Author: openjargon

The Santos Ltd (ASX: STO) share price has fallen by more than 20% from August 2025, as the chart below shows. A key question is whether the ASX energy share is good value at this level.

A decline in valuation could be an attractive buying opportunity because of the cyclical nature of energy prices. It can be useful to buy cyclical businesses after they’ve gone through a period of weakness.

At the moment, there are multiple analysts that rate the business as a buy. At the time of writing, there are currently nine buy ratings on the business, according to a Commsec collation of analyst opinions on the company.

Let’s take a look at what brokers are seeing with the ASX energy share.

Expert views on the ASX energy share

UBS is one of the brokers that rates the Santos share price as a buy, with a price target of $8.10. That implies the broker expects a possible rise of almost 30% within the next year. I think that’s likely to be a market-beating return, if it eventuates.

The broker noted that the company’s quarterly production for the three months to September 2025 saw production and sales revenue was slightly weaker than analyst estimates because of the impact of flooding in the Cooper basis, a slower ramp-up of production at Fairview from the drilling program under way (within GLNG) and a marginally slower ramp-up from the new Barossa gas project.

This led to Santos trimming its 2025 production and sales volume guidance, leading to a modest reduction of projected earnings per share (EPS) over the next two to three years.

Successful commissioning of Barossa provides a “material de-risking” of the Santos investment thesis and should support the Santos share price.

UBS commented that the oil outlook faces a number of supply and demand uncertainties, but the broker believes Santos’ fundamentals are solid. The broker thinks the ASX energy share is on the cusp of “material deleveraging” and a “step change” in free cash flow, making Santos shares its preferred pick in the Australia energy sector.

The broker also suggests that the business could decide to lift its distribution payout ratio from more than 40% of free cash flow excluding major growth to more than 60% of all-in free cash flow.

UBS said with its final thoughts:

We also believe the ADNOC process has revealed that other strategic competitors see considerable value in STO’s undeveloped asset portfolio, presenting STO numerous options for asset recycling, growth funding & improving shareholder returns. Following the resignation of the CFO and recognising that the CEO’s long-term performance rights vest from 2026, we think executive succession planning must become a key focus of the board.

Santos share price valuation

UBS projects the business could generate US$1.5 billion of net profit in FY26 and US$1.7 billion in FY28.

That means the Santos share price is valued at 9x FY26’s estimated earnings and 8x FY28’s estimated earnings. That certainly is a cheap price/earnings (P/E) ratio.

The post Why these brokers are bullish on the Santos share price appeared first on The Motley Fool Australia.

More reading

• Dividend investors: Premier ASX energy shares to buy in December
• Looking for strong dividend yields? Look no further than these energy stocks
• 5 things to watch on the ASX 200 on Friday
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor Tristan Harrison 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 originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

AMD is starting to see real momentum in its product offering, and may start competing with Nvidia on a more level playing field in the near future. A shift in the landscape could make AMD a better investment than Nvidia for 2026.

So, which am I picking for 2026? Let’s find out.

AMD’s key weakness is starting to improve

From a product offering standpoint, Nvidia has owned the data center space since the artificial intelligence (AI) buildout began in 2023. Nvidia’s technology stack, plus its leading software, made it the no-brainer choice to train AI models on, but AMD has improved its offering.

Thanks to a handful of acquisitions and partnerships, AMD’s ROCm software has improved to become a more competitive offering with CUDA (Nvidia’s software). During its recent financial analyst day, AMD noted that ROCm downloads have increased 10x year over year, showcasing that this software may be gaining traction in the AI community.

If AMD can offer a similar level of performance to Nvidia, Nvidia may be in trouble. It’s no secret that Nvidia’s hardware is far more expensive than AMD’s, and this shows up in the two companies’ margins.

AMD Gross Profit Margin data by YCharts

Nvidia’s gross margin and net income margin are far greater than AMD’s, which shows that a huge chunk of the cost of Nvidia GPUs goes to paying its profits. With a greater scrutiny on how much money AI hyperscalers are spending on their data center capital expenditures, turning to cheaper alternatives like AMD in exchange for some performance decrease may be a smart move.

As of right now, I doubt this will happen. Companies are fairly locked into the Nvidia ecosystem, and Nvidia CEO Jensen Huang noted the company was “sold out” of cloud GPUs right now. This wouldn’t be the case if Nvidia were losing market share to cheaper alternatives, but this could open the door for AMD.

If potential customers are trying to obtain more computing power in a short time frame and Nvidia doesn’t have the capacity, those companies may go to AMD to fulfill their needs. If those clients find that AMD’s hardware is comparable, they could start moving more business from Nvidia to AMD.

