The team at Bell Potter have been consistently bullish on ASX materials stock WA1 Resources Ltd (ASX: WA1) this year. 

WA1 listed on the ASX in February 2022. Since then, it has focused on an aggressive drill-out program at West Arunta, specifically targeting the Luni carbonatite structure. 

Niobium is a niche commodity, primarily micro-alloyed into structural steel to improve strength and reduce weight in applications.

In the last 12 months, this ASX materials stock has been relatively flat.

However a key announcement has led to a strong upgrade from the team at Bell Potter who now see this ASX materials stock as one that could double in the next 12 months. 

What happened?

WA1 has completed larger-scale processing tests on ore from its Luni niobium project. 

The tests showed the company can successfully concentrate the niobium into a high-grade product using a relatively simple flotation process and ordinary site water.

For investors, this is a big positive as one of the biggest risks for any mining project is whether the ore can actually be processed economically.

These results show that:

• The processing method appears to work consistently across different parts of the deposit.
• The quality of the concentrate produced is high enough to be commercially attractive.
• The project’s future processing plant design is becoming more certain.

In mining terms, this “de-risks” the project because investors now have more confidence that the ore can be turned into a saleable product.

Standout results

The best area of the deposit (Composite A), which is expected to be mined first, delivered:

• 46% niobium concentrate grade
• 67% recovery rate.

Recovery rate means 67% of the niobium in the ore was successfully captured during processing.

This was better than previous test results and suggests the project could be more profitable than originally expected.

Because recoveries were stronger than expected, Bell Potter increased its assumption for how much niobium WA1 can extract from the ore.

Big upgrade for ASX materials stock

As a result, Bell Potter has upgraded its price target on this ASX materials stock to $27.20 (previously $24.40). 

This is significant because this ASX materials stock currently trades for around $12.50 per share. 

The new target from Bell Potter indicates an upside potential of 129%. 

The testwork confirms a two-stage flotation regime can produce high-quality niobium concentrates with commercially relevant recoveries across the deposit, using raw site water.

The broker has retained its speculative buy recommendation. 

The post Bell Potter tips 129% upside for this ASX materials stock appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Bell 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.

Of those ASX investors who love buying and investing in Vanguard index funds, there are two real choices if an investor wishes to gain broad exposure to the Australian share market. The preferred choice of many is, of course, the Vanguard Australian Shares Index ETF (ASX: VAS).

This exchange-traded fund (ETF) is, by a large margin, the most popular index fund and ETF in Australia, with more than $26 billion currently under management.

VAS offers investors simple, easy access to our most well-known shares by mirroring the S&P/ASX 300 Index (ASX: XKO). As its name implies, this index tracks the largest 300 stocks listed in Australia. That’s everything from Commonwealth Bank of Australia (ASX: CBA), Telstra Group Ltd (ASX: TLS), and Woolworths Group Ltd (ASX: WOW), to JB Hi-Fi Ltd (ASX: JBH), Ampol Ltd (ASX: ALD), and Metcash Ltd (ASX: MTS).

However, there is another Vanguard index fund that addresses one of investors’ chronic concerns about ASX index funds – that they are too heavy on sluggish bank shares and mining stocks.

That Vanguard ETF is the Vanguard MSCI Australian Small Companies Index ETF (ASX: VSO). Instead of buying 300 of the largest stocks listed on the public markets, VSO only holds about 170. These are all taken from the bottom end of the ASX 300, so no CBAs or Telstras here.

Instead, you’ll find the likes of BlueScope Steel Ltd (ASX: BSL), NextDC Ltd (ASX: NXT), and Orica Ltd (ASX: ORI) amongst its largest holdings. VSO is designed to give extra weight to these smaller, and potentially more nimble and mobile stocks, at the expense of the ASX’s largest blue chips.

That all sounds grand. But today, let’s check out the numbers, and see which ASX ETF has actually delivered the best returns for investors.

VSO or VAS: Which ASX index fund comes out on top?

Let’s start with the Vanguard Australian Shares ETF. As of 31 May, this index fund has delivered a 1.38% return year to date. Over the past 12 months, the number is 7.091%. That stretches to 10.94% per annum over the three years to 31 May, 7.92% over five years, and 9.03% over ten.

These returns account for fees and include both capital growth and dividend distribution returns.

