Zip Co Ltd (ASX: ZIP) shares have fallen more than 50% over the past year, but according to the analyst team at UBS, it could be time to buy the dip.

UBS has a buy rating on Zip shares and a very bullish share price target, which I’ll get to shortly.

First, let’s have a look at their most recent trading results to see how they’re doing.

Share falls depsite record trading results

Zip in mid-August reported total income of $1.35 billion, up 24.6% on FY25, and record cash EBTDA of $268.9 million, up 57.9%.

The company’s total transaction volume (TTV) increased 27.2% to $16.7 billion, while the volume in the US market grew 42.5%.

Net bad debts increased from 1.52% to 1.77% in line with management’s expectations.

Zip Chief Executive Officer Cynthia Scott said it was a strong result.

She added:

Consistent execution has built the platform to deliver our next phase of growth and innovation. In FY26, we exceeded our targets with record cash earnings of $268.9m, up 57.9%, underpinned by material cash earnings growth in both markets. We maintained strong unit economics, expanded operating leverage and reinforced the value of our differentiated business model. Our focus on exceptional customer experiences is translating into stronger engagement. In the US, we achieved more than 40% growth in both TTV and revenue for a second consecutive year while adding new customers at scale. In ANZ, we returned to revenue and Australian receivables growth, led by the continued success of our Zip Plus product.

Ms Scott said the company was targeting cash earnings of $340 million in FY27, which would be a 26% increase.

Importantly, in the US market, the company said that the majority of TTV “continued to be derived from predominantly non-discretionary expenditure, with health, education, auto and transport the fastest growing categories”.

Broker sees Zip shares as cheap

UBS said this was a key strength of the company.

As they said:

Whilst we are watching macro risk, we see these concerns overplayed given Zip’s exposure to non-discretionary spend in the US, and slowing macro potentially catalysing growth in the buy now pay later space as consumers consider non-traditional cash flow management tools over traditional credit.

UBS said they had made minimal adjustments to their outlook for the company, outside of a 1% reduction in expected cash earnings due to another likely interest rate increase in both Australia and the US.

The broker said Zip was trading on a forward price-to-earnings (P/E) ratio of 15 times, which set it up well to achieve a compound annual growth rate in the high teens.

UBS has a price target of $4.40 on Zip shares, compared with the current $2.24.

The post Down more than 50%, are Zip shares too cheap to ignore? appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England 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.

Tuas Ltd vs Temple & Webster Group shares

If you’re weighing up Tuas Ltd (ASX: TUA) against Temple & Webster Group Ltd (ASX: TPW), you’re probably searching for deep value – after all, both shares have crashed over 65% year to date. While they live in entirely different industries (telecommunications for Tuas and online retail for Temple & Webster), this level of sell-off could have left one or both looking like bargains. Let’s compare their business models, recent results, and what stands out before I give my verdict on which might be the better value buy.

The case for Tuas

Tuas operates a mobile telecommunications network and provides mobile services, focusing on the Singaporean market. Headquartered in Sydney and founded in 2020, it’s a newer player, targeting SIM-only value plans in a highly competitive sector. Its lean operating footprint helps keep costs low.

Notably, Tuas:

• Has a market capitalisation of $907.60 million, the larger of the two companies in this comparison.
• Trades on a P/E ratio of 30.99 with earnings per share of $0.048.
• Has a 0% dividend yield, so you won’t get any income return at current prices.

The company appears growth-focused and is not aimed at income investors just yet.

The case for Temple & Webster

Temple & Webster is an online-only retailer specialising in furniture and homewares. Its huge web-based offering, including office furniture, lighting, and home décor, sets it apart from physical retailers. According to its most recent public description, the company offers a wide product range (over 200,000 items) and a strong online subscriber base, building scale since its 2011 founding.

For Temple & Webster:

• Market cap sits at $517.47 million – notably less than Tuas.
• Its shares command a hefty P/E ratio of 127.95, and earnings per share sit at $0.035.
• Like Tuas, Temple & Webster doesn’t currently pay a dividend.

Valuation comparison

Here’s how the fundamentals stack up side by side:

Metric	Tuas	Temple & Webster
Market Cap	$907.60 million	$517.47 million
P/E Ratio	30.99	127.95
Earnings per Share (EPS)	$0.048	$0.035
Dividend Yield	0.00%	0.00%
Year To Date Return	-76.59%	-67.54%

It stands out to me that Tuas now trades on a much lower P/E ratio than Temple & Webster – 30.99 vs 127.95. This suggests investors demand far more growth from Temple & Webster and are willing to pay up for its potential, despite both companies posting profits. Neither pays a dividend at present.

