Author: openjargon

South32 Ltd (ASX: S32) shares have come out of the blocks fast this year. They have blasted 30% higher in the first two months of the year to $4.60, at the time of writing.

After drifting through much of the past two years, South32 shares have flipped the script and delivered one of the stronger performances among large-cap miners on the S&P/ASX 200 Index (ASX: XJO).

Investors who were growing impatient are suddenly being rewarded as the market re-rates the diversified miner on the back of improving operations and firmer commodity prices. Now the question is: Can South32 shares keep the rally going?

No hype, real substance

The rally hasn’t come from hype. It has come from execution. South32 has tightened costs, delivered solid production across key assets, and reassured the market that guidance remains intact. The miner has backed it up with strong half-year financial results and solid production numbers, giving the rally real substance.

Copper, silver, and gold have smashed through to fresh record highs this year. The surge in commodity prices has powered South32 shares toward a multi-year high earlier this month. In the past 6 months, the ASX 200 mining stock has seen its value increase by a massive 71% to $20.5 billion.

Controlling cyclical miner

It’s not just macro tailwinds at play. Manganese volumes have impressed, alumina output has stabilised, and aluminium performance has been resilient despite a choppy macro backdrop. When a cyclical miner shows it can control what it can control, the market tends to pay attention. For a diversified producer like South32, stronger pricing flows directly into margins and cash generation.

Capital management has also helped sentiment. The ASX mining stock has maintained a disciplined balance sheet and continued returning cash to shareholders through dividends and buybacks. In a market where investors are demanding both growth and yield, that combination is powerful.

It reinforces the idea that this is not a speculative turnaround, but a business with tangible cash flow underpinning it.

Geopolitical challenges

Still, risks haven’t vanished. Commodity stocks like South32 shares remain at the mercy of global growth. A slowdown in China or a broader industrial downturn would quickly pressure metals prices and earnings expectations.

Operationally, asset-specific challenges remain, including power and geopolitical risks at certain offshore operations. Mining is never a straight-line business, and volatility is part of the package.

What next for South32 shares?

Valuation is another consideration. After a strong run for South32 shares, the easy gains may already be behind the stock. The market is now pricing in continued operational stability and supportive commodity markets. Any stumble in production or softer pricing could see momentum cool just as quickly as it heated up.

So is there more upside? There could be, particularly if base metal demand remains resilient and South32 continues to execute cleanly. Most analysts are still keen on South32 shares with a buy or strong buy rating. They have set an average 12-month price target of $4.80, a modest 4% upside.

Due to the recent share price surge, Morgans recently downgraded South32 shares to an accumulate rating (from buy) with an unchanged price target of $5. This points to a potential gain of roughly 9% over 12 months at current levels.

The post Can South32 shares keep it going after stellar start in 2026? appeared first on The Motley Fool Australia.

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• The 3 ASX shares I’d buy and hold into 2026

Motley Fool contributor Marc Van Dinther has positions in South32. 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 Alcoa Corporation CDI (ASX: AAI) share price is in focus as the company announces a quarterly dividend of US 10 cents per CDI, payable on 26 March 2026, with a record date of 10 March.

What did Alcoa report?

• Quarterly dividend of US 10 cents per CDI, unfranked
• Dividend ex-date: 9 March 2026
• Record date for eligibility: 10 March 2026
• Payment date: 26 March 2026
• Payments default to Australian dollars but other currencies available on request
• Non-resident withholding tax of 30% applies unless eligible for a reduced treaty rate

What else do investors need to know?

Alcoa advises CDI holders to ensure their payment instructions are up to date to avoid potential delays. Holders in Australia, New Zealand, the UK, or US must provide direct credit details, otherwise dividend payments will be withheld until valid banking information is received.

For those residing outside these countries, payments will be made by cheque in Australian dollars unless alternative global wire instructions are received. Alcoa also reminds investors that non-resident withholding tax will be deducted according to US tax law, with the standard rate set at 30% unless a valid tax treaty certification is in place.

What’s next for Alcoa?

