Author: openjargon

Value investing has been back in focus recently as several headwinds have pushed many equities below fair value. 

A new report from VanEck has highlighted why this is likely to continue. 

Investors have been rotating away from high-priced growth stocks and focusing on tangible cash flows, robust balance sheets, and reasonable valuations – companies known as “value” companies.

The core focus of value investing centres on targeting companies perceived to be trading at bargain prices relative to their underlying business performance. 

Often, they have been unfairly punished by the market because of recent negative publicity, a one-off lousy result, or they just operate in a less popular sector of the economy.

Therefore, value shares possess more robust fundamentals than their current share prices would otherwise indicate. 

In simple terms, these shares are trading on the stock market for less than their intrinsic value.

Value has been outperforming

According to VanEck, in May, the VanEck MSCI International Value ETF (ASX: VLUE) returned +15.08%. 

This outperformed the MSCI World ex Australia Index by 10.55%. 

Over the 12 months to 31 May 2026, VLUE returned +25.26%, outperforming the benchmark by 22.88%.

The report from VanEck also reinforced why this could continue. 

Inflation pressure to persist

According to the report, value companies have historically been better placed in periods where inflation and interest rates remain elevated. 

The ongoing oil crisis, alongside other factors such as historically high global government debt, could sustain inflationary pressures.

While markets have priced in a quick resolution to the US-Iran conflict, oil prices remain up around 56% from six months ago. Elevated oil and commodity prices have typically been a leading indicator of higher inflation.

US economic growth outlook still resilient

VanEck also reinforced that despite a number of growing pains, including mounting fiscal debt, tariff disruption, a shrinking labour force following immigration policy pivot, and an ongoing war with Iran, the US economy still looks resilient with a consensus forecast real growth at ~2% for 2026 and 2027.

In combination, somewhat resilient growth with growing long-term risk and persistent inflation pressure paints a stagflationary picture over the coming months, which is a potentially favourable environment for value companies.

Value outperformed in four of the last five stagflation periods.

Valuations remain compelling

Finally, VanEck believes that even after strong recent performance, value companies are not trading at stretched levels. 

Value (based on the MSCI World ex Australia Enhanced Value Top 250 Select Index) is trading at levels close to its 10-year average. 

From a relative value perspective, valuations are also at a multi-year low relative to broader equities.

The recent US earnings season has also confirmed that value fundamentals are meaningfully improving.

The past three quarterly results have seen value companies report more net beats than the benchmark. As of 31 May 2026, Q2 has been the strongest out of the past five quarters, with sell-side analysts forecasting higher year-on-year EPS growth than the broader market over the next two years.

ASX ETFs to target value

A simple way for investors to focus on value shares is with ASX ETFs.

Two options to consider include: 

• VanEck MSCI International Value ETF (ASX: VLUE) – gives investors a diversified portfolio of 250 international developed market large and mid-cap companies, with high value scores as calculated by MSCI at each rebalance
• Vaneck MSCI International Value (AUD Hedged) ETF (ASX: HVLU) – tracks the same international value strategy as VLUE but adds currency hedging back to Australian dollars

More information on the pros and cons of currency hedging can be found here.

The post 3 reasons to prioritise value investing right now: Expert  appeared first on The Motley Fool Australia.

More reading

• We’re back in a value market: Here’s 3 ASX ETFs to target
• 3 of the hottest thematic ASX ETFs for investors to target this week 

Motley Fool contributor Aaron Bell 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.

ASX consumer discretionary stocks have been battered so far in 2026. 

The sector relies heavily on consumer confidence and everyday Australians having the disposable income to buy non-essential goods and services. 

High inflation and rising interest rates have put pressure on these purchases, subsequently hurting consumer discretionary spending. 

However, this downward pressure has also created value opportunities in the sector. 

Two consumer discretionary shares have received buy ratings from the team at Bell Potter. 

Here’s what the broker is tipping for the next 12 months. 

Propel Funeral Partners Ltd (ASX: PFP)

Propel Funeral Partners is an Australian-based company that provides death care services in Australia and New Zealand. The company owns funeral homes, cremation facilities, cemeteries, and related infrastructure in almost every Australian state and New Zealand.

Its share price has fallen almost 35% year to date. 

However, it now presents as a value play.

