Investors are still backing BlueScope Steel Ltd (ASX: BSL), even after the company was reportedly ruled out of a major Australian steelworks deal.

The BlueScope share price is up 1.21% to $30.97 on Wednesday after fresh reporting on the future of the Whyalla Steelworks in South Australia.

It has been a strong period for the ASX 200 stock. BlueScope shares are now up around 28% in 2026 and about 36% over the past 12 months.

Let’s take a look at the latest news surrounding the company.

Whyalla race narrows

According to The Australian, BlueScope and its international consortium partners are no longer in the bidding race for the Whyalla Steelworks.

South Australian Premier Peter Malinauskas said Queensland coal entrepreneur Matt Latimore’s private company M Resources and India’s Jindal Steel are the only shortlisted bidders.

A buyer is expected to be named over the next few months.

The state government placed the steelworks into administration in February last year. The business had been operated by Sanjeev Gupta’s GFG Alliance.

BlueScope had previously been considered as a serious contender.

The company owns and operates the Port Kembla steelworks in New South Wales. It had joined forces with Nippon Steel, JSW Steel, and POSCO in a heavyweight international consortium.

At the time, BlueScope said it hoped to use its domestic operating experience and familiarity with Whyalla as it led the group through due diligence.

Why investors are holding steady

Investors don’t seem too concerned about BlueScope missing out on Whyalla.

Buying the steelworks would have given the company a larger role in Australian steelmaking. But it also would have brought a complicated asset that may need serious money spent over many years.

Whyalla has attracted attention because of its role as a major regional employer and strategic industrial site. It has even been discussed as a possible hub for lower-emissions iron and steel production.

While those ideas sound appealing, turning them into reality would likely take a lot of capital, government support, and time.

And BlueScope already has plenty on its plate.

The company owns the Port Kembla steelworks and has major operations in North America, where its North Star business in Ohio has been a major contributor in recent years.

Why the stock keeps climbing

BlueScope’s latest run has been hard to miss.

The stock is trading near the top of its 52-week range after a strong start to 2026.

The company is also one of the larger names on the ASX, with a market capitalisation of about $13.6 billion.

Even though today’s gain is modest, it still stands out against the Whyalla headlines.

A missed acquisition opportunity can sometimes weigh on a stock, especially when investors had expected a company to stay in the race.

But in BlueScope’s case, the market appears to be taking a different view.

The post This ASX 200 stock is rising after a major bidding shake-up appeared first on The Motley Fool Australia.

More reading

• After a 40% rally, what’s next for this ASX steel stock?

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

Oil and gas producers and distributors such as Beach Energy Ltd (ASX: BPT), Woodside Energy Group Ltd (ASX: WDS) and Ampol Ltd (ASX: ALD) shares have been in focus this year as geopolitical tensions, volatility and oil price and supply fears put pressure on the ASX energy sector.

Here’s the latest update from each energy stock, and what brokers expect next.

Buy Ampol shares

Ampol shares are trading in the red on Wednesday afternoon. At the time of writing, the petroleum distribution and retailer’s shares are down around 0.4% to $33.57. The shares have now slumped nearly 5% since the ASX opened on Monday morning. 

For the year-to-date, however, Ampol shares are up over 4%, and they’re 30% higher than this time last year.

The company’s shares climbed higher on the back of conflict in the Middle East and concerns about global oil supply earlier this year. 

Ampol has also posted a few recent updates that have gathered investor attention. In April, the Aussie fuel supplier said it had submitted a formal remedy offer to the Australian Competition and Consumer Commission (ACCC) about a proposed acquisition of fuel and convenience store operator EG Australia. 

The company also confirmed a 10% increase in refinery production, higher refiner margins, and increased production in its Q1 FY26 trading update. 

Ampol has locked in diesel and jet fuel supply through to the end of May, and gasoline supplies to the end of June, despite rising landed crude costs. 

Brokers rate the stock as a strong buy, and the $35.80 average target price implies a potential 7% upside from here.

Hold Woodside shares

Woodside shares have also slumped slightly on Wednesday, down around 0.5% to $30.58 at the time of writing.

The shares have been resilient this year, however, climbing over 29% for the year-to-date and 43% over the past 12 months.

Unsurprisingly, the oil and gas giant’s share price rally accelerated in early March, as conflict between the US and Iran intensified.

