Category: Stock Market

Wesfarmers Ltd (ASX: WES) shares were 0.098% higher at the close of the ASX on Wednesday afternoon, at $81.72 a piece. The stock crashed nearly 15% at the end of October following the retail company’s annual general meeting (AGM). This has dragged Wesfarmers shares 2.96% lower over the past month. For the year to date, the shares are still 14.42% higher.

What happened?

At the Wesfarmers’ AGM, management spoke positively about the company’s performance so far in FY26. They said that year-to-date sales growth in its Bunnings business was ahead of the growth recorded in the second half of FY25, supported by solid trading in the consumer segment. 

Management also said that its Kmart Group has benefited from “strong value credentials and quality” of its Anko product range, with year-to-date sales growth broadly in line with the second half of the 2025 financial year.

However, management did say that its Industrial and Safety division isn’t performing as strongly, citing that “trading conditions remain challenging, with earnings impacted by subdued demand across the mining and resources sectors”.

And it looks like investors were unimpressed by the company’s AGM announcement. 

Is there any upside ahead? 

Data shows that analysts aren’t too positive on the outlook for Wesfarmers shares. Out of 15 analysts, 7 have a sell or strong sell rating. Another 7 have a hold rating, and 1 has a strong buy rating.

The average target price is $81.25, implying a 0.57% downside from the current share price. Although some analysts think the shares could fall another 22.17% to around $63.60 over the next 12 months.

Are Wesfarmers shares worth holding for passive income though?

It’s true that while the Wesfarmers share price might have tumbled recently, and the outlook for its share price isn’t positive, investors need to factor in the passive income that Wesfarmers dishes out to its investors. The company continues to be one of the most effective ASX blue-chip shares to own over the long term. 

That’s because, while Wesfarmers is famous for its well-known retailers Bunning and Kmart, it also owns several other businesses. This diversity helps the company maintain a strong track record of delivering growth while consistently increasing dividends for shareholders. 

For FY25, the Wesfarmers board of directors decided on a fully franked final dividend of $1.11 per share. That brings the full-year dividend to $2.06 per share, representing a year-over-year increase of 4%. The full-year dividend represents 88% of underlying earnings per share.

So is it time to sell up? I think I’d sit and wait for now. Wesfarmers shares are a long-term play.

The post Is it time to sell your Wesfarmers shares? appeared first on The Motley Fool Australia.

More reading

• Macquarie names best and worst ASX stocks to buy in a rising interest rate environment
• 3 things about Wesfarmers stock every smart investor knows
• Here’s how Morgans rates the 3 biggest ASX 200 consumer discretionary shares
• 5 best Australian dividend stocks to buy in December
• These are the top ASX blue-chip shares I’d buy today

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

After a steady run this year, the S&P/ASX 200 Index (ASX: XJO) has cooled a touch, slipping a little over 3% across the past month. 

It’s hardly dramatic. 

A few big names, including Commonwealth Bank of Australia (ASX: CBA), have eased back from record highs, yet nothing resembles a storm. If anything, it looks like the market is catching its breath.

In other words, business as usual.

A breather is part of the rhythm

Markets move in bursts. Companies, however, do not. They operate every day, serving customers, refining products, optimising operations, and pursuing the next dollar of profit. Over long stretches, those earnings do the heavy lifting for investors.

In the short term, though, markets behave more like sentiment gauges. Hopes, fears, and macro narratives dominate. This is the heart of Benjamin Graham’s famous line: 

“In the short run, the market is a voting machine; in the long run, it is a weighing machine.” 

Investors vote based on emotion and expectation, but eventually, the fundamentals are weighed and valued accordingly.

That contrast explains why we see long, quiet plateaus in the index. Sometimes not much happens on the surface, even though thousands of companies are still playing the long game underneath.

Short-term noise vs long-term momentum

If you look for headlines, you will find them. The latest controversy surrounding Corporate Travel Management (ASX: CTD) is an example of how single-company news can spark big reactions. Broader macro events can also swing sentiment quickly. Markets can snap risk-on or risk-off in a matter of days.

Yet zooming out offers a different story. Markets regularly experience pauses, reversions, and consolidation phases. They are natural and healthy, especially after periods of strength.