The company just released updated FY26 guidance.

Propel Funeral Partners expects FY26 revenue of $225 to $230 million and operating EBITDA of $54.5 to $56.5 million.

The guidance was slightly weaker than the market expected. Revenue is 3% to 4% below analyst and market forecasts.

Profit (EBITDA) is approximately 7% below market expectations and 4% below Bell Potter’s own forecast.

The main issue is lower funeral volumes (fewer funerals than expected).

Bell Potter had expected funeral volumes to grow in the second half of FY26, but the guidance implies volumes could actually fall by around 1%.

On the positive side, the amount of revenue earned per funeral (ARPF) is still increasing, up about 2% on a comparable basis.

Based on this guidance, Bell Potter retained its buy recommendation on the consumer discretionary stock, but lowered its price target to $3.80 (previously $5.90). 

Despite lowering its price target, the broker still projects 12% upside in the next 12 months. 

Eagers Automotive Ltd (ASX: APE)

Eagers Automotive is the largest automotive retailing group in the Australian market.

Its share price has fallen 15% year to date. 

However, Bell Potter recently placed a $28 price target on this ASX consumer discretionary stock, indicating 34% upside from current levels. 

The broker said the stock looks reasonably valued on its P/E ratio. 

Back in early May, Eagers Automotive announced the completion of its strategic investment in CanadaOne Auto, one of Canada’s largest dealership groups, through the acquisition of 65% of the shares in its holding company.

Bell Potter’s view on the CanadaOne deal appears to be cautiously positive long term, but more conservative on near-term profitability than before.

We also see the recent trading update at the AGM as effectively “cleansing” the market as the H1 result has now been largely flagged – so there should be no surprises – and the sell-side has downgraded 2026 forecasts for higher bailment charges and the negative forex impact from CanadaOne.

The post Bell Potter just tipped 12% to 34% upside for these consumer discretionary stocks appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• Brokers name 3 ASX shares poised for 52% to 78% gains
• Here are the top 10 ASX 200 shares today
• Why is this ASX 300 stock crashing 14% today?
• 2 ASX shares that I rate as buys today for both growth and dividends

Motley Fool contributor Aaron Bell 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 Eagers Automotive Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Here is a question worth sitting on.

What would you call a software company that just delivered 31% revenue growth, added 110,000 new customers in the United States in a single year, partnered with Anthropic to embed AI into its platform, and authorised a $550 million share buyback?

Most investors would call it a buy. The market has called Xero Ltd (ASX: XRO) a sell.

Xero shares are down approximately 60% from their peak of $196.52 and are trading near $79.27 today. As a result, Xero has been one of the most punished large-cap technology stocks on the ASX.

Yet the business underneath has rarely looked more exciting. The market could be misunderstanding the opportunity set for Xero

Why Xero shares fell and why the market may be wrong

The sell-off has two primary causes.

First, the broader rotation out of high-multiple software stocks that has defined ASX technology investing in 2025 and 2026 hit Xero hard.

These investors have been particularly worried about the risk AI poses to Xero’s business model.

Second, Xero’s FY 2026 full-year result on 14 May showed a 27% decline in statutory net profit, which spooked short-term investors.

What those investors may have missed is that the profit decline was driven entirely by $45 million in one-off Melio acquisition costs.

Strip those costs out, and Xero delivered operating revenue growth of 31% to $2.8 billion, adjusted EBITDA growth of 18% to $757 million, and free cash flow of $554 million.

Those are, on the surface, quite exceptional numbers.

The US breakthrough that shows the way forward

For years, the US was Xero’s great unproven market. FY 2026 may have changed that in dramatic fashion.

US revenue surged 240% as Melio’s bill pay functionality was integrated into the Xero platform. This gives American small businesses a payments and accounting combination that Intuit’s QuickBooks does not natively offer at the same level.

Perhaps as a result, Xero added 110,000 US customers in FY 2026, its strongest-ever subscriber addition in that market.

The opportunity set is huge. The US is the world’s largest small business accounting software market, and Intuit controls approximately 80% of it.

Xero does not need to win the whole market to create extraordinary value for shareholders. The company just needs to keep taking share at its current pace.

CEO Sukhinder Singh Cassidy said:

Our strong full year results demonstrate Xero’s disciplined execution and macro-resilience. Our […] strategy is hitting its stride, demonstrated by accelerating US growth.