Woodside shares have rallied off the volatility around oil supply concerns, and even though conflict in the Middle East has cooled, the area is still highly volatile, and the movement of oil in the region is still uncertain.

It’s not just market demand driving the company’s shares higher, either. Woodside grabbed headlines in April when it posted a 7% quarter-on-quarter increase in operating revenue and a 8% hike in revenue for the first quarter of FY26. 

But it looks like analysts are concerned that the share price could be at, or approaching, its peak. If the US and Iran strike a deal to resume oil movement in the Middle East, it could have a headwind effect on Woodside shares.

They rate the stock as a hold with an average 10% upside to $33.34, at the time of writing. 

Sell Beach Energy shares

Beach Energy shares are also in the red at the time of writing, down around 1% to $1.08 a piece. While the oil and gas explorer and producer’s shares flew higher off the back of geopolitical tensions in March, they tumbled just as quickly.

The shares are now down over 7% year-to-date and around 18% lower than this time last year.

Beach Energy posted its third-quarter update in April, which revealed softer sales, a guidance downgrade, and ongoing operational disruptions. The update spooked investors, and now many are worried about whether the company can consistently grow earnings from here.

Even news this week that it has agreed to sell its 60% operated interest in licence VIC/P35, which includes the Artisan gas discovery, hasn’t slowed the selloff. 

Brokers aren’t thrilled either. 

They rate the stock a sell, with an average target price of $1.12. That implies around a 2% downside at the time of writing.

The post Beach Energy, Ampol and Woodside shares: 1 to buy, 1 to hold and 1 to sell appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Here is what this ASX energy giant is paying income investors in 2026
• 5 things to watch on the ASX 200 on Tuesday
• Analysts name 3 ASX shares to sell now
• Why Arafura Rare Earths, Dalrymple Bay, Tuas, and Woodside shares are falling 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 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.

Buying ASX shares and wondering what the latest inflation data means for interest rates and the broader stock market investment outlook?

You’re not alone!

Earlier today, the Australian Bureau of Statistics (ABS) reported that Consumer Price Index (CPI) rose 4.2% in the 12 months to April, down from the 4.6% increase reported in March.

Of some concern however, trimmed mean inflation increased to 3.4% for the 12 months to April, up from 3.3% last month.

That’s important because trimmed mean inflation, which takes out certain volatile items, is the Reserve Bank of Australia’s preferred gauge when it comes to making its interest rate decisions.

As you’re likely aware, the RBA has hiked interest rates at all three of its meetings in 2026. That sees the official cash rate back at 14-plus-year highs of 4.35%.

And the combination of higher rates and resurgent inflation has pressured many ASX shares, as witnessed by the 1.6% year to date decline in the All Ordinaries Index (ASX: XAO).

So, what does the latest inflation print really mean?

Will ASX shares get some interest rate relief?

I won’t shine you on.

It’s highly unlikely that we’ll see the RBA lower interest rates at its next meeting on 16 June.

But we may well see the central bank keep rates on hold at that meeting, which after three consecutive rate increases should offer some relief to ASX share investors.

Commenting on the RBA’s inflation conundrum, Josh Gilbert, lead analyst for APAC at eToro, said:

Ultimately, that trimmed inflation number has been stubbornly above the top of the 2% to 3% target band for longer than anyone is comfortable with, and until that breaks decisively lower, the RBA can’t claim the job is done.

Deloitte Access Economics partner Stephen Smith said (quoted by The Australian Financial Review):

Underlying inflation rose to 3.4% over the year. That remains well above the Reserve Bank’s target band and points to a more persistent inflation problem than headline CPI alone suggests.

Even if the Strait of Hormuz reopens soon, global energy markets will take time to stabilise. The immediate shock may fade, but the pass-through to freight, production costs and consumer prices will take longer.

Deloitte expects ASX share investors will see the RBA pause at its June meeting and then likely hike rates by another 0.25% in August.

Commenting on the uptick in trimmed mean inflation, BDO chief economist Anders Magnusson added:

This will be uncomfortable for the RBA and limits its scope to ‘look through’ the energy shock as a temporary disruption that will just roll by. The recent lift in unemployment suggests that higher interest rates may be starting to slow demand, but that is less meaningful if inflation remains high.

The post Buying ASX shares? Here’s what the experts are saying about Australia’s latest inflation print appeared first on The Motley Fool Australia.

