10 Top Australia’Shares For Investor

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As an investor, you may be considering the opportunities in the Australian stock market, we have compiled a list of the top 10 popular Australian stocks by value. These stocks have solid financials, growth potential. 


So here are the 10 large Australian stocks across various sectors, including energy, finance, and technology.


Stock Code

Market cap

YTD performance

1-year performance

5-year performance

P/E ratio

1. BHP

AU$ 312.91B

+ 2.47%

-12.64%

50.52%

8.72

2. CBA

AU$168.40B 

-1.92%

-7.38%

37.54%

17.33

3. CSL

AU$145.61B 

6.97%

14.88%

88.52%

46.58

4. NAB

AU$89.99B

-3.26%

-14.41%

0.32%

13.36

5. WBC

AU$78.11B

-2.11%

-8.81%

-22.18%

14.45

6. ANZ

AU$72.71B 

4.22%

-12.90%

-9.54%

10.25

7. MQG

AU$70.59B 

9.32%

-12.42%

71.77%

14.16

8. FMG

AU$69.31B

9.95%

3.22%

384.45%

7.84

9. WDS

AU$65.94B

-1.58%

5.68%

10.69%

5.46

10. WES

AU$59.07B

13.62%

6.47%

73.44%

23.16

Data last updated: 17/04/23 (AEST)


1.BHP Group Limited (ASX:BHP)

Market capitalization as of April 17: AU$ 312.91 billion


BHP Group Limited (ASX: BHP) is a metals and mining firm that produces commodities like iron ore, copper, nickel, coal, potash, and petroleum. They fully own or operate their assets and have ownership stakes in joint ventures. BHP has a PE multiple of 8.72x and a gain of over 18.83% in the past 6 months.


BHP Group Limited (ASX: BHP)'s commodities may carry a premium due to the competition in relevant sectors such as electric vehicles. Its three-year revenue growth rate is 14.2%, and its net margin is nearly 46%. Although the global share market has been exposed to rapidly changing commodity prices this year, BHP Group Limited (ASX: BHP)'s earnings have been cushioned by the increase in coal prices as iron ore prices fell.


The company has been paying its dividends consistently for the past 13 years and currently pays a quarterly dividend of AU$ 4.74 per share. The stock has a dividend yield of 8.43%, as of April 17. 


BHP Group Limited (ASX: BHP) received an upgrade from CLSA on April 5 to ‘Outperform’ from ‘Underperform,’ with a price target of AU$ 46.50.

2.Commonwealth Bank of Australia (ASX:CBA)

Market capitalization as of April 17: AU$168.40 billion


Commonwealth Bank (ASX: CBA) is a leading provider of financial services across Australia, New Zealand, and globally, offering a wide range of services through its various segments. Its strengths include a renowned brand, large-scale operations, and a diverse product mix, making it one of the largest companies listed on the ASX. 


Its opportunities for growth include implementing technology to improve services, initiatives like “One Commbank” to build customer relationships, and expanding activities in emerging markets like Asia.


In H1, Commonwealth Bank (ASX: CBA) reported a cash net profit after tax of AU$6.73 billion and an interim dividend of AU$2.73 per share, up AU$0.46 YoY. Operating income was AU$ 17.69 billion, with a 19% increase in net interest income. 


However, it received a "Moderate Sell" rating from analysts, with a consensus price target of AU$ 91.14, representing an 8.11% decrease from the current price of AU$ 99.18.


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3. CSL Limited (ASX:CSL)

Market capitalization as of April 17: AU$145.61billion


CSL Limited (ASX: CSL) is an Australian biotech company that specializes in plasma-based therapies, vaccines, and pharmaceutical products. It operates in an oligopoly market with two other leaders and has operations in over 30 countries. 


CSL Limited (ASX: CSL) has high returns on capital and invests in R&D and acquisitions to drive revenue, EPS, and FCF growth. H1 FY23 results showed a 19% increase in revenue to AU$ 9.68 billion, with an unfranked interim dividend of AU$ 1.44 per share. 


Based on ratings from 11 Wall Street analysts, CSL Limited (ASX: CSL) has a ‘Strong Buy’ consensus rating with an average 12-month price target of AU$335.86, suggesting an 11.53% increase from the current price of AU$301.14.

4.National Australia Bank Limited (ASX:NAB)

Market capitalization as of April 17: AU$89.99 billion


National Australia Bank Limited (ASX: NAB) is Australia's largest business bank, providing financial services to small, medium, and large businesses throughout their lifecycle. NAB operates in Australia, New Zealand, Asia, the UK, and the US, offering quality products and services with fair fees and charges. Its portfolio includes Australian banking, wealth management, and other financial services.