Two million subscribers are already using Xero’s AI

This is the part of the Xero story that many investors are misunderstanding.

Over two million Xero subscribers are now actively using AI features, with 300,000 specifically using new generative AI tools.

What’s more, Xero has partnered with Anthropic to integrate Claude AI directly into its platform. The company has launched XeroForce, a natural language AI agent that allows business owners to query their finances conversationally.

Smart document capture and automated reconciliation are live and driving measurable improvements in customer engagement.

These product updates make Xero’s platform more valuable and stickier for its existing user base.

Why AI is an opportunity, not a threat

The most persistent bear argument against Xero shares is that AI will make accounting software obsolete.

These fears may have been misplaced.

Rather than replacing platforms like Xero, AI agents depend on them. Every automated workflow needs a clean, structured, real-time data layer to function reliably, and businesses will pay a premium for software that provides it.

Xero has positioned itself to capture that value through higher-tier subscriptions, expanded product attach rates, and deeper customer lock-in.

With over two million subscribers already using Xero’s AI features, the more AI is embedded into the platform, the harder it becomes for customers to leave.

What Goldman Sachs and Morgans are saying about Xero shares

The broker community has been far more constructive on Xero shares than the market.

Goldman Sachs retained its buy rating and lifted its price target to $205. The broker described the US performance as an important data point that gives confidence to Xero’s American strategy.

At today’s Xero share price, that $205 target implies upside of approximately 160%.

Another broker, Morgans, upgraded Xero from hold to add with a $215 price target, noting improved sales traction and cost discipline as key positives.

Foolish Takeaway

Xero shares are down 60% from their peak.

The business just delivered 31% revenue growth, a US breakthrough, two million AI users, and a $550 million buyback.

What’s more, Goldman Sachs sees 160% upside.

For investors who can look past twelve months of share price pain, Xero could be the best tech stock on the ASX right now.

The post Why Xero shares could be the best tech pick on the ASX right now appeared first on The Motley Fool Australia.

More reading

• 3 ASX stocks I’d buy during a sharemarket crash
• Forget SpaceX shares and buy these ASX tech stocks
• ASX 200 tech stocks led the market with big share price gains last week
• Are Wesfarmers, Xero and this ASX 200 share buys in June?
• 3 amazing ASX growth shares to buy with $15,000

Motley Fool contributor Mark Verhoeven 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, Intuit, 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.

The ASX dividend stock Charter Hall Long WALE REIT (ASX: CLW) could be one of the smartest ideas to buy right now. It offers investors significant passive income at a very discounted price.

As the above chart shows, the real estate investment trust (REIT) has suffered a decline of 37% since April 2022, and it’s down 26% from September 2025.

Those declines occurred despite the business continuing to generate very solid rental income and paying good distributions during that period.

The REIT could be a very good buy today for the following reasons.

Diversification

The business has a widely diversified commercial property portfolio across various subsectors, but the properties are united by long-term leases with tenants. At the end of December 2025, it had a weighted average lease expiry (WALE) of 9.3 years – that’s a lot of rental income already locked in.

Its portfolio spans a number of sectors, including government-tenanted properties (such as Geosciences Australia), pubs and hotels, grocery and distribution, telecommunications exchanges, data centres, service stations, food manufacturing, waste and recycling management, Bunnings properties, and so on.

The company has a number of high-quality tenants such as government entities, Endeavour Group Ltd (ASX: EDV), Telstra Group Ltd (ASX: TLS), Coles Group Ltd (ASX: COL), Metcash Ltd (ASX: MTS), Westpac Banking Corp (ASX: WBC) and Wesfarmers Ltd (ASX: WES).

With an occupancy rate of 99.9%, the ASX dividend stock is maximising the rental potential of its portfolio.

Excellent passive income

Its solid rental income is translating into a pleasing distribution, despite the headwinds of higher interest rates.

The business expects to pay an annual distribution of 25.5 cents per security in FY26. That translates into a distribution yield of 7.5%. Not many property businesses are delivering returns as high as that.

I’m not sure what the FY27 payout will be, but I expect it will be similar. Plus, the business has rental indexation built into its contracts with tenants, with either fixed annual increases or the rises are linked to inflation.

