Author: openjargon

SRG Global Ltd (ASX: SRG) shares have been among the best performers on the ASX 200 index over the past 12 months.

During this time, the diversified infrastructure services company’s shares have risen approximately 150%.

Does this mean it is too late to buy this ASX 200 share? Bell Potter doesn’t think so.

What is the broker saying about this ASX 200 share?

Bell Potter was pleased to see the company upgrade its guidance this week after announcing a series of major contract wins. It said:

Contract update: SRG announced a significant contract update, with total award value of $1.85b, up from $0.65b in the last update in November 2025. Contracts were awarded by blue-chip clients across the Water, Defence, Energy, Industrial, Resources, Marine and Data Centre sectors. See pages 2-3 for more details on the individual contract awards.

FY26 guidance upgrade: SRG upgraded FY26 EBITDA to the top-end the $164- 168m guidance (BPe old $166m). At the top-end of the range, FY26 EBITDA growth is forecast to be 32%. Implied growth for the base business (ex-TAMS; assuming prorated $35m EBITDA business case performance) is 14%.

Another positive is that management has initiated guidance for FY 2027 which was ahead of consensus estimates. It adds:

FY27 guidance initiated: SRG estimates FY27 EBITDA to be within the range of $190-200m (BPe old $188m; VA $185m), representing 16% YoY growth at the midpoint of the FY27 guidance range (vs the top-end of the FY26 EBITDA guidance range).

In light of this, Bell Potter has upgraded its earnings estimates and valuation accordingly.

Buy rating reaffirmed

According to the note, the broker has retained its buy rating on the ASX 200 share with an improved price target of $4.25 (from $3.15).

Based on its current share price of $3.75, this implies potential upside of 13.3% for investors over the next 12 months.

In addition, Bell Potter expects a 1.7% fully franked dividend yield, lifting the total potential return to 15%.

The broker concludes:

We have upgraded our Target Price to $4.25/sh (up from $3.15/sh), reflecting more optimistic medium and long-term earnings growth expectations, a lower WACC (now 8.0% previously 8.6%) and a higher TGR (now 4.0%; previously 3.5%). SRG’s 27% valuation premium to the Industrial Services peer group (FY27 PE(A)) is justified. Management have a demonstrated a strong track-record of operational execution, delivered accretive acquisitions (Diona and TAMS in recent years) and guidance outperformance.

We see upside to consensus earnings forecasts from forthcoming guidance upgrades and accretive acquisitions. With FCF expanding over FY26-28, we anticipate SRG will be well capitalised to self-fund acquisitions.

The post This ASX 200 share is up 150% in 12 months, but it may not be too late to buy appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• These ASX stocks have hit the ground running in June – can they keep rising?
• Here are the top 10 ASX 200 shares today
• Why DroneShield, Pro Medicus, SRG Global, and Woodside shares are charging higher today
• Guess which ASX 200 share is jumping 17% on earnings guidance upgrade

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

The Treasury Wine Estates Ltd (ASX: TWE) share price is in the spotlight today as the company outlined its new five-year transformation plan at its 2026 Investor Day, aiming for a more focused brand portfolio and a substantial uplift in financial performance. Among the highlights, TWE is targeting $100 million in annualised cost reductions and expects EBITS of $480–490 million in FY26.

What did Treasury Wine Estates report?

• FY26 EBITS guidance of $480–490 million
• Annualised cost savings target of $100 million by FY29
• EBITS margin expansion to 25%+ long-term target (FY26e: ~19%)
• Leverage expected to return to below 2.0x by FY28 (peaking at 2.9x FY26)
• Increase in advertising & promotion (A&P) investment to ~10% of NSR by FY28
• No dividend payments until leverage falls under target

What else do investors need to know?

TWE’s transformation, branded “Ascent”, will sharpen its focus on “Power Brands” and “Regional Heroes”, with volume targets for these brands expected to reach 90% of group NSR over five years. The company will progressively divest, retire, or transition non-priority brands to support returns and margin expansion.

Major supply chain transformation is planned, particularly in Australia and the US, aimed at aligning production to long-term demand and improving capital efficiency. This includes divestment of surplus assets and rationalisation of the global network.

