Evolution Mining Ltd (ASX: EVN) shares had a tough session on Thursday.

The gold miner’s shares ended the day almost 4% lower at $11.34 after investors reacted negatively to its fourth-quarter update.

While this is disappointing, Bell Potter thinks it could have created a buying opportunity for investors.

What is the broker saying?

Bell Potter was pleased with the company’s update despite production coming in softer than expected. It commented:

EVN released its June quarter 2026 production and cost report which, in our view, was a solid final quarter from EVN and was its second-best quarter of FY26. While both gold and copper production came in below our forecasts, Ernest Henry returned to full production following the weak March quarter and delivered its best quarterly performance of FY26. For the June quarter, group production was 179.7koz gold and 18.8kt copper (vs BPe 189.0koz gold and 19.6kt copper). 

The broker also highlights that the ASX gold stock has released part of its guidance for FY 2027, revealing that its costs are expected to rise and its investments will increase. However, it is comfortable with this. It said:

EVN released high-level elements of FY27 guidance. Overall, it pointed to steady production, but higher sustaining capital, higher AISC on general cost inflation and higher CAPEX on growth projects. It also flagged increased spending on exploration and on life-of-mine studies. While higher than our prior forecasts, we are comfortable the organic investment options are lower risk and higher returning than M&A in the current market. EVN has an excellent track record on this front, where returns on invested capital at Cowal, Ernest Henry and Mungari have been high.

Should you buy Evolution Mining shares?

According to the note, Bell Potter has retained its buy rating on Evolution Mining shares with a trimmed price target of $15.10 (from $16.45).

Based on its current share price, this implies potential upside of 33% for investors over the next 12 months.

In addition, Bell Potter is forecasting an attractive 4.4% dividend yield in FY 2027. This boosts the total potential return beyond 37%.

Commenting on its investment thesis, the broker said:

EPS changes on this update are -6% for FY26, -15% for FY27 and -4% for FY28. We have trimmed our production forecasts and increased our AISC forecasts in line with initial guidance for FY27. We have also lifted our capital expenditure assumptions in line with the outlook. As a result, we also trim our dividend forecasts on the lower free cash flow. 

EVN offers fully unhedged gold and copper exposure via a portfolio of high quality, long-life assets in Tier 1 jurisdictions, overseen by a high-quality management team. EVN has stated its intention to pass growing free cash flows on to shareholders.

The post Could Evolution Mining shares rise 33%? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Evolution Mining posts record FY26 cash flow
• 5 things to watch on the ASX 200 on Wednesday
• Here are the top 10 ASX 200 shares today
• 5 things to watch on the ASX 200 on Friday

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

Chemist Warehouse is one of the most recognisable businesses on Australia’s streets. It’s owned by Sigma Healthcare Ltd (ASX: SIG), which isn’t a household name, but I think Sigma is an appealing ASX share to buy.

The country’s leading pharmacy business may be best known for Chemist Warehouse, but it also has other elements to the company including Amcal, Discount Drug Stores and a pharmaceutical wholesale business.

However, with Chemist Warehouse making up a significant majority of the company’s earnings, I think it’s the right place for investors to focus because of three different reasons.

Excellent performance by the existing store network

When there are many different growth areas of a business to consider, I think it’s important to see that the core business is performing strongly for shareholders, which is happening at Sigma Healthcare.

The core Chemist Warehouse network in Australia is doing very well and continues to drive the value of the intrinsic value of the business higher.

In early May, the business gave a trading update which revealed the Australian Chemist Warehouse network delivered total sales growth of 16.7% year-over-year for the period of 1 July 2025 to 30 April 2026. This was mostly powered by like-for-like (LFL) sales growth of 14.4%, which is an excellent rate of growth, in my view, for a large retail business.

Thankfully, the company has tailwinds such as Australia’s ageing and growing population. Plus, pharmacies are a huge market, so there is still a lot of market share the company could claim thanks to its scale benefits and low prices.

I expect Chemist Warehouse will be able to expand its Australian network with more stores at a pleasing pace over the rest of this decade.

Growth of the international network

Australia is not the only growth avenue for the business. The ASX share also operates in New Zealand, Ireland, Dubai and online in China.

Its international store network delivered 24.7% total sales growth and LFL sales growth of 14.4% for the period 1 July 2025 to 31 March 2026. I expect the company’s store networks in New Zealand and Ireland to steadily expand.

