Author: openjargon

It has been a big year for BHP Group Ltd (ASX: BHP) shareholders, but Monday has brought a step backwards.

BHP shares are down 2.56% to $65.58 at the time of writing, pulling further away from the record high of $68.77 reached last week.

That still leaves the mining giant up around 11% over the past month and 44% since the start of 2026.

So, after such a huge run, is now the time to sell BHP shares?

Brokers aren’t convinced

One thing that stands out is how far BHP has moved above most broker price targets.

According to the latest TipRanks figures, the average 12-month target across 14 analysts is $58.68. This is roughly 10.5% below the current share price.

The consensus is cautious, with just one buy rating, 12 holds, and one sell.

Morgan Stanley has a buy rating and $67.50 target. Berenberg has a hold rating and $64.22 target, while UBS sits at $59.

JPMorgan has a $56.66 target, Morgans has a sell rating and $55.30 target, and Deutsche Bank is at $51.

BHP is also trading on a price-to-earnings ratio (P/E) of just over 24 and a dividend yield of about 3%.

Why investors have been buying

It is not hard to see why BHP shares have had such a strong year.

The miner recently reported underlying EBITDA of around US$33 billion in FY26, helped by stronger commodity prices and record iron ore production in Western Australia.

Copper is becoming a much bigger part of the business. It contributed more than half of the underlying EBITDA for the first time, while BHP produced around 2 million tonnes for a second straight year.

The company is also targeting around 40% growth in copper production by FY35 through projects across Australia, Chile, and Argentina.

Net debt fell below US$9 billion, while BHP declared a final dividend of 99 US cents per share.

What about the September effect?

There’s another reason investors may be a little cautious heading into September.

Historically, it has been a tough month for the Australian share market. The S&P/ASX 200 Index (ASX: XJO) has averaged a 0.94% fall in September since 1992 and finished the month higher just 32% of the time.

Of course, that doesn’t mean BHP shares are guaranteed to fall next month.

But after such a stellar year, September’s poor track record may be something investors keep in the back of their minds.

Foolish takeaway

After a 44% rise this year, I can understand why some investors might be tempted to take some money off the table.

The broker targets suggest BHP is no longer cheap, and another pullback wouldn’t be surprising.

But I would be careful about selling a high-quality business simply because the shares have performed well or September has a poor historical record.

BHP still owns world-class iron ore and copper assets, and generates plenty of cash.

The valuation may look a little stretched today, but over the long term, I think the quality of the business matters far more than what happens over the next month.

The post BHP shares are pulling back from their record high. Is it time to sell? appeared first on The Motley Fool Australia.

More reading

• Chasing dividends? 11 ASX shares in top-paying sectors going ex-dividend this week
• Up 56%! 3 reasons to still buy BHP shares today
• Buy, hold, sell: Rio Tinto, PLS Group, BHP shares
• Experts name 2 ASX 200 blue chip shares to buy this week
• By September 2027, BHP shares could turn $10,000 into…

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

Reporting season is finishing and investors have received a great insight into the performance of ASX shares.

Following the FY26 numbers and comments on the outlook, share prices moved, and now investors have to decide whether these businesses are opportunities.

Let’s look at two ASX shares that are heavily backed by multiple analysts, suggesting they could be opportunities.

Qantas Airways Ltd (ASX: QAN)

Qantas is the largest Australian airline business. It also operates Jetstar, a freight business, and Qantas loyalty.

Despite difficult trading conditions amid the negative effects of the Middle East conflict, fuel cost impacts, and so on, Qantas was still able to generate a good level of earnings.

Its FY26 underlying profit before tax declined $330 million to $2.06 billion. The statutory net profit dropped $316 million to $1.29 billion. Qantas said the net impact of the Middle East was reportedly $420 million during FY27.

Despite the challenges, Qantas’ customer net promoter score (NPS) improved by 7 points, and Jetstar’s NPS rose by 1 point.

In terms of the outlook, Qantas said that travel demand remains resilient as customers continue to prioritise travel. Airfares are expected to increase, though jet fuel prices are also expected to remain elevated.

