Author: openjargon

S&P/ASX 200 Index (ASX: XJO) shares are down 1.5% on news that the US and Iran launched new attacks on each other this week.

Today, analysts at Trading Economics said the US hit an empty oil tanker bound for Iran on Tuesday, and Iran launched attacks on US naval bases in Bahrain and Kuwait, as well as commercial vessels.

The strikes have cast new doubt over the likelihood of a peace deal any time soon to end the conflict and re-open the Strait of Hormuz.

ASX investors are also still digesting yesterday’s news that Australian gross domestic product (GDP) rose by an anaemic 0.3% in the March quarter.

Over the 12 months to 31 March, GDP rose 2.5% in seasonally adjusted terms, according to the Bureau of Statistics. 

Additionally, the Fair Work Commission ordered a 4.75% lift to award wages, surprising many businesses with the above-inflation bump.

Inflation is currently running at 4.2% in annual terms.

However, CBA economists pointed out that minimum wage workers represents only 10% of all wage earners in Australia.

So, while the pay bump will raise labour costs for some companies, CBA does not expect that it will add upward pressure to inflation.

Meanwhile, brokers continue to review their ratings on ASX shares.

Here are some updates.

Tabcorp Holdings Ltd (ASX: TAH)

The Tabcorp share price is 79 cents, down 1.3% today and down 33% over the past month alone.

Morgans upgraded this ASX 200 consumer discretionary share to a buy rating on valuation grounds this week.

The broker said:

Following the announcement of AUSTRAC’s investigation this month, the TAH share price has fallen approximately 37%.

While we expect the investigation to remain an overhang for the foreseeable future, at these levels the stock appears materially undervalued.

Current trading conditions remain supportive in our view and position the company well for a strong upcoming result, despite inherent uncertainty surrounding the scope of the investigation and the quantum of potential penalties.

While we are cautious about speculating on the ultimate outcome, we believe the approximately $960m erosion in market value is overly pessimistic and reflects the most bearish of scenarios.

We upgrade TAH from Accumulate to Buy given what we view as a near-term share price overreaction, and an underlying business that looks on track to outperform in the near term.

Morgans has a 12-month share price target of $1.07 on Tabcorp stock. This implies a potential 35% upside from here.

BHP Group Ltd (ASX: BHP)

The BHP Group share price is $62.51, down a chunky 3.7% today, and up 40% over six months.

Germany’s DZ Bank AG upgraded the ASX 200 mining share to a hold rating this week.

DZ Bank has a price target of $65 on BHP shares.

This suggests that only 4% upside is left for the next 12 months.

4DMedical Ltd (ASX: 4DX)

The 4D Medical share price is $3.91, up 3% today, and down 14% in the calendar year to date.

The big picture is more impressive: this ASX healthcare share has ripped 1,158% over 12 months.

On Wednesday, 4DMedical announced a US$2 million program to fast-track entry into the acute pulmonary embolism (PE) market.

The program is called CLEAR – contrast-free lung evaluation for acute risk in pulmonary embolism.

4DMedical said PE would grow the addressable market for its CT:VQ product in the US to US$3 billion. 

The company said PE accounts for about 600,000 to 650,000 diagnosed clinical episodes in the US per year.

Yesterday, Ord Minnett reiterated its sell rating and $3 target on 4DMedical shares.

This suggests the broker anticipates a near 25% share price fall over the coming year.

The post Buy, hold, sell: Tabcorp, 4DMedical, BHP shares appeared first on The Motley Fool Australia.

More reading

• Why is the BHP share price sinking today?
• Top brokers name 3 ASX shares to buy now
• 5 things to watch on the ASX 200 on Wednesday
• Why 4DMedical shares can return to record highs: Expert
• 3 top ASX shares at 52-week highs I’d still buy

Motley Fool contributor Bronwyn Allen has positions in BHP Group. 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.

I think it can be useful for investors to keep an eye on which shares have experienced meaningful insider buying and selling.

That’s because insider buying is often regarded as a bullish indicator, as few people know a company and its intrinsic value better than its directors.

