Author: openjargon

It was a pleasant end to the trading week for the S&P/ASX 200 Index (ASX: XJO) and many ASX shares this Friday. After yesterday’s strong gain shook off the volatility that we saw earlier in the week, today’s gains cemented that optimism.

After spending the entire session in green territory, the ASX 200 ended up closing 0.41% higher today. That leaves the index at a flat 8,657 points as we head into the weekend.

This pleasing end to the Australian trading week follows a bullish session on Wall Street last night.

The Dow Jones Industrial Average Index (DJX: .DJI) managed to overcome some early jitters to rise 0.55%.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) wasn’t quite as optimistic, though, and inched 0.087% higher.

But let’s return to ASX shares now for a discussion on what was happening amongst the various ASX sectors this Friday.

Winners and losers

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

More reading

• This ASX uranium stock is jumping 7% today as brokers see more upside
• Why Appen, Guzman Y Gomez, Monadelphous, and PMET shares are racing higher today
• 4 ASX 200 stocks rocketing higher this week
• ASX 200 hits 5-day high as miners lead another rebound
• 4 ASX shares scoring upgraded ratings this week

Motley Fool contributor Sebastian Bowen 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 recommended Elders. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

After a tough month, Paladin Energy Ltd (ASX: PDN) shares are suddenly back in demand.

The uranium producer is up 6.69% to $11.15 at the time of writing, with buyers returning after a recent pullback.

Paladin shares are still down around 18% over the past month, so today’s move only claws back part of the recent fall.

But it does add another twist to what has already been a huge 12 months for shareholders.

The stock remains up more than 100% over the past year, helped by stronger interest in uranium and Paladin’s exposure to the Langer Heinrich Mine in Namibia.

So, what is pushing buyers back into the stock today?

Uranium is helping sentiment

A stronger uranium price appears to be one of the main drivers behind today’s move.

Uranium futures were recently trading above US$86.50 per pound, near their highest level in 2 months.

Prices have been supported by stronger risk appetite and growing confidence in longer-term demand from nuclear power.

Large tech companies are also adding to the interest, with nuclear energy increasingly being looked at as a power source for data centres.

Microsoft Corp (NASDAQ: MSFT) and Meta Platforms Inc (NASDAQ: META) have both been linked to nuclear power agreements, while US policy has also become more supportive of nuclear energy.

This gives investors another reason to look at uranium producers such as Paladin.

Paladin owns the Langer Heinrich uranium mine in Namibia and has projects across Australia, Canada, and Africa.

Brokers are still interested

Broker commentary also appears to be helping sentiment.

Recent broker updates show Morgan Stanley initiating coverage on Paladin with a buy rating and a $13.05 share price target.

Macquarie has also been positive, with a $13.25 target appearing in recent broker notes.

Ord Minnett has taken a more cautious view, cutting its price target to $9.50 earlier this month.

Nonetheless, the broader broker picture is still mixed. The latest consensus shows 4 buy ratings, 3 holds, and 2 sells, with an overall recommendation of hold.

What the chart is showing

The stock is now trading around $11.14, with today’s move taking it back above its previous close of $10.45.

The day’s range so far is $10.67 to $11.15, while the 52-week range is $5.74 to $15.10.

The chart also shows Paladin sitting below the middle of its recent Bollinger Band range.

The upper band is around $13.75, while the lower band is near $9.56.

Its relative strength index (RSI) is sitting around 46, which tells us the stock isn’t looking heavily overbought after its recent fall.

The post This ASX uranium stock is jumping 7% today as brokers see more upside appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy now
• Up about 80% this year, these ASX uranium stocks are still a buy
• Why CBA, Paladin Energy and CSL shares crashed  9% to 17% this week
• Are Paladin Energy shares a buy after crashing 14% this week?
• Why CBA, Healius, Paladin Energy, and Temple & Webster shares are sinking today

Motley Fool contributor Aaron Teboneras 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 Macquarie Group, Meta Platforms, and Microsoft. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Meta Platforms and Microsoft. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

S&P/ASX 200 Index (ASX: XJO) retail shares are down 14% in 2026 amid increasing headwinds for the sector.

