Author: openjargon

ASX 200 healthcare stock Pro Medicus Ltd (ASX: PME) made headlines yesterday after tumbling 24% following the release of its latest earnings result.

Investors were running for the exit despite some positive results.

For the six months ended 31 December, Pro Medicus reported:

• Revenue up 28.4% to $124.8 million
• Underlying profit before tax up 29.7% to a record $90.7 million
• Underlying EBIT margin expanding to 72.6%
• Interim dividend of 32 cents per share, fully franked. 

On the surface these look like solid results, but investors weren’t convinced. 

The ASX healthcare stock has now fallen 42% since the start of 2026. 

Brokers response

Following the brutal sell-off, Bell Potter updated its guidance on the ASX 200 healthcare stock. 

The broker said the outlook statements continue to support expectations of robust growth in the years ahead. 

Despite these positives, the stock has been “priced for perfection” and the 5% miss at the top line was sufficient to trigger a brutal share price reaction.

The earnings miss could not have been more poorly timed in an environment of hyper-sensitivity to the perceived threat to long term earnings posed by the evolution of advanced AI tools. 

In addition the company disclosed that it had been unsuccessful on more than one contract during the period, on the basis of price – not what the market needed on the back of an earnings miss.

Where to from here?

In yesterday’s report, Bell Potter reinforced it remains confident on ongoing outlook for revenue and earnings growth. 

However, it significantly reduced its share price target. 

The broker retained its buy recommendation on the basis the current price is an attractive entry point.

The broker now has a price target of $240.00 (previously $320.00) on this ASX 200 healthcare stock. 

This indicates an upside of 86% from yesterday’s closing price of $129.00.

Another ASX healthcare stock gets an update

Pro Medicus wasn’t the only healthcare stock that endured a tough day of trading yesterday. 

Oneview Healthcare PLC (ASX: ONE) shares dropped more than 7% on Thursday after releasing earnings results.

The company provides patient engagement and clinical workflow technology solutions to healthcare facilities. It serves hospitals and healthcare systems, academic medical centers, and pediatric hospitals.

Following yesterday’s results, Bell Potter improved its forecast operating losses (R. EBITDA) over the FY26-FY28 period by 20%/22%/48%. 

The broker retained its speculative buy recommendation and $0.50 price target. 

This indicates an upside of roughly 66%. 

Although the thematics appear to be improving, we remain cautious about the long-term trajectory and therefore moderated our long-term growth assumptions to leave our TP unchanged at $0.50/sh.

The post Broker weighs in on two ASX healthcare shares that crashed yesterday appeared first on The Motley Fool Australia.

More reading

• Why Pro Medicus shares could rebound over 100%
• Pro Medicus shares crash 22% despite record results. Is this a rare buying opportunity?
• Why AMP, CSL, Pro Medicus, and Temple & Webster shares are crashing today
• Pro Medicus shares crash 20% on results day
• Pro Medicus interim earnings surge on record profits

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 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.

ASX bank stocks are charging higher this week. 

ANZ Group Holdings Ltd (ASX: ANZ) shares closed 8.47% higher on Thursday at $40.35. For the year the shares are 29.2% higher.

It was the same story for Commonwealth Bank of Australia (ASX: CBA). Its share price climbed 5.41% over the course of the day to close at $178.74 a piece on Thursday. The shares are now 7.69% higher over the year.

Westpac Banking Corporation (ASX: WBC) and National Australia Bank Ltd (ASX: NAB) shares also climbed higher on Thursday. Westpac shares increased 1.81% to $41 and NAB shares increased 2.31% to $46.54. Over the year the shares are now 18.33 and 13.21% higher respectively. 

It’s a welcome recovery for the banking majors after overall banking sector weakness late last year caused share price declines across most of the sector. Somber sentiment means many investors were not expecting any type of recovery this year.

Why are the ASX bank stocks climbing higher?

Banking majors ANZ and CBA reported strong-than-expected profits this week.

CBA posted its half-year results yesterday where it revealed a 6% increase in cash net profit to $5,445 million. The bank also lifted its interim dividend by 4% to $2.35 per share. CBA’s CEO, Matt Comyn said that economic growth strengthened during the half, “driven by increases in consumer demand and rising investment in AI and energy infrastructure”.

ANZ announced its latest quarterly update ahead of the ASX open this morning. The bank reported a first-quarter cash profit of $1.94 billion, which was up a whopping 75% on the second-half average of FY25.