History suggests that these breather periods often resolve in one of two ways: either companies continue to compound, and the index grinds higher over time, or investors get better buying opportunities as volatility resets expectations. 

Neither outcome is inherently negative for long-term investors.

What long-term investors usually do next

If you are building wealth through ETFs or diversified portfolios, stretches like this are often when habits matter more than headlines.

Dollar cost averaging smooths out the emotional highs and lows. It is also how investors stay invested through quiet periods that feel directionless but ultimately contribute meaningfully to long-term compounding.

The Vanguard Australian Shares Index ETF (ASX: VAS) mirrors the performance of the broader market and has closely tracked the long-term average of the S&P/ASX 300 Index (ASX: XKO). 

Over time, the index has rewarded patient investors who stick to a consistent plan.

A gentle reminder about how markets grow

Companies do not grow in straight lines. Markets do not climb without interruption. These pauses can feel uneventful or even a little uncomfortable, but they form part of the market’s normal rhythm.

For investors focused on the long term, maintaining discipline has historically mattered far more than trying to predict the next few weeks’ sentiment.

The ASX 200 may be taking a breather today. In the long run, earnings growth and compounding tend to do most of the work.

The post The ASX 200 has taken a breather. Here’s what usually happens next appeared first on The Motley Fool Australia.

More reading

• Doomed takeover bid for Mayne Pharma to come to an end
• Forget Westpac shares and buy these ASX dividend stocks
• Is it time to sell your Wesfarmers shares?
• Bendigo and Adelaide Bank unveils RACQ Bank acquisition in investor update
• Bell Potter names the best ASX dividend shares to buy in December

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

The Bendigo and Adelaide Bank Ltd (ASX: BEN) share price is in focus today as the bank announces an agreement to acquire RACQ Bank’s retail lending assets and deposits, with over 90,000 customers. The deal is expected to be accretive to return on equity (ROE) and cash earnings per share, and forms part of the company’s broader growth strategy.

What did Bendigo and Adelaide Bank report?

• Agreement to acquire $2.7 billion in retail loans and $2.5 billion in retail deposits from RACQ Bank (as at 30 June 2025)
• Purchase to be completed at book value, funded from cash reserves
• Net interest income of approximately $50–$55 million expected from the acquired lending book
• Estimated incremental cost to service the acquired book: $12–$14 million before tax
• Transaction is expected to be 35–40bps ROE and 4–5cps cash EPS accretive (annualised)
• Regulatory approvals required, with completion targeted for 1H27

What else do investors need to know?

Bendigo and Adelaide Bank’s acquisition will be funded from its existing cash reserves and is expected to use around 35 basis points of CET1 capital. Management aims to integrate the new lending assets and deposits by leveraging its simplified core banking system, which will be in place by the end of 2025.

Once the deal completes, Bendigo’s Queensland exposure for residential lending will increase from 15% to 18%, offering greater geographic diversity. The integration is expected to be efficient, minimising costs, and will include a strategic referral agreement with RACQ Bank.

What did Bendigo and Adelaide Bank management say?

CEO and Managing Director Richard Fennell said:

RACQ Bank’s strong deposit franchise and member focus complements Bendigo Bank’s own deposit franchise and longstanding focus on our customers and the community. This acquisition leverages our proven ability to efficiently integrate significant portfolios and is expected to drive improved shareholder returns through cost efficiencies and geographic diversification.

What’s next for Bendigo and Adelaide Bank?

The strategic focus for Bendigo and Adelaide Bank is on optimising its deposit base and gaining efficiencies through consolidation to one core banking system. The company plans to migrate RACQ Bank customers and assets upon regulatory approval and completion in the first half of FY27.

Management expects the deal to support the group’s 2030 return on equity target and drive further sustainable growth, particularly in Queensland. Investors will be watching for progress updates on the transaction and integration.

Bendigo and Adelaide Bank share price snapshot

Over the past 12 months, Bendigo and Adelaide bank shares have declined 25%, trailing the S&P/ASX 200 Index (ASX: XJO) which has risen around 2% over the same period.

View Original Announcement

The post Bendigo and Adelaide Bank unveils RACQ Bank acquisition in investor update appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• ASX dividend shares: How to snowball your passive income
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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 positions in and has recommended Bendigo And Adelaide Bank. 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 you are looking for the very best ASX dividend shares to buy, then read on!

