Author: openjargon

If you are looking for an ASX uranium stock to buy, then it could be worth considering Paladin Energy Ltd (ASX: PDN) shares.

That’s the view of analysts at Bell Potter, who are feeling positive about this uranium producer following the release of its quarterly update.

What is the broker saying?

Bell Potter was pleased with Paladin Energy’s performance during the third quarter.

It highlights that its production was ahead of expectations, which has underpinned an upgrade to its guidance for FY 2026. The broker commented:

PDN reported quarterly uranium production of 1.3Mlb (2Q FY26 1.2Mlb; BPe 1.2Mlb), sales of 1.0Mlb (down 16% QoQ) and closing uranium inventory of 2.2Mlb, up 0.55Mlb QoQ due to timing of shipments. Commissioning of the remaining mining fleet and strong plant performance drove increased mining and production rates. PDN realised an average price of US$68/lb (down 13% QoQ) reflecting higher volumes sold into base escalated contracts. Production costs were US$40/lb.

Last week, PDN upgraded FY26 guidance to production of 4.5-4.8Mlb (previously 4.0- 4.4Mlb; YTD 3.6Mlb) and capital expenditure (excluding capitalised stripping costs) of US$15-17m (previously US$26-32m; YTD US$7m). […] Implied guidance points to a lift in production costs as mined volumes feed a higher portion of processed tonnes (vs processing stockpiled ore) and diesel cost inflation, which accounts for around 10-15% of PDN’s cost of production.

ASX uranium stock tipped as a buy

According to the note, the broker has retained its buy rating on Paladin Energy’s shares with an unchanged price target of $15.30.

Based on its current share price of $12.87, this implies potential upside of 19% over the next 12 months.

Commenting on its investment thesis, Bell Potter said:

We retain our Buy recommendation and $15.30/sh TP. PDN is positively exposed to rising uranium markets, with ~53% exposure to spot prices out to 2030. Production at LHM continues to improve, with transition to processing primarily fresh ore, milled grades should lift from 501ppm in 1H as should plant performance and reliability. The only risk we see is water disruptions as we enter a seasonally tricky period known for algal blooms which can impact availability from the desalination plant.

Overall, this could make the ASX uranium stock worth considering if you are looking for exposure to this side of the market for your portfolio.

The post This ASX uranium stock is a top buy according to one broker appeared first on The Motley Fool Australia.

More reading

• Why Bank of Queensland, Cochlear, Northern Star, and Paladin Energy shares are falling today
• Paladin shares are falling again. Here’s what investors might be overlooking
• Paladin Energy boosts uranium production and lifts FY26 guidance
• Why Eden Innovation, Elsight, Paladin Energy, and Zip shares are racing higher today
• Why Paladin Energy, Alcoa and Zip shares are making headlines on Friday

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 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 has been a lot of uncertainty on the ASX share market over the last couple of months with share prices moving around significantly. I think this is a great opportunity to buy ASX dividend shares.

When a share price goes lower, it boosts the dividend yield on offer. Therefore, when the opportunity is there, I think it’s worth jumping on. For example, if a business with a 7% dividend yield sees a 10% share price fall, the yield on offer becomes 7.7%.

The two businesses below have some of the most appealing dividend yields, partly because I expect ongoing payout growth.

Universal Store Holdings Ltd (ASX: UNI)

I think Universal Store is one of the most underrated businesses on the ASX for dividends because of both its yield and its impressive growth.

In my view, it’s important that a good ASX dividend share regularly increases its payout to help offset (or outpace) inflation and ensure our bank account grows in real terms.

Universal Store is best-known for two businesses within its stable – Universal Store and Perfect Stranger. The company aims to sell premium apparel to fashion-focused younger shoppers in Australia.

It is delivering excellent levels of growth – in the first half of FY26, group sales increased 14.2% to $209.6 million, with Universal Store sales rising 11.9% to $174.8 million and Perfect Stranger sales soaring 41.5% to $17.8 million.