If they are buying, it could be a sign that they are confident in the direction the company is heading and see value in its shares.

Conversely, if they are selling, it could be a sign that they think the shares are fully valued. After all, you would be reluctant to sell if you thought they were worth more.

With that in mind, listed below are three ASX 200 shares that have reported meaningful insider activity recently. They are as follows:

CSL Ltd (ASX: CSL)

The CEO of CSL appears to believe the beaten down biotech giant’s shares are good value at current levels.

According to a recent change of director’s interest notice, Gordon Naylor was buying shares on market on 26 May. The company’s leader snapped up a total of 1,100 CSL shares for a total consideration of $107,800. This equates to an average of $98.00 per share, which is a premium to what investors can pay on the market today ($92.86).

CSL shares are down around 45% since the start of the year.

Endeavour Group Ltd (ASX: EDV)

Another beaten down ASX 200 share that has reported insider buying is drinks giant Endeavour Group.

Two of the Dan Murphy’s and BWS owner’s executives have been buying shares recently.

Earlier this week, Endeavour’s independent non-executive director, Penny Winn, bought 26,165 shares through an on-market trade. She paid a total of $75,054.79, which represents a price of $2.8685 each.

Late last week, fellow independent non-executive director, Michael Ihlein, snapped up a sizeable 88,000 Endeavour shares for a total consideration of $250,800.

Endeavour shares are down around 20% since the turn of the year.

PLS Group Ltd (ASX: PLS)

The CEO of this lithium giant has been selling shares recently.

Last week, Dale Henderson sold a total of 627,500 PLS shares for a consideration of $4,032,145.60. This represents an average sale price of approximately $6.43 per share, which compares favourably to its current share price of $6.29.

The notice advises that the on-market share sale by Henderson was “for tax obligations and portfolio rebalancing purposes.”

It also highlights that following completion of the transaction, Henderson will continue to hold approximately 2.8 million shares and vested but unexercised performance rights in the company.

PLS shares are up 425% over the past 12 months.

The post 3 ASX 200 shares reporting major insider buying and selling appeared first on The Motley Fool Australia.

More reading

• Why Chrysos, Endeavour, Racura, and Treasury Wine shares are racing higher today
• This beaten-down ASX 200 stock just jumped 5%. Is the market too negative?
• Buy, hold, sell: ASX, Endeavour, and Judo Capital shares
• Why did CSL shares crash 22% in May?
• Up 473% in a year, should I buy PLS shares today?

Motley Fool contributor James Mickleboro has positions in CSL and Endeavour Group. 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.

Diversified industrial company Tasmea Ltd (ASX: TEA) has just declared a special dividend, in more good news for shareholders who are already sitting on gains of more than 150% over the past 12 months.

Still time to buy

But for those who aren’t holders of the company, there’s still the potential to buy in and receive the dividend, with the company setting an ex-dividend date of Wednesday, 10 June.

But it gets even better – should the share price hold up.

Shareholders will be able to take part in the company’s dividend reinvestment plan, which offers new shares in the company at $6.85 per share.

Calculated at today’s share price of $8.04, that would constitute an immediate windfall gain of 17.4%.

Tasmea said it encouraged shareholders to take advantage of the dividend reinvestment plan, and “the company’s founders and executive directors have indicated their intention to participate”.

The company said the decision to grant a special dividend was spurred by its strong performance.

As it said:

The decision to return capital to shareholders at this time is underpinned by a combination of strong performance metrics, continued strategic momentum and the Board’s wish to acknowledge and reward the loyalty of their long-term shareholders. The Company remains well positioned to deliver organic and programmatic growth opportunities across key sectors, including resources, energy, infrastructure, and water, and continues to experience strong customer demand as a consequence of essential maintenance and the electrification of its customers’ operations.

Tasmea said it expected continued profitable growth, and it expected to issue guidance for FY27 by the end of June once budgeting processes had been finalised.

Data centre move

News of the special dividend followed Tasmea earlier in the week, announcing the acquisition of Maxim Group for up to $254 million.