The most concerning factor for consumer discretionary retailers right now is falling consumer sentiment.

And it’s no surprise that Aussies are feeling pessimistic and tightening their purse strings.

What’s bringing consumers down?

The Reserve Bank has raised interest rates three times this year amid resurgent inflation exacerbated by the global oil shock.

The Westpac–Melbourne Institute Consumer Sentiment Index fell to an “extreme low” of 80.1 in April due to the Iran war.

That was the worst result since the pandemic, and there was only a small uptick of 3.5% this month.

Matthew Hassan, Head of Australian Macro-Forecasting at Westpac Banking Corp (ASX: WBC), said:

Despite a small improvement, consumers remain deeply pessimistic.

Forward views are clearly still being weighed down by uncertainty around global energy supply with the Strait of Hormuz still effectively shut.

However, rate rise fears are also in the mix.

Hassan said consumers expect variable home loan rates to rise further.

Even with three hikes already done this year, 85% of consumers still expect mortgage rates to increase further over the next 12 months.

That is closer to 90% across consumers with a mortgage.

Impact of the Federal Budget

Hassan said the personal impact of the Federal Budget for consumers was “very mixed”, according to this month’s survey.

Key announcements included proposed changes to capital gains tax (CGT) on all assets, including property, shares, and businesses.

Hassan said:

Among ‘baby boomers’ and ‘Generation X’, those expecting to be worse off outnumbered those expecting to benefit by 30–36% compared with a gap of just 9% for ‘Millennials’ and small net positive spread (+1%) among ‘Generation Z’ (or ‘zoomers’).

This week, the market was also surprised by weaker-than-expected jobs data, with unemployment lifting from 4.3% to 4.5%.

Commonwealth Bank of Australia (ASX: CBA) Senior Economist Ashwin Clarke was expecting employment to rise by 15,000 people.

Instead, employment decreased by 18,600 people in April.

Broker cuts price targets on 5 ASX retail shares

All of this factored into broker Jefferies slashing its 12-month share price target on ASX retail share Nick Scali Ltd (ASX: NCK) today.

The Nick Scali share price is $13.38, down 2.3% today and down 43% in the calendar year to date (YTD).

Jefferies downgraded Nick Scali shares from buy to hold and cut its target by 44% to $14 per share.

Analyst Michael Simotas forecasts lower profits ahead due to poor consumer sentiment and headwinds for the property market.

Even before the proposed CGT changes, the Australian property market had already begun to weaken on higher interest rates.

Latest data from Cotality shows a 0.6% fall in property values in Sydney and Melbourne in April and no growth in Canberra.

Last week, Sydney’s preliminary clearance rate fell 6% to 49.2%, the weakest result since the early COVID period in April 2020.

Simotas said his profit forecast downgrades for the ASX retail share were due to “operating deleverage in Australia, New Zealand and U.K. due to softening macroeconomic conditions and given Nick Scali’s sales are strongly correlated to housing market”.

Simotas cut his FY26 net profit forecast by 8%, and said he has cut forecasts for future years by up to 30%.

Other ASX retail shares with slashed price targets

Jefferies cut its share price targets on several other ASX retail shares today.

These include fellow furniture retailer, Harvey Norman Holdings Ltd (ASX: HVN).

The Harvey Norman share price is $4.37, down 1.5% on Friday and down 38% YTD.

Jefferies downgraded its 12-month price target for this ASX retail share by 27% to $4.40 per share.

Jefferies also cut its price target on ASX travel retail share Webjet Group Ltd (ASX: WJL) by 38% to 40 cents per share.

The Webjet share price is currently 47 cents, down 2.1% today and down 47% YTD.

Wesfarmers and JB Hi-Fi shares receive price target reductions

Jefferies cut its 12-month target for Wesfarmers Ltd (ASX: WES) shares by 5.9% to $72.

The Wesfarmers share price is $74.71, down 0.1% today and down 8.6% YTD.

ASX electronics retail share JB Hi-Fi Ltd (ASX: JBH) also attracted a 6% price target cut to $75.

The JB Hi-Fi share price is $73.18, up 1.7% on Friday and down 24% YTD.

The following chart shows the share price percentage falls for these 5 ASX retail shares.