Excitingly, Sigma is also going to enter the UK market thanks to a joint venture agreement with Greenlight Healthcare. Greenlight has 22 stores in and around London – Sigma will acquire a 75% interest in a number of stores, with the other 25% continuing to be held by Greenlight.

Under that joint venture, Sigma will licence the Chemist Warehouse brand and intellectual property, and provide retail support (including ranging, store layout, inventory management and marketing support).

Phase one will rebrand up to five stores initially, with the option for more stores if the first phase is successful.

Improving profit margins

In my view, the ASX share has an exciting future of sales growth ahead, but profit growth could be even better because the company’s increasing scale helps profit margins rise. Additional revenue dollars are becoming increasingly profitable in each reporting period.

For example, in the first half of FY26, the company reported that revenue grew by 14.9% to $5.5 billion.

Normalised operating profit (EBIT) grew strongly, rising by 18.7% to $582.9 million – faster than sales growth.

The normalised net profit after tax (NPAT) grew 19.2% to $392 million – faster than the EBIT growth.

It’s normally net profit growth that investors value a business on, so the profit growth looks very appealing to me. The company can use this net profit to fund more growth, pay down debt and/or pay rising dividends to shareholders.

Overall, there’s a lot to like about this ASX share, though it’s not the only name I’d love to have in my portfolio.

The post 3 reasons why the ASX share owner of Chemist Warehouse is a buy appeared first on The Motley Fool Australia.

More reading

• Leading brokers name 3 ASX shares to buy today
• Here are the top 10 ASX 200 shares today
• Here are the top 10 ASX 200 shares today
• Why I want to own these ASX shares brokers rate as buys
• How should I invest my money in FY27?

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

Centuria Industrial REIT (ASX: CIP) is one of the high-yield ASX dividend stocks I’d be very happy to rely on for passive income rather than receive the Age Pension.  

While the ASX share market is a great place to find ideas that can help deliver passive income, there are relatively small number of names I’d be willing to significantly invest in.

This real estate investment trust (REIT) is one of the names I really like.

There is an appeal to REITs because of how defensive and predictable their income is, as rental income is contracted with tenants. REITs like this one have a range of high-quality tenants including Telstra Group Ltd (ASX: TLS), Woolworths Group Ltd (ASX: WOW), Arnott’s, AWH, Visy and Fantastic Furniture.

Why this ASX dividend stock is more appealing

The Centuria Industrial REIT owns a portfolio of high-quality industrial properties that are located in high-demand areas where the vacancy rate is low. This is helping drive up the rental income potential of the properties.

Another benefit of this investment is that owning all of these industrial properties, the ASX dividend stock offers investors significant asset backing, providing pleasing downside protection. The Age Pension does not have a large asset base that can be sold.

It’s also delivering good rental growth compared to many other property sectors. Industrial property is benefiting from tailwinds like e-commerce adoption, the onshoring of supply chains and data centres.

In the first half of FY26, the business reported 5.1% like-for-like net operating income (NOI) growth, which is a good growth rate for a REIT, in my view. Excitingly, the business reported that its portfolio was 20% under-rented, which suggests strong rental growth as contracts come up for renewal in the coming years – the business currently has a weighted average lease expiry (WALE) of more than six years.

The business grew its FY26 distribution by 3% year-over-year, which is a solid rate of growth amid higher interest rates. Over the longer-term, I think the business could have a very compelling future.

The final thing I’ll note is that the business is trading at a very large discount to its underlying value, which is measured as the net tangible assets (NTA) per unit. At December 2025, it had NTA of $3.95 per unit – that means it’s trading at a discount of close to 25%.

How many shares I’d need to match the Age Pension

Currently, the maximum Age Pension that an Australian can receive is around $31,200 per year.

Based on the FY26 annual payout of 16.8 cents per security, that level of passive income translates into a forward distribution yield of 5.6% (at the time of writing).

To receive $31,200 of annual income, an investor would need 185,715 Centuria Industrial REIT shares. While that would be a huge investment for most Australians, I’d be happy to make that purchase because of how cheap it is and what it can offer passive-income investors.

But, it’s not the only high-yield ASX dividend stock I’d buy for dividends.

The post 185,715 shares of this high-yield ASX dividend stock pays an income equal to the Age Pension appeared first on The Motley Fool Australia.

More reading

• How much superannuation is needed to target a $100,000 annual passive income?
• How to invest $5,000 for passive income in superannuation?
• How should I invest my money in FY27?
• How much is needed in superannuation to target a $70,000 annual passive income?
• How much is needed in superannuation to target $60,000 in annual passive income?

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