Qantas loyalty is expected to grow underlying operating profit (EBIT) by between 5% to 7% in FY27. By FY30, it’s aiming for between $800 million and $1 billion of underlying EBIT.

Qantas is looking to reduce costs by approximately $475 million to help offset inflation.

According to CMC Invest, there have been 11 ratings on the ASX share in the last three months, all of which were buy ratings. Analysts are very positive on the airline right now.

Generation Development Group Ltd (ASX: GDG)

The financial business is involved in a number of areas. Generation Life is a market leader in investment bonds and lifetime annuities. Lonsec Research and Ratings is one of Australia’s leading qualitative financial research houses. Evidentia is one of Australia’s leading companies in the managed account sector.

Generation Development saw strong growth in FY26. Group funds under management (FUM) rose 37% to $46.5 billion, with net inflows of $9.7 billion (up 19%).

Within FUM, investment bonds FUM rose 35% to $5.95 billion and managed accounts FUM increased 37% to $40.5 billion.

Total revenue grew 23% to $178.7 million, and underlying net profit rose 21% to $40.7 million.

Generation Development said that its FY27 is supported by favourable long-term growth trends and remains “well positioned to benefit from ongoing adviser adoption and structural growth across retirement, managed accounts, independent investment research and investment governance solutions”.

It expects strong growth in FUM, supported by ongoing adviser adoption and market penetration.

According to CommSec, there are currently nine analyst buy ratings on the business.

These two ASX shares could be appealing opportunities, among other potential buys.

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

More reading

• 5 ASX 200 shares with 33% to 61% upside post-results: experts
• Would I buy Qantas shares today?
• 9 ASX 200 shares with strengthened buy ratings this week
• Here are the top 10 ASX 200 shares today
• 3 ASX 200 dividend shares that just upped their payouts

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Generation Development Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Northern Star Resources Ltd (ASX: NST) shares are having a rough start to the week after the gold miner announced another change to its senior leadership team.

At the time of writing, the Northern Star share price is down 5.45% to $23.43.

The stock opened at $23.71 and has fallen as low as $23.37 during the session, after closing at $24.78 on Friday.

The S&P/ASX 200 Resources Index (ASX: XJR) is also having a weak day, falling around 2%.

So, what has changed at Northern Star?

Another executive is leaving

According to the release, Northern Star chief financial officer Ryan Gurner will leave the company on 30 November after more than 11 years with the gold miner.

Gurner was appointed deputy CEO in July and only stepped into the interim CEO role on 29 August following the departure of long-time boss Stuart Tonkin.

He will stay in the top job until Suresh Vadnagra starts as managing director and CEO on 5 October.

After that, Gurner will return to his CFO role and help with the leadership handover before leaving Northern Star at the end of November.

General manager of finance, Philip Coetzer, has been appointed acting CFO while Gurner is serving as interim CEO.

The company will also begin looking for a permanent replacement in the CFO role.

Chairman Michael Chaney thanked Gurner for his contribution, saying his “financial acumen, integrity and leadership” had played a significant role in Northern Star’s growth.

Plenty of changes at the top

The latest announcement adds to what has already been a busy few months across Northern Star’s leadership team.

Tonkin finished up last week after more than a decade with the company, while Vadnagra is preparing to take over in October.

Chaney is also due to retire at the annual general meeting in November, with Michael Ashforth set to become chairman.

All of this is happening while activist investor Elliott Management continues to push for changes at the gold miner.

Elliott has criticised Northern Star over operational issues, cost overruns, and its strategic direction, while calling for changes to the board and a wider review of the business.

Earlier this month, it also released a list of potential directors it would like to see considered, including former Anglo American chief executive, Mark Cutifani.

Foolish takeaway

Today’s fall comes after a strong run through August.

Northern Star shares are still almost 18% higher over the past month, although they remain down roughly 12% since the start of 2026.

The stock is also well below its 52-week high of $31.96.

The post Northern Star shares slide 5% as investors digest another surprise appeared first on The Motley Fool Australia.