That deal would be paid for with an initial $72 million in shares and $112 million in cash, with further earn-out payments to come in the years up to FY29.

The company said regarding the deal:

Maxim Group is a market-leading specialist electrical contractor headquartered in Victoria, with established credentials across Data Centres, Major Government Infrastructure and Battery Energy Storage System (BESS) and Renewable Energy markets. Maxim has delivered over 450 projects, employs approximately 600 full-time staff including a deep cohort of HV-accredited and rail-inducted specialists. Maxim is currently active on approximately 30 projects across its core end-markets. The acquisition represents a defining step in Tasmea’s programmatic acquisition strategy and establishes Tasmea as a leading specialist electrical platform with national scale and direct exposure to Australia’s structurally growing Data Centre, BESS and Major Infrastructure markets.

The post This special dividend could deliver a windfall gain, and it’s not too late to buy in appeared first on The Motley Fool Australia.

More reading

• Tasmea share price rockets as it enters data centre race
• Could this surging ASX small cap still be hiding in plain sight?
• Are these ASX shares a buy, hold or sell after rocketing to record highs last week?

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

When it comes to picking shares that will outperform the market, it pays to have a look at what the experts are saying.

I’ve sifted through the analyst reports released this week and zeroed in on two from Macquarie that have flagged companies they think could notch outsized gains.

Let’s have a look at the companies they like.

Pexa Group Ltd (ASX: PXA)

Shares in this property settlement technology firm have been lacklustre over the past 12 months, returning a negative 16.6% over the period.

This is despite the company recently delivering what it called a “strong” third-quarter performance and reaffirming its FY26 guidance.

Total transaction volumes processed by the Pexa Exchange were 935,000 in the third quarter, up 7.3% from the previous corresponding period, the company said.

Pexa Chief Executive Officer Russell Cohen said regarding the third-quarter results:

We delivered strong performance in the third quarter of FY26 across both Australia and the UK. In Australia, property transaction volumes remained resilient, growing 7% versus the prior year despite market uncertainty and rising interest rates. UK market growth moderated from the first half, with macroeconomic uncertainty impacting volumes in the quarter. Another quarter of robust operational performance and disciplined cost management has positioned us to deliver performance towards the top end of our FY26 NPAT guidance range.

Macquarie said in its research note on Pexa that formal commitments from additional Tier 1 lenders to use the platform would lead to other Tier 1 lenders to “onboard quickly, driving rapid market share gains”.

Macquarie has a price target of $19.05 on Pexa shares, compared to $10.53 currently.

Ebos Group Ltd (ASX: EBO)

Ebos Group shares are down slightly more than 50% over the past 12 months; however, the Macquarie team believes the company is well-placed for share price gains.

The company is also paying a dividend yield of 5.9% this year, with that figure expected to increase to 6.9% in 2028.

EBOS in April downgraded its FY26 underlying EBITDA guidance to $610 to $620 million, down from a previous range of $615 to $635 million, due to higher fuel and energy costs.

Macquarie said on the positive side of the ledger, a new First Pharmaceutical Wholesaler Agreement has been struck with the Federal Government, which will benefit EBOS’ Symbion division.

Macquarie has a price target of NZ$36.44 on the stock compared with NZ$19.38 at the time of writing.

The post Macquarie names 2 ASX shares that could jump more than 80% appeared first on The Motley Fool Australia.

More reading

• These 3 ASX shares will deliver better than 5% dividend yields, Macquarie says
• 3 highly undervalued ASX 200 stocks to target in June with up to 87% upside
• Ord Minnett says this ASX 200 tech share could rise 85%
• Here are the top 10 ASX 200 shares today

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

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. At the time of writing, the benchmark index is down 1.5% to 8,652.7 points.