Management reported positive momentum in key brands, with Penfolds depletions up 40% in China for the March quarter and strong growth from US luxury brands. Inventory rebalancing is progressing in both China and the US, with the process expected to conclude by FY28.

What’s next for Treasury Wine Estates?

Looking ahead, TWE expects to return to revenue growth from FY28, once customer inventory is rebalanced and transformation benefits start to flow. EBITS is forecast to be at least stable in FY27, with progressive margin and return on capital improvements beyond that.

The company intends to increase A&P investment for its Power Brands and maintain disciplined cost controls. Management continues to review opportunities for strategic divestments and further operational improvements, especially in the Americas.

Treasury Wine Estates share price snapshot

Over the past 12 months, Treasury Wine Estates shares have declined 50%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 3% over the same period.

View Original Announcement

The post Treasury Wine Estates kicks off 2026 Investor Day with a renewed transformation plan appeared first on The Motley Fool Australia.

More reading

• Pro Medicus announces $16m US contract renewal
• 5 things to watch on the ASX 200 on Thursday
• Here are the top 10 ASX 200 shares today
• Why the ASX 200 is rallying despite a weaker growth warning
• Ingenia Communities affirms strong FY26 outlook and development pipeline

Motley Fool contributor Laura Stewart 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 Treasury Wine Estates. The Motley Fool Australia has positions in and has recommended Treasury Wine Estates. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

The Pro Medicus Ltd (ASX: PME) share price is in focus today after the company announced a five-year, $16 million contract renewal with The Ohio State University Wexner Medical Center. The deal adds new capabilities to an existing partnership and lifts the minimum commitments.

What did Pro Medicus report?

• Signed a five-year, A$16 million contract renewal with The Ohio State University Wexner Medical Center (OSUWMC)
• The contract now includes Visage 7 Workflow and Visage 7 Cardiology Imaging
• The agreement follows a transaction-based model with increased minimums and higher fees per transaction
• Total renewals for the financial year have reached A$141 million
• The agreement further strengthens Pro Medicus’ North American presence

What else do investors need to know?

Pro Medicus’ renewal with OSUWMC not only extends the existing relationship, but adds new product modules to the client’s platform, allowing the medical centre to phase out older systems. OSUWMC is a large, multi-disciplinary academic hospital, supporting over 1,400 beds and employing around 22,000 staff.

This renewal continues Pro Medicus’ trend of securing long-term, high-value contracts in the US healthcare sector, reinforcing its reputation for client retention and ongoing product innovation.

What did Pro Medicus management say?

Chief Executive Officer Dr Sam Hupert said:

Renewing this contract, to now include the additions of Visage 7 Workflow and Visage 7 Cardiology Imaging, confirms our belief that we have extensive native capabilities that Visage customers appreciate as they seek to retire legacy solutions and continue to scale their Visage 7 Enterprise Imaging Platform.

What’s next for Pro Medicus?

Ongoing renewals like this underpin Pro Medicus’ strategy to expand its cloud-based imaging footprint across large health networks. Management believes these multi-year deals provide sustainable revenue and highlight the demand for advanced imaging solutions.

The company looks set to continue investing in product enhancements, targeting further growth opportunities in North America and abroad as healthcare systems shift to enterprise-level, scalable platforms.

Pro Medicus share price snapshot

Over the last 12 months, the Pro Medicus shares have declined 44%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 3% over the same period.

View Original Announcement

The post Pro Medicus announces $16m US contract renewal appeared first on The Motley Fool Australia.

More reading

• Treasury Wine Estates kicks off 2026 Investor Day with a renewed transformation plan
• 5 things to watch on the ASX 200 on Thursday
• How much higher could Pro Medicus shares go? 2 brokers weigh in
• Here are the top 10 ASX 200 shares today
• Why the ASX 200 is rallying despite a weaker growth warning

Motley Fool contributor Laura Stewart 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. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial summary of the company announcement. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.

The race of AI mega-IPOs has a new entrant.

Anthropic, the San Francisco-based AI company behind the Claude platform, filed confidentially with the SEC on 2 June 2026 at a reported valuation of approximately US$950 billion to US$1 trillion.