The post 5 ASX retail shares whose 12-month price targets just got slashed appeared first on The Motley Fool Australia.

More reading

• 5 ASX 200 shares downgraded by the experts this week
• Here’s a 9% ASX dividend stock to consider for a monthly passive income
• Why are Virgin Australia shares booming 8% higher today?
• Buy, hold, sell: James Hardie, TechnologyOne, and Webjet shares
• 3 ASX stocks expected to increase their dividends in 2026

Motley Fool contributor Bronwyn Allen 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 Jefferies Financial Group and Wesfarmers. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Nick Scali and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

With just a few hours of trade left before Friday’s closing bell, the S&P/ASX 200 Index (ASX: XJO) is up 0.4% for the week, but these three ASX 200 shares are joining in with the rebound.

So, which stocks came under heavy selling pressure this week?

Read on!

Northern Star Resources Ltd (ASX: NST)

First up, we have Northern Star shares.

Shares in the Aussie gold mining giant closed last week trading for $20.50. At the time of writing, shares are changing hands for $18.89 each. That sees this ASX 200 share down 7.9% for the week.

Northern Star shares have closed in the red every day this week and look to do so again today.

Shares closed down 2.1% yesterday following the release of the company’s March quarter update.

Over the three months, Northern Star sold 380,807 ounces of gold. The miner produced that gold at an all-in sustaining cost (AISC) of $2,709 per ounce and reported revenue from gold sales of $2.01 billion.

Atop a modest retrace in the gold price this week (currently at US$4,527 per ounce, according to data from Bloomberg), Northern Star shares may have come under pressure with the company expecting an increase in its full-year FY 2026 growth capital expenditures.

Brambles Ltd (ASX: BXB)

Brambles shares also had a week to forget.

Shares in the global pallets and crates supplier closed last Friday trading for $22.10 and are currently trading for $16.96 each. That puts this ASX 200 share down 23.3% for the week.

Brambles shares crashed 20.2% on Monday following a trading update.

Investors were reaching for their sell buttons after Brambles cut its full-year FY 2026 sales revenue growth forecast to 2% to 3%. That was down from prior guidance of 3% to 4% revenue growth (at constant exchange rates).

Management also cut full-year profit growth guidance to 3% to 5%, down from prior guidance of 8% to 11% FY 2026 profit growth.

Which brings us to…

Tuas Ltd (ASX: TUA)

The worst-performing ASX 200 share this week is Tuas.

Shares in the Singapore-based telecom stock closed last week trading for $6.10. At the time of writing, shares are swapping hands for $2.28 each, putting the Tuas share price down a painful 62.6% for the week.

Most of that pain was delivered on Monday after the company announced that its SIMBA mobile business “may have been using radio frequency bands that it was not authorised to use”.

Today, investors learned that Tuas’ planned acquisition of Singapore telecom company M1 Limited will no longer proceed.

The post 3 ASX 200 shares crashing in this week’s rebounding market appeared first on The Motley Fool Australia.

More reading

• Why Catapult Sports, IAG, Telstra, and Tuas shares are falling today
• Why is everyone talking about Guzman Y Gomez, Tuas and Appen shares on Friday?
• 5 ASX 200 shares downgraded by the experts this week
• 7 ASX shares with strengthened buy ratings this week
• Tuas terminates M1 acquisition

Motley Fool contributor Bernd Struben 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.

The S&P/ASX 200 Index (ASX: XJO) is having another positive session on Friday. In afternoon trade, the benchmark index is up 0.5% to 8,665 points.

Four ASX shares that are rising more than most today are listed below. Here’s why they are pushing higher:

Appen Ltd (ASX: APX)

The Appen share price is up 11% to $1.25. Investors have been buying the artificial intelligence data services company’s shares following the release of an update at its annual general meeting. Appen has reaffirmed its FY 2026 guidance and continues to expect revenue of $270 million to $300 million. Management is also targeting an underlying EBITDA margin before FX of around 5% to 10%. Appen’s CEO, Ryan Kolln, said: “We continue to see positive signals on LLM-related growth from both Appen Global and Appen China customers. Tight cost controls remain in place, in keeping with our focus on managing costs in line with the revenue opportunity.”