The sales growth supported a 22% rise in underlying net profit after tax (NPAT) to $28.3 million. The business’ offering is clearly resonating with customers, particularly the Perfect Stranger brand. Its interim dividend was hiked by 18.1% per share.

The ASX dividend share is expecting to open more Universal Store and Perfect Stranger stores in the second half of FY26, as well as in the coming years. The increased scale could see ongoing sales strength and improving profit margins.

According to the forecast on Commsec, it’s trading with a projected FY27 grossed-up dividend yield of 8.9%, including franking credits, at the time of writing.

Future Generation Australia Ltd (ASX: FGX)

The other ASX dividend share I want to tell you about is a listed investment company (LIC) that doesn’t charge any management fees or performance fees. Instead, it donates 1% of its net assets each year to youth charities.

Its actual investments are a variety of funds from different fund managers who are all happy to work pro bono.

This investment style means investors have exposure to hundreds of underlying businesses, which are typically smaller (and have more growth potential) than what the S&P/ASX 200 Index (ASX: XJO) is weighted to.

As a LIC, Future Generation Australia is able to steadily grow its annual dividend per share from investment returns it has made in the current year or previous years.

In the most recent result, Future Generation Australia decided to increase its annual dividend per share by around 3% to 7.2 cents. That translates into a grossed-up dividend yield of approximately 7.5%, including franking credits.

I’m projecting a 7.75% grossed-up dividend yield (at the time of writing), including franking credits, for FY27.

The post Get paid huge amounts of cash to own these ASX dividend shares! appeared first on The Motley Fool Australia.

More reading

• 3 ASX shares Bell Potter rates as top buys
• 3 ASX dividend shares raising dividends like clockwork
• 3 cheap ASX dividend shares offering 5% to 6% yields (and major upside)
• Why Clarity, Qantas, Universal Store, and Westpac shares are falling today
• This ASX retail stock is sliding after a surprise leadership announcement

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

The Australian share market has traditionally generated a return of around 10% per annum.

But investors don’t necessarily have to settle for that, especially with some ASX stocks tipped for outsized returns.

Which ASX stock?

The stock that Bell Potter believes is severely undervalued is AMA Group Ltd (ASX: AMA).

It is the largest accident repair company in Australia with approximately 140 vehicle panel repair shops.

Bell Potter highlights that AMA released its third quarter update this month and has delivered earnings ahead of expectations thanks to stronger than forecast margins. In addition, it was pleased to see management announce plans for a share buyback. It said:

Normalised pre-AASB 16 EBITDA of $17.9m in 3QFY26 was 2% above our forecast of $17.6m and the beat was driven by a higher margin than forecast (7.0% vs BPe 6.7%) while revenue was slightly below ($254.2m vs BPe $263.3m). At a business level, Capital Smart and Specialist Businesses were both ahead of our forecasts ($13.3m and $1.8m vs BPe $12.4m and $1.0m) while AMA Collision and Wales were below ($2.0m and $1.5m vs BPe $4.6m and $2.1m).

Operating cash flow pre-AASB 16 of $(0.4)m was below our forecast of $3.8m but was negatively impacted by a higher-than-expected $6.3m tax payment during the quarter. AMA announced its intention to put a share buyback program in place given “the Board has determined that recent market volatility presents a good capital management opportunity.”

Share tipped to almost double

According to the note, the broker has retained its buy rating on the ASX stock with an unchanged price target of $1.10.

Based on its current share price of 56 cents, this implies potential upside of 96% for investors over the next 12 months.

Commenting on its buy recommendation, Bell Potter said:

There are no changes in the key assumptions we apply in the valuations we use to determine our target price which are a 5.5x multiple in the EV/EBITDA and 10.5% WACC in the DCF. Yes, we adjusted these assumptions to reflect the risk of a downgrade to the guidance but we leave them unchanged as we still see risk of a downgrade at some stage or a slight miss at the result. The result is no net change in our target price of $1.10 and we retain the BUY recommendation.

