Author: openjargon

There have been some big moves on the Australian share market on Thursday.

Two ASX shares that are in the headlines for different reasons are named below. Here’s what you need to know about them:

Megaport Ltd (ASX: MP1)

The Megaport share price is up 30% to $12.90 after the network solutions company announced another major contract win for its Latitude.sh business.

Latitude.sh secured three major GPU, CPU, network, and storage contracts across two customers.

The company believes this reinforces Megaport’s position as a critical infrastructure partner in the accelerating AI ecosystem.

According to the release, the contracts represent a combined total contract value (TCV) of approximately US$182.9 million (A$254 million), representing approximately US$65.2 million (A$90.6 million) in annualised recurring revenue (ARR).

Two of the contracts, representing approximately 90% of the TCV, have 36-month initial terms, while the third contract has a 24-month contract term.

Megaport’s CEO, Michael Reid, said:

We are at the forefront of an accelerating inflection point across the industry. As use cases shift from AI foundation models to inference and the edge, Megaport is becoming an essential platform for powering the applications of tomorrow with globally distributed, automated infrastructure.

Whether supporting AI, edge compute, or anyone requiring instant global reach and performance, Megaport is a one-stop platform for the AI ecosystem, providing on-demand, software-enabled performance of dedicated hardware with the flexibility of a global network.

Xero Ltd (ASX: XRO)

After initially charging higher, Xero shares have hit reverse and tumbled deep into the red. The cloud accounting platform provider’s shares are down 9% to $73.74 at the time of writing.

This has been driven by the release of the company’s FY 2026 results this morning.

Xero reported a 31% increase in operating revenue to $2.75 billion, an 18% lift in adjusted EBITDA to $757.4 million, and a 37% jump in annualised monthly recurring revenue (AMRR) to $3.27 billion.

This was driven by a 0.5 million increase in net customers to 4.92 million globally. Its growth was particularly strong in the key US market.

Commenting on the result, Xero’s CEO, Sukhinder Singh Cassidy, said:

Our strong full year results demonstrate Xero’s disciplined execution and macro-resilience. Our 3×3 strategy is hitting its stride, demonstrated by accelerating US growth with 110,000 new customers, including new Melio direct payments customers, and pro-forma revenue growth of 50%. We have powerful momentum across our markets, and delivered strong EBITDA growth while absorbing Melio.

This has moved us beyond single-job workflows in the US by integrating Melio to unite accounting and payments on one platform. Globally, we are providing a small business financial operating system for the AI era, driving value for customers while deepening our technology foundations, compliance capability and data advantages, and driving stronger unit economics.

So, why the selling? Well, although Xero’s result beat consensus estimates across most metrics, Citi notes that its profit was a miss due to higher R&D capitalisation.

The post Why Megaport and Xero shares are making the headlines today with big moves appeared first on The Motley Fool Australia.

More reading

• Why Xero shares are falling despite a big jump in revenue
• Megaport secures $254 million in contracts, boosts ARR and outlook
• Xero FY26 result: Revenue surges 31% but profit dips due to Melio acquisition costs
• 5 things to watch on the ASX 200 on Thursday
• Top brokers name 3 ASX shares to buy now

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

Shares in ASX copper company Carnaby Resources Ltd (ASX: CNB) hit a fresh 12-month high after the company announced it had made a significant discovery during recent drilling.

Mining project likely to expand

The company said in a statement to the ASX that it had struck a copper grade of 7.1% copper equivalent over a 19m intersection during drilling at the Trek 1 Footwall Lode.

The company said the new drilling confirmed the discovery of a significant new deposit, adding to drilling results first reported late last year, with the new lode also open down plunge and along strike to the north.

Carnaby Managing Director Rob Watkins said of the discovery:

These fantastic results from the new Trek 1 Footwall Lode discovery have completely opened up the Trek 1 deposit beneath the Ore Reserve pit design. We are looking at a completely new mineralised structure that links off the Main Lode in a more favourable northerly strike and may indeed be the primary driver of the Trek 1 deposit. The Footwall Lode has only been intersected in a handful of holes to date. In addition to the 400m extension discovery of the Main Lode, the Trek 1 Footwall Lode discovery is outside of the existing Mineral Resource.