More reading

• Why Liontown, Northern Star and Telstra shares are turning heads on Monday
• 5 things to watch on the ASX 200 on Monday
• ASX 200 mining shares outperform in final week of earnings season
• Why gold stocks have regained their shine: Expert
• Northern Star shares are closing in on $25. Can the rally keep going?

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.

Leading ASX exchange-traded funds (ETFs) could be the best way to invest in this period of uncertainty. I believe high-quality stocks are more likely to deliver satisfactory returns.

The two ASX ETFs I’m going to highlight have among the highest quality portfolios due to how they choose their holdings.

Over the long-term, I think the two funds below are extremely attractive.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

This ASX ETF aims to give investors exposure to a portfolio of high-quality US companies, which is where many of the leading global companies are listed.

The MOAT ETF uses a two-step process to ensure it maintains a high-quality portfolio that can perform over the long term.

Firstly, the fund wants to invest in businesses that have wide economic moats (competitive advantages). To achieve a wide economic rating, Morningstar analysts need to think that the company’s economic moat will almost certainly endure for the next decade and more likely than not for the next two decades.

In other words, these are some of the best, long-term companies that we can find in the US.

Competitive advantages can come in a variety of forms, such as cost advantages, intangible assets (patents, brands, regulatory licenses), switching costs, network effect, and efficient scale.

The second factor that the MOAT ETF looks for is a compelling valuation. Target companies must be trading at attractive prices relative to Morningstar’s estimate of fair value.

Over the long term, this ASX ETF has performed strongly for investors. Over the past 10 years, the MOAT ETF has returned an average of 14.3% per year. Past performance is not a guarantee of future performance, of course.

Betashares Global Quality Leaders ETF (ASX: QLTY)

The other fund I want to highlight is the QLTY ETF, which uses multiple factors to decide which are the highest-quality stocks in the world and invests in the top ones.

The four factors that go into choosing stocks for the portfolio include a high return on equity (ROE), low debt levels, earnings stability, and cash flow generation.

A high ROE says that the business earns a high level of profit for how much shareholder money is retained within the business. It may also suggest the business can generate strong returns on future additional retained earnings.

Having low levels of debt is likely a great sign of business health and helps it weather economic uncertainty.

Earnings stability helps protect the business during downturns (and perhaps it means less volatility for the share price, too). Plus, if earnings don’t fall, then that likely means profit is rising, which can help power shareholder returns.

Finally, cash flow is the best sign that a company’s profit generation is turning into real money that’s flowing into the bank account.

With 150 holdings from across the world, I think the ASX ETF offers pleasing diversification with good potential returns. Since inception in November 2018, the QLTY ETF has returned an average of 13.6% per year.  

The post 2 incredible ASX ETFs I’d buy for long-term returns appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in VanEck Morningstar Wide Moat ETF. 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 VanEck Morningstar Wide Moat ETF. 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 trading close to flat on Monday.

At the time of writing, the benchmark index is down 0.03% to 9,089 points after closing Friday at 9,092.3 points.

The ASX 200 climbed as high as 9,122 points earlier in the session before dropping to 9,055 points.

It also remains around 2% below the record high reached earlier this month.

So, what is keeping the ASX 200 close to flat today?

The banks are having a strong day

The ‘big four’ banks are doing plenty of the work keeping the ASX 200 around the flat line.

Commonwealth Bank of Australia (ASX: CBA) shares are up 2.22% to $160.74, while Westpac Banking Corp (ASX: WBC) shares have climbed 2.63% to $34.79.

National Australia Bank Ltd (ASX: NAB) shares are 2.17% higher at $39.12, and ANZ Group Holdings Ltd (ASX: ANZ) shares have gained 2.31% to $37.58.

However, with the banks carrying such large weightings in the index, those gains are helping offset weakness across a number of other sectors.

At the latest check, 101 stocks were lower, 91 were higher, and 8 were unchanged.

Gold miners are getting hit

The other side of the market looks very different, with gold and mining shares among the biggest losers.

