fool contributor James Mickleboro does not own shares in Rio Tinto Ltd.

ANZ Group Holdings Ltd

What it does: The ANZ we know and, arguably, love was born more than 50 years ago and is now one of Australia's 'big four' ASX 200 banks. Nowadays, it provides banking and financial services to millions of retail and business customers across 32 markets.

By Brooke Cooper: ANZ is both the highest-yielding and cheapest of the big four banks on a price-to-earnings (P/E) ratio basis. It currently boasts a 5.9% dividend yield and a P/E ratio of 10.65, according to CommSec data.

I also like the company's proposed acquisition of Suncorp Group Ltd (ASX: SUN)'s banking division – set to bring greater exposure to the Queensland market. The sunshine state was crowned Australia's best-performing economy by CommSec's latest State of the States report.

Finally, ANZ is favoured by both Macquarie and Citi. They each have an equivalent buy rating on the stock, while the latter has given it a $29.25 price target and expects the bank to grow its dividends in the future.

Motley Fool contributor Brooke Cooper does not own shares in ANZ Group Holdings Ltd or Suncorp Group Ltd.

Commonwealth Bank of Australia

What it does: CBA provides a range of financial services including retail and business banking, funds management, superannuation, insurance, and broking services. With a market cap of some $185 billion, it's Australia's largest bank and the second-biggest stock trading on the ASX.

By Bernd Struben: CBA is well-respected as a long-term, reliable dividend stock.

The bank has delivered two fully franked dividends per year for well over a decade, including during the pandemic-addled 2020 market turmoil.

CommBank also offers a dividend reinvestment plan (DRP).

At the current share price, CBA pays a 3.6% trailing dividend yield, having paid out $3.85 per share in 2022. But that could well grow.

Morgan Stanley is forecasting the CBA dividend to increase the most of any of the big four banks this year to $4.50 per share, up 17% year on year.

The CBA share price has also been a strong performer, gaining almost 9% so far in 2023 and around 17.2% over the past 12 months.

Motley Fool contributor Bernd Struben does not own shares in Commonwealth Bank of Australia. 

The post Top ASX dividend shares to buy in February 2023 appeared first on The Motley Fool Australia.

It's a good day for ASX shares investors today. The S&P/ASX 200 Index (ASX: XJO) is up 0.35% and the S&P/ASX All Ordinaries Index (ASX: XAO) is up 0.34%.

There's some good economic news likely contributing to this market momentum today. The Reserve Bank of Australia has told a government hearing that it believes inflation in Australia has already peaked.

But that doesn't mean there aren't more interest rate rises coming.

Head of the RBA's economic analysis team Marion Kohler fronted the senate select committee on the cost of living today.

In her opening statement, Kohler said:

… we think the peak in inflation was at the end of 2022 – at around 8 per cent – and that inflation will begin to ease over the course of this year".

What does this mean for ASX shares?

Inflation is a problem for most ASX shares because it increases input costs for companies.

Some ASX shares are less affected by cost inflation because they can offset it. They can do this by increasing the prices they charge consumers for their products and services.

The companies that can do this without too much trouble are in the consumer staples sector of the ASX. Examples include Coles Group Ltd (ASX: COL) and Woolworths Group Ltd (ASX: WOW).

Some companies have inflation built into their contracts, which means when inflation goes up, so does their income. Examples include Transurban Group (ASX: TCL), which has about 70% of its toll road contracts linked to inflation. So, they're somewhat protected.

But all in all, most companies will tell you they prefer inflation at the lower end of the scale. Typically, the lower their costs, the higher their profits.

What about interest rates?

Inflation is the sole reason interest rates have gone up so much over the past 12 months. So, if inflation has peaked, does that mean interest rates won't go any higher?

Sorry, no.

Unfortunately, we have a long way to go before getting inflation back into the RBA's comfort zone of 2% to 3%. And that's what they want.

The latest quarterly inflation report for December showed a higher-than-expected increase in the consumer price index (CPI). It went up 1.9% over the quarter to bring the annual rate for 2022 to 7.8%.

The RBA Board is "focused on returning inflation to target", according to Kohler. This means despite the pain that rising rates are causing businesses and borrowers, they will go on.

Kohler explained that continuing to increase rates meant inflation would fall faster.

She said:

We understand that some people are finding the rise in interest rates difficult to manage and others will have to cut back on discretionary spending.

However, higher interest rates are necessary to ensure that the current period of higher inflation and cost of living pressures does not persist too long.

The impact of further increases to interest rates on ASX shares is two-fold.

Firstly, it's another rising input cost for any company with debt on its books.

Secondly, rising rates mean homeowners will keep tightening their belts, which usually means cutting back on discretionary items.

That's not good for ASX consumer discretionary shares, nor other ASX shares like travel stocks.

The RBA Board will meet again on Tuesday to make its next monthly interest rate decision.

The experts reckon a 25 basis point rise is on the cards, taking the official cash rate from 3.1% to 3.35%.

The post ASX shares investors rejoice! RBA says inflation has now peaked appeared first on The Motley Fool Australia.