Mr Watkins said the company would incorporate the new results from the main and footwall lodes into an updated mineral resource estimate and also perform open-pit optimisations and underground scoping studies in the second half of the year.

He said Carnaby remains on track to complete the feasibility study for the project by mid-year, prior to a final investment decision, and was targeting first ore production in the second half of the year from the Greater Duchess project.

The company said there was scope for the size of the open pit at Trek 1 to increase in size, given the new drilling results.

The new drilling was part of an overall 3000m drilling campaign.

Positive study already released

Carnaby released a pre-feasibility study for the project in March, envisaging a mine which would operate for 12 years with a payback period of just 13 months.

The mine was expected to produce a total of 165,000 tonnes of copper equivalent.

Carnaby shares traded as high as 65 cents on the news on Thursday morning before settling back to be 10.9% higher at 61 cents.

The 65-cent mark is a new 12-month high, with the company’s shares having traded as low as 27 cents over the past year.

Carnaby Resources is valued at $151.9 million.

The post Why has this ASX copper stock surged to a new 12-month high? appeared first on The Motley Fool Australia.

More reading

• Up 152% in a year, guess which ASX All Ords silver share is leaping again on ‘bonanza-grade’ results
• Why Megaport and Xero shares are making the headlines today with big moves
• Which Australian ETFs would be top buys this month?
• Is the TechnologyOne share price an opportunity too good to pass up?
• Why on earth is the Bapcor share price crashing 21% on Thursday?

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.

Australian shares have had a mixed run recently, with some parts of the market holding up well and others coming under pressure.

For investors who want local exposure without trying to pick every individual winner, exchange-traded funds (ETFs) can make a lot of sense.

They offer diversification, simplicity, and access to different slices of the market. Some focus on broad index exposure. Others tilt towards quality or income.

Three Australian ETFs I think look like top buys this month are featured in this article.

Vanguard Australian Shares Index ETF (ASX: VAS)

The first ETF I would consider is the Vanguard Australian Shares Index ETF.

It is one of the simplest ways to invest in the Australian share market. It gives investors exposure to a broad basket of ASX shares across banks, miners, healthcare, retail, industrials, infrastructure, and more.

That broad exposure is the main attraction.

Instead of trying to decide whether Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), CSL Ltd (ASX: CSL), Wesfarmers Ltd (ASX: WES), or Macquarie Group Ltd (ASX: MQG) will be the best performer over the next year, investors can own a slice of many of them through one fund.

I think that is especially useful when the market outlook is uncertain.

Australia is dealing with higher inflation, rising interest rates, pressure on household budgets, and a more volatile global backdrop. In that kind of environment, I like the idea of spreading risk across many companies rather than relying too heavily on one view.

For investors wanting a core Australian holding, I think VAS remains hard to beat.

Betashares Australian Quality ETF (ASX: AQLT)

The second ETF I would consider is the Betashares Australian Quality ETF.

This is a more targeted option than the VAS ETF.

It focuses on Australian companies with quality characteristics. That can include strong profitability, balance sheet strength, and more resilient earnings.

I like this approach because the ASX can be quite cyclical.

Banks are exposed to credit conditions and housing. Miners are exposed to commodity prices. Retailers are exposed to consumer spending. Property shares are exposed to interest rates.

A quality filter can help investors tilt their portfolio toward businesses that may be better placed to handle different market conditions.

That does not mean the AQLT ETF will outperform every year. Quality shares can still fall, especially if valuations are high or market sentiment turns against them.

But over the long term, I think focusing on better businesses is a sensible way to invest.

It could be a useful complement for nvestors who already own a broad Australian ETF. It adds a more selective layer to local share market exposure.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The third ETF I would look at is the Vanguard Australian Shares High Yield ETF.

It is designed for investors who want more income from Australian shares.

It focuses on companies with higher expected dividend yields, which can make it attractive for retirees, income investors, or anyone wanting their portfolio to generate cash flow.

I think this could be useful in the current environment.

With inflation still a concern, investors may want assets that can produce a meaningful income stream. Australian shares have long been popular for dividends, particularly because many companies pay franked dividends.

The VHY ETF can provide exposure to dividend-paying sectors such as banks, miners, insurers, and other mature businesses.

