Some ASX shares spend long periods in the market’s bad books.

That can be frustrating for existing shareholders, but it can also create opportunities for patient investors. When expectations are already low, a business does not need perfection to improve the investment case. It may only need steadier execution, better confidence, or a clearer path to growth.

Here are two ASX shares I would consider buying before sentiment improves.

CSL Ltd (ASX: CSL)

CSL is one share I think investors may come back to over time.

The healthcare giant has been through a difficult period, and confidence is lower than it once was. But I still think the core business has plenty of value.

CSL operates in markets that are difficult to enter and require deep expertise, global scale, regulatory experience, and long relationships with healthcare providers. Plasma therapies, vaccines, and other specialist healthcare products are not areas where new competitors can simply arrive and quickly take market share.

What interests me now is the reset in expectations. CSL no longer needs to be viewed as a perfect compounder to be a worthwhile investment. A period of steadier margins, better execution, and clearer earnings growth could be enough to change the conversation.

The business still needs to deliver, of course. But I think the market may be underestimating how valuable CSL’s global healthcare infrastructure remains.

Zip Co Ltd (ASX: ZIP)

Zip is a very different idea. This is a higher-risk growth share, but I think it has become more interesting as the business has matured.

The old buy now, pay later excitement has faded. That may be a good thing. Zip is now being judged more on earnings, credit quality, operating discipline, and whether it can build a sustainable payments business.

I like that shift. A company that can grow while controlling risk has a much better chance of creating long-term value than one chasing volume at any cost. Zip still needs to prove that its model can keep scaling profitably, especially in large markets such as the United States.

But if management keeps improving credit settings, customer quality, and operating leverage, I think the upside could be meaningful.

Zip remains speculative compared with a blue-chip share. Still, I think it is the kind of stock that can move quickly if the market starts to believe the earnings story has changed.

Foolish takeaway

Buying before sentiment improves is uncomfortable by nature.

The easier moment usually comes later, after the share price has already started to recover and the story sounds cleaner. That is why I think shares like CSL and Zip are worth watching closely now.

Both businesses have something to prove, but both also have a credible path to becoming more valuable if execution improves. That is the kind of setup I like when looking for opportunities.

The post Why I’d buy CSL and Zip shares before they recover 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.

This ASX healthcare stock has become one of the biggest success stories on the ASX.

4DMedical Ltd (ASX: 4DX) has surged 26% over the past five trading days, climbed 37% in the past month, and rocketed an astonishing 1,900% over the past year.

The remarkable rally has now caught the attention of one of the world’s largest investment firms. Let’s take a look at who it is and why it has purchased millions of 4DMedical shares.

Sizeable new stake

According to an ASX update released on Wednesday, JP Morgan Chase & Co. (NYSE: JPM) has acquired more than 31 million shares in 4DMedical, giving it a stake of approximately 6.3% in the company.

The move suggests the investment giant sees potential in a business that is rapidly emerging as a major player in healthcare imaging technology.

It’s not hard to see why investor interest in the ASX healthcare stock has surged.

Intersection AI and medical imaging

4DMedical develops advanced respiratory imaging technology that allows clinicians to assess lung function in ways traditional imaging methods cannot.

Its proprietary software and artificial intelligence tools create detailed functional images of the lungs, helping doctors diagnose and manage respiratory conditions more effectively.

As healthcare providers increasingly adopt AI-powered diagnostic tools, 4DMedical is positioning itself at the intersection of two powerful long-term growth trends: medical imaging and artificial intelligence.

Recent company announcements have only strengthened that investment case.

Expanding globally

One of the company’s biggest recent moves was its acquisition of Austrian AI imaging company Contextflow.

The deal immediately expands 4DMedical’s European footprint and adds lung cancer screening capabilities. It also provides access to existing reimbursement arrangements in Germany.

Management of the ASX healthcare stock believes the acquisition could increase the company’s addressable market by around 50%, significantly expanding its long-term growth opportunity.

For investors, it represents another step in transforming 4DMedical from an emerging Australian healthcare company into a global imaging technology business.

Making progress in the US

The company has also been gaining traction in the world’s largest healthcare market.