Four ASX shares that are not letting that hold them back are listed below. Here’s why they are rising:

Chrysos Corporation Ltd (ASX: C79)

The Chrysos share price is up 2.5% to $6.15. Investors have been buying this mining technology company’s shares after it announced the successful refinancing of its corporate facilities. Chrysos has agreed a new three-year $200 million syndicated facility with three domestic financiers. Management notes that this moves it away from an existing asset-based financing debt structure to a corporate-style facility designed to provide operational flexibility and support the development, production and funding of PhotonAssay units in numerous jurisdictions around the world. Chrysos CEO, Dirk Treasure, commented: “We are pleased to have this facility in place to support the Company’s continued growth and accelerating deployment cadence. Continued adoption of PhotonAssay is driving strong demand across multiple regions, reflected in the additional four contracts signed with laboratories since our last update.”

Endeavour Group Ltd (ASX: EDV)

The Endeavour share price is up 3% to $2.96. This appears to have been driven by a broker note out of Citi. According to the note, the broker has upgraded the drinks giant’s shares to a buy rating with a trimmed price target of $3.25. Citi believes Endeavour could win market share based on its scale and price leadership strategy.

Racura Oncology Ltd (ASX: RAC)

The Racura Oncology share price is up 3.5% to $2.60. This morning, the biopharmaceutical company revealed that a specialist institutional investor focused on emerging healthcare companies has made an investment. The investor has provided a binding commitment to subscribe for 526,315 fully paid ordinary shares in Racura at an issue price of $1.90 per share. This represents a 23% discount to the average market price as of 3 June.

Treasury Wine Estates Ltd (ASX: TWE)

The Treasury Wine share price is up 10% to $4.54. This follows the release of the wine giant’s investor day update. The Penfolds owner’s Ascent strategy will focus on the brands and markets where it believes it can win, while cutting costs, simplifying operations, reshaping its supply chain, and strengthening its balance sheet. Treasury Wine revealed that it is targeting $100 million per year in cost reductions, which are expected to be fully realised by FY 2029.

The post Why Chrysos, Endeavour, Racura, and Treasury Wine shares are racing higher today appeared first on The Motley Fool Australia.

More reading

• This beaten-down ASX 200 stock just jumped 5%. Is the market too negative?
• Treasury Wine shares jump 12% on big investor update
• Treasury Wine Estates kicks off 2026 Investor Day with a renewed transformation plan
• Buy, hold, sell: ASX, Endeavour, and Judo Capital shares
• Here are the 10 most shorted ASX shares

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

Brave investors who waded in and bought Megaport Ltd (ASX: MP1) shares in April will be sitting on some outsized gains today.

Indeed, if you heeded Warren Buffett’s investment advice to “be greedy when others are fearful” and bought the S&P/ASX 200 Index (ASX: XJO) network services company at its one-year closing lows on 10 April, you’ll be sitting on a 147.5% gain today.

That’s enough to turn a $5,000 investment into $12,377. In less than two months.

Now you can’t actually buy Megaport shares today. Or at least not at time of writing.

As you may be aware, the ASX 200 tech stock entered a trading halt on Tuesday. Shares closed up 7.0% on Monday at $16.61 apiece.

And that’s where they are still at in late morning trade on Thursday, as the shares remain frozen while Megaport conducts an $827 million capital raising via a fully underwritten entitlement offer.

Atop that cap-raise announcement, yesterday, Megaport reported that it had signed four new AI infrastructure contracts valued at $459 million.

The company also narrowed its full year FY 2026 revenue guidance range to between $307 million and $315 million.

Which brings us back to our headline question…

Should I still buy Megaport shares after their huge surge?

Medallion Financial Group’s Philippe Bui analysed the outlook for the surging ASX 200 tech stock late last week, prior to this week’s announcements (courtesy of The Bull).

“MP1 is a leading global network-as-a-service provider, connecting enterprises to cloud providers and data centres,” he said.

And Megaport is among the ASX 200 tech stocks that are benefiting from the rapid rise of AI.

“Artificial intelligence-driven data centre investment is a direct tailwind, and this business is capturing it,” Bui noted.

