Buy, hold, sell: Appen, Flight Centre, and Telstra shares

The three ASX shares in this article are operating in different industries, but each face some interesting challenges over the coming years.

Some could benefit as conditions improve, while others may need to adapt to substantial changes in their markets.

Here’s how I would rate their shares today.

Appen Ltd (ASX: APX)

Appen shares are a hold for me. The company helps developers train and improve artificial intelligence (AI) models, putting it in an industry that continues to attract enormous investment.

But I have mixed feelings about its long-term prospects. AI models are becoming increasingly sophisticated, with synthetic data and automated evaluation potentially reducing the need for some traditional training services.

At the same time, more advanced AI creates demand for specialist data, human evaluation, and expert input in complex areas such as coding and mathematics. Appen could benefit from these opportunities.

Its recent results provide some encouragement. Revenue increased 17% in the first half of FY26, supported by particularly strong growth in China.

But the recovery remains uneven. Revenue from its Global business declined 27%, suggesting Appen still faces challenges replacing traditional work with newer AI projects.

I am also concerned about its reliance on a relatively small number of major technology customers, whose spending priorities can change quickly.

For me, the question is whether Appen can build a consistently profitable business as AI technology evolves. I think there is enough progress to justify holding the shares, but I would want clearer evidence of sustainable growth before buying.

Flight Centre Travel Group Ltd (ASX: FLT)

Flight Centre is a patient buy in my view. The travel company has faced a challenging period, with geopolitical tensions disrupting travel plans and higher fuel prices contributing to more expensive airfares.

But I think the work Flight Centre has done during this difficult period could pay off when conditions improve.

Management has materially reduced costs, leaving the business in a stronger position to benefit when travel demand picks up.

It has also strengthened its offering through acquisitions made around the bottom of the travel cycle, expanding its presence in specialist and higher-value travel markets.

I particularly like its position in corporate travel. Flight Centre has built a substantial global business serving companies that need help managing employee travel, bookings, and expenses.

That gives it an established customer base and opportunities to capture more business as corporate travel spending improves.

For me, the combination of a leaner cost base, a broader offering, and a strong corporate travel business could support a meaningful recovery in earnings.

I don’t expect conditions to improve overnight, particularly given the uncertainty surrounding international travel. But I would be happy to buy Flight Centre shares with a long-term view and give the recovery time to play out.

Telstra Group Ltd (ASX: TLS)

Telstra shares would be a buy for income investors. The telecommunications company has a substantial mobile network, millions of customers, and an established position in an industry that has become essential to everyday life.

I like the relatively dependable demand for its services, which helps support regular dividends.

Telstra paid 21 cents per share in FY26, and management is targeting further earnings growth under its Connected Future 30 strategy. That could provide room for dividends to increase gradually.

There is one longer-term development I would be watching, though. SpaceX has been expanding Starlink’s mobile capabilities and recently agreed to acquire approximately US$8 billion worth of mobile spectrum in the United States. 

I think that is a significant development, as it suggests SpaceX has ambitions to compete more directly with traditional telecommunications companies.

But for now, I think Telstra’s extensive infrastructure and network capacity give it a strong competitive position, particularly in populated areas.

As such, I think Telstra remains a good option for investors seeking dependable income.

Foolish takeaway

I would be happy buying Flight Centre and Telstra shares today, with the former offering recovery potential and the latter providing a more dependable source of income.

Appen is one I would continue holding for now. Its recent progress is encouraging, but I think it still has more to prove before I would consider adding to my position.

The post Buy, hold, sell: Appen, Flight Centre, and Telstra shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended Flight Centre Travel Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.