Chasing dividend yield at any price is a mistake.

A high yield sitting on top of a deteriorating business is rarely worth the risk.

The better approach is to find quality businesses that have pulled back enough to make their dividend yield attractive again.

These three well-known ASX dividend shares fit that description right now.

Wesfarmers Ltd (ASX: WES)

Wesfarmers is down about 9% from the all-time high of $95.18 it set in August last year.

That pullback has not been driven by a deteriorating business.

In the first half of FY2026, Wesfarmers delivered net profit after tax of $1.603 billion, up 9.3% on the prior corresponding period. Reassuringly, Bunnings and Kmart both continue to deliver strong sales growth.

The board lifted its fully franked interim dividend by 7.4% to $1.02 per share, a clear signal of confidence in the underlying cash generation.

At the lower share price, that growing dividend now goes further.

CMC Invest forecasts an annual dividend of $2.20 per share for FY2026, implying a forward yield of approximately 2.54%. That figure is expected to climb further as the dividend continues to grow into FY2027.

Wesfarmers has increased its dividend every year since divesting Coles in 2020. This streak gives income investors a degree of confidence in the trajectory of consistent dividend compounding.

BHP Group Ltd (ASX: BHP)

BHP offers a higher starting yield than Wesfarmers, backed by one of the strongest commodity tailwinds on the ASX.

BHP’s dividend is highly cyclical, swinging from $4.63 per share in 2022 to just $1.71 per share in 2025, before the trend reversed with a 2026 interim dividend of $1.04 per share, a healthy rise over the prior year’s 79 cents.

Including the September final dividend, BHP currently has a trailing 12-month payout of $1.96 per share. This is fully franked, putting the trailing yield at approximately 3.3% at current prices.

For Australian taxpayers, the full franking on that yield is important. This effectively lifts the after-tax return well above the headline figure for shareholders in the 30% tax bracket. What’s more, the franking lifts the after-tax return even further for those in pension-phase superannuation accounts able to claim the full cash refund.

The dividend backdrop has been reinforced by BHP’s copper exposure, with copper earnings now exceeding iron ore contributions for the first time in the company’s history. This comes as demand for AI data centres and electrification drives the copper price to record levels.

This tailwind gives the BHP dividend more support than its historical cyclicality alone would suggest.

Telstra Group Ltd (ASX: TLS)

Telstra is the most defensive of the three, and its dividend track record reflects that.

Shareholders have not seen a dividend cut since 2019 and have enjoyed an annual dividend increase every year since 2022.

Telstra’s most recent interim dividend came in at 9.5 cents per share, fully franked, matching the equivalent payout from 2025. This brings the trailing annual total to 19 cents per share and a trailing yield of approximately 3.7%.

Brokers see further growth ahead. UBS forecasts Telstra paying 21 cents per share in FY2026, implying a grossed-up yield of approximately 6.2% including franking credits.

Moreover, Morgan Stanley separately forecasts 20 cents per share with a price target implying further capital upside on top of the dividend.

Telstra’s mobile division, the largest network in Australia, continues to underpin that earnings growth through pricing power and steady subscriber growth.

The lesson for these ASX dividend shares

Each of these three businesses has pulled back for reasons that are largely cyclical or sentiment-driven rather than structural.

Wesfarmers fell on broader retail sector caution despite delivering double-digit profit growth.

BHP’s yield swings with the commodity cycle.

Telstra has simply continued growing its dividend through a defensive, less exciting period for the broader market.

That combination of real earnings growth and a lower entry price is exactly what makes these ASX dividend shares well priced.

Foolish takeaway

Wesfarmers, BHP, and Telstra all offer a different entry point into ASX dividend shares right now.

Wesfarmers offers the lowest starting yield but the most consistent growth track record. BHP offers a higher cyclical yield backed by a genuine structural copper tailwind. Telstra offers the most defensive earnings base and a long, uninterrupted streak of dividend growth.

For income investors prepared to look past the headlines, all three remain well-priced options on the ASX today.

The post There are still some well-priced ASX dividend shares. Here’s where to look appeared first on The Motley Fool Australia.

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Motley Fool contributor Mark Verhoeven 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 Wesfarmers. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended BHP Group and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Most Australians check their superannuation and focus on one thing: the balance.

That makes sense because it is the number staring back at you from the app or annual statement. It feels like the scoreboard. Higher is better, lower is worse, and anything below the average can feel like bad news.

But the uncomfortable truth is that your super balance is not the only number that matters in retirement planning. In many cases, it may not even be the most useful one.

The number that matters more is how much income that balance can realistically support.

A big superannuation balance can still feel small

It is easy to assume that reaching a large super balance will automatically make retirement feel comfortable, but that is not always the case.

A person with $500,000 in superannuation and high spending needs may feel far more financially stretched than someone with $350,000, a paid-off home, low expenses, and a modest lifestyle.

That is why retirement planning should not begin with the question: “How much do I have?” It should begin with a more practical question: “How much will I need each year?”