That would make it, alongside the SpaceX IPO already in progress, one of the two largest stock market debuts in history.

For Australian investors, Anthropic will not be available on the ASX.

However, two ASX-listed companies are already directly embedded in the infrastructure that Anthropic depends on to power its AI models.

Both stand to benefit materially as Anthropic’s public debut draws global attention and capital to the AI infrastructure theme.

What Anthropic actually does

Anthropic was founded in 2021 by former OpenAI employees, including Dario Amodei and Daniela Amodei.

The company competes directly with OpenAI’s ChatGPT and Google’s Gemini, and its Claude platform holds approximately 5% of the chatbot market, according to eMarketer.

More importantly for the investment case, Anthropic’s annualised revenue reportedly crossed US$44 billion as of May 2026. Furthermore, the company is on track to post its first-ever operating profit in Q2 2026.

As more and more capital flows into AI themes, the infrastructure layer beneath the AI stack tends to be a direct beneficiary.

NextDC Ltd (ASX: NXT)

NextDC is Australia’s largest independent data centre operator.

The company is building a massive $7 billion AI data centre campus in Western Sydney, with OpenAI signed on as its foundational customer.

As Anthropic scales its operations and increases its compute consumption to compete with OpenAI’s growing infrastructure, Australian data centre capacity becomes an increasingly critical resource.

NextDC has been growing at an extraordinary pace to meet that demand.

In the first half of FY 2026, NextDC raised its FY 2026 capital expenditure guidance to between $2.7 billion and $3.0 billion. Contracted utilisation surged 60% to 667MW in the March quarter alone.

The Anthropic IPO adds a further dimension to that thesis: as AI company valuations are revalidated at trillion-dollar levels, the infrastructure enabling those companies becomes even more strategically important and even harder to replicate.

Macquarie Technology Group Ltd (ASX: MAQ)

Macquarie Technology plays a different but equally important role in the Australian AI infrastructure stack.

Where NextDC focuses on hyperscale data centre capacity for large cloud and AI customers, Macquarie Technology specialises in sovereign cloud and cybersecurity infrastructure for Australian government agencies and critical industries.

That is a market where Anthropic’s Claude platform and similar AI systems are being deployed. The strict requirements within these deployments are that data must remain onshore and secure.

Macquarie Technology has now delivered 20 consecutive half years of operating income growth. This track record reflects the growing and non-discretionary nature of its customer base.

The company’s $200 million National Reconstruction Fund investment, announced in March 2026, will fund the IC3 Super West data centre expansion designed specifically for AI workloads requiring the highest levels of security and sovereignty.

Anthropic’s Claude platform is increasingly being adopted by Australian government agencies, financial institutions, and critical infrastructure operators.

Many of these organisations cannot use offshore AI infrastructure for regulatory or security reasons.

This creates a captive market for sovereign cloud providers operating on Australian soil.

Macquarie Technology is positioned to capture that demand. And no overseas hyperscaler can replicate what it offers in terms of data sovereignty and security clearance.

The broader AI IPO wave

The Anthropic IPO is not an isolated event.

SpaceX’s roadshow began this week, targeting a US$2 trillion valuation. OpenAI is expected to file later in 2026 at a similarly extraordinary valuation.

Together, these listings represent the single largest concentration of AI industry capital ever brought to public markets simultaneously.

Investment banks, including JPMorgan, Goldman Sachs, and Morgan Stanley, leading these listings, believe the liquidity impact is manageable. There is an estimated US$8 trillion sitting in US money market funds, providing the base demand for these deals.

As that capital flows into public AI companies, the attention and institutional interest in AI infrastructure plays, including those listed on the ASX, is likely to intensify rather than diminish.

The risks worth knowing

Both Nxt DC and Macquarie Technology carry meaningful capital expenditure commitments and are sensitive to interest rate movements given their asset-heavy models.

The Anthropic IPO has not yet been confirmed with a specific date or price. If it is delayed or prices are below expectations, the near-term sentiment benefit for AI infrastructure stocks could be muted.

Furthermore, both stocks have already run significantly in recent years, which limits the margin of safety at current prices.