The key potential positive catalyst is an end to the conflict in the Middle East and a reduction in fuel prices though we note that, even with fuel prices remaining elevated, anecdotal evidence suggests traffic volumes are relatively normal in at least city areas, particularly with school holidays now over.

The post Guess which ASX stock Bell Potter says could rise almost 100% appeared first on The Motley Fool Australia.

More reading

• 3 ASX shares Bell Potter rates as top buys
• This ASX industrials stock could be set to double according to one broker

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 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.

Telstra Group Ltd (ASX: TLS) has built a reputation as a reliable, income-focused share.

But is the telco a good buy this month? I think it is.

Here are three reasons I would consider buying Telstra shares today.

The earnings base is becoming more consistent

Telstra’s core business continues to deliver. Its mobile division remains a key driver of growth, supported by customer additions and higher average revenue per user. That has flowed through to earnings, with the company reporting growth across multiple parts of the business in the first half of FY26.

What stands out to me is how this is being achieved. The company is seeing operating leverage come through, supported by cost control and efficiency gains. It reduced underlying operating expenses during the first half, which helped offset cost pressures and supported profit growth.

This combination of revenue growth and cost discipline is important. It points to a business that is becoming more predictable and easier to manage, which tends to support more stable earnings over time.

Capital returns

There is more to Telstra than the dividend alone.

The company lifted its interim dividend to 10.5 cents per share in February and continues to run a large buyback program, which has been increased to $1.25 billion.

That combination can have a meaningful impact on returns.

Dividends provide a steady income stream, while buybacks reduce the number of shares on issue and support earnings per share growth. Over time, that can help lift both earnings per share and dividends per share.

Telstra is also generating the cash to support this approach, which is what gives me confidence in its sustainability.

Its position in the market remains strong

Telstra’s role in Australia’s telecommunications network is well established.

Demand for connectivity continues to grow as more devices, services, and businesses rely on mobile and data networks. Telstra remains a key provider across mobile, fixed, and infrastructure, which supports a large base of recurring revenue.

The company is also continuing to invest in its network and technology. This includes expanding its fibre footprint and improving service quality, which helps retain customers and supports pricing.

Over time, that kind of investment tends to reinforce its position rather than weaken it, which is important for a business built around long-term infrastructure.

Foolish takeaway

Telstra offers steady earnings, strong cash flow, and consistent capital returns.

With those pieces in place, I see it as a reliable income-focused investment that can continue to deliver over time, supported by a business that is becoming more stable and predictable.

The post 3 reasons I’d buy Telstra shares today appeared first on The Motley Fool Australia.

More reading

• Where I’d invest $5,000 in ASX blue-chip shares
• Stagflation: How to position an ASX stock portfolio
• Why I don’t own Telstra shares (yet)
• How to build a second income from ASX shares without taking big risks
• Where I’d invest on the ASX for passive income right now

Motley Fool contributor Grace Alvino has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Australian share market may be trading within sight of a record high, but not all shares have climbed with it.

A good number of ASX growth shares have been sold off over the past 12 months and still trade at a deep discount.

While this is disappointing for growth investors, it could have created a very attractive buying opportunity for those with capital to deploy.

With that in mind, here are three ASX growth shares that could be top picks right now:

Lovisa Holdings Ltd (ASX: LOV)

The first ASX growth share that could be a buy is Lovisa.

It is a fast-growing fashion jewellery retailer that is in the middle of an ambitious global expansion. At last count, the company was operating over 1,000 stores across more than 50 markets.

But management isn’t settling for that and continues to open new stores across the globe.

Morgans has named Lovisa as one of its top picks in the retail sector, highlighting the company’s scalable store model and strong brand appeal.

The broker currently has a buy rating and $36.80 price target on its shares. Based on its current share price, this implies potential upside of 50% over the next 12 months.

TechnologyOne Ltd (ASX: TNE)

Another ASX growth share that could be worth considering is TechnologyOne.