Northern Star Resources Ltd (ASX: NST) shares are down 5.27% to $23.48, while Evolution Mining Ltd (ASX: EVN) shares have fallen 5.90% to $14.75.

Capricorn Metals Ltd (ASX: CMM) shares are also down 4.99% to $16.37, and BHP Group Ltd (ASX: BHP) shares have dropped 2.30% to $65.75.

Gold tanked late last week after Federal Reserve Chair Kevin Warsh warned that price pressures remained a concern and interest rates may need to rise again.

Warsh said inflation still needs to return to the Fed’s 2% target, which sent bond yields higher and lifted expectations for another rate hike.

More pressure from overseas

The lead from overseas is not helping much either.

US futures are pointing lower ahead of Monday’s session, with S&P 500 Index (SP: .INX) futures down around 0.5% and Nasdaq Composite Index (NASDAQ: .IXIC) futures around 0.7% lower.

Oil prices have also moved higher after US forces struck two Iranian rocket launchers in the Strait of Hormuz, raising concerns about another escalation in the region.

Brent crude futures are trading around US$89 a barrel.

That is helping energy shares hold up better.

Santos Ltd (ASX: STO) shares are up 1.05% to $8.21, and Woodside Energy Group Ltd (ASX: WDS) shares are 0.93% higher at $32.57.

The post Why the ASX 200 is struggling today despite a bank share rally appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
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• Are ASX bank shares a buy in September?
• ASX 200 mining shares outperform in final week of earnings season
• Could ASX shares crash? 5 questions every investor should ask now

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

ASX mining/materials, utilities, and energy shares paid the biggest dividend yields of the 11 market sectors in FY26.

As we previously reported, utilities shares paid a 5.98% dividend yield, energy paid 5.14%, and materials paid 4.63%.

Those yields were well above the S&P/ASX 200 Index (ASX: XJO) average dividend yield for FY26 of 4.23%.

Energy and mining shares paid higher dividends in FY26 due to elevated earnings from stronger commodity prices.

Now remember, the dividends paid in the FY26 period mainly reflected final dividends for FY25 and interim dividends for FY26.

Over the next two months, the final dividends for FY26 are being paid following the end of the August reporting season today.

And we’re seeing the same trend play out.

That is, big ASX resources shares are paying generous dividends again due to those strong commodity prices.

Take ASX 200 iron ore and copper miner, BHP Group Ltd (ASX: BHP), for example.

BHP declared a final dividend for FY26 of US 99 cents, which is equivalent to A$1.40 on today’s exchange rate.

That’s 65% higher than the final BHP dividend for FY25 of 91.9 AU cents.

That’s a major lift in income for BHP shares investors.

In order to receive a dividend, you must own the ASX share before its ex-dividend date.

If you want to snatch the next BHP dividend, you need to buy BHP shares before they go ex-dividend this Thursday.

BHP is among 11 big names in the high-paying utilities, mining, and energy sectors scheduled to go ex-dividend this week.

If you’re chasing dividend income, here are the dates you need to know.

ASX shares going ex-dividend this week

ASX share	Ex-Div Date	Dividend	Payday
Fortescue Ltd (ASX: FMG)	1 September	46 cents	29 September
Origin Energy Ltd (ASX: ORG)	2 September	30 cents	2 October
Whitehaven Coal Ltd (ASX: WHC)	2 September	6 cents	15 September
Yancoal Australia Ltd (ASX: YAL)	2 September	7 cents	18 September
Mercury NZ Ltd (ASX: MCY)	2 September	14.1 cents	30 September
PLS Group Ltd (ASX: PLS)	2 September	5 cents	24 September
Newmont Corporation CDI (ASX: NEM)	2 September	26 cents	28 September
BHP Group Ltd (ASX: BHP)	3 September	$1.40	23 September
Woodside Energy Group Ltd (ASX: WDS)	3 September	79.5 cents	25 September
Ampol Ltd (ASX: ALD)	4 September	$1.85	30 September
Viva Energy Group Ltd (ASX: VEA)	4 September	7.7 cents	30 September

View more ASX shares going ex-dividend this week.