Foolish Takeaway

Australian investors cannot buy Anthropic directly on the ASX.

But what they can buy is the infrastructure Anthropic depends on to operate.

NextDC and Macquarie Technology are two of the most credible and directly positioned ASX-listed beneficiaries of the AI mega-IPO wave now unfolding.

As trillion-dollar AI valuations are validated in public markets for the first time, the infrastructure enabling those companies becomes not just an investment theme but a critical asset class.

The post The Anthropic IPO could be the next big catalyst for ASX AI infrastructure stocks appeared first on The Motley Fool Australia.

More reading

• Why Macquarie Technology is one of the most interesting AI infrastructure plays on the ASX
• 2 ASX tech shares I think could be worth much more by 2030
• Is NextDC the hottest ASX growth stock right now?
• 3 ASX shares riding the data centre boom that investors keep overlooking
• 2 of the best ASX 200 shares to buy and hold for 10 years

JPMorgan Chase is an advertising partner of Motley Fool Money. Motley Fool contributor Mark Verhoeven has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs Group and JPMorgan Chase. 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 team at Morgans has been busy looking at a number of popular ASX shares this week.

Let’s see if the broker is bullish or bearish on these names. Here’s what it is saying:

ASX Ltd (ASX: ASX)

Morgans was disappointed to see this stock exchange operator provide cost and capital expenditure guidance that was significantly higher than expected.

In light of this, the broker has reduced its earnings estimates beyond FY 2026 and trimmed its valuation accordingly.

This has seen Morgans reaffirm its hold rating with a new price target of $51.50. It said:

ASX released FY27 total cost guidance along with FY28 capex expectations both of which were materially above consensus at the time of release. Whilst the topline shows encouraging growth (+~12.5% FYTD), we anticipate the market to remain cautious given the elevated cost profile as the technology refresh continues.

We lift FY26F EPS ~4% on stronger-than-forecast cash market and Futures/OTC volumes, but lower FY27-FY28F EPS by ~5%, as the updated cost guidance more than offsets the higher revenue base in the outer years. Our DCF/PE-derived PT is lowered to A$51.50 on the above, accompanied by an increase in the house RFR to 4.6%. We maintain our Hold recommendation and note near-term elevated costs will likely remain a headwind.

Endeavour Group Ltd (ASX: EDV)

Another ASX 200 share that Morgans has been looking at is drinks giant Endeavour.

In response to the Dan Murphy’s and BWS owner’s investor day event, Morgans has retained its hold rating on Endeavour’s shares with a reduced price target of $2.80.

While there were positives from the investor day, Morgans highlights that there are execution risks to contend with while trading conditions remain challenging. It commented:

EDV provided a strategic update at its Investor Day with the new management team, led by CEO Jayne Hrdlicka, outlining their plans for growth. As expected, no trading update was provided given the company provided one only a few weeks ago. Management outlined three core growth pillars: 1) grow Retail revenue through repositioning the Dan Murphy’s and BWS offers; 2) improve Hotels performance by stepping up investments in renewals; and 3) reduce costs with $300m in targeted savings by FY29. We make negligible changes to FY26-28F EBIT forecasts; however, underlying NPAT declines by 0-3% due to higher interest expense.

Our target price decreases to $2.80 (from $3.30) reflecting changes to earnings forecasts and a reduction in our FY27F PE multiple to 13x (from 15x). While the Investor Day highlighted a range of revenue and cost opportunities, these require accelerated investment and are expected to keep balance sheet leverage elevated through FY27. Execution remains key, and with the liquor market still challenging, we prefer to wait for delivery before reassessing our view. HOLD retained.

Judo Capital Holdings Ltd (ASX: JDO)

Morgans is more positive on this small business lender.

It was pleased with management’s decision to undertake a second capital relief securitisation transaction. Morgans believes it reduces the need for an equity raising.

As a result, the broker has retained its buy rating with a $2.15 price target. It commented:

JDO announced its second capital relief securitisation transaction backed by SME business loans. The transaction is significant as it shows JDO’s ability to again source and its willingness to utilise capital relief securitisations to support its CET1 capital ratio without the need for equity raisings. Target price of $2.15 per share, with strong double digit earnings growth forecast across FY26-28F. BUY retained, with potential TSR at current prices of c.38% (driven entirely by capital growth).