Of course, investors need to remember that high-yield investing comes with risks. Dividends can be cut, and high yields can sometimes reflect market concern about a company’s outlook.

That is why I would use this Vanguard ETF as part of a diversified portfolio rather than relying on it alone.

Foolish takeaway

For investors looking at Australian ETFs this month, I think these three all have something useful to offer.

The VAS ETF provides broad market exposure, the AQLT ETF adds a quality tilt, and the VHY ETF focuses on income.

Used together, they could give investors a simple way to access Australian shares across growth, quality, and dividends.

There will still be volatility, especially with inflation, interest rates, and global uncertainty affecting markets. But for long-term investors, I think these three ETFs could be strong options to consider.

The post Which Australian ETFs would be top buys this month? appeared first on The Motley Fool Australia.

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• Are these ASX ETF giants still worth buying today?
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• After surging nearly 200%, is this the best ASX ETF in 2026?
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Motley Fool contributor Grace Alvino has positions in CSL, Commonwealth Bank Of Australia, Vanguard Australian Shares Index ETF, and Wesfarmers. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Macquarie Group, and Wesfarmers. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool Australia has recommended BHP Group, CSL, Vanguard Australian Shares High Yield ETF, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The TechnologyOne Ltd (ASX: TNE) share price has risen in recent weeks, but the business is still down 33% from its former all-time high in June 2025, as the chart below shows.

When a great business like TechnologyOne is down – and it’s down 18% in the last six months – I think it’s a great time to look at the stock as a potential opportunity.

The company describes itself as Australia’s largest enterprise software company, with a global presence. It has more than 1,300 subscriber customers which includes leading businesses, government agencies, local councils, and universities.

There are a few reasons why I think this business could be a top buy. Let’s get into it.

Great revenue growth

I think one of the most fundamental drivers of the TechnologyOne share price over time is whether its revenue is growing at a satisfactory pace.

Net profit growth is essential to send the underlying value of a business higher, with revenue being an important factor for that.

The world is becoming increasingly digital and this is a strong tailwind for TechnologyOne. The company is growing revenue in multiple ways.

Winning new subscribers is an important element – it has done very well in Australia and now it has its sights on markets like the UK, which has a similar sort of list of organisations such as councils, businesses, schools, universities and government. It recently won two important London councils, which I think bodes well for the future.

Another element of growth is how the company unlocks more revenue from its subscribers by investing in improving its software offering for customers. This is one of the main reasons why TechnologyOne is able to consistently deliver double-digit annual recurring revenue (ARR) growth each year.

In FY26, it expects to grow its FY26 ARR by between 16% to 18%, with the company targeting the top end of the guidance range.

Rising profit margins

As a software business, the company is able to tap into pleasing scale benefits where revenue can grow faster than expenses.

As I mentioned earlier, net profit is the ultimate driver of shareholder returns, so improving profit margins helps the business grow at a faster pace.

TechnologyOne expects to grow its profit before tax (PBT) in FY26 by between 18% to 20%. This impressive projection is, according to management, down to its software as a service (SaaS) offering and its products being turbocharged through AI.

The ASX share says that it’s delivering improving margins from significant economies of scale, with the profit before tax margin expected to increase to at least 35% in the long-term.

I think this bodes very well for the future as it builds towards its ARR target of $1 billion by FY30.

Compelling TechnologyOne share price valuation

According to the projection on Commsec, the business is forecast to deliver earnings per share (EPS) of around 50 cents in FY26 and 59 cents in FY27.

That means it’s currently trading at 57x FY26’s estimated earnings and 48x FY27’s estimated earnings.

While this isn’t as cheap as it was a few weeks ago, I think the business has an incredible future ahead and I think it’s undervalued by the market because of AI concerns. I think the company’s economic moat, reputation and customer service will allow it to stay ahead of any rivals and continue to grow profit.

The post Is the TechnologyOne share price an opportunity too good to pass up? appeared first on The Motley Fool Australia.