Guzman Y Gomez Ltd (ASX: GYG)

The Guzman Y Gomez share price is up 13% to $20.49. This follows news that the quick service restaurant operator has decided to close its struggling US stores. Guzman Y Gomez’s founder and co-CEO, Steven Marks, said: “I have always been confident in the differentiation of our food and guest experience, however this was not translating to an improvement in sales momentum. Having spent the last 3 months in the US, I realised this was going to take significantly more time and capital than we had expected. In assessing the trajectory of the current network, the Board and I have concluded that the business is unlikely to deliver the performance that would justify continued investment of shareholder capital.”

Monadelphous Group Ltd (ASX: MND)

The Monadelphous share price is up 2% to $29.97. This morning, this diversified services company announced that it has secured $120 million in new construction and maintenance contracts across the resources and renewable energy sectors. One is from Fortescue Ltd (ASX: FMG) for the battery energy storage system (BESS) construction contract at the Cloudbreak mine.

PMET Resources (ASX: PMT)

The PMET Resources share price is up 5.5% to 69.7 cents. Investors have been buying this critical minerals exploration company’s shares after it announced the start of its major 2026 summer-fall exploration campaign at the Shaakichiuwaanaan Property in Canada. It notes that this campaign comprises approximately 45,000 metres of drilling. The Shaakichiuwaanaan Property is the company’s flagship asset and hosts one of the largest pegmatite mineral resources and mineral reserves in the world.

The post Why Appen, Guzman Y Gomez, Monadelphous, and PMET shares are racing higher today appeared first on The Motley Fool Australia.

More reading

• Up 72% in a year, Monadelphous just scored another win
• 4 ASX 200 stocks rocketing higher this week
• 4 ASX shares scoring upgraded ratings this week
• Why is everyone talking about Guzman Y Gomez, Tuas and Appen shares on Friday?
• This ASX AI stock is surging 9% today after a wild month

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 positions in and has recommended Appen. 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.

Shares in Monadelphous Group Ltd (ASX: MND) have climbed 2% today (at the time of writing) after the engineering services company announced a fresh batch of contract wins across the mining and energy sectors.

It’s another win for the ASX 200 company that continues to consistently outperform expectations.

Over the last 12 months, Monadelphous shares have surged roughly 72%, making it one of the standout performers among the ASX’s industrial companies.

What did the company announce?

Monadelphous revealed it had secured approximately $120 million worth of new construction and maintenance contracts across the resources and renewable energy sectors.

The contracts include a new five-year panel agreement to provide mobile crane and lifting services across Rio Tinto Ltd’s (ASX: RIO) Pilbara operations, as well as a three-year contract extension for sustaining capital services with the mining giant. The company also secured a battery energy storage system construction project at Fortescue Ltd’s (ASX: FMG) Cloudbreak mine site and a new maintenance panel appointment with Port Waratah Coal Services in Newcastle.

The announcement reinforces something investors appear to increasingly appreciate about Monadelphous, that the company keeps winning repeat work from major customers.

Why repeat business matters

In engineering and maintenance contracting, relationships, safety performance, and execution track records are critical.

Mining companies typically prefer working with contractors that already understand their sites, systems, and operating procedures. Once those relationships are established, incumbents often have a meaningful advantage when new work becomes available.

Monadelphous has spent decades building those relationships across Australia’s resources sector, and today’s update suggests the company remains deeply embedded with Tier 1 operators like Rio Tinto and Fortescue.

That kind of positioning can be a powerful competitive advantage over time.

Exposure to the energy transition

The Fortescue battery energy storage system project marks Monadelphous’ third battery energy storage system project supporting the miner’s decarbonisation initiatives.

That suggests the company is not only benefiting from traditional mining investment, but may also be positioning itself to capture more work tied to electrification, renewable energy integration, and lower-emissions infrastructure.

As major resource companies spend money on modernising operations, contractors with proven capabilities could continue seeing strong demand.

Foolish bottomline

Engineering contractors can often be volatile businesses, particularly when projects are poorly priced or execution slips.

But Monadelphous has historically maintained a relatively disciplined reputation, focusing on operational delivery and long-term customer relationships rather than chasing growth at any cost.