It is a leading developer of enterprise software for governments, universities, and large organisations. These customers tend to be sticky, long-term users, which gives the company a high level of revenue visibility.

Its shift to a software-as-a-service model has been a huge success, delivering consistent annual recurring revenue growth and strong cash generation. But if you thought its growth was coming to an end, think again. Management believes it can double the size of its business every five years.

And while its shares have recovered from their lows, UBS still sees plenty of upside. It currently has a buy rating and $38.70 price target on its shares, which implies potential upside of almost 30%.

WiseTech Global Ltd (ASX: WTC)

A final ASX growth share that could be a top buy is logistics solutions technology company WiseTech Global.

Its CargoWise platform sits at the core of global freight and logistics operations. It is deeply embedded in customers’ workflows, with high switching costs and recurring subscription revenue.

Its share price has been pressured by broader tech sector weakness and AI disruption concerns. However, this type of software is very complex and would be very hard for AI to disrupt.

It is for that reason that Bell Potter put a buy rating and $78.75 price target on its shares this week. This suggests that over 70% upside is possible from current levels.

The post 3 stellar ASX growth shares to buy now with 30% to 70% upside appeared first on The Motley Fool Australia.

More reading

• Top brokers name 3 ASX shares to buy today
• Buy, hold, sell: ANZ, NAB, and WiseTech shares
• Still down 40% over the past year, how high could WiseTech shares recover?
• 5 oversold ASX shares to buy before the end of April
• Why I don’t own Telstra shares (yet)

Motley Fool contributor James Mickleboro has positions in Lovisa, Technology One, and WiseTech Global. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Lovisa, Technology One, and WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool Australia has recommended Lovisa and Technology One. 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 have been in the spotlight this week.

On Wednesday, the counter-drone technology company released its eagerly anticipated first-quarter update.

Was it a strong result? And should you be buying its shares today?

Let’s see what analysts at Bell Potter are saying about this popular ASX share.

What is the broker saying?

Bell Potter was pleased with the company’s quarterly update, highlighting that its revenue was up more than expected and its committed revenues continue to creep higher. It said:

Revenue: DRO reported $74m in revenue up 121% YoY which was a higher print than the April 8th trading update of $63m due to the timing of deliveries. Quarterly SaaS revenues were $5.1m vs $11.6m for the full year 2025, 6.9% of revenue.

Order intake: Committed revenues (incl. YTD revenue) for CY26 as at 20 April 2026 was $155m a $15m increase since 31 March 2026 reflecting a steady flow of smaller orders. Notably, DRO said it has received an order related to the FIFA World Cup. We expect more orders to flow from key USA events over the coming months. DRO has committed revenues comprising 42% of our upgraded CY26 revenue estimate of $365m (prev. $324m). Using November 30 as the cutoff for orders delivered in CY26, we are 39% of the way through the year, suggesting current contract activity is tracking ahead of our upgraded forecast.

Should you buy DroneShield shares?

According to the note, the broker has retained its buy rating and $4.80 price target on DroneShield’s shares.

Based on its current share price of $3.83, this would mean potential upside of 25% for investors over the next 12 months.

Bell Potter remains very positive on the company and believes it is well-placed to benefit from a wave of spending in the industry. Commenting on the company, the broker said:

We believe DRO has a market leading RF detect/defeat C-UAS offering and a strengthening competitive advantage owing to its years of battlefield experience and large and focused R&D team. We expect 2026 will be an inflection point for the global C-UAS industry with countries poised to unleash a wave of spending on RF detect and defeat solutions.

Consequently, we believe DRO should see material contracts flowing from its $2.3b potential sales pipeline over the next 3-6 months as defence budgets roll over to FY26e. At 43x CY26e EV / EBITDA, DRO trades at a discount to the global drone peer group. Further, we see upside risk to our revenue forecasts in CY26/27e, given the opportunities observed in the C-UAS industry.