More reading

• This ASX 200 stock is rising after a major bidding shake-up
• Beach Energy, Ampol and Woodside shares: 1 to buy, 1 to hold and 1 to sell
• Why ASX, CBA, Endeavour, and Tuas shares are falling today
• Down more than 30% over a year, are ASX shares now looking cheap?
• Why EOS, Life360, Nufarm, and Web Travel shares are pushing higher today

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 S&P/ASX 200 Index (ASX: XJO) is having a positive session on Wednesday. In afternoon trade, the benchmark index is up 0.15% to 8,670.3 points.

Four ASX shares that have failed to follow the market higher today are listed below. Here’s why they are falling:

ASX Ltd (ASX: ASX)

The ASX share price is down a further 7.5% to $47.16. Investors have been selling the stock exchange operator’s shares this week following the release of guidance for FY 2027. Management revealed that FY 2027 total expense growth is expected to be between 18% and 21%. It advised: “This is primarily driven by technology modernisation, the expanded Accelerate Program as part of our response to the ASIC Inquiry and investments to support customer-driven growth.” ASX has also increased its capex guidance for FY 2027. It now expects capex of $180 million to $200 million (from $160 million to $180 million). It then expects further capex of $170 million to $190 million in FY 2028.

Commonwealth Bank of Australia (ASX: CBA)

The CBA share price is down 1% to $162.70. This is despite there being no news out of Australia’s largest bank on Wednesday. However, it is worth noting that all of the big four banks are trading lower today. It is possible that some large investors are rotating funds out of the banks and into other areas of the market.

Endeavour Group Ltd (ASX: EDV)

The Endeavour share price is down 4% to $2.95. This follows the release of the drinks giant’s strategy update this morning. Although the Dan Murphy’s and BWS owner has a bold new strategy in place, which includes cost savings of $300 million, it has announced a reduction in its dividend payout ratio to conserve cash.

Tuas Ltd (ASX: TUA)

The Tuas share price is down a further 2% to $2.12. This Singapore-based telco’s shares have been under significant pressure since it terminated its proposed acquisition of M1 Limited. The company made the move after authorities suspended the review of the deal in response to news that Tuas’ Simba business may have used spectrum it did not own. It said: “Simba continues to co-operate with the investigation being undertaken by the Infocomm Media Development Authority into potential breaches of the Telecommunications Act and the conditions of Simba’s Facilities-Based Operator Licence. Tuas will keep shareholders updated in relation to that investigation.”

The post Why ASX, CBA, Endeavour, and Tuas shares are falling today appeared first on The Motley Fool Australia.

More reading

• Down more than 30% over a year, are ASX shares now looking cheap?
• Which ASX 200 share is sinking to a 52-week low after cutting its dividend payouts?
• Endeavour Group unveils strategy update and $300m cost savings drive
• How do ASX dividend shares compare to savings deposit rates today?
• CBA shares rebound 7%: Is the banking giant a buy, sell or hold?

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

The share market operator ASX Ltd (ASX: ASX) this week provided updated guidance on its expected expense growth for FY27 and updated capital expenditure, sending its shares rapidly south.

The company said the guidance announcement was informed by its annual planning process, and that its financial expectations for the current financial year were not affected.

Expenses to spike

But in FY27, the ASX expects total expenses growth of 18-21%, with operating expense growth of 13-16% compared to FY26.

The company said this was largely being driven by technology modernisation, “the expanded Accelerate Program as part of our response to the ASIC Inquiry and investments to support customer-driven growth”.

The expected capital expenditure has also increased, from $160- $180 million to $180- $200 million.

The ASX has kept its dividend policy unchanged, saying it would pay out 75- 85% of underlying net profit, but added that it expected to pay out towards the bottom end of this range for at least the next two dividends.

The ASX also said its operating revenue for the financial year to the end of April was $1.03 billion, up 12.5% on the previous corresponding period.

Mixed view on the outlook

The major brokers have run the ruler over the forecasts and have come up with differing price targets for ASX shares.

UBS is the most bullish, with a price target for ASX shares of $62, compared with the current $46.80 (at the time of writing).

The broker said the cost and capex outlooks were “materially higher than expected”, but the ultimate profit and loss impact would be much smaller due to the market operator’s ability to recover revenue.

The team at Jarden is also predicting upside for ASX shares, with a price target of $55.30, down from $58.75.