After a 72% rally over the last year, the market clearly believes the strategy is working.

And today’s announcement was another reminder of why Monadelphous continues to stand out.

The post Up 72% in a year, Monadelphous just scored another win appeared first on The Motley Fool Australia.

More reading

• Why Appen, Guzman Y Gomez, Monadelphous, and PMET shares are racing higher today
• Buying Rio Tinto shares? Here’s the yield you’ll get today
• Monadelphous wins $120m in new contracts across mining and renewables
• 5 things to watch on the ASX 200 on Friday
• 2 top ASX 200 dividend stocks to help boost your superannuation income

Motley Fool contributor Kevin Gandiya 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.

Insurance Australia Group Ltd (ASX: IAG) shares are having a rough finish to the week.

At the time of writing, the IAG share price is down 4.54% to $7.78.

The fall adds to a difficult 12 months for shareholders, with the ASX 200 insurance stock now down 11% over the past year.

It has recovered 4.2% since this time last month, but today’s move shows investors are still quick to sell when concerns start to appear.

The stock also remains well below its 52-week high of $9.18.

So, what has changed today?

Citi downgrade weighs on IAG shares

According to CMC Markets, Citi has downgraded IAG to ‘neutral’ from ‘buy’.

The downgrade comes as investors digest fresh commentary around the insurer’s possible exposure to the Greensill collapse.

Greensill Capital collapsed in 2021, triggering a long-running legal and financial fallout across several markets.

Citi analyst Nigel Pittaway has warned IAG could face a claim in an upcoming Greensill court fight, according to The Australian.

IAG writes well known insurance brands including NRMA, RACV and CGU, and has previously maintained that it avoided exposure to the Greensill disaster.

But the issue appears to have moved back into focus after recent developments involving other insurers and litigation reserves.

The company has provisioned $432 million for legal fees and claims handling, while saying it expects no net exposure.

Pittaway said this does not provide a major reason to question IAG’s declared net nil position by itself.

But he also said there’s a potential for the issue to resurface.

Why investors are nervous

Insurance stocks can look fairly defensive when premiums are rising and claims are manageable.

However, legal uncertainty can change how investors think about risk.

IAG is one of the biggest insurance businesses on the ASX with a market capitalisation of about $18.2 billion.

It also trades on a price-to-earnings ratio (P/E) of about 17 and has a dividend yield near 4%.

So, investors are not really looking at a distressed business. The concern is whether the unexpected legal costs could become larger than the market had expected.

The comparison with other insurers is also weighing on sentiment.

The Australian noted that Tokio Marine recently warned of significant litigation losses and reserve increases.

It also said Marsh has booked a US$425 million charge linked to Greensill litigation.

Foolish takeaway

The IAG share price is being hit today because investors took on another reason to question risk.

The business itself isn’t suddenly under pressure, but legal uncertainty can be enough to change sentiment.

And with the stock already down over the past year, today’s downgrade is adding more pressure.

The post Why this ASX 200 insurance stock is sinking today appeared first on The Motley Fool Australia.

More reading

• Why Catapult Sports, IAG, Telstra, and Tuas shares are falling today
• 5 ASX 200 shares downgraded by the experts this week
• Here are the top 10 ASX 200 shares today
• 9 ASX 200 shares with renewed buy calls from the experts this week
• Where to invest with interest rates rising

Motley Fool contributor Aaron Teboneras 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.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a positive note. At the time of writing, the benchmark index is up 0.5% to 8,665 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are falling:

Catapult Sports Ltd (ASX: CAT)

The Catapult Sports share price is down 5.5% to $3.55. Investors have been selling this sports technology company’s shares despite there being no news out of it. However, it is worth noting that Catapult’s shares have rallied very strongly this week following the release of its FY 2026 results. In fact, despite today’s pullback, the Catapult share price remains up almost 18% since this time last week. This could mean that some investors are taking a bit of profit off the table during Friday’s session.

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price is down 4.5% to $7.77. This appears to have been driven by a broker note out of Citi this morning. According to the note, the broker has downgraded the insurance giant’s shares to a neutral rating (from buy) with an $8.50 price target. Citi made the move largely on valuation grounds following a recent share price rally. In addition, it has concerns over IAG’s exposure to Greensill-related litigation risks.