Recent share price momentum

Comparing recent share price performance up to 9 October 2026:

• Tuas closed at $1.66, essentially flat over its last two trading sessions, and down sharply over the year (YTD return: -76.6%).
• Temple & Webster closed at $4.44, having gained 4.5% on the day, but still deep in the red for 2026 (YTD return: -67.5%).

Which is the better buy?

If I’ve got to pick between two shares smashed more than 65% this year, my pick would be Tuas. There are a few reasons for this call. While both still look risky and could have question marks about their future growth, Tuas trades at a far lower P/E multiple than Temple & Webster. That means, for every dollar of earnings, you’re paying a lot less for Tuas than for Temple & Webster – and both have posted profits in the latest data. Neither stock is paying a dividend, so income-seekers won’t find a winner here.

Temple & Webster has that classic high-growth online retailer story, and sometimes those stories come with extreme valuations. Right now, that shows up as a P/E of nearly 128, versus about 31 for Tuas. Unless Temple & Webster can accelerate earnings growth sharply from here, I’m wary of buying at that kind of multiple after a big fall.

Both shares carry risk, but on valuation grounds, Tuas looks like better value right now. If I had to choose where to hunt for a deep-value rebound, I’d lean toward Tuas.

The post Tuas vs Temple & Webster: Which beaten-down ASX share offers better value? appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart 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 Temple & Webster Group. The Motley Fool Australia has recommended Temple & Webster Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial draft. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

Megaport Ltd (ASX: MP1) has quickly become one of the most exciting growth shares on the ASX.

Its expansion into artificial intelligence (AI) infrastructure has opened up an enormous new market, and recent contract wins suggest the opportunity could be much bigger than investors previously imagined.

But with the shares already enjoying a strong rally, how much upside could still be ahead?

Could a $10,000 investment in Megaport shares today realistically grow to $20,000 by 2030?

A business with much bigger ambitions

The first reason I think Megaport shares have the potential to double is how dramatically its business has changed.

Megaport originally made its name by helping businesses connect to cloud providers and data centres through its global network.

That remains a valuable business, particularly as companies continue moving more of their operations online and need reliable connections between different systems.

But the acquisition of Latitude.sh has taken Megaport into a much larger growth market.

Latitude.sh provides GPU and CPU computing infrastructure, along with networking and storage, allowing customers to run demanding AI workloads.

This gives Megaport direct exposure to the computing power required as artificial intelligence becomes more widely adopted.

And the early results have been impressive. Since April, Megaport has announced approximately $2.3 billion worth of strategic AI infrastructure contracts.

Those agreements have helped lift the company’s pro forma annual recurring revenue to around $1.1 billion, although not all of that revenue is being billed yet.

For me, this is an important development. Megaport has moved beyond demonstrating that demand exists. It now has substantial contracted business to deliver.

What could Megaport look like in 2030?

AI adoption is still developing, and the demand for computing infrastructure could grow substantially as more businesses put AI applications into everyday use.

Megaport is positioning itself to benefit from that spending through Latitude.sh, while its original connectivity business can continue expanding alongside the broader cloud computing market.

The combination could make Megaport a much larger digital infrastructure company by the end of the decade.

We are already seeing how quickly its financial outlook is changing. Following its latest contract wins, Megaport upgraded FY27 revenue guidance to between $720 million and $810 million, with an expected EBITDA margin of 42% to 44%.

If the company delivers on those expectations and maintains strong momentum into FY28, FY29, and FY30, I think its earnings could look significantly different in a few years.

That would provide a foundation for further share price growth.

Could $10,000 in Megaport shares really become $20,000?

Using the recent Megaport share price of approximately $19.69, the shares would need to reach $39.38 for a $10,000 investment to double, excluding costs.

That is an ambitious target, particularly after the company’s recent rally. But I do not think it is beyond reach by 2030.

For that to happen, Megaport would need to successfully convert its existing contracts into revenue and profits, continue winning new customers, and demonstrate that its AI infrastructure business can deliver attractive returns. I would also want to see strong growth continuing beyond the current wave of contracts.

There are risks here. Building AI infrastructure requires substantial capital investment. Megaport is planning to spend between $1.78 billion and $1.88 billion in FY27, reflecting the scale of its expansion.

It also faces rapidly changing technology, competition, and the possibility that AI infrastructure demand develops differently from current expectations.

With so much growth already anticipated, disappointing execution could have a significant impact on the share price.

Foolish takeaway

I think Megaport shares have a realistic chance of doubling by 2030, although I would not treat that outcome as a certainty.

The company has secured a significant foothold in AI infrastructure, and I believe the next few years could see the business grow considerably.

There is still plenty to prove, but if Megaport can turn its growing contract pipeline into sustained earnings and cash flow, I would not be surprised to see the shares trading near $40 before the decade is over.

The post Could $10,000 invested in Megaport shares double by 2030? 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 Megaport. 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.