ANZ’s CEO, Nuno Matos, said:

The quarterly result highlights the early progress we are making in executing our ANZ 2030 strategy. Our productivity program aimed at removing duplication and simplifying the bank is well underway, delivering a significant reduction in expenses while growing revenue.

ANZ and CBA’s strong financial results have pushed the S&P/ASX 200 Index (ASX: XJO) close to an all-time high. At the close of the ASX on Thursday, the index was 0.32% higher.

There was no price sensitive news out of NAB or Westpac yesterday, but it’s likely that their share prices have been boosted by overall improved confidence in the banking sector following ANZ and CBA’s impressive results.

Westpac is due to announce its first-quarter results today.

NAB will post its first-quarter trading update for FY26 on 18 February.  

The post What’s going on with ASX bank stocks this week? appeared first on The Motley Fool Australia.

More reading

• Buy, hold, sell: Telstra, TechnologyOne, NAB shares
• Here are the top 10 ASX 200 shares today
• 7 ASX 200 large-cap shares hitting multi-year highs today
• Why ANZ, CBA, Northern Star, and Origin Energy shares are charging higher today
• The ASX 200 is back over 9,000 points! It’s thanks to just 2 ASX shares

Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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.

Light & Wonder Inc (ASX: LNW) shares fell 7.46% yesterday in what was largely a positive day of trading for the S&P/ASX 200 Index (ASX: XJO).

Australia’s benchmark index crawled 0.32% higher on Thursday. 

However investors were jumping ship from Light & Wonder shares despite no price sensitive news out of the company. 

Light & Wonder is a global gaming and entertainment company that develops and distributes gaming machines, gaming content, and digital gaming platforms.

Its products and services include electronic gaming machines sold to casinos and clubs, digital games, and casual/social gaming through its SciPlay division.

So is yesterday’s sharp sell-off an opportunity for investors to buy the dip? 

Let’s find out. 

Litigation in the rear view mirror

Light & Wonder shares were on a steady decline through most of 2025.

This was in line with much of the consumer discretionary sector.

However the share price started climbing late in the year and flew 40% higher throughout November and December. 

Light & Wonder shares then spiked again following the announcement from Aristocrat Leisure Ltd (ASX: ALL), that the two gaming companies had agreed to settle an ongoing legal dispute.

For context, Aristocrat took legal action after alleging that Light & Wonder used its trade secrets and copyrighted materials to develop two games. 

Light & Wonder agreed to compensate Aristocrat US$127.5 million (approximately AU$190 million) for misappropriation and infringement of its intellectual property.

Investors gobbled up Light & Wonder shares following this announcement, seemingly optimistic with the legal troubles settled. 

This included a rise of 17% in one day of trading alone. 

Where to now?

More recently, the stock price has been on a steady decline. 

Including yesterday’s 7% fall, the share price has dropped more than 16% in the last month. 

The core business still looks rock solid, generating consistent revenue through its Gaming, SciPlay, and iGaming segments. 

Light & Wonder is set to report fourth quarter and full year 2025 results on Tuesday, 24 February. 

It’s unlikely this will generate a sharp rally. 

Consensus seems to point towards upside through steady execution rather than any surprising news. 

Strong upside

Based on recent guidance out of brokers, it seems now could be a buying opportunity for Light & Wonder shares. 

It she price closed yesterday at $151.95. 

Analysts at Morgan Stanley have an overweight rating and $220.00 price target due to the company’s growth prospects in the medium term. 

This target indicates a potential upside of 44.79%. 

Elsewhere, TradingView has an average 1 year price target of $194.89, which indicates 28% upside. 

The post Are Light & Wonder shares a buy after tumbling 7% yesterday? appeared first on The Motley Fool Australia.

More reading

• 3 ASX 200 shares tipped to storm 50% to 60% higher this year
• 3 quality ASX shares to buy with $10,000
• These beaten down ASX growth shares could rise 50% to 75%
• Why these battered ASX shares deserve a second look
• What the stronger Australian dollar means for your shares

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 positions in and has recommended Light & Wonder Inc. The Motley Fool Australia has recommended Light & Wonder Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Generating $1,000 a year in passive income might not sound life changing, but it can be a meaningful step toward financial independence.

At a 5% average dividend yield, a $20,000 portfolio can produce roughly $1,000 in annual income.

The key is selecting a mix of ASX shares that together deliver that yield while still offering business quality and the potential for future growth.