They said:

We have previously flagged FY27 cost upside as a central concern, and today’s guidance confirms that risk at a magnitude greater than anticipated, with total expense growth of 18-21% exceeding our estimates by a considerable margin. The read-through is not uniformly negative: crystallising the cost envelope ahead of the CEO transition hands incoming CEO Anthony Attia a defined base rather than an open-ended liability, and the guidance should be broadly sufficient to accommodate Accelerate obligations once finalised, though the reset remains subject to ASIC and RBA agreement.

Jarden said the ASX is trading at a material discount to its 10-year average on a price-to-earnings basis. The broker has a neutral rating on the shares.

Macquarie also has a neutral rating on ASX shares with a price target of $54.00.

Macquarie said it was hard to see the ASX meeting its medium-term EBITDA targets.

They added, “With a review of the business strategy commencing, we maintain our Neutral recommendation”.

The post Down more than 30% over a year, are ASX shares now looking cheap? appeared first on The Motley Fool Australia.

More reading

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• Here are the top 10 ASX 200 shares today

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.

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) has bounced back from a soft start and is edging higher. At the time of writing, the benchmark index is up 0.1% to 8,667.9 points.

Four ASX shares that are rising more than most today are listed below. Here’s why they are pushing higher:

Electro Optic Systems Holdings Ltd (ASX: EOS)

The EOS share price is up 2.5% to $9.12. The catalyst for this may have been a broker note out of Bell Potter this morning. According to the note, the broker has retained its buy rating on the defence and space company’s shares with an improved price target of $10.60. In response to the completion of its acquisition of MARSS, Bell Potter said: “EOS is positioned as a market leader across many C-UAS verticals and is leveraged to increasing budget allocations to C-UAS technologies. EOS possess a catalyst rich next 12 months, with potential HELW, C2 and Slinger awards on the horizon.”

Life360 Inc (ASX: 360)

The Life360 share price is up 1.5% to $19.10. This may also have been driven by a broker note out of Bell Potter this morning. According to the note, Bell Potter has retained its buy rating on the location technology company’s shares with an improved price target of $33.00. It said: “We expect similarly strong paying circle growth in each of Q2, Q3 and Q4 and, given this is the key driver of revenue growth, we believe market focus will shift to this positive rather than the negative of any weakness in MAU growth.”

Nufarm Ltd (ASX: NUF)

The Nufarm share price is up 14% to $2.92. Investors have been buying this agricultural chemicals company’s shares following the release of its half-year results. Although Nufarm posted a 5% decline in revenue to $1.7 billion, its underlying net profit after tax increased 35% to $52 million. The company’s CEO, Rico Christensen, said: “We are pleased with first half performance and are well placed to deliver strong growth in underlying earnings and a significant reduction in leverage for the full year, consistent with previous guidance. We have made clear progress on the priorities we set in November last year, delivering earnings growth, improved cash flow and a reduction in leverage. The benefit of our increased strategic focus is visible in the margin improvement in Crop Protection and significant uplift in earnings from our Seed Technologies business.” Looking ahead, management has reaffirmed its FY 2026 outlook for positive free cash flow.

Web Travel Group Ltd (ASX: WEB)

The Web Travel share price is up 1.5% to $2.42. This follows the release of the travel technology company’s FY 2026 results. The WebBeds owner reported a 20% increase in revenue to $394.1 million, while net profit more than tripled to $35.5 million. The company’s managing director, John Guscic, said: “FY26 was a terrific year for the WebBeds business. We continue to win share, TTV margins continue to improve, and our scalable business model is delivering higher operating leverage. WebBeds’ EBITDA margin remains world class.”

The post Why EOS, Life360, Nufarm, and Web Travel shares are pushing higher today appeared first on The Motley Fool Australia.

More reading

• Nufarm shares jump 11% as turnaround signs continue
• Why are shares in this ASX travel company charging higher today?
• Why Life360 shares could be cheap and heading 75% higher
• Up 400%+: Does Bell Potter think EOS shares can keep rising?
• 5 things to watch on the ASX 200 on Wednesday

Motley Fool contributor James Mickleboro has positions in Life360 and Web Travel Group Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Electro Optic Systems and Life360. The Motley Fool Australia has positions in and has recommended Life360. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Is it 1969 or 2026? Investors might be a little confused, given that space, or more specifically, investing in space stocks, is becoming all the rage this year. A month ago, the ASX hosted no space-themed exchange-traded funds (ETFs). Today, it has one, and soon, it will have two.