The post Chasing dividends? 11 ASX shares in top-paying sectors going ex-dividend this week appeared first on The Motley Fool Australia.

More reading

• Up 56%! 3 reasons to still buy BHP shares today
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• Buy, hold, sell: Rio Tinto, PLS Group, BHP shares
• Experts name 2 ASX 200 blue chip shares to buy this week

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 no position in any of the stocks mentioned. 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.

Austal Ltd (ASX: ASB) shares are heading north on Monday after the defence shipbuilder released its FY26 results.

At the time of writing, the Austal share price is up 3.42% to $4.24.

That is despite the company reporting a statutory net loss of $53.6 million, compared with an $89.7 million profit a year earlier.

So, why are investors buying up the shares?

Revenue tops $2 billion

Austal reported FY26 revenue of $2.03 billion, up 11% from $1.82 billion last year.

However, earnings were hit hard by problems within its US business.

Group EBIT swung from a $113.4 million profit in FY25 to a $125.2 million loss, largely due to provisions linked to several loss-making US contracts.

Operating cash flow also dropped to $62.5 million from $406.3 million, while net cash finished the year at $186.3 million.

The company did not declare a dividend as it continues investing heavily in new production capacity.

Australasia is doing the heavy lifting

Austal’s Australasian business delivered revenue of $650.7 million, up 49% from the previous year.

EBIT climbed 137% to a record $85.3 million, with the EBIT margin increasing to 13.1%.

That growth was helped by higher shipbuilding activity and the ramp-up of major Australian defence programs.

Austal’s Australasian defence order book has also jumped to around $5.6 billion, compared with just $700 million a year earlier.

That includes work under the strategic shipbuilding agreement, along with the landing craft medium and landing craft heavy programs.

Austal Chief Executive Paddy Gregg said the existing and expected contract pipeline gives the company a path to potentially double Australasian revenue over the next 5 years.

A huge order book could be supporting the shares

Another number that stands out is Austal’s overall order book.

The company finished FY26 with around $16.5 billion of work, including options, across its Australian and US operations.

Its US order backlog alone is around $10.9 billion, while Austal continues expanding its submarine module manufacturing capacity.

Management is also targeting around $500 million of support and sustainment revenue in FY27.

The company said it expects to return to profitability in FY27 as it works through the issues affecting its US contracts.

What happens next?

Investors will also be watching the proposed sale of Austal USA.

South Korea’s Hanwha Defence has submitted an indicative offer valuing the US business at between US$1.05 billion and US$1.2 billion.

Hanwha has been granted due diligence, although there’s no guarantee a deal will go ahead.

Nonetheless, a sale at that level would leave Austal with a much stronger balance sheet.

The post Austal shares jump despite a $54 million loss. Here’s why investors are buying appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
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• Are Austal shares a buy, hold or sell after soaring 17% yesterday?
• Here are the top 10 ASX 200 shares today
• Austal posts FY26 loss, receives offer for US business

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.

S&P/ASX 200 Index (ASX: XJO) shares are up 0.03% at 9,095.2 points on the final day of reporting season.

Hundreds of companies have revealed their earnings this season.

Brokers have reviewed the reports and updated their ratings and 12-month price targets accordingly.

Here are five buy-rated ASX 200 shares with significant upside potential ahead, according to the experts.

NextDC Ltd (ASX: NXT)

The NextDC share price is $13.63, down 1.7% today and down 17% over 12 months.

UBS renewed its buy rating on NextDC shares, with a $22.55 target after reviewing the company’s FY26 earnings.

This implies potential capital growth of 61% over the next year.

WiseTech Global Ltd (ASX: WTC)

The WiseTech share price is $41.39, up 1.9% today and down 58% over 12 months.

Morgans reiterated its buy rating on this ASX 200 tech share after the company’s FY26 results.

The broker reduced its 12-month price target from $67 to $62.50.

However, this still implies a healthy potential upside of 52%.