That’s because the two listed below have just been named as high conviction buys by the team at Bell Potter. Here’s what the broker is saying about them:

Harvey Norman Holdings Ltd (ASX: HVN)

Bell Potter thinks that this retail giant could be one of the best ASX dividend shares to buy now. It has a buy rating and $8.30 price target on its shares.

Although its shares have rallied strongly over the past 12 months, the broker believes they are still good value. Especially when you factor in its property portfolio. It explains:

As a leading household goods retailer in Australia and growing presence globally, Harvey Norman has seen modest growth in its independent franchisee base in Australia and expanded its company operated global store print over the last 5 years. We see HVN as one of the most diversified retailers in terms of both categories and regions, while benefitting from both as a quasi-retailer/landlord and channel mix via company operated stores and franchising.

Despite the strong re-rate in the name, HVN trades at ~2.0x market capitalisation to freehold property value as Australia’s single largest owner in large format retail with a global portfolio surpassing $4.5b and collectively owning ~40% of their stores (franchised in Australia and company operated offshore). This sees our view that of the 1-year forward ~19x P/E multiple as justified considering the multiple catalysts near/mid-term.

Bell Potter expects fully franked dividends of 30.9 cents per share in FY 2026 and then 35.3 cents per share in FY 2027. Based on its current share price of $7.24, this would mean dividend yields of 4.25% and 4.9%, respectively.

Universal Store Holdings Ltd (ASX: UNI)

Another ASX dividend share that Bell Potter thinks could be one of the best to own is Universal Store. The broker has a buy rating and $10.50 price target on its shares.

Bell Potter is a big fan of the youth fashion retailer due to its attractive valuation and positive growth outlook. The latter is being underpinned by its store rollout and increasing private label product penetration. It said:

Universal is a leading youth focused apparel, footwear and accessories retailer in Australia. UNI has ~85 stores under its flagship ‘Universal Store’ brand and is expanding private label brands by growing the stand-alone format of ‘Perfect Stranger’ and ‘Thrills’ with more than 100 stores in total.

At ~18x FY26e P/E (BPe), we see UNI trading at a discount to the ASX300 peer group and see the multiple justified by the distinctive growth traits supporting consistent outperformance in a challenging category, longer term opportunity with three brands, organic gross margin expansion via private label product penetration (currently ~55%) and management execution. While catalysts associated with further interest rate cuts for Australia in CY25 are not imminent post the third rate cut in August, we continue to see the youth customer prioritising on-trend streetwear and expect UNI to benefit with their leading position.

Bell Potter is forecasting fully franked dividends of 37.3 cents per share in FY 2026 and then 41.4 cents per share in FY 2027. Based on its current share price of $8.55, this would mean dividend yields of 4.35% and 4.8%, respectively.

The post Bell Potter names the best ASX dividend shares to buy in December appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• 3 top consumer discretionary shares from Bell Potter
• Does Macquarie rate Harvey Norman shares a buy, hold or sell?
• Here are the top 10 ASX 200 shares today
• Why Harvey Norman, Mirvac, Qube, and Suncorp shares are falling today

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

ASX All Ords share Duratec Ltd (ASX: DUR) has raced ahead of the All Ordinaries Index (ASX: XAO) over the past year.

Duratec shares closed up 1.69% on Wednesday, trading for $1.81 apiece. That sees the Duratec share price up 27% in 12 months, smashing the 1.59% gains posted by the benchmark index over this same period.

Atop those outsized share price gains, the ASX All Ords share trades on a fully franked dividend yield of 2.35%.

If you’re not familiar with Duratec, the Australian engineering, construction, and remediation contractor’s four main operating segments are defence, mining & industrial, building & facades, and energy

And according to the analysts at Taylor Collison, Duratec is well-placed to deliver another year of outperformance and solid dividends.

Here’s why.

ASX All Ords share on the growth path

Duratec held its annual general meeting (AGM) on 20 November.

Looking back on FY 2025, the ASX All Ords share highlighted a 3.1% year-on-year increase in revenue to $573 million. Normalised earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 11.3% to $53 million. And on the bottom line, net profit after tax (NPAT) rose to $22.8 million.