Once you know that, your super balance starts to make far more sense.

Retirement is a cash flow problem

During your working life, income usually arrives through wages or a salary. In retirement, that income has to come from somewhere else. It may come from super drawdowns, investment income, the Age Pension, savings, or a combination of all of them.

That means your superannuation is not just a nest egg. It is a future pay packet, and like any pay packet, what is important is whether it can cover the life you want to live.

According to the Association of Superannuation Funds of Australia, a comfortable retirement requires around $630,000 in super for a single person and $730,000 for a couple, assuming home ownership and some Age Pension support.

Those numbers are useful, but they are only estimates of the capital needed to support a particular lifestyle.

Comfortable means choices

A comfortable retirement is not extravagant. It is not about luxury travel every month or spending without limits. Instead, it is about choice.

It means having the flexibility to eat out, run a reliable car, maintain private health insurance, replace household items when needed, visit family, and take occasional holidays without every decision feeling financially loaded.

By contrast, a modest retirement can still be workable, but it usually involves more compromise. The bills may be paid, but there is less room for mistakes, surprises, or indulgences.

This is why income is so important. It determines whether retirement feels flexible or fragile.

What to do instead

A better way to assess your superannuation is to work backwards.

Start by estimating the annual income you would like in retirement. Then consider how much of that could come from the Age Pension, if you are eligible. From there, your super only needs to fill the gap.

This approach can be far less intimidating than chasing a giant headline number.

It also makes the task more practical. If the gap is too large, you can respond by increasing contributions, reviewing investment options, reducing fees, delaying retirement, or adjusting expectations.

Foolish takeaway

Your superannuation balance is important, but it is not the whole story.

The real question is not whether your balance looks impressive on paper. It is whether it can help generate the income you need for the retirement you want.

In retirement, wealth is not just measured by what you have saved. It is measured by how comfortably that money lets you live.

The post The Australian superannuation number that is more important than your balance appeared first on The Motley Fool Australia.

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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.

12 months ago, Xero Ltd (ASX: XRO) shares were flying high, reaching a record high of $196.52. Fast forward a year, and the picture looks dramatically different.

At the time of writing, the accounting software company’s shares change hands for around $65.00, a 7-year low. That leaves the stock down more than 40% since the start of 2026 and roughly 66% lower than this time last year.

It’s been a brutal period for shareholders.

So what on earth is happening with this former ASX tech darling?

Why are Xero shares under pressure?

The latest weakness appears to be part of the broader sell-off that has swept through growth stocks.

Investors have become far less willing to pay premium valuations for technology companies, particularly those whose investment appeal depends heavily on future growth. As sentiment towards the sector has deteriorated, Xero shares have come under fire.

The market simply isn’t valuing software businesses the way it did during the boom years.

That doesn’t necessarily mean there’s anything fundamentally wrong with the company.

Business is still performing

While the price of Xero shares has collapsed, Xero’s operating performance tells a very different story.

Revenue surged 31% to NZ$2.75 billion in the most recent financial year, highlighting continued strong demand for its accounting software platform.

Adjusted EBITDA increased 18% to NZ$757.4 million, while free cash flow reached NZ$554 million.

Perhaps most importantly, annualised recurring revenue jumped 37%.

That’s a key metric for software companies because recurring subscription income provides visibility and predictability. Investors typically place a high value on businesses that can generate growing streams of recurring revenue.

In other words, the business continues to grow even as the share price struggles.

US opportunity remains enormous

One reason some investors remain optimistic about Xero shares is the company’s growing traction in the US.

For years, the US small-business market has been viewed as the company’s biggest long-term opportunity. Success there could significantly expand Xero’s addressable market and growth runway.

Encouragingly, organic growth in the US reportedly accelerated to 30%.

That’s an important milestone. If Xero can establish itself as a meaningful player in the world’s largest accounting software market, the long-term growth potential becomes far more compelling.

Management’s outlook also suggests growth remains firmly on the agenda. The company is targeting roughly 34% revenue growth in FY27 and expects adjusted EBITDA to land between NZ$860 million and NZ$920 million.

Those numbers hardly describe a business running out of steam.

What next for Xero shares?

Despite the strong operating performance, risks remain.

Investors are still waiting to see how the company’s Melio acquisition progresses, while broader market sentiment towards software stocks remains fragile.

That’s helping explain why Xero shares continue to trade well below previous highs.

Even so, some analysts see value emerging. Shaw and Partners believes the stock offers approximately 25% upside from current levels.

For now, the market appears torn between two competing narratives: a rapidly growing software business and a growth stock sector that remains deeply out of favour. Which story wins may determine where Xero shares head next.

The post What’s spooking investors about Xero shares? appeared first on The Motley Fool Australia.

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• 5 ASX growth shares I want in my portfolio in FY27
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• The ASX investing strategy that could quietly make you rich
• Down but not out: 3 ASX tech shares ripe for a rebound

Motley Fool contributor Marc Van Dinther 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 Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.