Zip Co Ltd (ASX: ZIP) shares are trading around $2.02 on Wednesday.

This means that for the buy now, pay later stock to double from here, it would need to reach $4.04.

That sounds like a big ask. But when I look at where earnings are expected to go over the next few years, I don’t think it is out of the question.

Earnings could do plenty of the work

The first thing I would want to see is Zip delivering on its earnings forecasts.

Consensus estimates point to earnings per share (EPS) of 15 cents in FY27, rising to 18 cents in FY28, and 22 cents in FY29.

That represents a 20% increase between FY27 and FY28, followed by another 22% increase in FY29.

At today’s $2.02 share price, Zip is trading on a P/E ratio of around 13.5 times forecast FY27 earnings. That falls to roughly 11 times FY28 earnings and a little over 9 times FY29 earnings.

I think those numbers explain why I can see a path towards a much higher share price.

If earnings keep climbing while the share price barely moves, Zip shares would become progressively cheaper. At some point, I think investors could become willing to pay more for that growth.

What valuation would $4.04 require?

At $4.04, Zip would trade at roughly 27 times forecast FY27 earnings.

That is much more demanding than today’s valuation.

But against the FY28 estimate, the P/E ratio falls to around 22 times and using FY29 earnings of 22 cents per share, it would be around 18 times.

That does not strike me as an impossible valuation if Zip is still producing robust earnings growth by then.

What would need to go right?

For those forecasts to become reality, Zip needs to keep growing the underlying business.

One part of that is continuing to win a greater share of the payments market in the United States and Australia. If more consumers use Zip and more merchants offer its payment options, transaction volumes should have room to keep expanding.

I would also want to see the customer base continue growing without Zip sacrificing credit quality in pursuit of that growth.

That means keeping bad debts under control as more users and transactions move through the platform.

If Zip can combine rising payment volumes and user growth with disciplined lending, I think the earnings outlook becomes much easier to believe.

And if the company can build a consistent track record of doing that, investors may eventually be prepared to pay a higher multiple for those earnings as well.

Foolish takeaway

I don’t think Zip shares need an extraordinary set of circumstances to double in value.

If Zip keeps taking market share, grows its customer base without letting bad debts get away from it, and reaches EPS of 22 cents by FY29, a $4.04 share price would represent less than 19 times earnings.

For a company still growing strongly at that point, I think that could be achievable.

The post What would it take for Zip shares to double? 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 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.

The Vanguard MSCI Index International Shares ETF (ASX: VGS) and the iShares S&P 500 ETF (ASX: IVV) are two ASX exchange-traded funds (ETFs) I would happily buy for the long term.

Both provide instant exposure to some of the world’s biggest companies, but they go about it differently.

If I had $10,000 and could choose only one today, which would I buy?

What do you get with the VGS ETF?

The biggest reason to buy the VGS ETF is diversification.

It invests in around 1,300 stocks across approximately 23 developed countries outside Australia, rather than concentrating entirely on a single overseas market.

The United States still plays a major role, which is why NVIDIA, Apple, and Microsoft sit among its largest holdings. Fellow technology giants Amazon and Alphabet also feature prominently.

But the Vanguard MSCI Index International Shares ETF also spreads investors’ money across markets, including Japan, the United Kingdom, Canada, France, and Switzerland.

I like that approach because investors are not relying entirely on the US stock market continuing to lead global returns.

For someone who wants one broad international ETF, the VGS ETF would be an excellent choice in my view.

What about the IVV ETF?

The iShares S&P 500 ETF takes a narrower approach.

It tracks Wall Street’s S&P 500 Index (SP: .INX), giving investors exposure to around 500 large US companies. Its biggest underlying holdings currently include NVIDIA, Apple, Microsoft, Amazon, Alphabet, Broadcom, and Meta Platforms.

There is clearly plenty of overlap with the VGS ETF.

The difference is that the IVV ETF puts more weight behind these US businesses rather than diluting their influence with companies from other developed markets.

I like that. The US remains home to many of the companies leading major areas of growth, including artificial intelligence, cloud computing, semiconductors, digital advertising, and software.

Of course, that greater exposure to the US also means accepting more concentration. If American shares underperform other developed markets for an extended period, the VGS ETF could benefit from having more money invested elsewhere.

However, I am willing to take that risk because I think the strength of the US businesses inside the IVV ETF gives the fund a compelling long-term growth outlook.

Which ASX ETF would I buy?

The VGS ETF would be my choice for someone prioritising broader international diversification, and I like that it reduces reliance on one country.

But if I had $10,000 and could buy only one, I would choose the IVV ETF.

I am comfortable taking greater exposure to the US market because of the quality and growth potential of the stocks inside it.

The post VGS vs IVV: Which ETF would I buy with $10,000? 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 positions in and has recommended Alphabet, Amazon, Apple, Broadcom, Meta Platforms, Microsoft, Nvidia, and iShares S&P 500 ETF. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, Vanguard Msci Index International Shares ETF, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Today could be an opportune time to buy Woodside Energy Group Ltd (ASX: WDS) and CSL Ltd (ASX: CSL) shares.

That’s according to Red Leaf Securities’ John Athanasiou, who issued a buy recommendation on both S&P/ASX 200 Index (ASX: XJO) stocks this week (courtesy of The Bull).

In intraday trade on Tuesday, CSL shares were changing hands for $181.88 each. While that leaves shares in the ASX 200 biotech giant down 8.6% in a year, the share price has rocketed a remarkable 96.8% since notching a multi-year closing low of $92.24 on 3 June.

CSL stock also trades on a 2.2% unfranked trailing dividend yield.

As for Woodside shares, trading for $31.27 on Tuesday, the ASX 200 energy stock has gained 33.6% in 12 months. Woodside shares also trade on a 5.2% fully franked trailing dividend yield. That equates to a grossed-up yield of 7.5% once we take those franking credits into account.

Should I buy CSL shares today?

“CSL’s recovery is gaining momentum after forecasting underlying profit growth guidance of about 5 per cent in fiscal year 2027,” Athanasiou noted. “Guidance exceeded market expectations.”

Summarising his buy recommendation on CSL shares, Athanasiou said:

Immunoglobulin sales improved in the second half of fiscal year 2026 amid the company announcing a further share buy-back of $1.1 billion. The outlook for this global health care company is improving after prolonged underperformance. CSL shares have risen from $92.24 on June 3 to trade at $179.19 on September 24.

Successfully meeting or exceeding its targets leaves room for a potentially higher share price considering the stock was trading above $300 in calendar year 2024.

Which brings us to…

Woodside shares benefiting from global energy crunch

Atop his bullish outlook on CSL shares, Athanasiou also issued a buy recommendation on Woodside shares.

“Woodside offers exposure to recent elevated global energy prices amid supply disruptions and continuing Middle East tensions,” he said. “Stronger realised prices should support near term cash flow and dividends.”

On the risk front, Athanasiou added, “A major risk is an easing of geopolitical tensions and a corresponding fall in crude oil prices.”

Explaining his buy recommendation on Woodside shares, Athanasiou concluded:

However, the company delivered a solid interim result. Operating revenue of $7.446 billion in the first half of 2026 was up 13 per cent on the prior corresponding period. Underlying net profit after tax of $1.334 billion was up 7 per cent. The Scarborough energy project is almost completed.

The post Expert names Woodside and CSL shares as top buys today appeared first on The Motley Fool Australia.

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