Meanwhile, VSO units have gone backwards by 2.6% in 2026 so far. However, over 12 months, investors have enjoyed a 13.27% return. That morphs into 11.42% per annum over the past three years, 7.02% over five years, and 9.33% over ten years.

As you can see, there isn’t a lot of distance between these two Vanguard ETFs. Both VAS and VSO come out ahead over different periods, but an investor who put all of their eggs in either VAS or VSO five or ten years ago would largely come out level.

It seems, going off the historical data at least, it didn’t matter if investors chose one, the other, or both.

The post VAS vs VSO: Do small-cap stocks beat the ASX 300? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Vanguard Australian Shares Index ETF and Vanguard Msci Australian Small Companies Index ETF. 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.

CSL Ltd (ASX: CSL) shares remain one of the most debated blue-chip stocks on the ASX.

The biotechnology giant is trading around $112.04, which is a long way below the levels investors were used to seeing in past years. That alone makes the stock interesting, but it does not make the investment case simple.

Ord Minnett has recently reviewed its CSL model and maintained a hold recommendation on the stock. The broker’s concern centres heavily on the Vifor nephrology business and the uncertainty around CSL’s earnings outlook as management works to reset the company.

So, is the broker right to stay cautious?

The cautious case

Ord Minnett’s concern is not hard to understand.

CSL is best known for its Behring plasma products business, but the group also includes Vifor and Seqirus. Vifor is exposed to nephrology therapies, while Seqirus operates in vaccines.

The broker believes Vifor’s challenges are being underestimated by the broader market. It has highlighted the loss of exclusivity rights for Injectefer, which is used to treat iron deficiency anaemia, as generic versions enter the US market. It also points to Velphoro, a therapy used by chronic kidney disease patients on dialysis, being removed from the US federal government’s transitional drug add-on payment adjustment program from January 2027.

Ord Minnett expects these issues to pressure pricing and has assumed a fall in Vifor revenue and profit of US$355 million in FY27.

That is not a minor concern.

The broker’s Vifor revenue and operating profit forecasts for FY27 sit below consensus estimates. It also expects Vifor operating profit across FY27 to FY29 to be more than 10% below market expectations.

That cautious view, combined with what it sees as a middling outlook for Seqirus, has led Ord Minnett to cut its CSL group earnings per share estimates for FY27 and FY28.

Why I see it differently

I understand the hold rating. CSL is dealing with genuine moving parts, and investors should not pretend the reset is already complete.

But I think the more interesting question is whether the current CSL share price is already giving patient investors a reasonable chance to be rewarded.

In my view, it is.

CSL is not just Vifor. The Behring division remains the core of the business, and Ord Minnett itself appears to see a modestly brighter outlook for this key plasma products operation.

That is important because plasma is the heart of CSL’s long-term investment case.

This is a global business with scale, specialist manufacturing capability, regulatory experience, collection infrastructure, and deep relationships across healthcare markets. Those strengths are difficult to recreate.

I also think the market’s view of CSL has changed dramatically. Investors are no longer treating it like a flawless compounder. Expectations are lower, the valuation has reset, and management has a clearer challenge: rebuild confidence through execution.

That does not need to happen quickly to make the stock attractive. It needs to happen steadily.

A patient buy

I would rate CSL shares as a buy for patient investors.

The word patient is important. Vifor’s challenges, Seqirus’ mixed outlook, margin pressure, and management’s broader reset all mean the recovery case may take time.

But I think the share price already reflects a lot of disappointment. CSL still has a globally important plasma business, exposure to healthcare demand, and the potential to improve earnings over time if management executes well.

Ord Minnett may be right to flag the risks in Vifor. I just think the hold rating is too cautious when looking at the broader business and the current valuation.

Foolish takeaway

CSL is no longer the easy blue-chip story it once seemed to be. Investors now have to weigh a high-quality global healthcare franchise against real earnings uncertainty and a business reset that still needs proof.

That tension is exactly why the opportunity exists.

I would not ignore Ord Minnett’s concerns. Vifor could remain a drag, and CSL has work to do. But for investors willing to look beyond the next couple of reporting periods, I think the balance of risk and reward now looks attractive.

CSL shares may require patience, but I think they are worth buying at current levels.

The post Is this broker right about CSL shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has positions in CSL. 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.