The post Buy, hold, sell: ASX, Endeavour, and Judo Capital shares appeared first on The Motley Fool Australia.

More reading

• This ASX bank stock has rebounded 7% from a 2-year low, and is tipped to climb up to 76% higher
• Leading brokers name 3 ASX shares to buy today
• Why Endeavour Group’s hotel portfolio could be more valuable than the market realises
• Here are the top 10 ASX 200 shares today
• Why are these 3 ASX 200 stocks crashing in this week’s rebounding market?

Motley Fool contributor James Mickleboro has positions in Endeavour 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 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.

A $5,000 investment can go a long way when spread across a handful of quality ASX dividend shares.

The key is finding businesses with the cash flows, assets, or market positions to support shareholder returns over time.

With that in mind, here are five ASX dividend shares that could be worth a closer look this month.

Accent Group Ltd (ASX: AX1)

The first ASX dividend share to look at is Accent.

It is one of Australia’s leading footwear and lifestyle retailers, with brands and store networks covering sports, streetwear, and casual fashion.

Retail can be a tough place when households are under pressure, but Accent has built a broad portfolio across well-known banners and owned brands. This gives it different ways to reach customers across stores and online.

The company’s earnings can be cyclical, but when trading conditions improve, its cash generation can support attractive dividends.

Harvey Norman Holdings Ltd (ASX: HVN)

Another ASX dividend share that could be worth a look is Harvey Norman.

The retailer has been through plenty of consumer cycles before and remains a major player in furniture, electronics, appliances, bedding, and household goods.

What makes Harvey Norman different from many retailers is its property portfolio. This gives the business an extra layer of asset backing and makes the investment case broader than store sales alone.

Consumer spending remains a risk, but its brand, franchise model, and property exposure could continue supporting dividends over time.

Macquarie Group Ltd (ASX: MQG)

A third ASX dividend share for income investors to consider is Macquarie.

Macquarie is not a traditional income stock, but it has a long record of rewarding shareholders while also reinvesting for growth.

Its operations span asset management, commodities, infrastructure, green energy, banking, and markets. That gives the company several ways to generate earnings across different conditions.

The company’s dividends can move with profits, so income may not be perfectly smooth. But Macquarie’s global platform and capital allocation record make it a high-quality option for investors seeking both income and growth.

Rural Funds Group (ASX: RFF)

A fourth ASX dividend share to look at for the $5,000 investment is Rural Funds.

This agricultural property owner leases farmland and related assets to operators across sectors such as cattle, almonds, macadamias, vineyards, and cropping.

That means it is more focused on rental income than directly running farms. This can provide a more predictable income stream than many agricultural businesses.

Overall, Rural Funds offers exposure to real assets and a dividend profile that stands apart from the usual bank and resource names.

Universal Store Holdings Ltd (ASX: UNI)

A final ASX dividend share for income investors to consider is Universal Store.

The youth fashion retailer operates brands including Universal Store, Perfect Stranger, and Thrills. It serves a clearly defined customer base and has been expanding its store network and online presence.

Fashion retail can be volatile, particularly when consumer confidence weakens. But Universal Store has a strong niche, a clean balance sheet, and room to keep growing its footprint.

If it continues executing well, it could provide both dividend income and long-term growth potential.

The post 5 ASX dividend shares to buy with $5,000 this month appeared first on The Motley Fool Australia.

More reading

• Why Catapult Sports, Harvey Norman, Inghams, and Opthea shares are sinking today
• Can you turn $20,000 into $100,000 with ASX shares?
• Why’s the ASX 200 falling today despite another tech rally?
• 2 ASX shares that I rate as buys today for both growth and dividends
• Forget BHP shares! Buy these ASX dividend shares instead for passive income

Motley Fool contributor James Mickleboro has positions in Accent Group and Universal Store. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia has positions in and has recommended Harvey Norman, Macquarie Group, and Rural Funds Group. The Motley Fool Australia has recommended Accent Group and Universal Store. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Superannuation is a very effective tool to invest in ASX shares for passive income because of the lower tax rate.