Here’s how that could look using four ASX dividend shares.

Dicker Data Ltd (ASX: DDR)

The first ASX dividend share to include is Dicker Data.

Dicker Data is one of Australia’s leading technology hardware and software distributors. While tech distributors are not always viewed as classic income stocks, Dicker Data has built a strong position supplying vendors and resellers across Australia and New Zealand.

The company currently offers a trailing dividend yield of around 4.3%. Its earnings can fluctuate with IT spending cycles, but long-term demand for technology infrastructure continues to underpin its business.

HomeCo Daily Needs REIT (ASX: HDN)

To lift the overall portfolio yield closer to 5%, adding a higher-yielding REIT can help.

HomeCo Daily Needs REIT focuses on neighbourhood retail centres anchored by essential services such as supermarkets, healthcare providers, and everyday convenience outlets. These tenants tend to generate stable foot traffic regardless of broader economic conditions.

This ASX share currently offers a trailing yield of approximately 6.6%, making it one of the stronger income contributors in this mix.

Transurban Group (ASX: TCL)

Another income anchor is Transurban. It owns and operates major toll roads across Australia and North America. These assets generate long-term, inflation-linked revenue streams based on traffic volumes.

The company’s shares currently provide a trailing dividend yield of around 4.8%. While traffic can fluctuate with economic conditions, long concession lives and population growth in key cities support the long-term case.

Universal Store Holdings Ltd (ASX: UNI)

The final ASX dividend share in this portfolio is Universal Store.

Universal Store operates youth-focused fashion brands and has continued to generate solid cash flow despite a challenging retail environment. With a trailing dividend yield of roughly 4.3%, it adds both income and potential growth exposure from its store rollout and private label strategy.

Retail earnings can be cyclical, but strong brand positioning and disciplined store expansion support the long-term outlook.

Bringing it together

By spreading $20,000 evenly across these ASX shares, the blended yield comes in at roughly 5%. That translates to about $1,000 per year in passive income, assuming dividends remain stable.

Importantly, this mix combines infrastructure, property, retail, and technology distribution, reducing reliance on a single sector.

The post Invest $20,000 in these 4 ASX shares and get $1,000 passive income appeared first on The Motley Fool Australia.

More reading

• These are my top ASX passive income picks
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• 3 super small-cap ASX shares that could be destined for big things
• 2 ASX dividend shares raising dividends like clockwork
• 3 quality ASX dividend shares to buy for passive income in 2026

Motley Fool contributor James Mickleboro has positions in Universal Store. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Dicker Data and Transurban Group. The Motley Fool Australia has recommended HomeCo Daily Needs REIT and Universal Store. 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 having a week to forget.

Shares in the S&P/ASX 200 Index (ASX: XJO) biotech stock have closed in the red every day this week so far, leading up to Friday’s opening bell.

The stock closed down 6.88% yesterday, trading for $152.19 a share.

That followed on the 4.6% losses suffered on Wednesday as investors pored over the company’s half-year earnings results. Investors also responded negatively to news, reported after market close on Tuesday, that Paul McKenzie was stepping down from his three-year stint as CEO.

The four consecutive days of losses see CSL shares down 15.68% since last Friday’s close.

Which, according to Family Financial Solutions’ Jabin Hallihan, could make today an opportune time to buy shares at a potential bargain (courtesy of The Bull).

Should you buy CSL shares today?

“CSL develops plasma therapies and vaccines for a global market,” Hallihan said late last week, prior to CSL’s results release and CEO departure news. “The company provides products to patients in more than 100 countries.”

Hallihan noted, “The share price has fallen from $271.32 on August 18, 2025 to trade at $181.48 on February 5, 2026. Our fair value is $295 a share.”

At Thursday’s close of $152.19 a share, this sees the ASX 200 biotech stock trading 94% below Hallihan’s fair value estimate.

Commenting on his buy recommendation on CSL shares, Hallihan concluded:

Short term earnings noise obscures a high-quality plasma franchise with structural demand growth. In a bull market, valuation normalisation and quality should deliver strong upside moving forward.

What’s been happening with the ASX 200 biotech stock?

As mentioned up top, it was a big news week for CSL shares.

On the leadership front, McKenzie abruptly retired as CEO and managing director effective on Tuesday. The board appointed Gordon Naylor, former CFO and president of CSL’s Seqirus business, as interim CEO and managing director. Naylor took over the reins on Wednesday.