Recently, 4DMedical announced a major agreement with SimonMed. This is one of the largest outpatient imaging providers in the US, with more than 170 imaging centres.

The partnership supports the rollout of the company’s CT:VQ lung imaging technology. It provides access to a large network of healthcare providers and potential patients.

Earlier this month, management also launched its CLEAR clinical program targeting acute pulmonary embolism.

Importantly, the ASX healthcare stock believes this initiative could expand the US addressable market for CT:VQ to approximately US$3 billion. This highlights the scale of the opportunity if adoption continues to grow.

Raised expectations

Despite the excitement, investors should remember that expectations are now much higher than they were a year ago.

After a 1,900% gain, the market is increasingly focused on execution. The ASX healthcare stock must continue converting clinical success into commercial adoption. It also needs to grow revenue, expand reimbursement coverage, and successfully integrate its European operations.

Any slowdown in adoption or commercial progress could lead to heightened volatility.

Even so, JP Morgan’s new stake suggests at least one major institutional investor believes the growth story still has room to run. For shareholders, that vote of confidence is unlikely to go unnoticed.

The post This ASX healthcare stock is up 1,900%. One top fundie wants more appeared first on The Motley Fool Australia.

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JPMorgan Chase is an advertising partner of Motley Fool Money. 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 JPMorgan Chase. 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.

Starting out in the share market can feel straightforward: buy a few popular ASX shares like BHP Group Ltd (ASX: BHP) and CSL Ltd (ASX: CSL), wait, and watch wealth grow. In reality, many new investors fall into avoidable traps that can hurt long-term returns.

The good news is that most of these mistakes are behavioural rather than technical. Once identified, they are relatively easy to fix. Here are three of the most common investing mistakes beginners still make.

1. Trying to time the market

One of the biggest mistakes new investors in ASX shares make is trying to predict short-term market movements.

It often starts with good intentions. Investors see headlines about falling markets and decide to “wait for a better entry point.” Or they sell during periods of volatility, hoping to buy back later at a lower price.

The problem is that timing the market consistently is extremely difficult, even for professionals. Markets tend to recover quickly, and missing just a handful of strong trading days can significantly reduce long-term returns.

A more effective approach is time in the market rather than timing the market. Regular investing, regardless of short-term noise, helps smooth out volatility over time.

2. Chasing hot stocks and trends

Another common mistake is buying ASX shares purely because they have recently surged.

This often happens during periods of market excitement. A stock doubles, gets attention on social media, and suddenly feels “safe” because everyone is talking about it.

But strong recent performance does not guarantee future returns. In many cases, the best part of the rally has already passed by the time retail investors enter.

Chasing momentum can also lead to concentration risk, where portfolios become overly exposed to a small number of high-flying growth stocks.

A more balanced approach focuses on business quality, earnings growth, and valuation rather than recent price action.

3. Ignoring diversification

Many beginners also underestimate the importance of diversification.

It is common for new investors to hold just a few ASX shares, often in sectors such as banking, mining, or technology. While this can work in strong markets, it creates significant risk if one sector underperforms.

Diversification helps reduce the impact of any single company or industry on overall portfolio performance. It can be achieved across sectors, geographies, and even asset classes.

Exchange-traded funds (ETFs) are among the simplest ways to achieve diversification without having to pick individual stocks. Broad-market ETFs provide exposure to hundreds of companies in a single investment.

Foolish takeaway

Most investing mistakes do not come from complex errors. They come from behaviour: reacting emotionally, chasing performance, and underestimating risk.

By focusing on long-term investing, prioritising quality businesses, and maintaining diversification, beginners can avoid many of the pitfalls that derail returns early on.

Investing does not need to be complicated, but it does require discipline.

The post New to ASX shares? Avoid these 3 beginner mistakes appeared first on The Motley Fool Australia.

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• Why I’d buy CSL and Zip shares before they recover
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• Down 54%: What should I do with my CSL shares now?
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Motley Fool contributor Marc Van Dinther has positions in BHP Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL. The Motley Fool Australia has recommended BHP Group and CSL. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.