More reading

• Why these ASX 200 tech shares could beat the market over the next decade
• Buy, hold, sell: TechnologyOne, Telstra, and Woodside shares
• Top brokers name 3 ASX shares to buy next week
• 3 super ASX tech stocks I’d buy in May with $3,000
• $10,000 invested in these ASX 200 shares 10 years ago is worth…

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

The Bapcor Ltd (ASX: BAP) share price is getting hammered today.

Shares in the embattled S&P/ASX 300 Index (ASX: XKO) auto parts company closed yesterday trading for 51.5 cents. In earlier trade, shares just plunged to 40.5 cents each, down 21.4%. At time of writing, shares have recovered a touch, changing hands for 42.0 cents each, down 18.5%.

For some context, the ASX 300 is down 0.1% at this same time.

Unfortunately for longer-term shareholders, today’s sharp sell-off isn’t unique for the stock. Indeed, the Bapcor share price is now down a steep 92.2% since this time last year.

Here’s what’s got investors reaching for their sell button today.

Why is the Bapcor share price in free fall?

The ASX 300 auto parts company is taking a hit after releasing a trading update.

The company reported achieving positive sales momentum between February and April from the turnaround activities intended to restore growth.

However, the Bapcor share price is under heavy pressure, with management noting that the company’s trading performance for the second half of FY 2026 has been negatively impacted by the Middle East conflict.

Bapcor noted that trading conditions have “materially deteriorated” since late March. The headwinds have been fuelled by the Iran war as well as increasing interest rates.

Higher Aussie interest rates have led to a strong Australian dollar relative to the New Zealand dollar, which the company noted is negatively impacting the earnings of its New Zealand business segment.

As such, the ASX 300 stock downgraded its full year FY 2026 earnings guidance from what it provided on 26 February, two days prior to the outbreak of the Iran war.

Bapcor now expects to deliver FY 2026 underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of $144 million to $150 million (post AASB16). That’s down from prior guidance of $150 million to $160 million.

Pre AASB16 (which accounts for leases), Bapcor now expects full year underlying EBITDA of $62 million to $68 million, down from previous guidance of $74 million to $79 million.

What did management say?

Commenting on the trading update that’s crushing the Bapcor share price today, CEO and managing director Chris Wilesmith said:

We are pleased with the positive momentum of the turnaround, which has been delivered through decisive actions we’ve taken to improve pricing, stock availability and team engagement.

This is despite the challenging external environment which was not contemplated when we began this turnaround, and which has slowed the rate of improvement contemplated in our previous guidance. We will continue driving initiatives during the important trading months of May and June.

The post Why on earth is the Bapcor share price crashing 21% on Thursday? appeared first on The Motley Fool Australia.

More reading

• Up 152% in a year, guess which ASX All Ords silver share is leaping again on ‘bonanza-grade’ results
• Why Megaport and Xero shares are making the headlines today with big moves
• Why has this ASX copper stock surged to a new 12-month high?
• Which Australian ETFs would be top buys this month?
• Is the TechnologyOne share price an opportunity too good to pass up?

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 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 Worley Ltd (ASX: WOR) share price is in the spotlight as the company hosted its 2026 Investor Day, revealing a refreshed medium-term strategy through to FY30. Key highlights include $95 million in annualised cost savings already actioned and the announcement of a new share buyback program of up to $300 million.

What did Worley report?

• Annualised cost savings: $95 million actioned, with an additional $25 million underway, exceeding the company’s $100 million target
• Revenue growth: Aggregated revenue has grown by 15% CAGR from FY22 to FY25
• EBITA margin: Guidance for FY26 EBITA margin (excluding procurement) of 9.0–9.5%
• Share buyback: Launching a new on-market buyback of up to $300 million following a completed $500 million program
• Digital investment: $70 million planned investment in digital and AI over the next two years
• Backlog: Backlog has increased to $16.9 billion as at March 2026

What else do investors need to know?

Worley’s Investor Day presentation outlined a renewed focus on full project delivery and expansion into future-facing markets such as data centres, nuclear, and energy transition materials. The company highlighted notable new partnerships, including with Baker Hughes on LNG projects and Orbia on a lithium facility in Louisiana, as well as contracts supporting power and data centre growth in the US and feasibility work on rare earths in Brazil.