As for the results for the six months to 31 December, the company reported revenue of US$8.3 billion, down 4% year on year on a constant currency basis.

On the bottom line, CSL saw a 7% decline in underlying net profit after tax and amortisation (NPATA) to US$1.9 billion.

Commenting on the half-year results that pressured CSL shares, CFO Ken Lim said, “We are clearly not satisfied with our performance and have implemented a number of initiatives to drive stronger growth going forward.”

Looking ahead, Lim added:

We continued to advance our broader transformation strategy, making strong progress on our cost efficiency initiatives and strengthening the foundations of the business.

We invested in growth opportunities including our strategic collaboration with VarmX. This will deliver enhanced growth, profitability and shareholder returns.

CSL also increased its share buyback program from US$500 million to US$750 million.

The post Why CSL shares could be trading at a 94% discount today appeared first on The Motley Fool Australia.

More reading

• Here’s an ASX 200 share that I think could beat CSL in 2026
• Why AMP, CSL, Pro Medicus, and Temple & Webster shares are crashing today
• Are CSL shares a buy after this week’s brutal selloff?
• Buy, hold, sell: Beach Energy, CSL, and Pro Medicus shares
• 5 things to watch on the ASX 200 on Thursday

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.

ASX investors buy gold stocks for a number of reasons. Perhaps they might think a particular gold miner is undervalued. Perhaps they might be bullish on the price of gold itself and see gold miners as a potentially lucrative leverage play on further price increases. Or perhaps just wish to hedge against inflation, geopolitical tension, or economic uncertainty. But ASX investors rarely buy gold stocks for the dividends.

As we went through late last year, the economics of mining gold are strikingly different to other commodities that ASX investors might be used to investing in. Gold miners typically don’t enjoy the fat margins and bulk production that other commodities like oil or iron ore can facilitate.

That’s mainly why we are used to seeing dividend yields of 4%, 5%, or even 6% from big miners like BHP Group Ltd (ASX: BHP), Fortescue Ltd (ASX: FMG), or Rio Tinto Ltd (ASX: RIO). And why dividends of 2% or less are common to see with even the largest ASX gold stocks like Newmont Corporation (ASX: NEM) or Northern Star Resources Ltd (ASX: NST).

Well, that’s the conventional wisdom anyway. However, we are in a different world right now. Gold, as many investors would know, has just come off the back of one of the most significant price rallies we’ve ever seen in precious metals investing. It’s hard to even picture, but it was only 12 months ago that gold was asking under US$3,000 an ounce. Today, that same ounce will set investors back just over US$5,080. And that’s after the pullback we have seen over February. Gold hit a new record high of over US$5,500 an ounce late last month.

Evolution’s monster dividend changes the ASX gold stock game

This sharp surge in value has obviously been mana from heaven for ASX gold stocks. Consider Evolution Mining Ltd (ASX: EVN). Evolution dropped its latest earnings on Wednesday. And they were something special for a gold miner. First up, Evolution told investors that it achieved an all-in sustaining cost (cost of mining and processing in simpler terms) of US$1,063 ($1,493) per ounce over the six months to 31 December 2025.

If we assume Evolution had that cost base a year ago, this means the miner’s gross margin has surged from US$1,831 a year ago to US$4,017.

So even though gold itself has surged 75.5% over the past 12 months, Evolution’s profitability has exploded by almost 120%. This is probably why Evolution was able to declare a record 20-cent-per-share dividend on Wednesday. That dividend represents a whopping 185.7%, or a near-tripling, over the 7 cents per share interim dividend that investors received last year.

At the time of writing, Evolution shares are trading with a trailing dividend yield of 1.25%. However, the new internal dividend, together with last year’s final dividend of 13 cents per share, gives Evolution a forward yield of 2.07%. That might not look too significant. But remember, Evolution’s 154% gain over the past 12 months has blunted that dividend yield substantially.

If an investor bought this stock a year ago, they will soon be enjoying a yield on cost of 6.36%. Perhaps the gold-dividend game is changing.

The post ASX gold stocks never pay high dividends, but Evolution just changed the game appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• These 3 ASX 200 shares have had a stellar month. Is there more upside to come?
• Evolution mining shares surge after unexpected dividend boost announced
• Evolution Mining unlocks $120m Northparkes deal with Triple Flag
• Evolution Mining half-year results: record profit and higher dividend

Motley Fool contributor Sebastian Bowen has positions in Newmont. 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 closed 0.32% higher at 9,043.5 points on Thursday as earnings season continues.