The ASX dividend stock trades at a big discount

One of the main reasons why the yield is so high is that the business is trading at a large discount to its underlying value.

REITs regularly tell investors the net value of their businesses, which is the value of the properties and other assets minus the loans and other liabilities. What’s left is the net asset value (NAV), or net tangible assets (NTA), per share.

The business reported that its NTA at 31 December 2025 was $4.68. That means, at the time of writing, it’s trading at a 27% discount to this figure. While one could argue about the underlying value of the properties, the distribution is paid from clear rental profits generated, which translate into a large yield.

It’s a great ASX dividend stock, though it’s not the only investment I’d happily make today.

The post 1 ASX dividend stock down 37% I’d buy right now appeared first on The Motley Fool Australia.

More reading

• Down 25%: 3 ASX dividend shares to buy with 7% yield
• 2 ASX income shares I’d buy outside Westpac and the big four banks
• How much is needed in superannuation to target a $3,000 monthly passive income?
• Forget Westpac, these ASX dividend shares could be better buys
• How much is needed in superannuation to target a $7,500 monthly passive income?

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 Wesfarmers. The Motley Fool Australia has positions in and has recommended Telstra Group. 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.

REA Group (ASX: REA) shares have been hotly covered over the last 12 months. 

The online real estate advertising company was heavily impacted by fears about AI’s impact on its core business. 

A key concern was that AI assistants could become the primary way people search for property, reducing traffic to REA Group’s platforms, weakening its network effects and potentially putting pressure on its advertising and listing revenues.

This sent its stock price plummeting 33% over the last year. 

However, in the last few months, it has shown signs of recovery. 

Many brokers and experts were tipping it for a strong rebound. 

However, a new report from Bell Potter suggests the current share price weakness could persist for the long term. 

Here’s what the broker had to say. 

REA shares are not yet at the bottom of the cycle

Bell Potter said in a new report that it had examined historical earnings and valuation performance against a further deterioration in REA’s current operating environment. 

There are several key drivers that have changed its outlook on REA Group shares: 

• Rising near-term RBA cash rate forecast driving softening in demand for lending
• Recent budget measures adversely impacting investment in property as an asset class, largely in the investor book, partially offset by owner-occupied

• Both factors, combining to negatively impact average national dwelling values and listing volumes, more than offset the buy yield for REA
• REA’s history of EPS declines in a falling 12-month average dwelling price environment.

Recent budget measures undertaken by the Aus Gov. to adjust capital flows and housing affordability have driven the expectation for a decline in national avg. house prices, coinciding against a backdrop of an additional forecast rate hike (+20-25bps) and subsequent softening in demand via lending origination value. 

The two previous instances of YoY avg. national dwelling price declines (FY19, FY23) saw significant decreases in REA listings (-8%, -12%), driving Resi segment revenue and Group EPS (-9%, -8%) declines on half-yearly bases. Melbourne and Sydney avg. house prices typically lead the housing cycle and are both approaching YoY declines as of May ’26.

From a buy to a sell

In simple terms, Bell Potter thinks the housing market is weakening, which could hurt REA’s earnings more than investors currently expect.

REA (owner of REA Group and its property listing websites) makes a lot of money when homes are bought and sold because agents pay to advertise properties on its platform.

If fewer homes are listed for sale, REA earns less revenue.

The broker’s FY26 outlook is largely unchanged. However, FY27 and FY28 earnings are expected to be substantially lower than Bell Potter previously thought.

Based on this guidance, Bell Potter has changed its rating on REA Group shares to a sell (previously buy). 

The broker also updated its 12-month price target to $137 (previously $217). 

From last week’s closing price of $158.81, this indicates a further downside of almost 14%. 

The post Why did this major broker just do a backflip on REA Group shares? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Tuesday
• How to become rich by investing in ASX shares
• Can you turn $20,000 into $100,000 with ASX shares?
• Here are the top 10 ASX 200 shares today
• 2 ASX 200 shares I think could beat the market over 10 years

Motley Fool contributor Aaron Bell 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.

There are a lot of shares for investors to choose from on the Australian share market.

To narrow things down, let’s take a look at two ASX 200 shares that analysts are tipping as buys this week, courtesy of The Bull.