“Our portfolio approach, spanning Defence, Energy, Mining & Industrial, Building & Facade, and Emerging sectors, continues to provide resilience and growth opportunities, and remains a key differentiator,” Duratec non-executive chair Martin Brydon said on the day.

Commenting on the outlook for Duratec’s defence segment following the AGM, Taylor Collison said:

DUR continues to see a strong medium-term outlook in defence. Beyond Garden Island [where the company has been contracted for work on HMAS Stirling], there are potential projects valued at more than $15bn scheduled for delivery between 2028 and 2032.

In addition, work at Henderson in WA sits near the top of a large pipeline of prospective opportunities. The scale and longevity of these programs provide meaningful visibility across the decade.

The broker also sounded a positive note on the ASX All Ords share’s mining & industrial segment.

According to Taylor Collison:

Management continues to execute on its strategy of expanding Managed Service Agreements with major Australian miners, including Newmont Corp (ASX: NEM), BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO), and Fortescue Ltd (ASX: FMG).

The addressable opportunity is substantial and supported by favourable commodity prices. However, as DUR continues to grow within the sector, we remain mindful that margins in mining services are typically lower and may trend down as the business scales.

Connecting the dots, the broker concluded:

At 14.6x our FY27 EPS estimates, we view the current valuation as attractive given the breadth of the opportunity set, including HMAS Stirling, iron ore maintenance, and activity across the oil and gas sector (maintenance and decommissioning).

Taylor Collison maintained its outperform recommendation on Duratec shares, with a $2.09 target price.

That’s more than 15% above Wednesday’s closing price for the ASX All Ords share. And it doesn’t include those upcoming dividends.

The post Why this dividend paying ASX All Ords share is tipped to outperform again in 2026 appeared first on The Motley Fool Australia.

More reading

• Bell Potter names the best ASX dividend shares to buy in December
• Is this ASX healthcare stock a buy low candidate after falling 35%?
• 3 ASX dividend shares to buy for a passive income stream
• 5 things to watch on the ASX 200 on Thursday
• 3 top consumer discretionary shares from Bell Potter

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

Trajan Group Holdings Ltd (ASX: TRJ) is a small-cap ASX healthcare stock that has fallen 34.95% in 2025. 

Trajan Group Holdings is a developer and manufacturer of analytical and life sciences products and devices, seeking to enrich human well-being through scientific measurement. 

Its current portfolio of products comprises products, devices, and solutions that are used in the analysis of biological, food, and environmental samples.

Broker Bell Potter released fresh analysis on the company yesterday, which included a buy recommendation and optimistic price target. 

Here is what the broker had to say. 

Improving sentiment, headwinds easing

The report said that the headwinds from Academic/Government segments in both US & China, appear to be easing. 

The broker also said tariff mitigation should be completed by FY26 through a combination of pricing and cost out programmes. 

Instrument sales still face challenges from funding pressures, however consumables business appears to be holding up. 

Bell Potter also noted this ASX healthcare stock is beginning to utilise AI technology. 

According to the report, AI is beginning to creep into management commentary with a range of AI agents being developed to speed up lead conversion and software development.

As sentiment and operating performance amongst TRJ’s US peers improves, so should TRJ’s financial results.

The broker did note that market acceptance depends on the company’s ability to improve testing products and to introduce new products successfully, while proving its offerings are superior to competing technologies.

AGM results 

Trajan Group also recently held its 2025 AGM.

The company reported: 

• Group revenue of $166.5M, up 7.4% from pcp. 
• Group EBITDA $15.5M, up 26.2%. 
• Operating NPATA rose 33.3%. 

Overall, the company maintained revenue guidance. 

Based on the AGM results, Bell Potter said the key catalyst for the company is demonstrating improvement in EBITDA margins. 

In 1Q26 revenue is slightly ahead of pcp but segment performance is patchy, with Components & Consumables (C&C) revenue up a solid c.10%, but Capital Equipment (CE) down c.20% with an expected recovery through the year.

Price target upside

In yesterday’s report, Bell Potter maintained its buy recommendation and target price of $1.25 for this ASX healthcare stock. 

Based on yesterday’s closing price of $0.67, this indicates an upside of approximately 86%. 