The post Are DroneShield shares a buy after its latest update? appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• 3 key takeaways from DroneShield’s latest results
• Why Northern Star, DroneShield and BHP shares are making waves on Wednesday
• DroneShield share price jumps after reporting 121% Q1 revenue increase
• DroneShield delivers record 1Q26 revenue and cash receipts

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 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.

Wondering whether the banks are in the buy zone right now?

Well, the team at Morgans has done the work for you. It has been busy running the rule over ASX bank shares and has given its verdict on them.

Here’s what it is saying:

ANZ Group Holdings Ltd (ASX: ANZ)

Morgans currently thinks that ANZ shares are overvalued at current levels and has put a sell rating and $30.72 price target on them. Based on its current share price of $36.41, this implies potential downside of 15.6%. It recently said:

We revise our forecasts ahead of ANZ’s 1H26 result in May and reflecting on the recent updates provided by NAB and WBC. FY26-28F EPS downgraded by 6-7%. Target price reduced 6% to $30.72/sh. SELL retained given c.-15% downside at current prices, including 4.4% cash yield.

Bank of Queensland Ltd (ASX: BOQ)

This regional bank’s shares could be around fair value now according to the broker. As a result, earlier this week it downgraded Bank of Queensland’s shares to a hold rating with a $7.39 price target. Based on its current share price of $6.61, this implies potential upside of almost 12%. It explains:

We expect a material decline in 1H26 earnings, with recent share price strength driven by the expected capital return from the equipment finance whole-of-loan sale. Share price strength has compressed total return potential to c.5%. As such, we moderate our rating from ACCUMULATE to HOLD. Target price $7.39.

Commonwealth Bank of Australia (ASX: CBA)

Australia’s largest bank may be performing above expectations, but Morgans still isn’t a buyer. It currently has a sell rating and $124.26 price target on CBA shares. Based on its current share price of $175.04, this implies potential downside of 29% over the next 12 months. It said:

CBA delivered a meaningful beat of 1H26 earnings expectations. We have materially upgraded our EPS forecasts after factoring in continuation of higher loan growth and benign credit loss environments. We expect DPS growth won’t match EPS growth as we see approaching CET1 capital tightness. Target price lifted to $124.26. SELL retained, with potential TSR of -24% (including 3% cash yield) at current elevated prices and trading multiples.

National Australia Bank Ltd (ASX: NAB)

This big four bank’s shares may be down heavily from their 52-week high, but Morgans still thinks they are overvalued.

This week, the broker put a sell rating and $34.56 price target on NAB shares. Based on its current share price of $40.22, this suggests that 14% downside is possible.

NAB announced a $1.8bn DRP equity raising, increased loan provisioning, and acceleration of capital software amortisation. Material forecast downgrades as we adjust for today’s announcement and introduce increased conservatism into our modelling. SELL given potential TSR at current prices of -12% (including c.4.2% cash yield).

Westpac Banking Corp (ASX: WBC)

Morgans has downgraded Australia’s oldest bank’s shares to a sell rating with a $34.06 price target following the release of its trading update.

Based on the current Westpac share price of $39.40, this implies potential downside of 13.5% for investors over the next 12 months. It said:

WBC published a trading update ahead of its 1H26 result due for release on 5 May. Implied revenues were weaker, costs lower, and credit impairment charges higher than our and market expectations. We revise our rating from TRIM to SELL as total return expectations at current prices have fallen below the -10% trigger. We estimate c.18% price downside risk partly offset by c.3.8% forecast cash yield. Target price $34.06.

The post How does Morgans rate ANZ, BOQ, CBA, NAB, and Westpac shares? appeared first on The Motley Fool Australia.

More reading

• Why Bank of Queensland, Cochlear, Northern Star, and Paladin Energy shares are falling today
• Buy, hold, sell: ANZ, NAB, and WiseTech shares
• Why this ASX bank stock is tumbling today after earnings
• Bank of Queensland half-year 2026: profit falls, dividend steady as revenue rises
• Stagflation: How to position an ASX stock portfolio

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 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.

