Author: openjargon

Wesfarmers Ltd (ASX: WES) shares are trading in the green in Wednesday afternoon trade. At the time of writing, the shares are up 3.8% to $77.12.

It’s welcome news for investors after the retail conglomerate fell out of favour this year. The leading Australian blue-chip company has been smashed by global volatility.

After initially climbing 9% through the first few weeks of the year, Wesfarmers shares have crashed nearly 18% through to early April.

While the shares have climbed higher again today, they’re still down 5.7% for the year to date and 12.7% lower than six months ago.

The sell-off of such a major blue-chip ASX stock prompts the question, why is everyone selling their Wesfarmers shares?

1. Inflation concerns

Concern about inflation rates and the rising cost of living has smashed the retail giant’s shares recently. Higher food, fuel, rent, and mortgage costs for an undetermined amount of time mean consumers are tightening their spending habits and cutting back on discretionary spending. 

While Wesfarmers has broad retail operations across several markets, its key subsidiaries include household names such as Bunnings Warehouse, Kmart Australia, Officeworks, and Priceline.

Lower sales volumes across discretionary businesses translate to a weaker outlook. And that can dampen investor confidence.

2. Its latest results missed expectations

The blue-chip company posted its H1 FY26 results in mid-February, where it revealed a 3.1% increase in revenue, a 9.3% hike in NPAT, and an 8.4% rise in EBIT. It also announced a 7.4% increase in its fully-franked interim dividend.

On paper, the result looks good, but investors weren’t impressed, and many quickly sold up their shares. By the end of the day, the stock had tumbled 5.6%, and it kept going through to late March.

3. Concerns that share price growth has peaked

Analysts are mostly bearish on Wesfarmers shares. TradingView data shows that seven out of 16 analysts have a sell or strong sell rating on the stock, and another seven have a hold rating. 

The average target price, however, is $80.36, which implies a 4% upside at the time of writing. 

4. Profit talking after a share price rally

While there are several reasons that investors could have fallen out of favour with Wesfarmers shares, it’s also possible that a lot of this year’s sales are down to investors taking their gains off the table after a strong rally. 

The company’s shares spiked to $89.25 in mid-Feb, up 9.2% over the first six weeks of the year.

5. Market-wide rotation

Looking more broadly, the Australian sharemarket has undergone a broad-based sell-off and rotation over the past couple of months after market volatility and concerns about the US-Iran war worried stressed-out investors. 

There was an overall shift from retail-heavy stocks like Wesfarmers into energy and defensive assets in order to ward off some volatility. 

The post Why is everyone selling Wesfarmers shares? appeared first on The Motley Fool Australia.

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• 3 quality ASX shares to buy for a beginner investor

Motley Fool contributor Samantha Menzies 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 Wesfarmers. 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.

Firefly Metals Ltd (ASX: FFM) shares are flying higher on Wednesday.

This comes after the copper-gold developer released another standout drilling update from its Green Bay project in Canada.

In afternoon trade, the Firefly share price is up 18.95% to $2.04, after pushing above the psychological $2 barrier during midday. That leaves it not far below its 52-week high of $2.30.

That extends an already huge 12-month run, with the stock now up 176% over the past year.

Let’s take a closer look at what was announced.

Another strong step-up in Green Bay confidence

According to today’s ASX update, Firefly’s latest underground drilling has again confirmed strong continuity within the high-grade Core Zone at the Ming deposit.

The standout intercept was 70.8 metres at 4% copper equivalent, including 19.2 metres at 7.5% copper equivalent.

A second hole returned 53.3 metres at 4.1% copper equivalent, including 18.2 metres at 5.8% copper equivalent.

The latest results continue to improve confidence in the scale and consistency of the higher-grade section of the orebody ahead of economic studies expected in mid-2026.

That remains a major focus because the current Green Bay resource already totals 50.4 million tonnes at 2% copper equivalent in measured and indicated categories.

It also includes another 29.3 million tonnes at 2.5% copper equivalent in inferred resources.

Why investors are buying the update

The strong share price move appears to reflect more than just another solid drill result.

The market is increasingly focused on the quality of the Core Zone, which could become an attractive early mining area thanks to its grade and continuity.