That says it all.

Yep, as we covered earlier this month, 12 May saw the debut of the BetaShares Space Industry ETF (ASX: RCKT). This ASX ETF allows Australian investors to indirectly own shares in a number of global leaders in the space sector. RCKT units have done quite well since their ASX inception, too, currently up almost 30% since launch (no pun intended).

Perhaps rival ETF provider Global X has noticed. It has just revealed that its next ASX ETF will also be space-themed, designed to “capture the future of the space economy”. It will be known as the Global X Space Tech ETF, and trade with the ticker code ‘MOON’.

And that’s all we know for now. Global X hasn’t released any further details, including its launch date, fees, underlying index, or holdings.

There is a good chance that it will look fairly similar to the BetaShares Space Industry ETF, though. As we’ve discussed here before, RCKT tracks the Solactive Space Industry Index. It charges a management fee of 0.57% per annum. Its top holdings currently include Rocket Lab Corp, AST Spacemobile Inc, Planet Labs PBC, and Viasat Inc.

A new ASX ETF for the SpaceX age

Let’s get to the elephant in the room, though. There’s little doubt that the impending initial public offering (IPO) of Elon Musk’s SpaceX is driving this interest in space investing. SpaceX, which also owns Starlink, xAI, and X (formerly Twitter), is shaping up to be one of the biggest IPOs in history and could make Musk the world’s first trillionaire. The company’s ambitious plans, vast scope, and unique leadership have excited investors all over the world. When SpaceX does eventually float, you can bet your bottom dollar that it will be a large, if not the largest, holding in both RCKT and MOON.

The Global X and Space Tech ETF and the Betashares Space Industry ETF will, in all likelihood, be the easiest way for ASX investors to buy into SpaceX without owning the US stock themselves. No doubt the provers know this, and are rolling out these ASX ETFs in anticipation. Watch this space.

The post SpaceX IPO: Strap in for launch with another ASX space ETF appeared first on The Motley Fool Australia.

More reading

• Why ASX, CBA, Endeavour, and Tuas shares are falling today
• Down more than 30% over a year, are ASX shares now looking cheap?
• Why EOS, Life360, Nufarm, and Web Travel shares are pushing higher today
• These 2 ASX tech stocks could return more than 40% Shaw and Partners says
• Could this surging ASX small cap still be hiding in plain sight?

Motley Fool contributor Sebastian Bowen 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 AST SpaceMobile, Planet Labs PBC, and Rocket Lab. The Motley Fool Australia has recommended Rocket Lab. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Shaw and Partners keeps a pretty close eye on the small to mid-cap technology sector on the ASX, and produces some interesting research about up and coming companies.

This week they’ve issued new reports on two of those companies, with each undervalued by more than 40% according to the broker.

Let’s have a look at what they’re saying.

Humm Group Ltd (ASX: HUM)

This company recently released a third-quarter update, saying it delivered a “robust” performance, “despite significant macroeconomic and geopolitical uncertainty, an evolving interest rate environment, and subdued business and consumer confidence.”

The fintech’s assets under management was 5.1% higher than for the previous corresponding period at $5.4 billion, although new loan origination fell 8.6% to $820 million.

The company said its net interest margin was 5.3%, down 20 basis points, “reflecting deliberate portfolio choices and a rapidly evolving interest rate environment”.

On the outlook, the company said it expected growth to be subdued, “with Humm Group intentionally prioritising prudent underwriting and sustainable returns over volume”.

Shaw and Partners maintained its buy rating on Humm Group shares, saying the company was undervalued, trading below its net tangible asset value and at a lower price-to-earnings multiple than the small-cap financials sector generally.

The broker has a price target of 85 cents per share, compared with 58 cents currently.

Eroad Ltd (ASX: ERD)

Fleet management technology company Eroad recently reported its full-year results, with revenue coming in just 0.4% higher at NZ$195.2 million, while normalised EBIT was NZ$2.9 million, down from NZ$9.9 million the previous year.

That result was impacted by higher operating costs, non-recurring expenses, and lower capitalisation of R&D costs, the company said.