Looking ahead, Alcoa CDI holders can update their currency preferences and banking details until 10 March 2026 to ensure smooth dividend reception. The AUD equivalent for this dividend will be announced by 20 March 2026.

Alcoa continues to emphasise its commitment to consistent shareholder returns by maintaining regular quarterly payments while supporting its operational and financial strategies.

Alcoa share price snapshot

Over the past 12 months, Acola shares have risen 68%, outperforming the S&P/ASX 200 Index (ASX: XJO) which has risen 11% over the same period.

View Original Announcement

The post Alcoa announces March 2026 dividend appeared first on The Motley Fool Australia.

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• Virgin Australia posts 1HFY26 earnings

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 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. 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 Dateline Resources Ltd (ASX: DTR) share price is charging higher on Friday after the company unveiled a new US heavy rare earths acquisition.

At the time of writing, the gold and rare earths developer’s shares are up 8.57% to 38 cents.

That means the stock has now climbed more than 60% since the start of 2026. It extends an already strong run for the small-cap resources company.

So, what did Dateline announce?

Dateline locks in US heavy rare earths project

This morning, Dateline revealed it has acquired the Music Valley heavy rare earth elements project in California.

The project comprises 57 claims covering 1,140 acres in Riverside County, around 8 miles southeast of Twentynine Palms.

According to the company, historical United States Geological Survey work has identified heavy rare earth mineralisation in the area. Reported rock chip results ranged from 6.69% to 15.04% total rare earth oxides, including high levels of yttrium and dysprosium grades.

Heavy rare earths such as dysprosium and terbium are used to enhance magnet strength and heat resistance in electric vehicles, wind turbines, defence systems, and advanced electronics.

Dateline said it plans to undertake mapping, geochemistry, and geophysics to define drill targets at Music Valley.

Expanding its US critical minerals footprint

The acquisition is part of a wider strategic push in North America.

As part of the transaction terms, Dateline has also completed a US$1.05 million investment in Fermi Critical Minerals Inc. Fermi is raising capital to advance uranium and rare earths projects in Wyoming and Colorado.

Dateline Managing Director Stephen Baghdadi said the deal gives the company direct exposure to heavy rare earths mineralisation in California, while also expanding its footprint across uranium and rare earths assets in the United States.

The planned work program at Music Valley will be funded from Dateline’s existing cash balance.

The company already owns 100% of the Colosseum Gold-REE Project in California, located near the Mountain Pass rare earth mine. The addition of Music Valley broadens Dateline’s asset base and strengthens its exposure to US-based rare earths and uranium opportunities.

Foolish Takeaway

Rare earths have become strategically important due to their role in electrification, renewable energy, and defence technologies. And with geopolitics heating up, Western governments are increasingly looking to diversify supply chains away from China.

Dateline’s latest move strengthens its exposure to the growing strategic focus on securing reliable alternative rare earths supply chains.

While investors have responded positively, Music Valley remains an early-stage exploration project. Its ultimate value will depend on successful drilling, resource definition, and the company’s ability to advance the project beyond exploration.

The post Dateline shares surge again after major US rare earths deal appeared first on The Motley Fool Australia.

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• Up 116% in 6 months, guess which ASX All Ords gold stock is rocketing again today on big US news

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 Neuren Pharmaceuticals Ltd (ASX: NEU) share price is in focus after the company posted a 15% rise in 2025 DAYBUE royalties to A$65 million and a profit after tax of A$30 million.

What did Neuren Pharmaceuticals report?

• 2025 royalty income from DAYBUE® was A$65 million, up 15% from 2024
• Net profit after tax came in at A$30 million
• Cash and short-term investments stood at A$296 million at year end
• Completed A$50 million share buy-back; new buy-back program starts March 2026
• DAYBUE net sales reached US$391 million, up 12% year on year
• Cumulative DAYBUE income since launch now A$510 million

What else do investors need to know?

Neuren’s partnership with Acadia Pharmaceuticals continues to deliver, with DAYBUE gaining approval for the new powder formulation (DAYBUE STIX) and a growing patient base in the US. Acadia’s guidance for 2026 points to net sales of US$460–490 million, with potential Neuren royalties of A$70–77 million.