Here’s what these analysts are recommending to investors this week:

Coles Group Ltd (ASX: COL)

The team at Morgans thinks that supermarket giant Coles could be an ASX 200 share to buy this week.

The broker rates Coles highly due to its non-discretionary earnings base, improving operational leverage, and attractive valuation following recent share price weakness. In addition, it likes Coles shares for the solid dividend yield they currently offer.

Commenting on the company, Morgans said:

The supermarket operator offers a resilient, non-discretionary earnings base. Demand for consumer staples remains stable through economic cycles, and Coles benefits from pricing discipline across a duopolistic market structure. Recent share price weakness, driven partly by broader cost-of-living and regulatory scrutiny concerns, has created a more attractive entry point for long term investors. The company also offers a solid dividend yield and improving operational leverage.

Woodside Energy Group Ltd (ASX: WDS)

Over at MPC Markets, its analysts have named Woodside shares as a buy this week.

It likes the energy giant due to its exposure to LNG demand from Asia, which will soon be boosted by the Scarborough Energy project. MPC Markets highlights that the project is around 96% complete and should be shipping its first cargoes later this year.

In addition, the investment solutions advisory company believes the market is not fully pricing in the production uplift from Woodside’s major growth projects. As a result, it sees value in Woodside shares at current levels and is recommending them to investors that are seeking exposure to the energy sector.

Commenting on Woodside, MPC Markets said:

Woodside is one of Australia’s leading oil and gas producers. The company remains leveraged to LNG demand from Asia. The Scarborough Energy project is reportedly 96 per cent complete and on track for first LNG cargoes in the fourth quarter of 2026. Energy prices remain volatile, but gas continues to play an important role in regional energy security.

In our view, the market isn’t fully pricing in the production uplift from Woodside’s major growth projects. The dividend has been under pressure, but the balance sheet and asset base remain appealing for investors seeking energy exposure.

The post Why Coles and Woodside shares are being tipped as buys appeared first on The Motley Fool Australia.

More reading

• Here’s the dividend forecast out to 2028 for Coles shares
• 5 things to watch on the ASX 200 on Friday
• This beaten-down ASX 200 stock just jumped 5%. Is the market too negative?
• 5 things to watch on the ASX 200 on Thursday
• Top brokers name 3 ASX shares to buy now

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group Ltd. 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.

It has been an extraordinary year for ASX mining shares.

The materials sector rose 32% in 2025 and is up a further 15% so far in 2026.

This has been driven by surging copper prices, a recovering iron ore market, and growing investor interest in the commodities essential to artificial intelligence, electrification, and green energy infrastructure.

Recently, all three of the sector’s biggest names have pulled back from recent highs. This is due to several factors, including concerns around an iron ore oversupply and broader market pullbacks.

This pullback, however, may be creating one of the best entry point opportunities into these beloved mining stocks on the ASX.

BHP Group Ltd

BHP Group Ltd (ASX: BHP) recently hit an all-time high of just over $65.

Today it trades marginally lower, providing a potential opportunity for patient investors.

The near-term selling is due to broader risk-off sentiment rather than any change in BHP’s fundamentals.

For the first time in BHP’s 136-year history, copper earnings exceeded iron ore contributions in the first half of FY2026. The copper price has surged above US$13,000 per tonne on AI data centre demand, electric vehicle growth, and grid infrastructure investment.

BHP plans to grow copper-equivalent production at 3% to 4% per year through 2035.

This should reinforce what is already one of the world’s most valuable copper portfolios at exactly the right moment.

With many long-term tailwinds and smart strategic positioning from BHP management into the copper market, there are many reasons for investors to be optimistic.

Furthermore, the fully franked dividend, backed by both copper and iron ore cash flows, also gives income investors a meaningful yield even after the strong share price run.

For investors looking to buy into a quality blue-chip ASX mining stock, BHP should be on their watchlist.

Rio Tinto Ltd

Rio Tinto Ltd (ASX: RIO) offers a different but equally attractive investment case for investors who want diversified commodity exposure rather than a concentrated copper and iron ore bet.

Rio’s portfolio spans iron ore, copper, aluminium, lithium, and titanium. This makes the company one of the most broadly diversified mining companies in the world.

The ASX 200 materials sector is up 15% in 2026, and Rio has been a major contributor to that performance. Rio Tinto’s share price has risen strongly from its 2025 lows as iron ore held above US$100 per tonne and copper prices surged.