We’ll see if that thesis plays out, but the reality is there is plenty of room for both these companies to thrive.

The AI computing market is massive

Nvidia believes that global data center capital expenditures will rise to $3 trillion to $4 trillion by 2030, up from $600 billion in 2025. AMD is also bullish on this space and believes there will be a $1 trillion compute market by 2030. These two projections are fairly similar, as Nvidia’s projections include all data center costs, while AMD’s focuses on just compute.

If both companies are right on the market opportunity, there is a massive growth runway, which is why AMD told investors to expect a 60% compounded annual growth rate (CAGR) in its data center division. Nvidia likely expects a similar growth rate, making both stocks genius investments for 2026 if the 2030 projections from each company pan out.

Currently, Nvidia is the far cheaper stock, trading at 25 times next year’s earnings versus 34 for AMD.

AMD PE Ratio (Forward 1y) data by YCharts

That’s a significant premium that investors must pay to own AMD, which hasn’t been as successful in its AI endeavors.

As a result, I think Nvidia is the better stock pick over AMD, as there are fewer expectations priced in. However, if AMD starts to deliver on its growth projections, don’t be surprised if AMD outperforms Nvidia in 2026. Both companies are valid investments, and I won’t be surprised when either beats the market in 2026.

 The Motley Fool has positions in and recommends Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post Better Artificial Intelligence (AI) stock for 2026: Nvidia or AMD? appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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• Nvidia stock price slumped 12.6% in November. What’s next for the artificial intelligence (AI) behemoth?

Keithen Drury has positions in Nvidia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Advanced Micro Devices and Nvidia. The Motley Fool Australia has recommended Advanced Micro Devices and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

These 2 ASX 200 retail shares are quiet achievers. Both companies generate strong, repeatable cash flows, which fuel fully franked dividends.

Investors hunting for both growth and income might want to have a closer look at these 2 ASX 200 retail shares, which currently happen to be trading well below their recent peaks.

JB Hi-Fi Ltd (ASX: JBH)

JB Hi-Fi has a knack for proving sceptics wrong. Just when analysts wonder how much more a bricks-and-mortar electronics chain can squeeze out of Australian shoppers, JB Hi-Fi finds another margin to defend, another cost to trim and another store to outperform.

That consistency is exactly why the stock keeps popping up on “growth and income” shortlists. This might be a good time to jump in, as the ASX share has tumbled 17.5% in the past 6 months to $91.81.

Then there’s the income. JB Hi-Fi remains one of the ASX’s most reliable dividend generators. Investors get a fully franked yield that often looks better than term deposits, with the bonus of capital growth potential.

The company decided to increase its dividend payout ratio from 65% to a range of between 70% to 80% of net profit from FY26, suggesting larger dividends are likely in the coming years.

The ASX 200 retailer also decided to increase its annual dividend per share to $2.75, representing a 5.4% increase year-over-year. At the current JB Hi-Fi share price, that represents a grossed-up dividend yield of 3.2%, including franking credits. It also declared a special dividend of $1 per share in FY25.

RBC Capital Markets is positive on the company’s outlook, saying the company has an “industry-best cost base efficiency”.

RBC just set a price target of $101 for the next 12 months on JB Hi-Fi shares, which points to an 11% upside.

Premier Investments Ltd (ASX: PMV)

Premier Investments isn’t the kind of retailer that shouts for attention. Its portfolio includes Smiggle, Peter Alexander and a string of high-performing apparel brands.

The ASX 200 share has managed to carve out a rare position. It offers dependable income and could offer genuine growth potential at its current level. At the time of writing, it’s at a 52-week low of $14.17, a loss of 56% for the year.

Premier’s magic ingredient is control. Premier Investments runs tight operations, squeezes every dollar out of its store network and has a habit of turning niche brands into category killers. Peter Alexander remains Premier’s crown jewel, clocking strong sales and enviable margins thanks to its cult-like following and premium pricing.

Cash generation is where Premier Investments quietly flexes its muscles. The company’s balance sheet is robust, dividends flow consistently and a strong franking profile makes payout days even sweeter for investors seeking income.

Analysts expect attractive dividend income in the years ahead. CMC Markets forecasts the business could pay an annual dividend per share of 79 cents in FY26. That translates into a potential grossed-up dividend yield of 6.5%, including franking credits.

Last week, the ASX retail share got smashed after a trading update highlighted weaker discretionary spending in 1H FY26.

Macquarie responded by retaining its neutral rating on Premier Investments but reduced its 12-month price target on Premier Investments from $20.80 to $16.20 per share.

This implies a potential upside of 14% in the new year.