As for the company’s performance, Bui said:

Revenue quality is improving, margins are expanding and existing customers are spending more. Wholly owned subsidiary Latitude.sh secured three major contracts in May, representing a meaningful step forward in recurring revenue.

While Bui sounded optimistic about the potential for more gains, he issued a hold recommendation on Megaport shares for now.

“At current prices, in line with historic valuation averages, emerging upside doesn’t appear fully priced in,” Bui concluded.

What’s the latest from the company’s Latitude.sh subsidiary?

Megaport shares closed up 4.5% on 14 May, with even larger share price gains over the following two trading days, after the company announced the three contract wins from Latitude.sh that Bui mentioned above.

The GPU, CPU, network, and storage contracts were reported to be worth a combined total contract value (TCV) of $254 million. That works out to around $91 million in Annualised Recurring Revenue (ARR).

The post Up 148% since April, should I still buy Megaport shares today? appeared first on The Motley Fool Australia.

More reading

• How high does Macquarie think Megaport shares will go?
• 5 things to watch on the ASX 200 on Thursday
• Why is everyone talking about Megaport, Ampol and Northern Star shares on Wednesday?
• Megaport shares in focus amid $458.9m AI contract wins and capital raising
• Megaport secures 4 new AI contracts, announces capital raise

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 Megaport. 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.

Endeavour Group Ltd (ASX: EDV) has finally given shareholders a green day worth noticing.

The drinks retailer and hotels operator is up 5.58% to $3.03 at the time of writing, even as the broader market trades lower.

By contrast, the S&P/ASX 200 Index (ASX: XJO) is down 1.17% to 8,683 points.

The move comes after a rough stretch for the owner of Dan Murphy’s and BWS, with the stock still down around 11% over the past month.

Over 12 months, Endeavour shares are still about 27% lower.

Why investors are buying today

The latest buying appears to be tied to a broker upgrade, with Citi moving Endeavour to a buy rating after the stock’s recent fall.

Citi analyst Sam Teeger sees room for Endeavour to claw back market share under new management.

Endeavour owns Dan Murphy’s and BWS, giving it a large position in the Australian liquor market. But the company has been under pressure as shoppers watch their spending more closely and competitors fight harder for sales.

Citi appears to believe a more price-led approach could help the company win back some ground from Coles Group Ltd (ASX: COL) and independent rivals.

But after a tough run, it hasn’t taken much to bring some buyers back. The stock was already trading near depressed levels, so the latest broker news gave investors a reason to look again.

Target price still moves lower

Even with the upgrade, Citi is not ignoring the work still ahead.

The broker reportedly cut its target price by 6% to $3.25, with higher capital expenditure and lower gaming and hotel peer multiples weighing on the valuation.

Endeavour is still trying to reset the business after a difficult period. Last week, the company outlined plans to reduce complexity, improve returns, and lower capital expenditures following a heavy investment phase.

It is also targeting at least $100 million in cost savings in FY27.

But investors will want to see those savings materialise without the company losing further sales momentum.

Coles could be a catalyst

Coles could also play a role in how the market views Endeavour from here.

Citi reportedly flagged the August Coles result as a key event, with Coles weighing up whether to reduce its big-box liquor store network by about 10%.

The liquor market remains tough, and shoppers are still sensitive to prices. But if Endeavour can regain some momentum while controlling costs, the share price may have more room to recover.

Foolish Takeaway

Today’s rally is a welcome change for shareholders, but it doesn’t undo the damage from the past year.

Endeavour shares remain well below where they were 12 months ago, and the company still needs to prove its reset can lift performance.

The post This beaten-down ASX 200 stock just jumped 5%. Is the market too negative? appeared first on The Motley Fool Australia.

More reading

• Why Chrysos, Endeavour, Racura, and Treasury Wine shares are racing higher today
• Buy, hold, sell: ASX, Endeavour, and Judo Capital shares
• Top brokers name 3 ASX shares to buy now
• Why’s the ASX 200 falling today despite another tech rally?
• How to get wealthy investing $300 a month into ASX shares

Citigroup is an advertising partner of Motley Fool Money. Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has 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.