The completion of the US$6.7 billion Arcadium Lithium acquisition in March 2025 has positioned Rio as one of the world’s largest lithium producers.

As the world continues to electrify, lithium will remain a key resource powering this global transition.

Rio Tinto maintains a 60% payout ratio dividend policy, meaning higher earnings from commodity tailwinds flow directly into shareholder distributions.

That discipline, combined with a diversified earnings base, has made Rio one of the most reliable income-producing mining stocks available to Australian investors.

Fortescue Ltd

Fortescue Ltd (ASX: FMG) is the highest-risk and potentially highest-reward of the three. This ASX mining share offers the most direct and concentrated exposure to the iron ore price.

The company has been the outlier among the big three in 2026, lagging BHP and Rio Tinto as its lower-grade ore product has faced margin pressure from tightening Chinese steel mill profitability standards.

However, Fortescue has been actively building a second growth engine through its Fortescue Energy division. This division is pursuing green hydrogen and green ammonia projects across multiple continents.

The company maintains a dividend payout policy of 50% to 80% of net profit after tax, with dividends paid fully franked twice per year.

Furthermore, the CMRG index, which tracks Chinese steel mill restocking demand on a weekly basis, has been rising for three consecutive weeks. This is a precursor to increased iron ore orders that should provide near-term price support for Fortescue’s primary product.

From a valuation perspective, Fortescue exhibits a price-to-sales ratio below the industry average for ASX mining stocks. This suggests that the market may be undervaluing the business relative to its peers.

For investors comfortable with higher commodity price sensitivity in exchange for a lower entry valuation, Fortescue offers an interesting proposition.

The risks worth knowing

All three miners are commodity businesses, and commodity prices can fall as quickly as they rise.

The iron ore price remains sensitive to Chinese steel demand, which is under ongoing pressure from environmental tightening and property-sector weakness.

A re-escalation of the Middle East conflict could push oil prices higher, increasing mining operating costs across all three companies.

Foolish takeaway

BHP, Rio Tinto, and Fortescue are not cheap on absolute measures.

But the pullback from recent highs has improved the entry points across all three.

For long-term investors who believe the copper demand story, the China recovery, and the commodity supercycle have further to run, all three ASX mining shares remain worth serious consideration.

The post 3 top ASX mining shares for investors right now appeared first on The Motley Fool Australia.

More reading

• How to start investing in ASX shares with just $500
• Buy, hold, sell: Megaport, Bendigo Bank, BHP shares
• BHP, CBA, and Westpac shares are sells this week: experts
• Are Fortescue or Rio Tinto shares the better buy?
• Would Warren Buffett buy BHP shares?

Motley Fool contributor Mark Verhoeven 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.

Artificial intelligence (AI) has become one of the biggest investment themes in the world.

But picking the winners is not easy. Some companies will dominate more than others and valuations across the sector can move quickly when sentiment changes.

That is why the Global X Semiconductor ETF (ASX: SEMI) could be worth a closer look.

A different way to play AI

This ASX exchange traded fund (ETF) gives investors exposure to the companies making the chips, equipment, and technology that sit behind the AI buildout.

That is important because AI needs enormous amounts of computing power, memory, networking, and advanced manufacturing capacity.

This puts semiconductor companies right at the centre of the trend. Whether the winners are cloud giants, software platforms, robotics companies, or autonomous vehicle businesses, many of them will need more chips to keep growing.

The fund’s holdings include Taiwan Semiconductor Manufacturing Co (NYSE: TSM), NVIDIA (NASDAQ: NVDA), and ASML Holding (NASDAQ: ASML). These businesses sit at different points of the semiconductor supply chain, from chip design and manufacturing to the highly specialised equipment needed to produce advanced chips.

Why it could be attractive

The semiconductor industry has historically been cyclical, but the current demand backdrop looks unusually powerful.

AI models are becoming larger, data centres are requiring more powerful hardware, and companies across the world are racing to build the infrastructure needed for next-generation computing.

This doesn’t mean it will be smooth sailing for the ASX ETF. Semiconductor shares can be volatile, especially when investors worry about valuations, inventory cycles, or capital spending.

But over the long term, the need for more computing power looks difficult to ignore.