While the ongoing conflict in the Middle East has delayed some project awards and impacted current year financial expectations (with FY26 underlying EBITA growth now unlikely), Worley remains positive about its long-term prospects. The company emphasised the resilience of its business model, global diversification, and a disciplined approach to risk and capital allocation.

What’s next for Worley?

Worley’s medium-term strategy is focused on scaling its full project delivery capacity, targeting double-digit growth in underlying EBITA through to FY30. Management plans to reinvest cost savings into digital and AI capabilities, while pursuing growth in integrated gas, energy transition materials, and critical infrastructure. The business is also expanding its leadership team to support these ambitions.

Despite near-term headwinds from global uncertainty, especially in the Middle East, Worley expects structural megatrends such as energy transition, infrastructure modernisation, and digital acceleration to drive demand in its core and adjacent markets. The company believes its capital-light model and global scale uniquely position it for long-term value creation.

Worley share price snapshot

Over the past 12 months, Worley shares have declined 8%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen 4% over the same period.

View Original Announcement

The post Worley unveils new growth strategy and $300m buyback at Investor Day appeared first on The Motley Fool Australia.

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• GrainCorp shares: 1H26 profit drops but guidance stands
• Air New Zealand flags sharp FY26 loss as rising fuel costs bite
• Megaport secures $254 million in contracts, boosts ARR and outlook
• Xero FY26 result: Revenue surges 31% but profit dips due to Melio acquisition costs
• 9 ASX 200 shares with renewed buy calls from the experts this week

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.

After a bruising year on the ASX, Xero Ltd (ASX: XRO) has failed to win over investors with its latest result.

The accounting software company released its FY26 result today, with revenue moving strongly higher but profit going backwards.

At the time of writing, the Xero share price is down 3.93% to $77.82.

That adds to a painful run for shareholders. Xero shares are now down 32% in 2026 and 55% over the past year.

Here’s what was in the result.

Revenue jumps, but profit goes backwards

According to the release, Xero reported operating revenue of NZ$2.8 billion for the year ended 31 March 2026, up 31% on FY25.

That included 28% growth in constant currency. Excluding the Melio acquisition, organic revenue growth was 21%.

The company also grew its customer base to 4.92 million. That was up 11% from last year, with 506,000 net customer additions.

Average revenue per customer increased 23% to NZ$55.44, helped by price changes, product mix, payments revenue, and currency movements.

Adjusted EBITDA rose 18% to NZ$757.4 million, while free cash flow increased 9% to NZ$554 million.

Unfortunately, the strong revenue and cash flow numbers did not stop reported profit from going backwards.

Net profit after tax (NPAT) fell 27% to NZ$227.8 million as Xero said its Melio-related acquisition costs weighed on reported earnings.

Melio drives the US expansion

Xero’s US push remains one of the biggest pieces of the update.

The company said the US was its fastest-growing market, with revenue up 240%, or 30% on a pro-forma basis.

A large part of that growth is tied to Melio, the US payments platform Xero acquired last year.

Xero said global payments revenue grew 53% in FY26.

The company is also putting more weight behind artificial intelligence (AI).

Management said more than 500,000 customers are now using its generative AI features. It also said 2.6 million customers used some form of AI feature over the past year.

While that sounds promising, investors will now want to see how it flows into revenue and margins.

Outlook points to more growth

Xero guided to FY27 operating revenue of between NZ$3.62 billion and NZ$3.73 billion.

It also expects adjusted EBITDA of between NZ$860 million and NZ$920 million.

That points to more growth, although management said the result will include extra US brand spending of up to NZ$55 million.

The board has also approved a share buyback of up to $550 million which should help with share dilution.

Foolish takeaway

There’s enough in this result to see why some investors may still like Xero.

The business is still growing, customer numbers are higher, and free cash flow remains healthy.

The problem is that the market has become much tougher on expensive software stocks on the ASX.

After a 53% fall over the past year, expectations are now much lower than they once were.

The post Why Xero shares are falling despite a big jump in revenue appeared first on The Motley Fool Australia.

More reading

• Why Megaport and Xero shares are making the headlines today with big moves
• Xero FY26 result: Revenue surges 31% but profit dips due to Melio acquisition costs
• 5 things to watch on the ASX 200 on Thursday
• Top brokers name 3 ASX shares to buy now
• Down 50%, these 2 ASX growth shares look too cheap to ignore

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

After two years of underperformance, the global biotech giant is showing signs of a meaningful recovery.