The S&P/ASX 200 Index (ASX: XJO) is having a tough time on Thursday. In afternoon trade, the benchmark index is down 1.4% to 8,664.1 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are tumbling:

IperionX Ltd (ASX: IPX)

The IperionX share price is down 4% to $5.69. This morning, this titanium alloys producer released the results of the definitive feasibility study (DFS) for its 100%-owned Titan Critical Minerals Project in the United States. The DFS shows that the project is expected to deliver a “US$813 million after-tax NPV8, 39% IRR and US$1.9 billion after-tax free cash flow from an initial 14-year mine plan producing heavy rare earth concentrate, titanium minerals and zircon.” It seems the market was expecting even stronger results.

Northern Star Resources Ltd (ASX: NST)

The Northern Star share price is down 5% to $20.62. Investors have been selling gold miners after the price of the precious metal fell overnight. The catalyst was a rise in oil prices on Wednesday after tensions between the US and Iran escalated. This has sparked fears that inflation may spike and require interest rate hikes to get it under control. The S&P/ASX All Ordinaries Gold index is down around 3% at the time of writing.

Opthea Ltd (ASX: OPT)

The Opthea share price is down a further 19% to 1.3 cents. This biotechnology company’s shares have lost around 98% of their value over the past two sessions after returning from a suspension that lasted over a year. After a failed clinical trial, Opthea is ending its focus on retinal diseases and relaunching with a new strategy focused on OPT-302 as a potential treatment for lymphangioleiomyomatosis (LAM). It is a rare, chronic lung disease that primarily affects women. The company believes OPT-302 could have a role because the disease is associated with elevated VEGF-C and VEGF-D signalling, which OPT-302 is designed to inhibit. Opthea’s executive chair, Dr Jeremy Levin, said: “Opthea is relaunching with a focused strategy centered on OPT-302 and a clear objective: to evaluate a differentiated, mechanism-driven therapeutic opportunity in LAM while leveraging the Company’s substantial existing development, manufacturing and clinical infrastructure.”

Superloop Ltd (ASX: SLC)

The Superloop share price is down 5% to $3.41. This may have been driven by the release of a broker note out of Macquarie this morning. According to the note, the broker has downgraded the telco’s shares to a neutral rating (from outperform) but with a slightly improved price target of $3.70. Macquarie made the move on valuation grounds following a strong gain since the start of the year.

The post Why IperionX, Northern Star, Opthea, and Superloop shares are tumbling today appeared first on The Motley Fool Australia.

More reading

• Why this red-hot ASX 300 stock is tumbling 10% today
• 5 things to watch on the ASX 200 on Thursday
• Why Catapult Sports, Harvey Norman, Inghams, and Opthea shares are sinking today
• Why Acrow, Ampol, Medallion Metals, and Northern Star shares are racing higher
• Why is everyone talking about Megaport, Ampol and Northern Star shares on Wednesday?

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.

Megaport Ltd (ASX: MP1) has had plenty of news out this week, but we haven’t seen a share price reaction as the stock has been in a trading halt.

That hasn’t stopped the team at Macquarie running the ruler over the company and issuing a bullish target price, which we’ll get to shortly.

Firstly, let’s look at what Megaport has said this week.

Major contracts won

The company said in a statement to the ASX on Wednesday that it had secured four new AI infrastructure contracts with a combined total contract value of about $458.9 million.

These contracts would require $369.5 million in infrastructure spending, “primarily for high-performance NVIDIA GPUs, network, and storage infrastructure”.

Megaport also said it would establish an on-demand GPU pool, supported by $350 million in investment, “providing enterprise customers with access to AI infrastructure through both contracted and consumption-based commercial models”.

The company added:

Newly secured contracts and creation of the GPU Pool form the foundation of Megaport’s strategy to establish a Globally-Distributed AI Inference Cloud leveraging its footprint of more than 1,100 connected data centres across 31 countries.

To fund these new developments, the company launched a rights issue to raise $827.3 million at a share price of $14.30. This compares to the current share price of $16.61.