Droneshield Ltd (ASX: DRO)

The Droneshield share price is $1.74, down 0.7% today and down 46% over 12 months.

Bell Potter renewed its buy rating on this ASX 200 industrials share after its 1H FY26 results.

The broker trimmed its 12-month price target from $2.50 to $2.40.

This suggests a potential 35% upside ahead.

Qantas Airways Ltd (ASX: QAN)

The Qantas share price is $9.56, down 0.3% today and down 17% over 12 months. 

Morgan Stanley kept its buy call in place on Qantas shares following the airline’s FY26 results.

The broker raised its target on the ASX 200 industrials share from $12.50 to $12.80.

This suggests a potential 33% upside ahead.

Objective Corporation Ltd (ASX: OCL)

The Objective Corporation share price is $6.40, down 5.9% today and down 69% over 12 months. 

Morgans maintained its buy recommendation on this ASX 200 tech share after the company’s FY26 results.

The broker has a revised 12-month price target of $8.50, implying a potential 33% upside ahead.

OCL’s FY26 result was largely in line with expectations. The result came however with more sticker shock in the form of another legacy contract loss leading to a further $3.2m ARR reduction.

OCL enters FY27 with ARR of $114.1m. Despite this softening & FX headwinds during the year, OCL continued to see strong underlying SaaS growth momentum and progress of a number of strategic milestones (including the launch of Build Australia), which is key to ARR momentum and FY27+ outlook.

Rebasing our forecasts for OCL’s revised FY27 ARR and guidance sees our NPAT estimates reduce by ~18-21% in FY27-28F.

Following these revisions OCL is trading on FY27F P/E of 24x, with a share price near 5 years lows.

The post 5 ASX 200 shares with 33% to 61% upside post-results: experts appeared first on The Motley Fool Australia.

More reading

• Morgans names 3 ASX tech stocks to buy
• Why I think Xero and WiseTech shares are strong buys
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• 4 ASX shares I’d buy with $5,000 in September
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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 DroneShield, Objective, and WiseTech Global. The Motley Fool Australia has positions in and has recommended Objective and WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The ASX healthcare share Sonic Healthcare Ltd (ASX: SHL) could be one of the best picks within the S&P/ASX 200 Index (ASX: XJO) for retirees wanting dividends.

Sonic Healthcare describes itself as one of the world’s leading medical diagnostic companies. It operates in nine countries, including Australia, the UK, Germany, the US, and Switzerland, with 330 laboratories and 47,000 employees. Impressively, it’s the number one player in six countries.

For multiple reasons, I think it’s a great option for retirees.

Defensive earnings

Healthcare is a defensive sector because of the nature of the types of services it provides.

People don’t choose when to become sick or injured – healthcare demand doesn’t change like discretionary spending does. I’d imagine most people (and governments) would prioritise spending on health over most other categories.

Sonic Healthcare provides an essential service in the healthcare process, so I think its earnings are very defensive.

The ASX healthcare share reported an impressive set of numbers in FY26, considering the economic uncertainty.

Revenue grew 13% to $10.9 billion, underlying operating earnings (EBITDA) climbed 11% to $1.9 billion, and underlying earnings per share (EPS) grew 14% to $1.256.

Profit growth is key for a business to deliver a stable and rising dividend because profit pays for passive income. Therefore, even retiree passive income investors need to look at the earnings outlook.

Good dividend credentials

The ASX healthcare share has paid dividends since 1994. It has increased its dividend almost every year since 1994, except in 2011 and 2012, when it maintained it.

There are very few ASX businesses out there that have increased their payout as consistently over the last 25 years.

I expect the business will be able to continue growing its payout for the foreseeable future.

In the 2026 financial year, Sonic Healthcare continued its progressive dividend policy, hiking the payout by 1 cent per share to $1.08. That translates into a dividend yield of 5.4% excluding franking credits and around 7% including franking credits.  

That’s a really attractive starting yield for retirees, in my opinion.

The ASX healthcare share has earnings tailwinds

I expect the business will be able to increase its payout in the coming years because its earnings could grow materially.