Development is progressing on Neuren’s second drug, NNZ-2591, with the Koala Phase 3 trial in Phelan-McDermid syndrome now underway and FDA Fast Track designation secured. Neuren has also expanded its clinical pipeline and added the rare SYNGAP1-related disorder to its targets.

What did Neuren Pharmaceuticals management say?

Neuren CEO Jon Pilcher said:

In 2025 we achieved a critical milestone for Neuren’s value creation strategy with the commencement of our Koala Phase 3 clinical trial of NNZ-2591 in Phelan-McDermid syndrome. There is so much to look forward to this year as we continue to execute that program towards a New Drug Application and in parallel advance NNZ-2591 for Pitt Hopkins syndrome and HIE. All of this is self-funded by our growing revenue from DAYBUE, which has now reached A$510 million since launch in 2023. We are very excited to watch the impact of the recent launch of DAYBUE STIX in the US as a potentially attractive new option for Rett syndrome patients and their families.

What’s next for Neuren Pharmaceuticals?

Looking ahead, Neuren expects ongoing revenue growth from DAYBUE, especially with the broader US rollout of DAYBUE STIX and new regional market opportunities. The company remains well-funded to back its clinical programs, including the pivotal Phase 3 trial for NNZ-2591 and further indications.

A new share buy-back will launch in March 2026, with management highlighting confidence in Neuren’s outlook and financial strength. Investors can watch for updates on European regulatory decisions, Japanese trial results, and further pipeline progress throughout the year.

Neuren Pharmaceuticals share price snapshot

Over the past 12 months, Neuren shares have declined 5%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 11% over the same period.

View Original Announcement

The post Neuren Pharmaceuticals earnings: Profits up, pipeline builds in 2025 appeared first on The Motley Fool Australia.

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• Alcoa announces March 2026 dividend
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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 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. 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.

Some ASX dividend shares are providing investors with a big dividend yield. Part of the reason why the payouts are so large is because the businesses are undervalued, in my view. 

A good passive income stock is one that can provide resilient dividends and grow its underlying value over time.

There’s not much point buying high-yield ASX dividend shares if the share price and dividend decline over time.

So, I’m going to highlight two high-yield names that have a record of consistency and I think could deliver rising payouts over time.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop has a goal to become the leader of hair removal products in Australia, with its national store network selling a variety of male and female wet and dry shave products.

The company recently released its FY26 half-year result which included positive numbers.

In the six months to 31 December 2025, sales grew 2.2% to $128.6 million, operating profit (EBIT) grew 2.5% to $18.1 million and net profit after tax (NPAT) climbed 1.5% to $12.2 million.

Pleasingly, online sales increased by 7.4% and the gross profit margin grew 100 basis points (1.00%) to 46.5%). The main driver of the ASX dividend share’s gross profit improvement was the expansion of its private brand Transform-U.

Work on the store network in the HY26 period is supportive sales growth in the second half of FY26 and FY27. It opened two locations in the first half, with another one planned to open in March 2026. It also refitted one full store and relocated one in the half, with three full store refits and two relocations planned for the second half.

All of the above helped the business maintain its annual dividend per share at 4.8 cents per share in the HY26 result.

In terms of passive income appeal, the ASX dividend share increased its payout each year between FY17 and FY23, maintained it in FY24 and then grew it again in FY25 to 10.3 cents per share. That translates into a grossed-up dividend yield of 9.4%, including franking credits, assuming it just kept the dividend the same in FY26.

In the second half of FY26 to 22 February 2026, total sales grew 3.8%. I think this bodes well for another dividend increase in FY26, particularly if Transform-U continues growing.

Hearts and Minds Investments Ltd (ASX: HM1)

The other high-yield ASX dividend share I want to highlight is Hearts & Minds, a listed investment company (LIC).

Pleasingly, there are no management fees or performance fees involved with the portfolio. Instead, it donates 1.5% of its net assets each year to medical research to a variety of organisations. This could unlock life-changing, or life-saving, medical advancements.