Today’s release also noted that economic and technical studies tied to a larger copper-gold restart remain on track for mid-2026.

At the same time, Firefly remains well funded, ending December with roughly $251 million in cash and liquid investments.

The high-grade Core Zone is also close to existing underground infrastructure, which could improve restart economics and shorten the pathway to first production.

Foolish Takeaway

Firefly’s latest Green Bay results continue to show that its high-grade core could support attractive early mine economics.

With the stock now valued at roughly $1.56 billion and still delivering strong drilling momentum, attention is now turning to the mid-2026 economic studies as the next major catalyst.

The company’s strong cash position also gives it the flexibility to continue drilling aggressively while advancing restart studies.

After a 176% gain over the past year, the latest rally shows investors are still backing further resource growth at Green Bay.

The post This ASX mining stock just jumped 19% on a huge drilling result appeared first on The Motley Fool Australia.

More reading

• This ASX healthcare stock is up 70% in a year and climbing again today
• Why is everyone selling Wesfarmers shares?
• This ASX healthcare stock could more than double according to Canaccord Genuity
• 3 ASX 200 shares that could quietly compound for years
• Why surging ASX 200 copper stocks like Sandfire and BHP shares are ‘vulnerable’

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.

Clarity Pharmaceuticals Ltd (ASX: CU6) has some big news coming this year, and the team at Canaccord Genuity is excited by the company’s potential.

The Canaccord team has a buy recommendation on the stock, and while they’ve reduced their price target on the company, it’s still extremely bullish. We’ll get to that later.

Firstly, why is there cause for interest around what the company is doing?

Prostate cancer plans progressing

Canaccord says the major focus for Clarity in the company year are its two Phase III diagnostic trials, “assessing 64Cu-SAR-bisPSMA in PSMA-avid prostate cancer”.

Canaccord goes on to say:

We are expecting readouts from both trials in 2H CY26. If positive, we would anticipate FDA submission and potential launch in 1H CY28. The company has begun bolstering its access to 64Cu in the US, having recently added Theragenics to its existing agreements with SpectronRx and Nusano. With 64Cu supply no longer a question in our minds, our attention turns towards the sales, marketing and distribution side of the equation.

Clarity said in late March that it had signed a large-scale manufacturing agreement for the supply of copper-64 (64Cu) with Theragenics, with the manufacture to take place in Atlanta, Georgia.

Clarity Executive Chair Dr Alan Taylor said at the time:

Clarity is closer than ever to commercialisation of 64Cu-SAR-bisPSMA, with outstanding data recently released from the head-to-head Co-PSMA investigator-initiated trial3 and our announcement on achieving our target number of participants in the Phase III AMPLIFY trial just months since imaging the first patient.

Large addressable market

Canaccord said they had reviewed the US market for PSMA (Prostate-Specific Membrane Antigen) compounds and forecast the 2035 market to be worth US$2.9 billion.

They added:

Should 64Cu-SAR-bisPSMA be approved, and subsequently launch in 2H28, by FY35 we see Clarity generating US$860m in sales, representing 29% share. While there is pushback regarding workflow changes and incumbency, we are encouraged by the growing body of evidence (albeit with smaller patient numbers currently), which delineates 64Cu-SAR-bisPSMA from the current (and developing) players. We see that patients, clinicians, and pharma are all incentivised to find disease at earlier time points, allowing earlier intervention.

Canaccord has a price target on Clarity shares of $8.41, down from $9, with the reduction coming from foreign exchange changes and adjustments to the timelines for the company’s portfolio.

This is well north of 100% up on the current share price for Clarity of $3.19. Clarity is valued at $1.14 billion.

The post This ASX healthcare stock could more than double according to Canaccord Genuity 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.

Not every great investment needs to be exciting.

In fact, some of the best-performing ASX 200 shares over time have been the ones that steadily grow earnings, expand margins, and reinvest for the future without attracting too much attention along the way.

For investors focused on long-term compounding, here are three ASX shares that could be worth considering.

Goodman Group (ASX: GMG)

The first ASX share that could deliver steady compounding is Goodman Group.

Goodman focuses on logistics and industrial property, which has benefited from the growth of ecommerce and supply chain optimisation.

More recently, it has been increasing its exposure to data centre developments, positioning itself to benefit from rising demand for digital infrastructure and artificial intelligence.