The fund also gives Australian investors exposure to an area that is not well represented on the ASX. Local investors can own banks, miners, supermarkets, and property trusts easily. Getting meaningful exposure to global chip leaders is much harder without looking offshore.

Is it a buy?

This ASX ETF will not be suitable for everyone. It is concentrated in one industry, which means it can fall sharply if the semiconductor cycle turns.

But for investors comfortable with volatility, it offers a great way to gain exposure to one of the most important parts of the global technology stack.

If AI continues to reshape the economy, the companies supplying the hardware behind it could remain in demand for many years. That makes this fund arguably one of the more interesting ASX ETF options for growth-focused investors.

The post Could this ASX ETF be the best way to invest in the AI boom? appeared first on The Motley Fool Australia.

More reading

• What are the best performing thematic ASX ETFs right now?
• The growing case for this semiconductor ASX ETF
• ASX investors: Are you overinvested in the Magnificent 7 without knowing it?
• If I could buy only one ASX ETF for the next 10 years, this could be it
• Could this ASX ETF be the easiest way to invest in AI?

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

Most Australians think they need to save thousands of dollars before they can start investing in the share market.

That is simply not true.

With as little as $500, Australian investors can buy shares in some of the country’s most successful companies or get instant diversification across 200 businesses in a single trade.

The key is knowing where to start, keeping costs low, and giving your investment time to compound.

Here is a practical guide to getting started with $500 today.

Step one: choose a broker

Before buying any ASX shares, you need a brokerage account.

Most major Australian online brokers, including CommSec, Selfwealth, Stake, and CMC Invest, allow investors to open accounts with no minimum deposit.

Brokerage fees typically range from $5 to $19.95 per trade depending on the platform.

For a $500 investment, keeping brokerage below $10 is important, as a $19.95 fee represents 4% of your investment before you have even bought a single share.

Stake and Selfwealth both offer competitive flat-fee brokerage that suits investors starting with smaller amounts.

Option one: the diversified approach with A200

For a first-time investor with $500, the single best option on the ASX, in my opinion, is arguably the Betashares Australia 200 ETF (ASX: A200).

One unit of A200 provides immediate exposure to 200 of Australia’s largest companies, including Commonwealth Bank, BHP, Wesfarmers, CSL, and Macquarie Group, without the need to research or pick individual stocks.

The fund charges a management fee of just 0.04% per annum, the lowest of any Australian shares ETF available on the market.

That is $0.20 per year on a $500 investment, a cost so low it barely registers over a long investment horizon.

Since its inception, the ASX200 index has returned approximately 8.53% per annum, including dividends.

Distributions are paid quarterly in April, July, October, and January, giving even a small investor a genuine income stream from day one.

For a beginner investor, A200 removes the hardest part of investing: deciding which stocks to buy.

Option two: a blue-chip large-cap like CBA

For investors who want to own shares in a single well-known Australian company, Commonwealth Bank of Australia (ASX: CBA) is one of the most widely held stocks in the country.

CBA is Australia’s largest bank by market capitalisation, operates the most downloaded financial app in Australia with more than 8 million active users, and has grown its fully franked dividend every year since 2021.

CMC Invest forecasts CBA will pay a fully franked dividend of approximately $5.15 per share in FY2026. This implies a grossed-up yield of approximately 4.6% at current prices, including franking credits.

CBA shares currently trade at approximately $160, which means $500 buys approximately three shares with change left over.

Although not a large position, it is a start. And the habit of investing regularly, buying two or three CBA shares each month, is how long-term wealth is built.

It is worth noting that CBA trades at a premium valuation of approximately 26 times earnings. This may limit the near-term upside compared to some other options.

However, for a first-time investor who wants to own a household name they understand and trust, CBA is a reasonable starting point.

Option three: commodity exposure through BHP

For investors seeking exposure to global commodity markets and the AI and electrification megatrends driving copper demand, BHP Group Ltd (ASX: BHP) offers a compelling entry point.

BHP shares currently trade at approximately $61.20, meaning $500 buys approximately eight shares, the most units of the three options in this article.

For the first time in its 136-year history, copper earnings exceeded iron ore contributions at BHP in the first half of FY2026. This is because the copper price has surged above US$13,000 per tonne due to demand from AI data centres and electric vehicles.