The Hearts & Minds portfolio is constructed from two different sources. First, there’s a core group of fund managers that make picks for the portfolio. Second, it holds an annual investment conference where leading investment professionals choose a single stock that could perform.

This approach provides both diversification and can lead to solid returns. The three years to December 2025 showed an average portfolio return of 14.7% per year. That’s a high enough return to fund a large and growing dividend, while also seeing growth in the portfolio value.

Hearts & Minds recently declared a half-year dividend of 9.5 cents and intends to increase its payout by 0.5 cents per share every six months for the foreseeable future. The implied annual dividend per share of 19.5 cents for FY26 translates into a grossed-up dividend yield of 9.4%, including franking credits.

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

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Motley Fool contributor Tristan Harrison has positions in Hearts And Minds Investments. 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 Shaver Shop Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Mesoblast Ltd (ASX: MSB) share price is focus today after the company reported a surge in revenue to US$51.3 million, thanks to the successful commercial launch of Ryoncil® in the US.

What did Mesoblast report?

• Total revenue jumped to US$51.3 million (A$78.3 million), up from US$3.2 million in the previous period.
• Ryoncil® gross profit (excluding amortisation) was US$44.2 million versus nil a year ago.
• Net loss narrowed to US$40.2 million from US$47.9 million, an improvement of US$7.8 million.
• Net operating cash spend was US$30.3 million, with expectations for further reduction in the second half.
• cash and cash equivalents stood at US$130 million at period end.
• Mesoblast provided net revenue guidance for FY2026 of US$110 million to US$120 million.

What else do investors need to know?

Mesoblast’s growth is being driven by its flagship product Ryoncil®, which launched commercially in the US and is now covered by government and commercial payers representing around 280 million Americans. Forty-nine transplant centres have been onboarded, with the aim to reach sixty-four centres covering 94% of US transplants.

The company is also progressing its clinical pipeline. It finalised the Phase 3 protocol for expanding Ryoncil® into adult treatment for steroid-refractory acute graft versus host disease and is scaling up manufacturing for its next-generation therapy, rexlemestrocel-L.

What did Mesoblast management say?

Mesoblast Chief Executive Dr Silviu Itescu said:

Today we report strong operational and financial performance for the first half of FY2026, a period that marks an important inflection point in Mesoblast’s evolution from clinical development to sustainable commercial execution. Sales momentum for Ryoncil® continued to build, driving meaningful revenue and reinforcing the product’s value in addressing significant unmet medical need and the strength of our commercial strategy. Importantly, we have improved the Company’s financial position with positive cash flow generated from Ryoncil® sales, disciplined cost management, and a strategic refinancing, providing greater flexibility to support expansion and late-stage clinical programs. As we enter the second half of FY2026, we remain focused on accelerating commercial uptake, advancing regulatory and label expansion opportunities, and maintaining financial discipline to deliver sustainable long-term shareholder value.

What’s next for Mesoblast?

Looking ahead, Mesoblast expects continued revenue momentum as Ryoncil® gains traction in the US market. The company remains focussed on onboarding additional transplant centres, increasing patient access, and expanding the approved uses for Ryoncil® into broader inflammatory conditions.

Beyond Ryoncil®, work continues on rexlemestrocel-L for chronic low back pain and advanced heart failure, with pivotal US trials nearing completion and regulatory filings expected in the coming months. Management is aiming for sustainable growth through product lifecycle extensions and new approvals.

Mesoblast share price snapshot

Over the past 12 months, Mesoblast shares have declined 2%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 11% over the same period.

View Original Announcement

The post Mesoblast shares: Revenue surges on Ryoncil® US launch in H1 FY2026 appeared first on The Motley Fool Australia.

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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 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. 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 Harvey Norman Holdings Ltd (ASX: HVN) share price is in focus today after the company posted a double digit uplift in profit before tax and raised its interim dividend for the half-year ended 31 December 2025.

What did Harvey Norman report?

• Total system sales revenue up 6.9% to $5.16 billion
• Profit before tax increased 16.5% to $466.31 million
• Net profit after tax & non-controlling interests up 15.2% to $321.91 million
• EBIT up 14.4% to $527.53 million
• Fully-franked interim dividend increased 20.8% to 14.5 cents per share
• Basic earnings per share up 15.3% to 25.84 cents

What else do investors need to know?