Its integrated model, which combines development, management, and investment, allows it to generate earnings from multiple sources.

With long-term structural demand for logistics and data infrastructure, Goodman appears well placed to continue growing its earnings in a relatively steady and predictable way.

For investors looking beyond short-term market noise, these types of businesses can often deliver strong returns simply by continuing to execute over time.

REA Group Ltd (ASX: REA)

Another ASX 200 share that could quietly compound over time is REA Group.

REA operates Australia’s leading online real estate platform, which has become the go-to destination for property listings. This dominant position gives it significant pricing power and strong network effects.

As more buyers and sellers use the platform, its value increases, allowing REA Group to continue lifting prices and expanding its revenue.

It is also leveraging its audience to grow adjacent services such as data, insights, and financial products. This creates additional revenue streams without needing to significantly expand its cost base.

With a capital-light model and strong margins, REA Group is well positioned to continue compounding earnings over time.

TechnologyOne Ltd (ASX: TNE)

A final ASX 200 share that could be a long-term compounder is TechnologyOne.

The enterprise software provider has been steadily transitioning its customers to a cloud-based platform, which is driving recurring revenue and improving margins.

What stands out is the predictability of its earnings. Once customers are embedded in its ecosystem, switching costs are high, which supports long-term retention.

TechnologyOne is also expanding internationally, particularly in the UK, where it is replicating its Australian success.

This combination of recurring revenue, operating leverage, and global expansion could support consistent growth over many years. In fact, management believes it can double in size every five years.

The post 3 ASX 200 shares that could quietly compound for years appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has positions in Goodman Group, REA Group, and Technology One. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goodman Group and Technology One. The Motley Fool Australia has recommended Goodman Group and Technology One. 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) copper stocks are shooting the lights out today.

In afternoon trade on Wednesday, the ASX 200 is up 2.6% as investors digest news of a two-week ceasefire in the Iran war.

And the copper miners are charging ahead of those gains. That’s because a resolution in the Middle East conflict would reduce the forecast pressure on global growth and, accordingly, increase forecast demand for crucial industrial metals like copper.

Indeed, since the outbreak of the war at the end of February, the copper price has fallen by almost 8% to US$12,313 per tonne. Mind you, that’s still up 41% since this time last year.

And with investors hopeful that the war could be nearing an end, here’s how these three leading ASX 200 copper stocks are tracking today and over the past 12 months:

• BHP Group Ltd (ASX: BHP) shares are up 3.6% today at $54.84 and up 55.0% in 12 months
• Sandfire Resources Ltd (ASX: SFR) shares are up 10.5% today at $18.26 and up 108.3% in 12 months
• Capstone Copper Corp (ASX: CSC) shares are up 9.2% today at $12.46 and up 85.4% in 12 months

While Sandfire Resources and Canadian-based Capstone Copper are relatively pure play copper stocks, you may be surprised to see BHP shares on this list.

But when BHP reported its half-year results (H1 FY 2026) in February, investors learned that at US$8 billion, copper contributed more than half the miner’s earnings for the six months, surpassing iron ore for the first time.

For the full 2026 financial year, BHP expects to produce between 1.9 million and 2.0 million tonnes of the red metal.

ASX 200 copper stocks facing ‘near-term risks’

When it comes to the US and Israeli war with Iran, investors would do well not to be overly exuberant amid the early ceasefire news.

“Investors shouldn’t mistake this pause for a resolution,” eToro market analyst Josh Gilbert said.

“A two-week ceasefire window is welcome news for risk assets broadly, but the reality is we’ve seen patterns like this before, and the underlying uncertainty can persist,” he added.

And ASX 200 copper stocks like BHP and Sandfire could prove particularly vulnerable to a prolonged conflict in the Middle East.

That’s according to the analysts at Goldman Sachs, who warn of potentially slumping global demand for the red metal, should the war persist (courtesy of The Australian Financial Review).

According to Goldman Sachs:

We see the near-term risks as skewed to the downside if strait flows remain disrupted for longer than our base case, which would keep energy prices higher for longer and likely slow global economic growth.

And the big one-year share price gains posted by BHP and its rival ASX 200 copper stocks may have been partly driven by overvalued global copper prices.