Telstra Group Ltd (ASX: TLS)

The Telstra share price is down 1.5% to $5.38. This also may have been driven by the release of a broker note this morning. According to a note out of Macquarie, its analysts have downgraded Telstra’s shares to a neutral rating (from outperform) with a trimmed price target of $5.57 (from $5.64). The broker thinks investors should be looking at tech stocks in the current environment rather than defensive telcos. This is particularly the case given its belief that the defensive premium that Telstra shares command could be at risk as interest rates rise.

Tuas Ltd (ASX: TUA)

The Tuas share price is down 3.5% to $2.23. This follows news that the Singapore-based telco has terminated its proposed acquisition of M1 Limited. This follows news earlier this week that authorities had suspended the review of the deal after Tuas’ Simba business was found to have allegedly used spectrum it did not own. It said: “Simba continues to co-operate with the investigation being undertaken by the Infocomm Media Development Authority into potential breaches of the Telecommunications Act and the conditions of Simba’s Facilities-Based Operator Licence. Tuas will keep shareholders updated in relation to that investigation.”

The post Why Catapult Sports, IAG, Telstra, and Tuas shares are falling today appeared first on The Motley Fool Australia.

More reading

• 3 ASX 200 shares crashing in this week’s rebounding market
• Why this ASX 200 insurance stock is sinking today
• Morgan Stanley names 3 ASX shares to buy
• Why is everyone talking about Guzman Y Gomez, Tuas and Appen shares on Friday?
• 5 ASX 200 shares downgraded by the experts this week

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

Artificial intelligence (AI) is often talked about as a software or semiconductor story.

That makes sense. The chips, models, and platforms are doing extraordinary things. But behind all of that is a less glamorous requirement: infrastructure.

AI needs enormous computing capacity. It needs data centres, land, power, cooling, network connectivity, and capital. It also needs companies capable of delivering complex projects in the right locations.

This week, Nvidia CEO Jensen Huang described AI factories as “the largest infrastructure expansion in human history.”

That is a huge statement, but I think it captures why investors may need to think beyond the most obvious AI winners. The physical backbone of AI could be a major long-term opportunity in its own right.

Two S&P/ASX 200 Index (ASX: XJO) shares I’d buy for exposure to this theme are named in this article.

NextDC Ltd (ASX: NXT)

NextDC is one of the most direct AI infrastructure plays on the ASX.

The company owns and operates data centres, which are becoming increasingly important as demand grows for cloud computing, cybersecurity, enterprise software, digital services, and AI workloads.

I like NextDC because it gives investors exposure to the capacity side of the AI boom. It does not need to create the best AI model or design the winning chip. Its role is to provide the infrastructure that helps customers run the digital workloads they need.

That can be a powerful place to sit if demand keeps rising.

The company’s recent update showed how strong that demand has become. NextDC announced record contracted utilisation and a major capital plan to support future growth.

This shows that large customers are locking in capacity well in advance, suggesting that high-quality data centre space is becoming increasingly strategically important.

There are risks. NextDC is capital-intensive, and building data centres requires a large upfront investment. Funding, construction, power availability, and customer concentration all need to be watched closely.

But I think those risks come with the territory. If AI infrastructure demand continues to grow, companies with available capacity, technical expertise, and strong customer relationships could be in a valuable position.

For investors wanting a direct ASX 200 exposure to data centre demand, NextDC would be high on my list.

Goodman Group (ASX: GMG)

Goodman is another AI infrastructure opportunity.

It is best known as an industrial property giant, with logistics assets across major global markets. That part of the business remains attractive, supported by e-commerce, supply chain efficiency, and the need for well-located warehouse space.

But I think the data centre opportunity has become one of the most compelling parts of the Goodman story.

Data centres are not easy to build. They need suitable land, planning approvals, capital, customers, technical execution, and, increasingly, access to power. These constraints can make the right sites far more valuable.

This is where Goodman looks well placed. The company has a global development platform, relationships with major customers, and a track record of creating value from scarce, well-located assets. Its growing focus on data centres gives investors a way to benefit from the AI infrastructure boom while leveraging the backing of a broader property platform.