This is the second day that the ASX 200 has traded above the 9,000 threshold, with the benchmark now at a 14-week high.

Strong reports from ANZ Group Holdings Ltd (ASX: ANZ) and Northern Star Resources Ltd (ASX: NST) moved the market up today.

Here, we review the opinions of experts on three ASX 200 shares within the communications, technology, and financials sectors.

One is a buy, one is a hold, and one is a sell.

Let’s take a look.

Telstra Group Ltd (ASX: TLS)

The Telstra share price closed at $4.88, steady today and up 24.8% over the past 12 months.

On The Bull this week, Jabin Hallihan from Family Financial Solutions revealed a buy rating on Telstra shares.

Hallihan values this ASX 200 telecommunications stock at $5.40 per share.

He explains his view:

Reported net profit after tax of $2.3 billion in full year 2025 was up 31 per cent on the prior corresponding period.

Cash earnings per share of 22.4 cents were up 12 per cent.

Cost discipline, share buy-backs and resilient mobile earnings support steady upside in a market that still rewards defensiveness.

On top of this, Telstra pays reliable, fully franked dividends.

Its full year dividend of 19 cents a share in fiscal year 2025 was up 5.6 per cent on the prior corresponding period.

TLS was recently trading on a dividend yield of 3.85 per cent.  

Technology One Ltd (ASX: TNE)

The TechnologyOne share price closed at $21.70, down 6.9% today and down 32% over the past year.

Tony Paterno from Ord Minnett has a hold rating on this ASX 200 technology share.

Paterno explains:

TNE’s result in fiscal year 2025 disappointed the market with annual recurring revenue growth falling below consensus expectations. Offsetting the negative result was robust growth in the UK.

TNE’s core segments continue to perform well.

Early feedback on TNE’s recently launched artificial intelligence product Plus has been positive. 

TNE is one of the higher quality software businesses on the ASX and we remain positive about its outlook.   

National Australia Bank Ltd (ASX: NAB)

The NAB share price rose 3.9% to an all-time high of $47.25 on Thursday.

NAB had no news for the market today.

NAB shares closed at $46.54, up 2.3% today and up 13% over the past 12 months.

Hallihan has a sell rating on this ASX 200 bank share.

The analyst commented:

NAB is Australia’s largest business bank, benefiting from an oligopolistic market structure.

Statutory net profit of $6.759 billion in full year 2025 was down 2.9 per cent on the prior corresponding period.

A credit impairment charge of $833 million was up from $728 million in the previous year.

In our view, the shares are materially overvalued and leave little margin for error.

Capital is better redeployed into discounted quality.

The post Buy, hold, sell: Telstra, TechnologyOne, NAB shares appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Best ASX stock to buy right now: Xero or TechnologyOne?
• 7 ASX 200 large-cap shares hitting multi-year highs today
• These are my top ASX passive income picks
• My 10 best ASX shares to buy in February

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

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

More reading

• Buy, hold, sell: Telstra, TechnologyOne, NAB shares
• 7 ASX 200 large-cap shares hitting multi-year highs today
• Is it too late to buy surging ASX 200 lithium shares like PLS and Liontown?
• Why ANZ, CBA, Northern Star, and Origin Energy shares are charging higher today
• The ASX 200 is back over 9,000 points! It’s thanks to just 2 ASX shares

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Amcor Plc. 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 Information Technology Index (ASX: XIJ) is trading 0.69% higher in afternoon trade on Thursday. The index is down 15.23% year-to-date and 36.66% over the year, after a crash in investor confidence sent ASX tech stocks plummeting in late-2025 and into early-2026.

Renewed concerns about artificial intelligence (AI) disruption have driven tech shares such as WiseTech Global Ltd (ASX: WTC), Megaport Ltd (ASX: MP1), and NextDC Ltd (ASX: NXT) sharply lower.

WiseTech shares are down 7.07% today to $47.34 a piece, and down 61.65% for the year. 

Megaport shares are 5.44% lower in Thursday afternoon trade, to $10.95. The stock is still 23.17% higher over the year. 

Meanwhile, NextDC shares are down 1.15% to $13.74, and down 8.75% for the year.

On paper, the plummeting share prices of these ASX tech stocks look concerning, but I think it’s a once-in-a-decade opportunity.

Here’s why.