National Australia Bank Limited (ASX: NAB) reported strong Full Year 2022 Results with revenue of AU$18.4 billion (up 8.9% YoY) and net income of AU$7.06 billion (up 9.4% YoY). EPS increased from AU$1.96 to AU$2.19. The dividend yield is 5.55%, and NAB declared a fully franked final dividend of AU$ 0.78 per share for FY2022, resulting in a total dividend of AU$ 1.51 per share (up 24% YoY). 


However, Wall Street analysts gave National Australia Bank Limited (ASX: NAB) a ‘Hold’ consensus rating with an average price target of AU$30.26 (up 6.31% from the current price of AU$28.46).


5.Westpac Banking Corporation (ASX:WBC)

Market capitalization as of April 17: AU$78.11 billion


Westpac Banking Corp (ASX: WBC) is one of the four big banks in Australia and has been paying fully-franked dividends to investors for years. Despite the shares remaining 23.5% below where they were five years ago, they currently offer a fully-franked dividend yield of 5.65%.


 ASX broker Morgans predicts a target price of AU$34.69 for Westpac shares, with a potential upside of close to 17%. The bank's revenue decreased by 12% to AU$19.3 billion in FY2022, while net income increased by 4.3% to AU$5.69 billion and profit margin rose to 30%. EPS grew to AU$1.60, exceeding predictions by 13%. 


Westpac plans to grow lending in FY23, but competition and funding needs may limit benefits. The bank aims to reduce expenses to AU$11.56 billion by FY24, but inflation, regulations, and digital investment may hinder progress. Impairment charges may increase in FY23 due to economic stress. Westpac's CET1 ratio is within range, and the bank will focus on digitization to improve its customer franchise.

6.ANZ Group Holdings Limited (ASX:ANZ)

Market capitalization as of April 17: AU$72.71 billion


ANZ Group Holdings Limited is a company that offers various banking and financial products and services in Australia and around the world. ANZ Group Holdings Limited (ASX: ANZ) reported a 9.3% increase in revenue to AU$19.7 billion and net income growth of 16% to AU$7.14 billion in its Full Year 2022 Results. 


The profit margin also rose to 36% and EPS improved to AU$2.51. However, ANZ shares fell over 13% in 2022, underperforming the S&P/ASX 200 Index and the other big banks, Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), and Westpac Banking Corp (ASX: WBC). 


ANZ Group's shares could benefit from higher interest rates in 2023, which can increase the bank's net interest margin (NIM). ANZ projects an additional net interest income of AU$ 2.02 billion in FY23 and AU$ 4.30 billion in FY25, leading to potentially higher dividends. Citi rated ANZ as a ‘Buy’ with an AU$38.86 price target, forecasting fully franked dividends of AU$2.23 per share in FY 2023 and AU$2.37 per share in FY 2024, translating to yields of 7.1% and 7.6%, respectively.

7. Macquarie Group Limited (ASX:MQG)

Market capitalization as of April 17: AU$70.59 billion


Macquarie Group Limited (ASX: MQG) is a global financial group founded in 1969, with offices in 33 markets and over 18,000 employees worldwide. The company provides diversified financial services in Australia, Europe, the Americas, Africa, the Middle East, and the Asia Pacific. 


Macquarie Group Limited (ASX: MQG) reported a net profit of AU$ 2,305 million in the first half of 2023, up 13% YoY, but down 13% from H2 2022. The company declared an interim dividend of AU$ 3.00 per share (40% franked), representing a payout ratio of 50%. Macquarie Group's financial position remained robust, with a group capital surplus of AU$ 12.2 billion, exceeding regulatory requirements.


Despite an 8% decline in share price since March 7, 2023, due to global banking turmoil, Macquarie Group Ltd (ASX: MQG) remains well-positioned for long-term earnings growth, thanks to its diversified businesses. The company's global operations enable investment in green energy and financing, while its strong capital position allows it to outperform its ASX bank share peers. According to consensus ratings, Macquarie Group Limited is currently rated as a ‘Strong Buy,’ based on 6 buy ratings and 2 hold ratings.

8.Fortescue Metals Group Limited (ASX:FMG)

Market capitalization as of April 17: AU$69.31 billion


Fortescue Metals Group Limited (ASX: FMG) is the world's most cost-effective iron ore producer and provides strong returns to shareholders. As the company transitions into a global green energy business, it remains committed to profitable decarbonization. The announcement of a fully franked interim dividend of A$0.75 per share reflects its commitment to shareholders.