Guidance remains in the LSD% range but sentiment is improving, through industry tailwinds (or headwinds easing) including efficiencies, volume leverage, strength in pharma, chemicals and CDMOs, as well as China stimulus.

The post Is this ASX healthcare stock a buy low candidate after falling 35%? appeared first on The Motley Fool Australia.

More reading

• Bell Potter names the best ASX dividend shares to buy in December
• Why this dividend paying ASX All Ords share is tipped to outperform again in 2026
• 3 ASX dividend shares to buy for a passive income stream
• 5 things to watch on the ASX 200 on Thursday
• 3 top consumer discretionary shares from Bell Potter

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

If you are looking for a passive income stream, then the Australian share market remains one of the best places to do it.

But which ASX dividend shares are in the buy zone? Let’s take a look at three that analysts are recommending to clients. They are as follows:

Adairs Ltd (ASX: ADH)

The first ASX dividend share that could be a buy according to analysts is Adairs. It is one of Australia’s leading homewares retailers.

Adairs has returned to form recently following a difficult period. And with improved inventory management, stronger online performance, and cost efficiencies flowing through, the company now sits in a healthier financial position.

As consumer sentiment gradually improves, Adairs’ margin profile and cash generation should improve, supporting its fully franked dividend. Morgans expects the company to pay fully franked dividends of 11 cents per share in FY 2026 and then 15.5 cents per share in FY 2027. Based on its current share price of $1.85, this equates to dividend yields of 6% and 8.4%, respectively.

Morgans has a buy rating and $2.60 price target on its shares.

BHP Group Ltd (ASX: BHP)

Another ASX dividend share that could be a top pick for passive income is BHP.

The Big Australian’s world-class and low cost mining assets generate significant free cash flow through the cycle, allowing the company to continue rewarding its shareholders even when commodity prices soften.

Morgan Stanley expects BHP to pay dividends of approximately $1.90 per share in FY 2026 and then $1.70 per share in FY 2027. This would mean dividend yields of 4.4% and 4%, respectively.

The broker also sees plenty of upside for investors with its overweight rating and $48.00 price target.

Dicker Data Ltd (ASX: DDR)

A third ASX dividend share that analysts rate as a buy is Dicker Data. It is an IT hardware and software distributor with a long track record of steady revenue growth, resilient margins, and rising dividends.

The company’s relationships with top-tier technology vendors, along with its focus on recurring product demand, have helped support consistent cash flow. And with digital infrastructure spending remaining robust, Dicker Data appears well placed to continue rewarding shareholders with attractive fully franked dividends.

Morgan Stanley is forecasting fully franked dividends per share of 47.6 cents in FY 2025 and then 50.8 cents in FY 2026. This equates to dividend yields of 4.6% and 4.9%, respectively.

The broker has an overweight rating and $10.30 price target on its shares.

The post 3 ASX dividend shares to buy for a passive income stream appeared first on The Motley Fool Australia.

More reading

• Rio Tinto versus BHP shares: One I’d buy and one I’d sell
• What happened with BHP, Rio Tinto and Fortescue shares in November?
• Is the BHP share price a buy for passive income?
• Here’s the earnings forecast out to 2030 for BHP shares
• Analysts think BHP and these ASX dividend shares are buys this week

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

On Wednesday, the S&P/ASX 200 Index (ASX: XJO) was on form and recorded a small gain. The benchmark index rose 0.2% to 8,595.2 points.

Will the market be able to build on this on Thursday? Here are five things to watch:

ASX 200 expected to rise again

The Australian share market looks set to rise again on Thursday following a decent night on Wall Street. According to the latest SPI futures, the ASX 200 is expected to open the day 16 points or 0.2% higher this morning. In late trade in the United States, the Dow Jones is up 1%, the S&P 500 is up 0.4%, and the Nasdaq is 0.25% higher.

Oil prices push higher

ASX 200 energy shares Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could have a good session on Thursday after oil prices pushed higher overnight. According to Bloomberg, the WTI crude oil price is up 0.55% to US$58.95 a barrel and the Brent crude oil price is up 0.35% to US$62.68 a barrel. Traders were buying oil after Russia-Ukraine peace talks failed to reach a breakthrough.