Harvey Norman’s franchising operations posted a 14.2% increase in profit before tax, with better margins and robust sales. Overseas company-operated businesses delivered a notable profit lift, especially in Singapore, Malaysia, New Zealand, Ireland, Slovenia, and Croatia, partly offset by expansion costs in the UK.

The property segment’s profit before tax rose 7.8% to $178.82 million thanks to rental growth and low vacancies, and there was a fair value uplift in the New Zealand property portfolio. The balance sheet remains strong, with net assets at $4.95 billion and a low net debt to equity ratio of 13.02%.

Operating cash flows reached $392.88 million, supported by solid cash receipts from both retail sales and franchise fees, with a cash conversion ratio of 96.2%.

What did Harvey Norman management say?

Chairman Gerry Harvey said:

This is a very solid first-half result, with profit growth driven by higher system sales, disciplined cost control and strong performances across our franchising operations and overseas retail businesses.

What’s next for Harvey Norman?

Harvey Norman said sales momentum has continued into January 2026, with aggregated system sales up 4.6% and comparable sales up 4.3% over the prior period. The company remains focused on disciplined growth, cost control, and capital management, aiming to support further expansion in Australia and overseas.

The group’s strong asset base and low gearing leave it well-placed to continue investing in its retail and property operations despite ongoing competition and changing market conditions.

Harvey Norman share price snapshot

Over the past 12 months, Harvey Norman shares have risen 24%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 11% over the same period.

View Original Announcement

The post Harvey Norman posts 1H26 result appeared first on The Motley Fool Australia.

More reading

• Alcoa announces March 2026 dividend
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• Virgin Australia posts 1HFY26 earnings

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 no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Harvey Norman. 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.

If I had to choose just one ASX stock to buy and hold right now, it would be ResMed Inc (ASX: RMD).

That does not mean it will always be my top pick. Markets change, valuations move, and new opportunities emerge. But as things stand today, I think ResMed combines scale, structural growth, innovation, and financial strength in a way that is hard to ignore.

Here is why.

A massive, underpenetrated opportunity

ResMed operates in sleep and breathing health, primarily treating obstructive sleep apnoea. The opportunity here is enormous.

According to the company’s recent investor presentation, more than 1 billion people globally are estimated to suffer from sleep apnoea, yet penetration remains low, with less than 20% of patients diagnosed or treated in the US and under 10% in the rest of the world.

That gap represents a very long runway for growth. Ageing populations, higher obesity rates, and increasing awareness of sleep health are all powerful structural tailwinds. Even the rise of GLP-1 medications appears to be increasing diagnosis and therapy uptake rather than reducing it, based on the real-world data shared in the company’s presentation.

This is not a short-cycle story. It is a decades-long healthcare trend.

Financial strength and operating momentum

ResMed’s latest results showed why I have confidence in the business model.

In the December quarter, ResMed delivered revenue of US$1.4 billion, up 11% year on year, with gross margin expanding to 61.8%. Operating income increased 18% and diluted earnings per share rose to US$2.68.

That combination of double-digit revenue growth and expanding margins tells me that it is not just growing, it is scaling.

The balance sheet also remains strong. As highlighted in the presentation, the company had a net cash position of US$715 million as at Q1 FY26. That provides flexibility for further R&D, acquisitions, dividends, and buybacks.

A connected ecosystem, not just a device maker

One of the biggest reasons I would choose ResMed over many other healthcare names is that it is no longer just a hardware company.

The company describes itself as a global leader in connected and digital health. It has processed more than 24 billion nights of respiratory medical data and has tens of millions of patients connected to its cloud platforms.

That data advantage is powerful. It strengthens clinical relationships, improves patient adherence, and creates switching costs. It also enables AI-enabled features such as Smart Comfort, which recently received FDA clearance and is designed to personalise therapy settings.

When I look for a single stock to hold long term, I want network effects and ecosystem advantages. ResMed increasingly has both.

Innovation is constant

Another reason I would be comfortable holding this ASX stock for many years is its culture of innovation.