Cast your mind back to the height of the pandemic and CSL Ltd (ASX: CSL) looked untouchable.

The global plasma and vaccine giant had delivered extraordinary returns for decades and commanded a premium valuation that reflected its status as one of Australia’s highest quality businesses.

What followed has been tough for CSL investors.

Plasma collection disruptions, a costly acquisition, and rising costs weighed on earnings and sentiment alike.

But for patient investors, the story today looks considerably more interesting.

What went wrong and why it is now reversing

The core issue for CSL through 2023 and 2024 was the hangover from the pandemic.

Plasma collection centres struggled to rebuild donor volumes after COVID-19 disruptions, and the cost of collecting each litre of plasma rose sharply.

At the same time, the $16.4 billion acquisition of Vifor Pharma added significant debt and integration complexity.

Today, both of those headwinds are easing.

Plasma collection volumes have recovered materially, and CSL’s RIKA automated plasma collection technology is now reducing the cost per litre collected, restoring the unit economics that underpin CSL Behring’s profitability.

Vifor’s iron deficiency and nephrology products are integrating well and contributing meaningfully to group earnings. 

Some indicators are improving

For the first half of FY2026, CSL reported net profit after tax of US$1.93 billion, up 16% on the prior corresponding period, with the CSL Behring division posting revenue growth of 13%.

SEQIRUS, the company’s influenza vaccine business, continues to perform strongly as demand for high-dose influenza vaccines grows among older populations.

Free cash flow is recovering, and CSL recently increased its interim dividend, signalling management confidence in the earnings trajectory.

The long-term case remains strong

CSL operates in markets with high barriers to entry.

Plasma-derived therapies require decades of manufacturing expertise, a vast donor network, and regulatory approvals.

The global demand for immunoglobulins, albumin, and clotting factors continues to grow as populations age and access to specialist care expands in emerging markets.

Analysts’ average price target on CSL shares is well above current trading levels.

With a lower earnings multiple than it has historically attracted, the entry point today for CSL shares looks more attractive than it has in recent years.

Foolish Takeaway

Despite having a rough time of late, CSL shares are well poised to deliver in the future.

CSL exhibits many quality indicators, such as consistent earnings growth, a widening competitive moat, and a management team with a long track record of disciplined capital allocation.

For Fools with a multi-year time horizon, CSL looks like one of the most attractive large-cap opportunities on the ASX today.

The post Why CSL shares could be one of the best buys on the ASX right now appeared first on The Motley Fool Australia.

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• Is the worst over for CSL shares after this week’s sell-off?
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• Down 59%: Will CSL shares ever regain momentum?

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 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.

Bhagwan Marine Ltd (ASX: BWN) recently released a trading update which indicated earnings would be below last year’s result and also below consensus analyst estimates.

Shares still looking cheap

That said, the analyst team at Shaw and Partners think the stock is a buy at current levels, with a bullish share price target on the company. We’ll get to that later.

First let’s have a look at what the company announced. Earlier this week Bhagwan Marine said it was facing a tougher trading situation.

The company said:

The conflict in the Middle East, together with organisational restructuring within the energy sector, has resulted in selected delays to the award and commencement of spot and short-term projects. These delays are considered timing-related rather than structural in nature, with underlying long-term demand remaining strong.

The company said it now expected EBITDA to be in the range of $38.5-$40.5 million, excluding contributions from the recently-acquired Riverside Marine and acquisition costs.

Including the Riverside business, the result is expected to be in the range of $44.5-$46.5 million.

This compares with full year earnings last year of $50.9 million and consensus expectations for this year of $56.3 million.

Bhagwan said it was doing what it could to limit the impact of negative effects from the Middle East war.

It said:

Pricing structures include mechanisms to mitigate variable operating costs, including fuel pass through provisions and pricing adjustments at contract renewal or extension. The Company maintains strong visibility over its fuel supply arrangements and has not experienced any fuel-related disruptions. Higher operating costs arising from the conflict and broader inflationary pressures are being closely managed and are expected to be substantially recovered over time.

