There are a number of ASX shares that could be excellent buys right now based on their valuations and potential growth.

When the valuation makes sense, businesses that are growing earnings rapidly could be very attractive buys.

When one analyst rates a business as a buy, that’s interesting. When numerous experts rate a stock as a buy, it could be a compelling opportunity. Let’s look at two ASX shares with significant backing.

TechnologyOne Ltd (ASX: TNE)

TechnologyOne is one of the ASX leading tech companies. It provides enterprise resource planning (ERP) software to various customers such as government entities, local councils, companies, universities and so on.

According to the Commsec collation of analyst opinions, there are currently 13 buy ratings on the business, as well as one hold rating and two sell ratings.

The company is delivering impressive growth year over year. It has a net revenue retention (NRR) goal of 115%, which means it’s aiming to grow its revenue from its existing client base by 15% each year. At that pace, revenue would double in size over five years.

The ASX share is winning more clients in different markets, across both geographies and sectors. It’s growing in the UK, which is a large target market and has similar institutions to Australia, so its software offerings could resonate with potential customers.

I like how the company invests significantly in research and development, which helps it provide the best offering for clients. Additionally, AI tools could help the business lower its costs/speed up its development.

According to the projection on Commsec, the TechnologyOne share price is valued at 51x FY27’s estimated earnings.

Zip Co Ltd (ASX: ZIP)

Zip is one of the leading buy now, pay later businesses in Australia and New Zealand.

According to the Commsec collation of analyst opinions, there are currently 12 buy ratings on the business, with no other ratings.

The ASX share is experiencing ongoing solid growth in the US, which is now the company’s core growth market and it’s seeing rising profit generation.

In the FY26 third quarter, Zip reported total income growth of 20.2% to $335.2 million and operating profit (cash EBTDA) growth of 41.5%. Revenue is growing at a strong pace and profit margins are increasing, which is a great sign for the company’s future net profit.

The company has seen an increase in net bad debts, so that’s something to keep an eye on. But, it’s a lot cheaper than it was in October 2025 – it’s down more than third since then.

According to the projection on Commsec, the Zip share price is valued at 33x FY26’s estimated earnings.

The post 2 ASX shares highly recommended to buy: Experts appeared first on The Motley Fool Australia.

More reading

• Buy, hold, sell: TechnologyOne, Pro Medicus, PLS Group shares
• Top brokers name 3 ASX shares to buy next week
• 10 fantastic ASX shares to buy for FY27
• Why brokers think Zip shares could soar 50% or more in FY27
• Why I’d buy and hold ResMed and TechnologyOne shares with $5,000

Motley Fool contributor Tristan Harrison has positions in Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Technology One. The Motley Fool Australia has recommended Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

If you are looking for exposure to the healthcare sector and have a high tolerance for risk, then it could be worth considering the ASX share in this article.

That’s because the team at Bell Potter believes it could be a buy with huge upside potential.

Which ASX healthcare share?

The share that Bell Potter has initiated coverage on this week is Lumos Diagnostics Holdings Ltd (ASX: LDX).

It is a commercial-stage point-of-care (POC) diagnostics company that is busy developing rapid testing solutions for frontline healthcare settings.

Bell Potter believes the company’s FebriDx product is worth getting excited about. It explains:

FebriDx is a rapid POC test built around a simple clinical question, Does the patient have an acute respiratory infection (ARI) requiring antibiotics? Unlike other assays, FebriDx assesses the patient’s immune response to distinguish bacterial from nonbacterial illnesses after 10 minutes, via a single fingerstick blood sample. 

The dual biomarker (CRP/MxA) rapid read out supports antibiotic stewardship through real-time decision making that ensures lower and more effective antibiotic use. The journey has been long and has had some setbacks, but now there is a clear path to commercial success following FDA approval with CLIA waiver and reimbursement from CMS that delivers a starting gross margin of 60% and capacity to increase it to 80% over time.

The good news is that the broker highlights that this product gives the ASX healthcare share an estimated US$1 billion market opportunity. It adds:

The CLIA waiver for FebriDx in March 2026 expanded access to eligible sites by c.8.5x from c.32k to c.277k sites via enabling lower-complexity clinics to perform the FebriDx rapid diagnostic test. The waiver provides access to clinics that are a better fit for FebriDx with lower-complexity front-line settings where FebriDx’s rapid, analyserfree workflow is better aligned with real-time prescribing decisions. LDX claims it is now exposed to c.80m annual patient visits to Urgent Care / Primary Care Physicians which creates a c.US$1b opportunity.