Demand for its services could grow for the foreseeable future, driven by the ageing and growing population in the company’s core markets.

Another way that the company can grow its earnings is by making the occasional acquisition. Its focus in recent times has been Europe. This tactic gives the business a much stronger scale in that market, boosting profit margins.

Over time, I think this business can continue to grow its profits and dividends, making it a compelling pick for investors.

The post Why this ASX healthcare share is a retiree’s dream for FY27 appeared first on The Motley Fool Australia.

More reading

• Why I think these boring ASX shares could build serious wealth
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• Buy, hold, sell: Super Retail, APA, Sonic Healthcare shares

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 no position in any of the stocks mentioned. The Motley Fool Australia has recommended Sonic Healthcare. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

CSL Ltd (ASX: CSL) shares are marching higher today.

Shares in the S&P/ASX 200 Index (ASX: XJO) biotech giant closed on Friday trading for $172.32. In late morning trade on Monday, shares are changing hands for $173.38 apiece, up 0.6%.

For some context, the ASX 200 is up 0.3% at this same time.

Today’s outperformance is par for the course for stockholders since CSL shares closed at a multi-year low of $92.24 on 3 June.

Indeed, with today’s intraday moves factored in, the share price is up a whopping 88.0% since plumbing that low water mark less than three months ago.

Atop those capital gains, investors who hold the stock at market close next Tuesday, 8 September, will receive the final unfranked CSL dividend of $2.277 a share. CSL will pay that dividend on 2 October.

CSL stock trades on a 2.4% unfranked dividend yield (partly trailing partly pending).

Why did the ASX 200 biotech stock plunge to multi-year lows in June?

Despite the remarkable turnaround since 3 June, CSL shares remain down 39% since January 2025.

The company has faced a number of headwinds that saw investors reaching for their sell buttons.

Among these, was the management’s announcement of their intent to spin off the CSL Seqirus segment, its influenza vaccine business, into a separate ASX-listed company.

The company has also been hit by lower than forecast plasma demand, which were partly to blame for CSL’s repeated earnings downgrades.

And investors were taken off guard by former CSL CEO Paul McKenzie’s unexpected exit in February this year.

But, judging by the surging share price these last three months, CSL’s FY 2026 ‘reset’ looks to be paying off handsomely.

And looking to ahead, Morgans’ Damien Nguyen believes the ASX 200 biotech stock remains an appealing opportunity (courtesy of The Bull).

Here’s why.

Should I buy CSL shares today?

“CSL is a global healthcare leader with strong competitive advantages across plasma therapies, vaccines and specialty medicines,” Nguyen said. “Demand for its products remain largely independent of economic conditions.”

Summarising his buy recommendation on CSL shares, Nguyen concluded:

In our view, the latest full year result in 2026 is generating confidence that repeated earnings downgrades are behind CSL.

With defensive earnings, global market leadership and attractive long term growth prospects, we view CSL as an appealing investment opportunity.

What did CSL report for FY 2026?

CSL announced its FY 2026 results on 18 August.

While the company reported a 1% year-on-year decline in revenue to US$15.8 billion, that came in well ahead of its revised guidance (issued in May) of US$15.2 billion.

Management also painted a more positive outlook for FY 2027.

“FY26 has been a year of reset. We have taken decisive action and created a clear path to return to sustainable growth,” CSL interim CEO Gordon Naylor said.

CSL expects steady revenue in FY 2027, while underlying net profit after tax (NPAT) is forecast to grow by around 5%.

CSL shares closed up 17.3% on the day the results were released.

The post Up 88%! Why CSL shares remain an ‘appealing’ buy today appeared first on The Motley Fool Australia.

More reading

• Experts name 2 ASX 200 blue chip shares to buy this week
• Buy, hold, sell: Commonwealth Bank, Goodman Group, CSL shares
• CSL shares have surged 49%: Are brokers finally turning bullish?
• Should I buy CSL shares before the end of August?
• Buy, hold, sell: CSL, BHP, Westpac shares

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 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.