The return we should focus on is the after tax return. Its therefore advantageous that superannuation has a lower tax rate than what it would be for a full-time working Australian with their individual tax rate. For people in retirement, the tax rate in superannuation could be zero.

With that in mind, I think the below two ASX shares are very effective options for $7,500 in superannuation.

Future Generation Global Ltd (ASX: FGG)

I imagine plenty of retirees may not have substantial diversification with their assets. There may be a significant focus on Australian businesses and Australian property.

Considering the ASX only makes up around 2% of the global share market, it could be wise to look at investments that give exposure to some of the other 98%.

I believe Future Generation Global is a good option for both diversification and income.

In terms of the diversification, it’s currently invested in the funds of 16 fund managers who invest in global shares. Across those funds, Future Generation Global has exposure to more than 3,700 shares from around the world. It’s invested in shares from North America, the UK, Europe, Asia, other developed markets and emerging markets.

On the income side of things, it has increased its annual dividend per share each year since 2019, meaning it has given investors several years of consecutive dividend growth.

Excluding the special dividend in 2025, it currently has a grossed-up dividend yield of 6.9%, including franking credits, at the time of writing. I think that’s a solid start for superannuation investors.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is the other ASX share I want to highlight, it’s an investment house that has been operating for more than 120 years – it’s one of the oldest businesses on the ASX and it has a great track record of longevity.

The business is invested in a variety of sectors such as industrial property, swimming schools, agriculture, water rights, telecommunications, energy, retail and plenty more. I think it’s great that the business is diversified and has the investment flexibility to alter its portfolio over time towards the best opportunities it can see.

Its portfolio has been deliberately positioned to be defensive and generate resilient cash flow, so it’s able to provide reliable and growing dividends over time. It has actually increased its regular annual dividend every year since 1998, meaning there’s a high likelihood it will increase its payout again with the FY26 result.

The company doesn’t have the biggest dividend yield around, but that’s partly because it has a healthy dividend payout ratio, retaining some of its profit each year to invest in more opportunities.

Its latest two dividend payments equate to a grossed-up dividend yield of 3.6%, including franking credits.

The post How to invest $7,500 for passive income in superannuation? appeared first on The Motley Fool Australia.

More reading

• How much is needed in superannuation to target a $9,000 monthly passive income?
• 2 ASX shares with dividend yields above 8%
• 15 ASX shares going ex-dividend before EOFY
• 3 ASX dividend shares raising dividends like clockwork
• Screaming buys: My top 5 favourite stocks in the world

Motley Fool contributor Tristan Harrison has positions in Future Generation Global and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Commonwealth Bank of Australia (ASX: CBA) share price has been one of the biggest talking points on the ASX.

The banking giant’s shares are currently trading at $164.76. That compares with a 52-week low of $146.97 and a 52-week high of $192.00.

So, after that pullback from its highs, how should investors think about its valuation?

Start with earnings

One simple way to value CBA is to compare its share price with expected earnings.

Consensus estimates have CBA generating earnings per share of $6.54 in FY 2026 and $7.04 in FY 2027. That compares with $6.17 per share in FY 2025.

This means the market is expecting earnings per share to grow by approximately 6% in FY 2026 and then a further 8% in FY 2027. Across the two-year period, that works out to compound annual earnings growth of approximately 7%.

Based on the current share price of $164.76, CBA is trading on approximately 25.2x estimated FY 2026 earnings.

Looking further ahead, the bank is trading on approximately 23.4x estimated FY 2027 earnings.

That is a high multiple for a major bank, particularly one with earnings expected to grow at a mid to high single-digit rate rather than at the pace normally associated with high-growth companies.

How does that compare historically?

This is where the valuation debate becomes more interesting.

Over the past 10 years, CBA’s average annual price-to-earnings ratio has ranged from around 13.5 times to 24.7 times. Across those years, the average comes out at approximately 17.3 times earnings.

That means CBA is still trading well above its longer-term average multiple, even after falling from its 52-week high.