Megaport Chief Executive Officer Michael Reid said AI inference was “one of the biggest infrastructure opportunities of the next decade”.

He added:

The contracts announced today reflect the accelerating demand for globally-distributed AI inference infrastructure. Megaport’s software-provisioned compute, network, and storage platform positions us strongly to meet that demand. “The proceeds from the Entitlement Offer will enable us to fulfil contracted customer demand while building an on-demand GPU Pool that creates new opportunities across enterprise and sovereign AI markets globally. “AI inference is becoming a global infrastructure challenge, not simply a GPU problem. As AI adoption accelerates, organisations need seamless access to GPUs, CPUs, storage, and the connectivity that powers them. Megaport is built to deliver it all.

Megaport shares looking cheap

Macquarie said in a note to clients after the announcements that Megaport was a “high quality AI play with improving core business”.

They added:

50% of new contracts are existing customers, the rest are new. One of these customers provides global inference nodes to enterprise, suggesting this customer is strategically important and can grow in time.

Macquarie said Megaport offered AI exposure with shorter lead times and less capital expenditure than data centre operators.

Macquarie has an outperform rating on Megaport shares and a 12-month price target of $27.80.

Megaport is valued at $2.95 billion.

The post How high does Macquarie think Megaport shares will go? appeared first on The Motley Fool Australia.

More reading

• Up 148% since April, should I still buy Megaport shares today?
• 5 things to watch on the ASX 200 on Thursday
• Why is everyone talking about Megaport, Ampol and Northern Star shares on Wednesday?
• Megaport shares in focus amid $458.9m AI contract wins and capital raising
• Megaport secures 4 new AI contracts, announces capital raise

Motley Fool contributor Cameron England has positions in Megaport. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group, Megaport, and Nvidia. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Commonwealth Bank of Australia (ASX: CBA) shares are down around 1% at the time of writing on Thursday morning, to $162.95 a piece.

It’s been a shaky run for the ASX banking giant over the past 12 months, with its share price swinging wildly between $146.98 and $192.

CBA shares flew higher in early February after reporting a solid first-half FY26 result. The bank posted profit growth and confirmed continued strength in home lending. 

But the major bank suffered a sharp correction in May. The biggest event was CBA’s largest one-day share-price fall on record, dropping over 10% in a single session.

The drop came after CBA posted a disappointing third-quarter capital update, reporting flat operating income and a 1% decline in its unaudited cash NPAT. 

The results spooked investors, who rushed to sell their shares.

The question everyone is asking now is: How low could the CBA share price go?

What the experts think

Market Index data shows all brokers have a strong sell rating on the banking giant’s shares, and they tip a 24% downside to an average target price of $124.20, at the time of writing.

TradingView data is similar. Out of a collection of 16 analysts, 14 have a sell or strong sell rating, and another two rate the bank stock as a hold. A $127.43 target price implies a 22% downside at the time of writing. However, some think the shares could drop another 45% to just $90 each.

Why are analysts so negative on CBA shares?

CBA shares are widely considered overpriced versus its ASX bank peers. Many believe the bank’s bumper price tag isn’t supported by its business fundamentals. 

CBA’s price-to-earnings (P/E) ratio, at the time of writing, is 26.22. This is much higher (and therefore more expensive) than the other major big four Australian banks.

At the same time, the bank is facing ongoing earnings pressures, with expectations that growth will be in the single digits going forward.

Everything points to CBA shares being well overdue for a correction. 

Not as simple as it looks

Analysts are pretty negative about CBA shares and tip a strong downside ahead.

But yet, each time the bank’s share price falls, it starts ticking back up.

If the outlook for CBA is so unimpressive, why are investors still buying its shares?

It looks like the banking giant’s shares are supported by a flight to quality. 

In unstable markets, investors often rotate into large companies with stable dividends and dominant market positions to mitigate volatility. And it looks like CBA is the safe-haven stock of choice for investors right now.

The post How low could CBA shares go? appeared first on The Motley Fool Australia.

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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.