Buy 4D Medical shares

Analysts at Bell Potter think that 4DMedical Ltd (ASX: 4DX) shares are a buy for investors with a high risk tolerance. This morning, the broker has retained its speculative buy rating on the lung imaging technology provider’s shares with an improved price target of $2.50. It said: “We expect further wins from the 4D Medical sales team being mainly expansion of existing license arrangement to include fee for service revenues for CTVQ.”

Gold price rises

It could be a good session for ASX 200 gold shares including Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) on Thursday after the gold price pushed higher. According to CNBC, the gold futures price is up 0.35% to US$4,235.5 an ounce. This was driven by increasing US rate cut bets after the release of weak payroll data.

Buy Harvey Norman shares

Bell Potter thinks investors should be buying Harvey Norman Holdings Ltd (ASX: HVN) shares. This morning, the broker has named the retail giant as one of its high conviction picks with a buy rating and $8.30 price target. It said: “Despite the strong re-rate in the name, HVN trades at ~2.0x market capitalisation to freehold property value as Australia’s single largest owner in large format retail with a global portfolio surpassing $4.5b and collectively owning ~40% of their stores (franchised in Australia and company operated offshore). This sees our view that of the 1-year forward ~19x P/E multiple as justified considering the multiple catalysts near/mid-term.”

The post 5 things to watch on the ASX 200 on Thursday appeared first on The Motley Fool Australia.

More reading

• 3 top consumer discretionary shares from Bell Potter
• ASX dividend shares: How to snowball your passive income
• Here are the top 10 ASX 200 shares today
• 3 of the best ASX 200 shares to buy right now!
• Why 4DMedical, Dateline, Predictive Discovery, and Wildcat shares are racing higher

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has 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.

With emerging headwinds for consumer discretionary shares, analysts at Bell Potter have provided updated guidance on where to look within a choppy sector. 

Despite economists now tipping an increase for the cash rate at this month’s RBA meeting, Bell Potter still sees opportunity for a few consumer discretionary shares. 

Sector overview

In the broker’s Monthly Bell report, the analyst team said they have seen varying performance recently between discretionary categories with technology/electronics, wellness & sports and services such as cafes & recreation leading the way.

Meanwhile others such as mass apparel & lifestyle footwear and furniture & household goods are lagging.

While the pause in interest rate cuts in Australia limits catalysts for the Consumer Discretionary sector, we continue to prefer key beneficiaries from the rate cuts seen so far and category outperformers. We continue to look for retailers with differentiating customer value propositions & balance sheet strength and support names who may grow via market share expansion with more diverse customer demographics.

The report said to expect another year of growth in the promotional period around Black Friday. Beneficiaries are expected to be technology products, household appliances and gifting driven purchases. 

The 2025 projections for the Black Friday seasonal period in Australia (as per Roy Morgan and Australian Retailers Association) sees a further 4% increase in the 4-day weekend retail spend compared to a 3% increase in 2024.

The broker listed three high conviction consumer discretionary with buy recommendations. 

Adore Beauty Group Ltd (ASX: ABY)

Bell Potter said key drivers for business growth are its continued store-rollout targeting a network of 25+ stores, along with its private label brands and high-margin retail media arm contributing to margin expansion and thus a strong earnings trajectory. 

It views this consumer discretionary stock as well positioned to take advantage of the high performing beauty category within the Australian market.

Target price: $1.25. 

Harvey Norman Holdings Ltd (ASX: HVN)

As a leading household goods retailer in Australia and growing presence globally, Bell Potter said Harvey Norman has seen modest growth in its independent franchisee base in Australia and expanded its company operated global store print over the last 5 years. 

It sees Harvey Norman as one of the most diversified retailers in terms of both categories and regions, while benefitting from both as a quasi-retailer/landlord and channel mix via company operated stores and franchising.

Target price: $8.30. 

Universal Store Holdings Ltd (ASX: UNI)

The company has ~85 stores under its flagship ‘Universal Store’ brand and is expanding private label brands by growing the stand-alone format of ‘Perfect Stranger’ and ‘Thrills’ with more than 100 stores in total.