What more could an Australian investor want than both growth and dividends? Some ASX shares that are indeed offering that.

I like it when ASX shares pay dividends because it means our bank account is experiencing the improvement in the profit of that business – it’s not just ‘on paper’ returns. The more it grows, the bigger the dividend payments can be.

With that in mind, I’m going to talk about two ASX shares that I believe are likely to grow their underlying earnings and dividend significantly over the next several years.

Pinnacle Investment Management Group Ltd (ASX: PNI)

This business makes investments in high-quality funds management businesses (‘affiliates’) and helps them grow by offering a number of services including client distribution services, legal, finance, compliance, seed funds under management (FUM) and plenty of other areas.

This allows the fund manager to focus on delivering strong investment returns, which is the best way to help grow its FUM.

Pinnacle’s portfolio of fund managers, such as Coolabah, Solaris, Pacific Asset Management, Firetrail and Plato, has steadily grown Pinnacle’s total affiliate FUM and this helped increase the underlying profit.

Performance fees can be variable, so its statutory net profit won’t necessarily grow every single year. But, ongoing FUM inflows across the portfolio can help the core earnings and fund strong growth of its ‘base’ dividend.

The projection on Commsec suggests the ASX share’s forecast earnings per share (EPS) could grow by 68% between FY26 and FY28.

This would mean it’s currently trading at under 16x FY28’s estimated earnings, with a potential grossed-up dividend yield of around 7.7%, including franking credits for FY28, at the time of writing.

Guzman Y Gomez Ltd (ASX: GYG)

GYG is a Mexican restaurant business, with more than 200 locations in Australia, as well as a few in Singapore, Japan and the US.

The company is delivering good sales growth at its existing restaurants, which is helping drive good (and growing) restaurant margins. In the third quarter of FY26, the business reported comparable sales growth across Australia, Singapore and Japan of 6.6%.

The ASX share also has significant plans to expand its Australian restaurant network in the coming years, which can help drive total network sales and scale benefits. At 31 March 2026, it had 242 Australian locations (up 31 year-over-year) – it wants to reach 1,000 Australian locations within 20 years.

The company’s total network sales grew 19.5% to $345.9 million in the third quarter of FY26, demonstrating its compounding ability. I’m not counting on the US expansion efforts to add anything meaningful, but if it does then it could be a very useful bonus.

The projection on Commsec suggests EPS could rise by 127% between FY26 and FY28, putting the valuation at 42x FY28’s estimated earnings, at the time of writing.

GYG’s dividend is not expected to be huge, but it could rapidly rise in the coming years. The forecast amount for FY28 translates into a possible grossed-up dividend yield of 2.35%, including franking credits.

The post 2 ASX shares that I rate as buys today for both growth and dividends! appeared first on The Motley Fool Australia.

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• Buy, hold, sell: Collins Foods, Domino’s, and Guzman Y Gomez shares
• These are the 10 most shorted ASX shares
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Motley Fool contributor Tristan Harrison has positions in Guzman Y Gomez and Pinnacle Investment Management Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Pinnacle Investment Management Group. The Motley Fool Australia has positions in and has recommended Pinnacle Investment Management Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Wednesday, the S&P/ASX 200 Index (ASX: XJO) was out of form and sank into the red. The benchmark index fell 1.2% to 8,843.6 points.

Will the market be able to bounce back from this on Thursday? Here are five things to watch:

ASX 200 set to fall

The Australian share market looks set for a subdued session on Thursday despite a good night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 30 points or 0.35% lower this morning. In the United States, the Dow Jones was up 0.7%, the S&P 500 rose 1.05% and the Nasdaq charged 1.65% higher.

Fortescue update

Fortescue Ltd (ASX: FMG) shares will be on watch on Thursday when the iron ore giant releases its third-quarter update. The market is expecting the miner to report iron ore shipments of approximately 49Mt for the three months. In addition, all eyes will be on its costs after the surge in diesel prices following the war in the Middle East.