Goldman Sachs noted:

The copper price continues to trade well above our 2026 fair value estimate of about US$11,100 … which would fall below US$11,000 under our economists’ severely adverse scenario of a 1.2 percentage point hit to global GDP growth from the energy price spike.

Our fair value estimate takes into account price support from the ex-US market balance and adds a 25% probability of broad strategic copper stockpiling. This means that the copper price is not being supported at the current level by fundamentals, making it vulnerable to another move lower should the economic outlook deteriorate and investors de-risk.

Stay tuned!

The post Why surging ASX 200 copper stocks like Sandfire and BHP shares are ‘vulnerable’ appeared first on The Motley Fool Australia.

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

Regis Resources Ltd (ASX: RRL) shares are racing higher on Wednesday after the gold miner released another strong quarterly cash and bullion update.

In mid-afternoon trade, the Regis share price is up 7.66% to $7.375, after opening at $7.25 and reaching an intraday high of $7.42.

The move lifts the gold stock’s 12-month gain to roughly 74%, continuing a strong run that has made it one of the ASX gold sector’s standout performers.

Based on the current share price, Regis’ market capitalisation now sits around $5.58 billion.

The rally comes after a fresh ASX release showed another major increase in cash and bullion holdings. Gold prices also climbed back toward record levels overnight as safe-haven demand strengthened.

Another $198 million added to the balance sheet

The main catalyst was Regis’ March quarter production and balance sheet update.

The company reported total group gold production of 90.6k ounces for the quarter, taking FY26 year-to-date production to 277.5k ounces.

Duketon contributed 57.5k ounces, and Tropicana delivered 33.1k ounces on an attributable basis, leaving the miner comfortably on track to meet full-year production guidance.

The bigger focus, however, was cash generation.

Regis revealed that cash and bullion increased by $198 million during the quarter, even after making a $92 million FY25 tax payment in February.

That lifted total cash and bullion holdings to $1.128 billion as at 31 March.

Gold strength supports the rally

The market reaction was also helped by another strong move in bullion overnight.

Gold prices climbed back above US$4,790 an ounce, with market data showing the yellow metal rising almost 2% as investors moved back into safe-haven assets. That leaves bullion up more than 55% over the past year.

As an unhedged producer, Regis gets the full benefit of stronger spot prices through margins and free cash flow, which is now feeding into its balance sheet.

The company also said there has been no material impact from broader fuel supply uncertainty across Australia. It is still watching costs and supply chains closely ahead of its full quarterly report later this month.

Foolish Takeaway

Regis is increasingly standing out as one of the ASX gold sector’s strongest cash generators.

A $1.128 billion cash and bullion balance, zero direct hedge exposure, and another lift in bullion prices are helping keep the stock in focus.

After a 74% gain over the past year, this latest update shows how strongly Regis is benefiting from higher gold prices and a growing cash balance.

The post ASX 200 share leaps 8% as gold rally drives cash pile past $1.1 billion appeared first on The Motley Fool Australia.

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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.

Many of Australia’s top brokers have been busy adjusting their financial models and recommendations again. This has led to a number of broker notes being released this week.

Three ASX shares that brokers have named as buys this week are listed below. Here’s why their analysts are feeling bullish on them right now:

Guzman Y Gomez Ltd (ASX: GYG)

According to a note out of Morgans, its analysts have retained their buy rating on this burrito seller’s shares with an improved price target of $26.70. This follows the release of a third-quarter update that impressed the broker. It highlights that Guzman Y Gomez delivered a meaningful acceleration in Australian comparable store sales growth, providing tangible evidence that the business is executing well against a challenging consumer backdrop. It also points out that transaction growth continued to outpace comparable store sales growth. This maintains its strategy to be volume and frequency-led rather than price-driven. The Guzman Y Gomez share price is fetching $19.50 at the time of writing.

Lovisa Holdings Ltd (ASX: LOV)

A note out of UBS reveals that its analysts have upgraded this fashion jewellery retailer’s shares to a buy rating with a $26.00 price target. UBS highlights that Lovisa’s shares have fallen heavily this year amid concerns over slower store growth, softer like-for-like sales in the local market, and ongoing losses from the new Jewells store brand. However, the broker believes much of this risk is now priced in. Furthermore, it thinks the resilience of Lovisa’s youth-focused, low price point offering is underappreciated by the market, and expects management to prevent sustained losses from Jewells either by fixing the business or considering a closure. The Lovisa share price is trading at $23.96 this afternoon.