Bell Potter said at ~18x FY26e P/E (BPe), it sees Universal Store shares as trading at a discount to the ASX300 peer group. Its optimism is justified by the distinctive growth traits supporting consistent outperformance in a challenging category, longer term opportunity with three brands, organic gross margin expansion via private label product penetration (currently ~55%) and management execution.

Target price: $10.50.

The post 3 top consumer discretionary shares from Bell Potter appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Thursday
• Does Macquarie rate Harvey Norman shares a buy, hold or sell?
• Here are the top 10 ASX 200 shares today
• Why Harvey Norman, Mirvac, Qube, and Suncorp shares are falling today
• Brokers name 3 ASX dividend stocks to buy

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 recommended Adore Beauty Group. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool Australia has recommended Adore Beauty Group and Universal Store. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Brokers are always looking for buy ideas; the ever-changing share prices (and updates) give investors the opportunities to buy appealing ASX shares that are undervalued.

When a broker thinks a stock is a buy, that’s an interesting signal. When numerous analysts are excited about an ASX share, it could indicate an appealing investment opportunity.

We’re going to look at three of the most buy-rated businesses on the ASX right now.

Orica Ltd (ASX: ORI)

According to CommSec’s collation of analyst opinions, there are currently 14 buy ratings on the business.

Broker UBS describes Orica as the world’s largest supplier of commercial explosives and blasting systems, servicing both the mining and infrastructure sectors. Its customers are from numerous markets, including Australia, Asia, the Pacific, North America, Latin America, Europe, the Middle East, and Africa.

UBS is one of the brokers that rates Orica as a buy, with a price target of $27. That suggests a possible rise of 11% over the next year from where it is at the time of writing.

The broker noted that the ASX share’s recent FY25 result saw operating profit (EBIT) growth across all segments, reflecting improvements in the mix of products and the margin.

Pleasingly, FY26 guidance suggests EBIT growth across all segments. UBS wrote:

Orica is positively leveraged to resilient global mine production activity, and supportive AN prices given relatively balanced global supply. We expect mix and margin improvements from the uptake of premium blasting solutions and technology services, and the integration of recent acquisitions, to drive a 3yr EPS CAGR of +8% (FY25-28E). We see ongoing P/E re-rate potential…

Coles Group Ltd (ASX: COL)

According to CommSec’s collation of analyst opinions, there are currently 10 buy ratings on one of Australia’s largest supermarket businesses and a large player in the liquor space.

UBS is one of the brokers that rates Coles shares as a buy, with a price target of $25. That implies a possible rise of more than 12% within the next year.

The broker likes the business following the company’s FY26 first-quarter update. Coles’ total sales grew 3.9% to $10.96 billion, which is more than what UBS was expecting.

UBS highlighted in a note how Coles is outperforming rival Woolworths Group Ltd (ASX: WOW), along with the benefit of automated distribution centres (ADCs) and customer fulfillment centres (CFCs):

We remain confident superior execution continues as COL leverages recent investments (eg, Witron ADCs – improved availability in NSW & QLD; Ocado CFCs – drove 28% 1Q26 online growth [WOW +13%], with all missions performing well), plus ongoing promotional effectiveness (fewer, better) & sound ranging (increasingly store-led), with these both supply chain enabled.

UBS forecasts $1.25 billion of net profit in FY26 for Coles.

QBE Insurance Group Ltd (ASX: QBE)

According to CommSec’s collation of analyst opinions, there are currently nine buy ratings on the business.

QBE is an insurance business with a presence in North America, Australia and the Pacific, and international.

UBS has a buy rating on the ASX share, with a price target of $24.15. That implies a possible rise of 26% over the next year, at the time of writing.

The broker noted that the 2025 third-quarter update showed FY25’s earnings and the outlook for FY26 “continue to track in-line with expectations” despite a softening in the premium rate cycle.

UBS noted:            

With FY26E COR [combined operating ratio] guidance of ~92.5%… supporting a ~16% ROE outlook, mid-single digit volume growth ambitions retained, investment yields stabilising and A$450m buyback announced (~1.5% shares), its FY26E earnings outlook remains well underpinned. At a 10x FY26E PE (0.54x ASX200, 18% disc to 5yr avg) we continue to see compelling value and retain a Buy rating.

The post Brokers rate these 3 top ASX shares as buys in December appeared first on The Motley Fool Australia.

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