The post Buy these 2 ASX 200 retail shares for growth and income appeared first on The Motley Fool Australia.

More reading

• Opportunity knocks? Broker ratings on 4 ASX shares at 52-week lows
• Why Chalice Mining, Predictive Discovery, Premier Investments, and St Barbara shares are sinking today
• 5 things to watch on the ASX 200 on Thursday
• How high does RBC Capital think JB Hi-Fi shares can go?
• Macquarie names its top ASX consumer staples and consumer discretionary stock picks

Motley Fool contributor Marc Van Dinther 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 Premier Investments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Treasury Wine Estates Ltd (ASX: TWE) shares are limping through a brutal year. The ASX 200 shares have been under constant pressure as investors digest softer sales and a procession of downgrades.

Treasury Wine shares are trading at $5.49 apiece at the time of writing. That sees the stock down 51.4% this year and at levels that remain at 10-year lows.

For some context, the S&P/ASX 200 Index (ASX: XJO) gained 6.6% in 2025.

Structural headwinds in China and US

The drop is painful for a prestigious 68-year-old company that is known for premium wine labels such as Penfolds, 19 Crimes and Lindeman’s, which are sold in more than 70 countries around the world.

Treasury Wines’ fall reflects not just short-term noise but structural headwinds. The company’s board has flagged distribution challenges in key markets, such as the US.

Another strategically important market, China, has recovered more slowly than expected despite the easing of trade hurdles in 2024. Trade and geopolitical shifts, particularly in the US, add to the company’s challenges.  

Paused buyback program

Those setbacks have led to earnings downgrades, the withdrawal of formal earnings guidance from the company and a pause to the company’s $200 million buyback program.

These moves have shaken investor confidence, and as a result, the share price has suffered significantly.

The 40 cents per share in partly franked dividends that Treasury Wine paid over the full year will only compensate its shareholders modestly for their share price losses. At the current share price, Treasury Wine shares trade on a dividend yield of 7.3%.

What next for Treasury Wine shares?

Analysts have responded with varying degrees of caution, and recent broker notes show some downgrades. However, most analysts see Treasury Wine shares as positive, with a ‘hold’, ‘buy’ or even ‘strong buy’ recommendation. 

TradingView data shows that the most optimistic analysts expect Treasury Wine shares to climb as high as $9.90, which implies 80% upside at the time of writing. The average share price target for the next 12 months is $7.37 and that still suggests a possible gain of almost 17%.   

Analysts at Morgans recently retained the hold rating for the wine stock and set a $6.10 price target for the next 12 months.

The broker noted:

We suspect that trading has been weaker than expected and wouldn’t be surprised if consensus is too high. The 1H26 result will be particularly weak. We have made large revisions to our forecasts and stress that earnings uncertainty remains high. Consequently, we maintain a HOLD rating.

The post Over 51% down this year, how low can Treasury Wine shares go? appeared first on The Motley Fool Australia.

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• Buy, hold, sell: Collins Foods, Imdex, Treasury Wine shares
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Motley Fool contributor Marc Van Dinther 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.

Buy-and-hold investing with ASX shares makes a lot of sense because it allows compounding to work its magic for a long period of time.

Lower turnover means fewer opportunities to lose some of the portfolio value to the ATO because of capital gains tax.

But, I’d only want to own great investments for a long time, not mediocre businesses. I’d expect strong companies to deliver better returns over time thanks to the above-average profit growth.

The two ideas below are high-quality ones that I’ve bought for my own portfolio and I’m excited about.

TechnologyOne Ltd (ASX: TNE)

The world is rapidly changing in some areas, including AI. Having the right technology for organisational operations is important, which is what TechnologyOne offers. It provides enterprise resource planning (ERP) software to governments, local councils, businesses and universities.

TechnologyOne invests around a quarter of its revenue each year into research and development (R&D), ensuring that it can continue to provide customers with the best (and improving) software. This initiative is also helping the ASX share unlock more revenue from subscribers as they pay for more features.

The company is aiming for a net revenue retention (NRR) of 115%, implying 15% growth of revenue from its existing customer base each year. At that pace, revenue would double in five years.

With the business targeting large addressable markets, such as the UK and education sector, I think it has a very attractive future. This ASX share is a great candidate for a buy and hold strategy. When also considering its rising dividend and growing profit margins, it’s a very appealing investment.

According to the forecast on CMC Markets, the TechnologyOne share price is valued at 46x FY27’s estimated earnings. In a decade, I’m expecting the company’s annual recurring revenue (ARR) to be well over $1 billion.  

VanEck MSCI International Quality ETF (ASX: QUAL)

This is one of the exchange-traded funds (ETFs) that I’m putting my long-term retirement money into.