Telix Pharmaceuticals Ltd (ASX: TLX)

A note out of Bell Potter reveals that its analysts have retained their buy rating and $19.00 price target on this radiopharmaceuticals company’s shares. This follows the release of a solid first-quarter sales update this week. Bell Potter was pleased with Telix’s update and believes it leaves the company well-placed to achieve its guidance in FY 2026. In addition, it highlights that Telix continues to make good progress on multiple pipeline products. It also sees major short term share price catalysts on the horizon. This includes the potential acceptance by the FDA of the resubmitted NDA for Pixclara and the amendment to the IND for TLX591. The Telix share price is fetching $13.83 at the time of writing.

The post Top brokers name 3 ASX shares to buy today appeared first on The Motley Fool Australia.

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

The ASX share market is a great place to find potential investments that could deliver significant returns in a relatively short amount of time.

Few businesses deliver a return of 100% or more in a single year, so just because analysts think a stock can at least double in 12 months doesn’t mean that will happen, or that the return will even be positive.

But there are a few names that experts are very optimistic about, so let’s take a look at them.

Megaport Ltd (ASX: MP1)

This ASX tech share enables clients to quickly connect to hundreds of data centres around the world. It has a truly global presence in regions like the Americas, Asia Pacific, and EMEA (Europe, the Middle East and Africa).

In the recent FY26 half-year result, the ASX share reported revenue growth of 26% to $134.9 million, with net revenue retention of 111% and annual recurring revenue (ARR) growth of 19%, implying pleasing revenue growth from its existing client base.

According to CMC Invest, there have been nine recent expert ratings on the business, with eight of those being a buy. Of the nine ratings, the average price target is $15.84, implying a possible rise of around 110% from current levels.

Xero Ltd (ASX: XRO)

Xero is one of the world’s largest cloud accounting software providers, with a presence in a number of countries like Australia, New Zealand, the UK, the US, Canada, South Africa, and Singapore.

The ASX share is growing at a rapid pace – in the HY26 result, operating revenue rose 20% to NZ$1.19 billion and free cash flow surged 54% to NZ$321 million.

According to CMC Invest, there have been seven recent ratings on the business, with an average price target of $158.22. That implies a possible increase of just over 100% from where it is today.

Qoria Ltd (ASX: QOR)

Qoria describes itself as a global technology company that’s keeping children safe and well in their digital lives. It says it has supported 32,000 schools across four continents and kept 30 million children safe. The ASX share provides a parental control platform in an app.

In the FY26 half-year result, the ASX share reported that its revenue increased by 25% to $69 million, and underlying operating profit (EBITDA) jumped by 68% to $10.3 million, which is a strong rate of expansion.

According to CMC Invest, there are currently five buy ratings on the business, with an average price target of 65 cents, which implies a possible rise of approximately 110% in the year ahead.

The post 3 ASX shares tipped to grow 100% or more in the next 12 months appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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 and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

In the biggest capital raise to hit the ASX in some time, the L1 Gold Fund Ltd (ASX: LGF) is looking to raise up to $1 billion in new capital to target investments in undervalued mid-cap gold companies.

In the fund’s initial public offer prospectus, lodged with the ASX, it says it intends to raise a minimum of $500 million and up to $1 billion in new shares priced at $2 each.

Opportunities in gold

The fund said the strategy thereafter would be to invest across a range of securities in the gold sector.

As it said in its own words:

The Company has been established to invest predominantly in the gold sector, constructing a portfolio of Australian and international Securities (including shares, options or debentures in listed or unlisted gold mining companies in Australia or overseas) and Other Eligible Investments (which may include derivatives, such as gold futures contracts, and potentially also minority or temporary holdings of title to gold), but with the Company predominantly investing in Securities and Other Eligible Investments that are listed on a securities exchange.

But the fund also intends to invest in an “opportunistic” manner, “in other precious metal sectors (such as silver, platinum and palladium), which will involve selective investment in these sectors where the Manager identifies compelling risk-adjusted opportunities.”.