The investor presentation outlines new product rollouts such as AirSense 11 in additional global markets and new fabric-based mask launches. It also highlights the expanding digital pathway from diagnosis through to long-term therapy adherence.

This is not a company standing still. It continues to invest in R&D and new technologies to support long-term growth. Over a five-year horizon, management has outlined high single-digit revenue growth with earnings growth above revenue growth.

That operating leverage is exactly what I want in a compounding business.

Foolish Takeaway

If I could only own one ASX stock today, I would want structural, non-cyclical demand, global exposure, strong margins and cash flow, a defensible competitive position, ongoing innovation, and a healthy balance sheet.

ResMed ticks all of those boxes.

Of course, no stock is risk-free. Healthcare regulation, competition, reimbursement changes, and macroeconomic factors can all influence performance. But when I weigh up the long-term drivers, scale advantages, and financial quality of the business, ResMed stands out to me as a high-conviction, buy-and-hold candidate right now.

The post If I could only buy and hold a single ASX stock, this would be it appeared first on The Motley Fool Australia.

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

Shares in Qantas Airways Ltd (ASX: QAN) fell 9% on Thursday following the release of the airline’s half-year results.

That drop came despite Qantas delivering an underlying profit before tax of $1.46 billion and underlying earnings per share of 68 cents for the half. In other words, the result itself was solid.

So the question is not whether the numbers were weak. It is whether the pullback has created an opportunity.

Here is why I would be leaning towards yes.

Earnings funding a more profitable future

One of the most important themes in the release was fleet renewal.

CEO Vanessa Hudson made it clear that strong earnings are allowing Qantas to invest in “the largest fleet renewal in our history.” She also noted that the next-generation aircraft already in service are helping drive financial performance.

That matters.

Airlines are capital-intensive businesses. The difference between an average airline and a high-quality one often comes down to fleet age, fuel efficiency, maintenance costs, and network flexibility.

Qantas delivered nine new aircraft during the half and is accelerating deliveries, with 30 more expected over the next 18 months. Around 60% of Jetstar’s increase in profitability in the half was driven by its new aircraft, according to management.

In other words, earnings today are being reinvested into assets that should improve margins tomorrow.

Newer aircraft are more fuel efficient, cheaper to maintain, and open up new routes such as the ultra long-range A350s for Project Sunrise. Over time, that can structurally lift returns on capital.

A dominant position in a rational market

Airlines typically trade on low earnings multiples because they operate in brutally competitive markets.

But Australia is different.

Qantas operates in what is effectively a duopoly domestically, alongside Virgin Australia Holdings Ltd (ASX: VGN). That structure has historically supported rational capacity growth and healthier margins than seen in markets like the US or Europe.

Group Domestic delivered $1.05 billion in underlying EBIT in the half, up 14%. Loyalty also remains a high-quality earnings stream, with underlying EBIT of $286 million, up 12%.

When you combine the core airline business with a fast-growing, high-margin loyalty arm, you start to see why Qantas arguably deserves to trade at a premium to many global peers.

Valuation looks compelling

Qantas reported underlying earnings per share of 68 cents in the first half. If we annualise this to 136 cents, Qantas shares are trading at roughly 7.1 times earnings.

Yes, airlines often trade on low multiples. Cyclicality, fuel price volatility, and geopolitical risk justify some discount.

But I think Qantas is not a typical airline.

It has a dominant position in a relatively insulated domestic market, a dual-brand strategy through Qantas and Jetstar, a valuable and growing Loyalty division, a clear fleet renewal program that is already driving profit improvements, and strong liquidity of $12.6 billion at the end of the half.

That combination makes it closer, in my view, to a high-quality franchise than a marginal commodity business.

In some ways, I think of it like the Commonwealth Bank of Australia (ASX: CBA) of the airline industry. CBA trades at a premium to other banks because of its scale, brand, technology leadership, and dominant market position. Investors are willing to pay up for quality and consistency.

Qantas may never trade on a bank-like multiple. But if it continues to execute, invest in its fleet, grow Loyalty, and maintain pricing discipline in a rational market, I think 7.1 times earnings could prove dirt cheap.