Despite the cost issues, the company said, “supported by strong tendering activity and a healthy project pipeline, the outlook remains positive despite the short-term geopolitical and economic environment”.

Valuation undemanding

Shaw and Partners said in a note to its clients that the company had retained its buy rating as it was trading at a discount to its peers.

The Shaw team added:

We view the earnings soft-patch as timing-related rather than structural, reflecting delays to spot and short-term project awards amid geopolitical disruption, not a deterioration in demand or pricing.

They said they believed that Bhagwan had not lost any customers over the period, and, “core activity in ports, decommissioning and industrial sands is tracking at or ahead of expectations, reinforcing that underlying earnings power and utilisation remain intact”.

Shaw and Partners has lowered its price target for Bhagwan Marine from 90 cents to 60 cents, however this is still well above the current price of 32 cents.  

Bhagwan Marine is valued at $127.1 million.

The post This ASX resources service provider could almost double in value, Shaw and Partners says appeared first on The Motley Fool Australia.

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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.

Selloffs can make investors uncomfortable.

They can also create better buying opportunities when the long-term story remains intact.

That is how I am looking at two ASX shares that have come under pressure this week. One is a market-leading bank. The other is a much higher-risk growth stock exposed to a powerful defence theme.

The road could be bumpy for both, but I would still be willing to buy with a long-term view.

Commonwealth Bank of Australia (ASX: CBA)

CBA shares were sold down after the bank’s third-quarter update, and I can understand why the market reacted that way.

The result was solid rather than spectacular, and the stock had been trading on a very demanding valuation. When expectations are high, even a reasonable update can disappoint.

But I think the bigger picture is more important.

CBA remains Australia’s highest-quality major bank in my view. It has a powerful deposit franchise, deep customer relationships, strong digital capability, and a brand that gives it an advantage few competitors can match.

Those qualities are valuable through the cycle.

The Australian economy may be entering a more difficult patch, with higher fuel prices, inflation pressure, and interest rates weighing on households and businesses. That could mean more volatility for bank shares in the short term.

But CBA is exactly the type of bank I would want to own through that environment. It has the scale, balance sheet, and customer base to keep generating strong profits even when conditions become less favourable.

The share price may still not be cheap, even after the fall. That is why I would be patient rather than rushing in.

But if the market keeps marking CBA down, I think long-term investors could be getting a rare chance to buy a first-class ASX blue chip at a better price.

DroneShield Ltd (ASX: DRO)

DroneShield is a very different proposition.

Its shares came under pressure after the company advised that it had received an ASIC notice requiring it to provide reasonable assistance with an investigation.

The investigation relates to announcements and information provided to the ASX in November 2025, as well as trading in DroneShield shares the same month. The company said it will cooperate fully and that it is unclear what action, if any, may result.

This clearly adds risk.

Governance issues and regulatory investigations can weigh heavily on confidence, especially for a growth stock where sentiment is already important.

Even so, I think investors should separate the near-term uncertainty from the long-term market opportunity.

DroneShield develops artificial intelligence-based platforms that protect against advanced threats such as drones and autonomous systems. Its customers include military, government, law enforcement, critical infrastructure, and airports.

That market still looks very attractive to me.

Drones are becoming cheaper, more capable, and more common in modern conflict and security planning. Defence forces and civilian organisations are increasingly having to think about how to detect, track, and respond to drone threats.

That gives DroneShield a strong thematic tailwind if it can keep converting demand into contracts, scaling production, and maintaining technology leadership.

I would treat this as a higher-risk holding. The ASIC investigation needs to be watched closely, and the share price could remain volatile. But for investors comfortable with that risk, I think the long-term counter-drone opportunity remains compelling.

Foolish takeaway

CBA and DroneShield have very different risk profiles.

CBA is a high-quality blue-chip bank facing valuation pressure and a more uncertain economy. DroneShield is a fast-growing defence technology business facing regulatory uncertainty and share price volatility.

Neither selloff should be ignored. But I do not think either destroys the long-term investment case.

For patient investors, I would be happy to consider buying both shares after this week’s falls, while accepting that the next few months may not be smooth.

The post Why I would buy CBA and DroneShield shares after selloffs this week appeared first on The Motley Fool Australia.

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