There are reasons why investors have been willing to pay a premium. CBA has the strongest retail banking franchise in Australia, a leading digital offering, a large deposit base, and a track record of strong profitability.

But valuation is still important. A great business can produce disappointing returns if investors pay too much for it.

What about dividends?

Income investors may also value CBA based on its dividends.

The market expects fully franked dividends of $5.15 per share in FY 2026 and $5.45 per share in FY 2027. That is up from $4.86 per share in FY 2025.

Based on the current share price, this implies forward dividend yields of approximately 3.1% in FY 2026 and 3.3% in FY 2027.

Those dividend yields are useful, especially once franking credits are included. But they are not especially high compared with some other ASX dividend shares or with what CBA itself has offered at lower valuations in the past.

Is the CBA share price good value?

CBA remains a very high-quality bank. Its brand, technology, customer base, and balance sheet strength all help justify a valuation premium.

The question is how much of a premium is reasonable.

At more than 23x FY 2027 earnings, the market is valuing CBA more like a growth stock than a traditional bank. Yet the earnings outlook points to steady growth rather than explosive growth.

There is a reason that investors are willing to pay up. Defensive earnings, strong capital levels, fully franked dividends, and a dominant retail banking franchise are all valuable, particularly in uncertain markets.

But investors still need to ask whether they should value those qualities this highly.

The CBA share price is no longer at its highs, but on traditional earnings measures, it still arguably looks expensive compared with its own history.

For the current valuation to be justified, the bank may need to keep delivering clean earnings growth, defend margins, and avoid a meaningful deterioration in credit quality. That’s easier said than done in the current environment.

The post How to value the CBA share price appeared first on The Motley Fool Australia.

More reading

• How combining superannuation and ASX shares can set you up for retirement better than property
• Why the RBA’s next move could be the most important event for ASX shares in 2026
• Is this ASX financials stock a better buy than CBA shares?
• Should you buy CBA and NAB shares this week?
• Brokers rate these 5 ASX 200 shares as a sell!

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 is a category of ASX stock that tends to get overlooked: quality consumer businesses that are not retailers, not banks, and not miners.

They do not fit neatly into any of the narratives dominating the market in 2026.

Breville Group Ltd (ASX: BRG) is a perfect example.

The Sydney-based designer and distributor of premium kitchen and home appliances operates across more than 70 countries, generates consistent earnings growth, and has outperformed its global industry peers for the better part of a decade.

Yet Breville shares are down approximately 23% from their peak of $37.11, and barely anyone is talking about them.

This has created an interesting situation for patient investors.

Why Breville keeps outperforming its peers

Breville does not compete on price.

The company rather competes on design, innovation, and the aspirational appeal of its premium brands. These include Breville in Australia and the US and Sage in Europe and the UK.

Breville’s positioning insulates the business from the margin pressure that squeezes lower-end appliance manufacturers when commodity costs rise or consumer budgets tighten.

Macquarie has been tracking the global small appliance industry for years and its data offers clear insight.

Breville has outperformed the industry benchmark by approximately 11% per annum between 2018 and 2024.

Most remarkably, Breville is one of only a handful of global appliance companies whose revenue is currently above pandemic-era peaks, a group that also includes Nespresso and De’Longhi.

Every other major player is still trying to recover to their 2021 revenue levels. Meanwhile, Breville has already blown past them.

The FY2025 result confirmed the momentum

The most recent full-year result delivered further evidence of the outperformance story.

Breville reported FY2025 revenue growth of 10.9% and a 14.6% increase in NPAT, with the global products segment. This segment accounts for the overwhelming majority of revenue, delivering constant currency growth of 13.0% in the December 2024 half.

The coffee segment continues to be the primary growth engine, benefiting from the ongoing premiumisation trend in home coffee preparation that accelerated during the pandemic.

New market development, particularly in Asia and Latin America, is adding a further growth dimension that is still in its early stages.

What Macquarie thinks about Breville shares

Macquarie retained its outperform rating on Breville shares this week with a $37.10 price target.

The broker was pleased with the most recent industry data.

At the current Breville shares price of approximately $26.26, that $37.10 target implies upside of approximately 30%.