So, should I buy Qantas shares after the 9% fall?

For me, a 9% pullback after a strong profit result is not a red flag. It is often the market digesting guidance, costs, or simply locking in gains after a strong run.

What matters more is whether the long-term story is intact.

Qantas is generating significant earnings. Those earnings are funding a younger, more efficient fleet. The loyalty business continues to expand. The domestic market structure remains rational. And the shares are trading on a low earnings multiple relative to that quality.

Airlines will always carry risk. Fuel costs, economic slowdowns, and operational disruptions can hurt profits quickly.

But at around 7 times annualised earnings, with structural improvements underway, I would be comfortable buying Qantas shares after this decline as part of a diversified portfolio.

The post Should I buy Qantas shares after their 9% decline? appeared first on The Motley Fool Australia.

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Motley Fool contributor Grace Alvino has positions in Commonwealth Bank Of Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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.

As February earnings season draws to a close, brokers are updating their outlooks on ASX shares following important announcements. 

Two S&P/ASX 300 Index (ASX: XKO) shares that received fresh guidance from Bell Potter yesterday were Capricorn Metals Ltd (ASX: CMM) and Elders Ltd (ASX: ELD). 

Both saw solid share price increases on Thursday for different reasons. 

Capricorn Metals released HY results, while Elders made headlines by announcing the sale of a key part of its business. 

Here’s what the companies released. 

Capricorn Metals delivers record profit

Capricorn Metals is a gold production company based in Perth, Western Australia. 

Investors reacted positively to half-year results from Capricorn Metals that included:

• Sales revenue up 64% to $350.1 million from the sale of 59,816 ounces of gold at an average price of $5,842 per ounce
• Underlying net profit after tax up 130% to $144.8 million
• Underlying EBITDA rose 101% to $215.3 million with a 62% margin
• Maiden fully-franked interim dividend of 5 cents per share ($22.8 million) declared.

Following yesterday’s 1.45% gain, its share price is now up 77.6% over the last 12 months.  

What did Bell Potter have to say?

Following the results, the team at Bell Potter said it was an excellent result that reflects operational performance, with the company tracking to the top end of guidance and maintaining its track record of delivery. 

It increased earnings per share by: FY26: +3%; FY27: +4%; and FY28: +25%. 

CMM is a sector leading gold producer, unhedged and debt free. It is fully funded to grow production from ~115kozpa to ~300kozpa, potentially from 2HCY27, from two gold mines in WA, each with +10 year mine lives.

CMM is run by a management team that has an excellent track record of delivery.

As a result, the broker increased its price target on these ASX shares to $16.10 (previously $14.30). 

From yesterday’s closing price of $14, this indicates a potential upside of 15%. 

The broker also retained its buy recommendation. 

Elders shares downgraded

Elders is an agribusiness that provides goods and services to Australian primary producers.

Yesterday, the company announced it has agreed to sell its Killara Feedlot business to Australian Meat Group for approximately $195.8 million. 

Following the announcement, Bell Potter released updated guidance on the company. 

NPAT changes are -14% in FY26e, -9% in FY27e and -8% in FY28e incorporating the above and higher base interest rates. Our target price is now $9.00/sh (prev. $9.45/sh) reflecting earnings changes mitigated in part by higher Killara proceeds.

From yesterday’s closing price of $7.40, the broker still sees 21% upside for these ASX shares. 

The broker maintained its buy recommendation. 

Our Buy rating is unchanged. We see encouraging signs for FY26e, with livestock turnoff values exhibiting double digit YoY growth through 1H26TD, mitigated in part by dryer conditions through most of the summer cropping window and an easing in input price tailwinds.

The post Bell Potter just updated its guidance on these ASX 300 shares appeared first on The Motley Fool Australia.

More reading

• Elders sells Killara Feedlot in $195.8m deal
• Capricorn Metals declares maiden dividend and record profit
• 3 excellent ASX dividend shares to buy this month
• Here are the top 10 ASX 200 shares today
• 3 top ASX dividend shares to buy with $5,000

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