Fortescue Metals Group Limited (ASX: FMG) is shifting its focus to become a major player in green energy through Fortescue Future Industries (FFI), which focuses on green hydrogen, green ammonia, and high-performance electric batteries. FFI has potential green energy projects in the US, Norway, Queensland, and Kenya. If successful, FFI could become one of the biggest global green energy players, unlocking significant value for the company.


Fortescue Metals Group (ASX: FMG) reported a decline in revenue, net income, profit margin, and EPS compared to the same period in 2022. Despite revenue is in line with analyst estimates, EPS missed estimates by 9.8%. Looking ahead, the company is forecasting a decline in revenue of 7.2% p.a. on average during the next 3 years, while revenues in the Metals and Mining industry in Australia are expected to remain flat.

9.Woodside Energy Group Ltd (ASX:WDS)

Market capitalization as of April 17: AU$65.94 billion


In 2022, Woodside Energy Group Ltd (ASX: WDS), an Australian energy company based in Perth, achieved remarkable financial results. NPAT surged 228% to AU$ 8,740 million, operating revenue rose 142% to AU$ 22,591 million, and operating cash flow increased 132% to AU$ 11,841 million. The company ended the year with AU$ 8,325 million in cash on hand, liquidity of AU$ 13,776 million, net debt of AU$768 million, and a gearing ratio of 1.6%.


They completed the merger with BHP's petroleum business, progressed the Scarborough and Sangomar projects, and completed the sell-down of Pluto Train 2. The fully-franked final dividend was AU 193.60 cps, resulting in a full-year dividend of AU 340.08 cps, representing a total distribution of AU$ 6,465 million. 


Citi forecasts attractive dividend yields of 7.7%, 7.5%, and 6.5% for the next three financial years. Currently, Woodside has a dividend yield of over 10.79%.

10.Wesfarmers Limited (ASX:WES)

Market capitalization as of April 17: AU$59.07 billion


Wesfarmers Ltd (ASX: WES) owns Bunnings, a leading home improvement retailer with over 110,000 products and 507 trading locations. For H1 2022, Wesfarmers had a revenue of AU$ 22.558 billion and a free cash flow of AU$ 1.365 billion. 


Woodside Energy Group Ltd (ASX: WDS) reported a 142% increase in operating revenue to AU$22,591 million and a 223% increase in underlying net profit after tax to AU$7,046 million for FY 2022, with a final dividend of AU$1.93 per share, bringing its full-year dividend to AU$3.40 per share, and a current dividend yield of 6.3%. 


According to Citi, Woodside's fully franked dividends are forecasted to be AU$ 3.54, AU$ 3.44, and AU$ 2.97 per share for FY 2023, FY 2024, and FY 2025, respectively. Over the past six months, the shares of Wesfarmers Ltd (ASX: WES) have experienced a notable upward trend. With its diversified operations and capacity to invest in new ventures, it is an intriguing and compelling ASX 200 stock to consider buying, despite not being as inexpensive as it was in the previous year.

Tips for buying stocks

Investing in the stock market can be a daunting task, but here are some helpful tips to guide you:


  • Gain knowledge: Before investing, educate yourself about the stock market and how to evaluate stocks. You can find ample resources online, or consider taking an investing course.

  • Create a plan: Determine your investment goals and risk tolerance and create a plan that aligns with those goals. Decide on the types of stocks, amount of investment, and time horizon for your portfolio.

  • Diversify: Don't rely on a single stock. Diversify your portfolio by investing in different types of stocks and sectors to spread out your risk.

  • Conduct research: Before investing in any stock, conduct thorough research. Analyze the company's financials, management team, industry trends, and other relevant information.

  • Stay disciplined: Stick to your investment strategy and avoid making impulsive decisions based on short-term market fluctuations. Regularly review and adjust your portfolio as needed.

  • Seek professional advice: If you're new to investing or uncertain about your strategy, consider seeking the help of a financial advisor. They can guide you through the market and help you make informed decisions.

          

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Conclusion

In this article, we have introduced 10 top Australian stocks. However, investing comes with risks, and investors need to conduct thorough research and due diligence to make informed decisions and manage their investment portfolios well.


Finally, we hope that this article provides valuable information and insights for investors, helping them find suitable shares in the Australian market and achieve long-term financial growth.


* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

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