The fully franked dividend offers income investors a strong yield alongside commodity price optionality.

BHP has pulled back slightly from its all-time highs, which improves the entry point for new investors.

Morgan Stanley carries an overweight recommendation on BHP shares with a price target of $67.50, implying some upside from current levels.

The most important thing: start

The hardest part of investing is starting.

Every month that passes without investing is a month of compounding returns lost forever.

A $500 investment in A200 ten years ago, with dividends reinvested, would be worth approximately $1,130 today based on the index’s historical return of approximately 8.53% per annum.

The same $500 invested every month over that period would have grown to approximately $92,000.

That is the power of compounding over time, and it starts with a single $500 trade.

The post How to start investing in ASX shares with just $500 appeared first on The Motley Fool Australia.

More reading

• 3 top ASX mining shares for investors right now
• Buy, hold, sell: Megaport, Bendigo Bank, BHP shares
• BHP, CBA, and Westpac shares are sells this week: experts
• Which ASX bank stock is the best buy right now?
• Would Warren Buffett buy BHP shares?

Motley Fool contributor Mark Verhoeven 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.

S&P/ASX 200 Index (ASX: XJO) shares are likely to open lower today after a dramatic fall on Wall Street on Friday.

Stronger-than-expected US jobs data sparked fears of higher inflation and interest rates for the world’s biggest economy.

The Nasdaq Composite Index (NASDAQ: .IXIC) was smashed, falling 1,121 points or 4.2%.

That was the Nasdaq’s biggest daily fall in more than 12 months.

Investment research company, Hedgeye, said it was also the largest daily point decline in Nasdaq’s history, according to news.com.au.

Higher interest rates are a particular headwind for tech companies amid massive artificial intelligence (AI) capex spending.

The S&P 500 Index (SP: .INX) also fell heavily, down 200 points or 2.64%.

Meanwhile, here are three ASX 200 shares with new ratings today.

Megaport Ltd (ASX: MP1)

The Megaport share price rose 19% last week and set a 52-week high of $21.16 on Friday.

The gain followed news of four new AI infrastructure contracts worth $458.9 million.

To fund new capex required for the contracts, Megaport launched a $827.3 million entitlement offer.

UBS retained its buy rating and lifted its 12-month price target on Megaport shares from $16.70 to $24.20.

This implies a potential upside of 31% from Friday’s $18.48 close.

BHP Group Ltd (ASX: BHP)

The BHP Group Ltd (ASX: BHP) share price rose to a new record of $65.04 last Wednesday.

Then on Thursday and Friday, ASX 200 iron ore shares fell sharply on news of a major production increase at Simandou.

The massive Simandou project in Africa is the world’s largest undeveloped iron ore deposit.

The mine began operations in November, and its output is expected to change global demand/supply dynamics.

Last week, the iron ore price fell 6.3% to US$102 per tonne, a 7-week low.

UBS reiterated its hold rating on BHP shares with a $55.86 price target on Friday.

This suggests a 9% downside from Friday’s $61.24 close.

Bendigo and Adelaide Bank Ltd (ASX: BEN)

The Bendigo and Adelaide Bank share price closed at $10.12, down 1.6% on Friday.

Morgan Stanley tips a 5% earnings downgrade for ASX 200 bank shares due to Labor’s proposed capital gains tax (CGT) changes.

The broker says the changes could lead to softer mortgage growth and narrower margins in FY27.

Australia’s banks are highly exposed to residential housing, which is already softening due to higher interest rates.

Morgan Stanley has just reiterated its sell rating on Bendigo and Adelaide Bank shares.

The broker reduced its 12-month share price target from $10.10 to $9.80.

This implies a potential 3% downside from here.

The post Buy, hold, sell: Megaport, Bendigo Bank, BHP shares appeared first on The Motley Fool Australia.

More reading

• 3 top ASX mining shares for investors right now
• How to start investing in ASX shares with just $500
• BHP, CBA, and Westpac shares are sells this week: experts
• 7 ASX shares set to soar 30% to 90% in 12 months: experts
• ASX 200 tech stocks led the market with big share price gains last week

Motley Fool contributor Bronwyn Allen has positions in BHP Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Megaport. The Motley Fool Australia has positions in and has recommended Bendigo And Adelaide Bank. 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.