Furthermore, Macquarie forecasts Breville’s dividend to grow from 39.1 cents per share in FY2026 to 51.1 cents by FY2028.

This is a 31% increase in the payout over three years, backed by earnings growth the broker describes as highly visible given the company’s long order pipeline and global distribution reach.

The risks worth acknowledging

Breville is not without risk.

Consumer discretionary spending is under pressure from the RBA’s rate hiking cycle, and a sustained deterioration in household budgets could delay appliance upgrade cycles.

The strong Australian dollar reduces the AUD value of overseas earnings when translated back to domestic reporting currency.

Lastly, tariff risk in the United States, where a significant portion of revenue is earned, has not fully resolved despite some moderation in the trade tension environment.

Foolish takeaway

Breville shares have drifted lower while the underlying business has kept outperforming every global benchmark the industry tracks.

Macquarie has done the homework and arrived at a bull case backed by three years of forecast dividend growth.

For investors looking for a quality consumer stock that the market has temporarily lost interest in, Breville shares look like exactly the kind of opportunity that tends to reward patient investors.

The post Breville shares could be the most underrated consumer shares on the ASX right now appeared first on The Motley Fool Australia.

More reading

• Can you turn $20,000 into $100,000 with ASX shares?
• How to get wealthy investing $300 a month into ASX shares
• Leading brokers name 3 ASX shares to buy today
• Why did ASX 200 retail shares lead the market last week?
• 2 strong Australian stocks to buy now with $9,000

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

ASX small-caps can be a high upside allocation for an investor’s portfolio. 

While diversification and long-term principles should still be the fundamental base of a healthy strategy, ASX small-caps can provide increased potential compared to blue-chip stocks.

For investors looking to monitor smaller companies with big potential, brokers have tipped these two options to rise significantly.

Biome Australia Ltd (ASX: BIO)

Biome Australia develops and commercialises clinically backed innovative live biotherapeutics (probiotics), marketing 18 products under the ‘Activated Probiotics’ Brand. 

As is the case with small-caps, it has experienced plenty of volatility recently. 

It was making headlines yesterday after rocketing 20% in a single session after signing a new manufacturing agreement.

In a new report from Bell Potter, the broker has predicted this rise can continue in the next 12 months. 

The broker has a $1.00 price target on this ASX small-cap, indicating a massive 270% upside from current levels. 

In the report, Bell Potter highlighted that Biome Australia has announced an initiative to derisk and diversify its supply chain. The company is doing this by introducing contract manufacturing in its home market of Australia of assembly and packaging of its Activated Probiotics range. 

The initial two-year term with Specialty Probiotics Australia (SPA) is on an exclusive basis. It is subject to limited carve outs and meeting quality and delivery standards.

Conceptually, this is a positive and material development that should enhance operating leverage and BIO’s capacity to plan for growth, which has been impeded to some degree by relying completely on importing finished product. Assuming BIO continues to build its domestic franchise, we can see a path to $100m in Australian sales, with attractive margins.

Imricor Medical Systems Inc (ASX: IMR)

Imricor Medical Systems is a medical device company. It engages in the design, manufacture, and distribution of magnetic resonance imaging (MRI) compatible products for cardiac catheter ablation procedures.

It has also experienced volatility in 2026, but remains up 6% year to date. 

The team at Morgans believes this ASX small-cap could be an upside play. 

There are multiple near-term catalysts approaching which when achieved will see a share price re-rating. IMR is now well funded to deliver on clinical, regulatory, and commercial objectives. We have updated our model and valuation for the capital raise. Our target price is A$2.61 (was $2.63). We maintain our SPECULATIVE BUY recommendation.

From yesterday’s closing price of $1.74, the price target from Morgans indicates a 50% upside for this ASX small-cap. 

The post 2 ASX small-caps with 50% and 270% upside according to Brokers appeared first on The Motley Fool Australia.

More reading

• How to value the CBA share price
• Breville shares could be the most underrated consumer shares on the ASX right now
• Why experts think this ASX growth share can rise 63% in a year
• Which defensive shares are outperforming the ASX 200
• 5 things to watch on the ASX 200 on Thursday

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