I also like that Goodman is not a pure-play data centre stock. That can reduce some of the reliance on one theme. Its logistics business still has long-term demand drivers, while data centres add another layer of potential growth.

The main risk is valuation. Goodman is a high-quality business, and the market often prices it that way. Large development pipelines also come with execution risk.

Even so, I think Goodman has the assets, capital discipline, and global reach to remain one of the best ASX 200 ways to invest in this infrastructure shift.

Foolish Takeaway

The AI boom is about more than chips and software.

If AI demand keeps growing, the world will need much more digital infrastructure to support it. That could create a long runway for companies providing data centre capacity, power access, and development expertise.

Neither share is risk-free, and both require patience. But if AI infrastructure really does become one of the defining investment themes of the next decade, these are two ASX 200 shares I would want in my portfolio.

The post 2 ASX 200 shares I’d buy for the AI infrastructure boom appeared first on The Motley Fool Australia.

More reading

• Morgan Stanley names 3 ASX shares to buy
• 2 ASX 200 shares I’d buy for the next 10 years
• 3 amazing ASX 200 shares I’d buy and forget about until 2036
• 3 of the best ASX 200 blue-chip shares to buy now
• How to build a $150,000 ASX share portfolio from scratch

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 Goodman Group and Nvidia. The Motley Fool Australia has recommended Goodman Group and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

It’s never a bad idea to get some expert help when looking for shares that might be undervalued.

I’ve had a look at the research reports coming out of Morgan Stanley this week and picked out three which might be of interest.

Let’s have a look.

Catapult Sports Ltd (ASX: CAT)

Catapult specialises in technology which can be used to track sportspeople on the field and during training, with the metrics used by coaches and athletes to improve performance.

The company released its full year results this week, and said its annualised contract value increased 28% year-on-year to US$133.8 million.

Chief Executive Officer Will Lopes said it was a transformational year for the company.

He added:

We set ourselves ambitious targets: maintain our organic growth rate, reinvest meaningfully in our platform, and stay focused through a period of significant M&A. We delivered on all of them. These results reflect the efforts of every person at this company, and to the world-class sports teams who trust us with their performance every day.

Morgan Stanley said it was “another strong result, with operating metrics all improving”.

They added:

Of particular note was the pleasing progress made with bedding down the IMPECT and Perch acquisitions. Combined, they were the first material acquisitions made in some time by Management. We think the FY26 result demonstrated CAT’s ability to integrate and scale acquisitions effectively, with both IMPECT and Perch appearing to perform well post acquisition and contributing positively to growth, product breadth and cross-sell opportunities. This was achieved alongside delivering organic growth in the core business.

Morgan Stanley has an overweight rating on Catapult shares with a price target of $5.20 compared to $3.57 currently.

Bega Cheese Ltd (ASX: BGA)

An interesting takeaway from the Morgan Stanley research note on Bega is that they believe that the increased use of GLP-1 weight-loss drugs is a tailwind for the company, because it, “supports smaller, nutrient-dense, protein rich consumption occasions”.

They added:

This shift favours BGA’s convenient dairy formats, supporting volume, pricing, and margins over time.

Morgan Stanley is forecasting better than 20% compound annual growth in earnings per share for Bega from FY25-FY28, “driven by branded mix improvement and supply chain consolidation benefits”.

The broker has a price target of $6.70 on Bega shares compared to $5.42 currently.

Goodman Group Ltd (ASX: GMG)

Goodman is due to report its third quarter results next week.

Morgan Stanley has got in ahead of time with a research note that has a price target of $36.15 on the shares compared to $30.37 currently.

The broker said they will be looking for good news out of the company.

Given the VA Consensus is at FY26 EPS growth of 10%, we would suggest that the market is somewhat anticipating an earnings upgrade. However, the probability of a data centre contract/s is less certain, and therefore would be a positive surprise if delivered.

The post Morgan Stanley names 3 ASX shares to buy 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 positions in and has recommended Catapult Sports and Goodman Group. The Motley Fool Australia has positions in and has recommended Catapult Sports. The Motley Fool Australia has recommended Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.