I’m a big believer that Australians should allocate a significant portion of their portfolio to international shares directly or indirectly because of how many great businesses are listed overseas.

But, we don’t necessarily need to own a piece of thousands of companies, just the best ones. That’s what the QUAL ETF is trying to provide – it owns 300 of the highest-quality global businesses from across various countries and sectors.

There are a few factors that all of the businesses inside of the QUAL ETF need to have. It’s this combination of factors that makes them appealing.

Firstly, they must have a high return on equity (ROE). In other words, they make a high level of profit on how much shareholder funds are retained within the business.

Second, they have stable earnings. That means profits aren’t going backwards – they’re usually going upwards!

Finally, the companies must have low leverage. They should have low levels of debt for their size, making them more sustainable businesses. By utilising this quality-focused strategy, the QUAL ETF has managed to deliver an average return per year of 15.75% over the prior five years, outperforming many ASX shares in that time.

The post 2 ASX shares to buy and hold for the next decade appeared first on The Motley Fool Australia.

More reading

• The best Australian stocks to buy today and not check again until 2035
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Motley Fool contributor Tristan Harrison has positions in Technology One and VanEck Msci International Quality ETF. 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.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Buffett is now approaching retirement, with plans to hand over his CEO role to Greg Abel, currently the company’s vice-chairman of non-insurance operations, at the end of the year. But this expert investor has remained active in his final months and quarters of leadership. And that means we can take a look at what Buffett’s latest portfolio moves say about the market…

Good news for Buffett fans

First, though, here’s some good news for all of you Buffett-watchers: Buffett still will be around as chairman, will go into the Berkshire Hathaway office to share ideas with the team, and he’s promised to continue communications through an annual Thanksgiving message. So we may hear about Buffett’s thoughts on key subjects well into the future.

Now, let’s consider Buffett’s general investment strategy over time and the moves he’s made in recent quarters. Buffett is known for choosing quality companies with solid competitive advantages, or moats, and investing in them for the long term. The billionaire won’t jump into the latest trend even if everyone else is doing so — and even if it’s delivering big returns fast. Buffett prefers companies he can count on over time, and this strategy has been a successful one.

One extremely important point is that Buffett favors value stocks, meaning he aims to buy stocks trading for less than what they truly are worth. The idea is that the rest of the investment community eventually will recognize the strengths of these particular companies and buy the shares — and these stocks then will rise.

So, what has Buffett been doing lately? The billionaire’s moves have been very clear: Over the past 12 quarters, he’s been a net seller of stocks, and he’s built up Berkshire Hathaway’s cash position to reach record levels.

BRK.B Cash and Short Term Investments (Quarterly) data by YCharts

Meanwhile, in his 2024 letter to shareholders, Buffett wrote that it’s rare to be “knee-deep” in buying opportunities.

Buffett’s moves suggest one thing…

This, along with Buffett’s focus on value, says something very clear about the market today — and a key market metric supports this. The S&P 500 Shiller CAPE ratio, a view of stock price in relation to earnings over 10 years, recently reached beyond 39, a level it’s only surpassed once before.

S&P 500 Shiller CAPE Ratio data by YCharts

Buffett’s actions, supported by this valuation metric, suggest the stock market is expensive and has been so for a while. But, before you make any abrupt investing decisions based on this, it’s important to take a deeper look into Buffett’s moves. The Oracle of Omaha, as he’s often called, hasn’t stopped investing. He’s still found opportunities — for example, he picked up shares of UnitedHealth Group in the second quarter and shares of Alphabet in the third quarter.

Both of these stocks were inexpensive at the time, and they continue to be reasonably priced. This shows us that, even if the overall stock market is pricey, investors still may find interesting opportunities.

UNH PE Ratio (Forward) data by YCharts

Now, looking specifically at the Alphabet purchase, we can draw an additional conclusion. Though technology and artificial intelligence (AI) stocks have climbed over the past few years, this doesn’t mean that every AI player is expensive. It’s important to consider each company individually — if you don’t, you might miss out on a deal today that may become a winner down the road.

So, Buffett’s moves over the past several quarters — from his selling activity to his accumulation of cash — suggest that today’s market is expensive. And the Shiller CAPE ratio confirms this. But Buffett doesn’t recommend staying away. Instead, his investing principles ring true in any market environment, including today’s: Look for value, and when you find it, buy and hold for the long term.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post What Warren Buffett’s latest portfolio moves say about the market appeared first on The Motley Fool Australia.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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Adria Cimino 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 Alphabet and Berkshire Hathaway. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended UnitedHealth Group. The Motley Fool Australia has recommended Alphabet and Berkshire Hathaway. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.