Big potential returns

According to the note, the broker has initiated coverage on Lumos Diagnostics shares with a buy rating and 25 cents price target. 

Based on its current share price of 8.6 cents, this implies potential upside of 190% for investors over the next 12 months.

Commenting on its initiation, Bell Potter said:

We initiate coverage with a BUY recommendation and a 10-yr DCF-based valuation/ TP of $0.25/sh, assuming a WACC of 13% and TG of 3.5%. Our TP offers material upside which relies on ensuring deep utilisation by WellStreet and wider adoption of FebriDx over time.

The post Top broker just put a buy rating on this ASX healthcare share appeared first on The Motley Fool Australia.

More reading

• 2 ASX shares highly recommended to buy: Experts
• How much superannuation is needed to target a $100,000 annual passive income?
• 5 things to watch on the ASX 200 on Wednesday
• Why Nick Scali shares are set for a 36% rebound: Expert
• 2 ASX blue-chip shares offering big dividend yields

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.

Superannuation is a very effective tool for investors to generate returns with a lower tax rate. It could be a very useful way to invest for Aussies wanting passive income.

The main reason it’s so appealing is that superannuation has a lower tax rate compared to many individuals, trusts and companies. I believe the nature of the superannuation structure, and how Aussies access that money in retirement, enable investors to invest for the long-term.

Receiving passive income is one of the rewarding elements of owning ASX shares with how little effort we need to put in for the ongoing dividend payments.

In my opinion, the passive income we receive after tax is a more important figure than the before-tax figure, because that’s what investors get to keep.

Superannuation can have a tax rate as low as 0% in retirement. That’s great. In the accumulation phase, the superannuation 15% tax rate on income is lower than what many individuals or companies may experience.

Every household may have a different tax situation, so I’ll just focus on a specific dividend income target and won’t refer to tax rates from now on.

How much is needed in superannuation for $100,000 of annual passive income?

Receiving $100,000 in dividends each year would be wonderful, in my opinion. I’d love to receive that much, though I’ve got a long way to go to get there.

There are a variety of asset classes that investors can consider for income such as term deposits, bonds, property and shares.

I think that ASX shares are the best choice for passive income, partially thanks to the excellent bonus of franking credits.

The portfolio size required to earn $100,000 depends on the size of the dividend yield.

As an example, a portfolio with a 5% dividend yield would require a $2 million portfolio. If a portfolio had a dividend yield of 6%, it would need a $1.67 million portfolio.

Different dividend yields require different-sized portfolios to reach that $100,000 of passive income from superannuation.

The sorts of ASX dividend shares I’d buy

Within the ASX share space, there are a few different types of dividend options that offer good dividend yields, such as real estate investment trusts (REITs), S&P/ASX 300 Index (ASX: XKO) shares and compelling listed investment companies (LICs).

Some of the businesses I’d consider with a lower-to-medium dividend yield include Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), Wesfarmers Ltd (ASX: WES), Australian Foundation Investment Co Ltd (ASX: AFI) and Telstra Group Ltd (ASX: TLS).

Some of the higher-yielding names I’d consider include WCM Global Growth Ltd (ASX: WQG), Future Generation Global Ltd (ASX: FGG), Future Generation Australia Ltd (ASX: FGX), Centuria Industrial REIT (ASX: CIP) and Dexus Industria REIT (ASX: DXI).

There are even more ASX dividend shares that superannuation investors could consider for passive income, but I think the above names are a useful starting list.

The post How much superannuation is needed to target a $100,000 annual passive income? appeared first on The Motley Fool Australia.

More reading

• How much passive income can I earn off a $50,000 portfolio?
• How much do I need in superannuation to receive $6000 per month in passive income?
• How to build a successful ASX dividend portfolio
• How I’d invest $10,000 in ASX shares for the next decade
• 3 of the best ASX dividend stocks to supplement your superannuation

Motley Fool contributor Tristan Harrison has positions in Future Generation Australia, Future Generation Global, Washington H. Soul Pattinson and Company Limited, and Wcm Global Growth. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited and Wesfarmers. The Motley Fool Australia has positions in and has recommended Telstra Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.