Oil prices rise

ASX 200 energy shares such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could have a good session on Thursday after oil prices pushed higher. According to Bloomberg, the WTI crude oil price is up 3.1% to US$92.45 a barrel and the Brent crude oil price is up 2.9% to US$101.31 a barrel. This was driven by news that Iran has seized container ships in the Strait of Hormuz.

DroneShield shares rated as a buy

DroneShield Ltd (ASX: DRO) shares are in the buy zone according to analysts at Bell Potter. In response to the counter-drone technology company’s quarterly update, the broker has retained its buy rating and $4.80 price target on DroneShield’s shares. It said: “At 43x CY26e EV / EBITDA, DRO trades at a discount to the global drone peer group. Further, we see upside risk to our revenue forecasts in CY26/27e, given the opportunities observed in the C-UAS industry.”

Gold price rises

ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could have a good session on Thursday after the gold price pushed higher overnight. According to CNBC, the gold futures price is up 0.75% to US$4,754.8 an ounce. Traders were buying gold after a drop in Treasury yields.

The post 5 things to watch on the ASX 200 on Thursday appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• 3 key takeaways from DroneShield’s latest results
• Why Bank of Queensland, Cochlear, Northern Star, and Paladin Energy shares are falling today
• Why Northern Star, DroneShield and BHP shares are making waves on Wednesday
• Why are Northern Star shares sinking today?

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 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.

Investors in Pro Medicus Ltd (ASX: PME) shares have been on a wild ride.

The healthcare tech stock is down 6% over the past five days, yet still up 19% over the past month. Zoom out further, and it’s a different story, as shares have fallen more than 50% over the past six months. Hectic is one word for it.

So what’s really going on?

Landing new contracts

Start with the fundamentals. Pro Medicus remains a high-quality business. Its imaging software platform is widely used by hospitals and radiology groups, particularly in the US, and continues to win new contracts. The company benefits from a sticky customer base, high margins, and strong recurring revenue once systems are embedded.

The long-term growth story is still intact. Demand for advanced imaging solutions continues to rise, and Pro Medicus shares are well positioned to capture that trend. It’s also expanding within existing customers, which can drive incremental revenue without the need for entirely new deals.

Broad market de-rating

So why the share price volatility? The main culprit is sentiment, not operations.

High-growth healthcare and tech stocks have been hit by a broad market de-rating, and Pro Medicus has been caught in the crossfire. Even after the sell-off, the stock still trades on a price-to-earnings ratio above 60, leaving it sensitive to any shift in investor expectations.

That dynamic has flowed through to broker views. Morgans recently retained its buy rating but trimmed its price target to $210, which suggests a 50% upside at the time of writing. The broker adjusted its model to reflect more conservative growth assumptions, including slower implementation revenue and updated currency settings. Even so, it maintained that the underlying business remains strong and long-term demand is intact.

More broadly, analyst sentiment remains favourable. According to TradingView data, 11 out of 15 brokers rate the stock as a buy or strong buy. The average 12-month price target sits at $194.38, implying around 38% upside, while the most bullish forecasts suggest gains of up to 75%.

Valuation risk

Still, risks remain. Valuation is the big one. Even after a sharp pullback, Pro Medicus shares continue to trade at a premium to most ASX stocks. That leaves less margin for error if growth slows or expectations aren’t met.

Execution is also key. Investors are closely watching the pace of contract wins and how quickly those deals translate into revenue. Any delays or weaker-than-expected growth could weigh on sentiment further.

Foolish Takeaway

Pro Medicus remains a high-quality growth company, but it’s also a stock driven heavily by expectations. When sentiment is strong, it can rally quickly. When it shifts, the downside can be just as sharp.

For now, the business looks solid. The price of Pro Medicus shares, however, may continue to be anything but.

The post What on earth’s going on with Pro Medicus shares? appeared first on The Motley Fool Australia.

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Motley Fool contributor Marc Van Dinther has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has recommended Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.