The prospectus said the fund will aim to generate positive absolute returns over the medium to long term, being more than three years, and will achieve this by holding both long and short positions in stocks.

The prospectus adds:

As the Investment Strategy seeks to identify assets that are undervalued or overvalued by the market, the Company produces investment returns from income generated by the relevant assets (eg capital growth or dividends) or by a future correction of the market. By way of example, the Company may hold a Long Position in shares of a mid-cap mining company in Australia or overseas that the Manager deems to be undervalued. The initial focus of the Company will be to invest in a set of high conviction, primarily mid-cap1 existing gold producers that the Manager believes to be significantly undervalued. The Manager will look for the most compelling opportunities across the entire listed peer group of such gold producers globally, a significant portion of which the Manager expects to be in the form of listed international Securities. The decision to initially focus a significant portion of the Company’s portfolio on mid-cap gold producers is due to the Manager’s view that there are attractive valuations, near-term earnings growth potential and a significant breadth of investment opportunities within this part of the gold sector.

The fund expects its initial portfolio to be made up of about 15% Australian-listed equities, 34% international equities, and the remainder in exchange-traded derivatives.

The fund expects its shares to start trading on the ASX on April 24.

The post This new billion-dollar ASX gold fund promises broad exposure to the market 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.

DroneShield Ltd (ASX: DRO) shares are being hit hard on Wednesday, with the sell-off going beyond a routine leadership change.

In afternoon trade, the DroneShield share price is down a sizeable 17.29% to $3.30, after falling as low as $3.20 earlier in the session.

That is a brutal one-day move, especially with the S&P/ASX 200 Index (ASX: XJO) pushing 2.6% higher.

Even so, the defence technology stock remains up almost 280% over the past 12 months. That helps explain why some investors may be quick to lock in gains when uncertainty re-emerges.

Let’s take a look at what’s driving the weak sentiment.

Investors are focusing on trust, not the transition

According to the ASX announcement, DroneShield CEO Oleg Vornik has stepped down effective immediately after more than a decade leading the business.

In addition, chairman Peter James will retire and not seek re-election at May’s Annual General Meeting (AGM).

Chief product officer Angus Bean has been elevated to chief executive, and former REA Group chair Hamish McLennan will join as chairman-elect.

While the leadership changes look orderly on paper, the market’s attention has quickly shifted back to the controversial November selldown. At that time, Vornik, James, and another director sold a combined $70 million in shares.

The selldown triggered a major collapse in the stock that month and left lingering concerns around governance and board oversight.

With the stock having staged such a strong recovery since then, today’s leadership exits appear to have brought those concerns back into focus.

Strong quarterly growth was not enough

The weaker move stands out because DroneShield paired the leadership update with another strong trading result.

The company reported March quarter revenue of $63 million, up 87% year-on-year, alongside record quarterly cash receipts of $77 million, up 361%.

It also said it already has $140 million in committed FY26 revenue just 3 months into the financial year.

Under normal conditions, those numbers would likely have supported buying interest.

Instead, the market appears more focused on the boardroom reset and the lingering fallout from last year’s insider selldown.

That reaction comes even as Vornik described his time leading DroneShield as “the experience of a lifetime”. He said he was proud to have helped build the company from a $27 million IPO into an ASX 200 defence technology business valued in the billions.

The contrast between record operating momentum and renewed leadership uncertainty appears to be keeping sellers in control. Some investors may also be using the weakness to lock in gains after the stock’s huge 12-month run.

Foolish takeaway

DroneShield remains one of the ASX’s standout momentum stocks, still valued at about $3.1 billion after today’s decline.

The latest quarterly numbers show the business is still delivering exceptional growth, but leadership turnover and the overhang from last year’s insider selldown have clearly unsettled sentiment.

After a 280% rally over the past 12 months, today’s sell-off suggests investors are waiting for confidence in the new leadership team to improve.

The post DroneShield shares tumble 17% as CEO exit revives leadership fears appeared first on The Motley Fool Australia.

More reading

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• Pro Medicus announces $23m US contract
• DroneShield posts record revenue and unveils leadership changes
• Magellan Financial Group posts March 2026 AUM drop

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 DroneShield and is short shares of DroneShield. 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.