Long-term drivers of growth haven’t gone away

Despite the recent volatility in the tech market, the fact is that AI isn’t going anywhere. AI, cloud computing, cybersecurity, automation, and digital payments are still front and centre. 

Technology is rapidly advancing, businesses are investing in AI more than ever before, and continued tech investment points to widespread, ongoing adoption rather than abandonment.

I think short-term investor concerns will likely be just that… short term. And short-term market concerns don’t change the fact that tech is the fastest-growing segment of the sharemarket over the long term.

Eventually, the market will correct itself, and the ASX tech stocks involved in AI could enjoy a share price recovery.

The upsides are huge for ASX tech stocks

Current valuations of tech stocks present a strong opportunity for investors to buy at a discount.

Analysts are hugely optimistic about the outlook for these tech stocks, with many tipping significant upside over the next 12 months when investor confidence returns and people start pressing the buy button once again.

Data shows that 14 out of 15 analysts have a buy or strong buy rating on WiseTech shares. And the maximum upside is $167.24 per share, implying an enormous 253.19% over the next 12 months at the time of writing.

It’s a similar story for Megaport shares too. Out of 14 analysts, 10 have a buy or strong buy rating on the ASX tech stock. The maximum target price is $22.27, which implies a 103.1% upside at the time of writing.

Analysts are even more bullish on NextDC shares. All 14 analysts have a buy or strong buy consensus on the shares. The maximum target price is $29.36 which implies a 114.46% upside at the time of writing.

The post A once-in-a-decade chance to buy ASX 200 tech stocks like WiseTech, Megaport and NextDC? appeared first on The Motley Fool Australia.

More reading

• 3 of the best Australian stocks to buy and hold until 2036
• Where to invest $10,000 in ASX growth shares
• Buy this ASX tech share after the AI software selloff
• My 10 best ASX shares to buy in February
• Top brokers name 3 ASX shares to buy today

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

When high-quality software stocks sell off, long-term investors tend to start paying attention.

Over the past year, sentiment toward technology shares has deteriorated sharply. Rising rates, concerns about artificial intelligence disrupting traditional software models, and multiple compression have all weighed heavily on valuations.

Two of the ASX’s best-known software names, Xero Ltd (ASX: XRO) and TechnologyOne Ltd (ASX: TNE), have both been caught up in the pullback.

Xero shares are down roughly 58% over the past 12 months, while TechnologyOne has fallen around 32% over the same period.

So which one looks like the better buy right now?

The case for TechnologyOne shares

TechnologyOne has quietly become one of the most consistent software businesses on the ASX.

It provides mission-critical enterprise software to governments, universities, and large organisations. Over recent years, its transition to a software-as-a-service model has transformed the business. Recurring revenue has risen, cash generation has strengthened, and earnings visibility has improved materially.

Management has laid out an ambitious target to double the size of the business roughly every five years. With growing momentum in the UK and a highly sticky customer base, that goal does not look unrealistic.

For investors seeking stability and steady execution, TechnologyOne remains a compelling long-term compounder.

The case for Xero shares

Xero, meanwhile, operates in a larger and more competitive global market.

It provides cloud accounting software to small and medium-sized businesses and has built strong positions in Australia, New Zealand, and the UK. The long-term opportunity remains significant as more businesses transition from legacy accounting systems to cloud-based platforms.

The sharp share price decline reflects concerns that AI could lower barriers to entry in accounting software or pressure pricing. However, Xero’s platform is deeply embedded in customer workflows, with extensive integrations and ecosystem partnerships that are not easily replicated overnight.

Importantly, much of that risk now appears reflected in the valuation after the 58% sell-off.

Which one wins?

Both ASX stocks remain high-quality software businesses with strong recurring revenue models and long growth runways.

TechnologyOne arguably offers the smoother ride, with a more concentrated customer base and a long history of disciplined execution. But its smaller share price decline suggests investors are still willing to pay a premium for that consistency.

Xero, on the other hand, has seen far more valuation compression. While risk remains, the larger pullback means expectations are significantly lower. If the company can continue delivering subscriber growth and margin expansion, the rebound potential could be greater.

The post Best ASX stock to buy right now: Xero or TechnologyOne? appeared first on The Motley Fool Australia.

More reading

• The 3 ASX shares I’d buy and hold into 2026
• Is the Xero share price an opportunity too good to pass up?
• My 10 best ASX shares to buy in February
• 2 quality ASX shares near 52-week lows worth watching
• 3 ASX 200 shares worth buying after February’s sell-off

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