Executive Chair John Scott said, “Although our performance remained strong in our core markets of New Zealand and Australia with year-on-year ARR growing 5% and 73%, respectively, the group results reflect the legacy issues and challenges we have been managing”.

He added:

We have taken decisive action to reset the business and position it for sustainable growth over the medium to long-term. The transformation program commenced mid-year, with a focus on five strategic priorities – Operational Excellence, Product Excellence, Customer Service, becoming AI Native, and Winning eRUC (e-road user charge). All of this is supported by a new executive management team with the clarity and energy required to execute.

Shaw and Partners has steeply discounted its price target for the company from $2.15 down to $1.10, but this is still well above the 78.5 cents the shares are changing hands for.

The post These 2 ASX tech stocks could return more than 40% Shaw and Partners says appeared first on The Motley Fool Australia.

More reading

• Why ASX, CBA, Endeavour, and Tuas shares are falling today
• Down more than 30% over a year, are ASX shares now looking cheap?
• Why EOS, Life360, Nufarm, and Web Travel shares are pushing higher today
• SpaceX IPO: Strap in for launch with another ASX space ETF
• Could this surging ASX small cap still be hiding in plain sight?

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.

The Australian share market has not exactly been a one-way ticket higher lately.

Plenty of investors have been dealing with a choppy S&P/ASX 200 Index (ASX: XJO), stretched bank valuations, weaker technology sentiment, and plenty of uncertainty around interest rates, inflation, and global markets.

Yet hidden beneath the broader market noise, one ASX small cap has been quietly doing something very different.

At the time of writing, Tasmea Ltd (ASX: TEA) shares have surged more than 120% over the past 12 months, including a sharp rise of more than 20% in just the past few weeks.

That is a very different outcome to the broader market. As a rough benchmark, the iShares Core S&P/ASX 200 ETF (ASX: IOZ), which tracks the ASX 200, is up only around 2.3% over the same 12-month period, excluding dividends.

So, what is going on?

The boring business delivering exciting returns

Tasmea is not a flashy technology company. It is not riding an artificial intelligence boom. It is not promising to reinvent finance, healthcare, or mining.

Instead, it provides specialist trade services to essential Australian industries.

The company operates across maintenance, shutdowns, emergency breakdown work, brownfield upgrades, and labour solutions. Its customers include asset owners across mining and resources, oil and gas, infrastructure, defence, water, power, renewables, telecommunications, and other critical industries.

In plain English, Tasmea helps keep important physical assets running.

That might not sound exciting. However, the share market often becomes interested when a business combines practical demand, strong execution, and rising earnings.

Tasmea appears to be doing exactly that.

Earnings growth is doing the heavy lifting

One reason Tasmea shares have been charging higher is simple: the company is growing quickly.

In FY25, Tasmea reported statutory revenue growth of 37% to $547.9 million, operating earnings (statutory EBIT) growth of 60% to $74.4 million, and net profit after tax growth of 74% to $53.1 million.

Importantly, earnings per share (EPS) rose 53% to 23.2 cents.

That matters because EPS growth is one of the cleanest ways to measure whether shareholders are actually participating in a company’s growth. Revenue growth is nice. Net profit growth is very nice. EPS growth is often nicer again.

The company has also guided for further strong growth in FY26. Based on its previously stated guidance, EPS is expected to move towards around 30 cents per share, implying another significant step higher.

That is before investors fully consider the potential longer-term benefits from the WorkPac acquisition.

Why WorkPac could matter

Tasmea completed the acquisition of WorkPac Group in December 2025.

WorkPac is a workforce solutions business, and the strategic logic is fairly clear. Tasmea already operates in industries where skilled labour is critical. By adding WorkPac, the company strengthens its ability to source, mobilise, and deploy labour across its existing operating divisions.

This could help Tasmea support organic growth, improve labour certainty, and potentially unlock synergies over time.

Of course, acquisitions come with risk. Integration has to be managed carefully. The business also needs to keep winning work, maintaining margins, and avoiding the temptation to grow just for the sake of size.

However, if management executes well, WorkPac could make Tasmea a more powerful platform than the market appreciated a year ago.

The small-cap sweet spot

This is where Tasmea becomes interesting from a long-term investing perspective.

Small caps that successfully grow into mid-cap or large-cap businesses can potentially reward shareholders in two ways.

First, earnings can grow. That means the underlying business becomes more valuable over time.

Second, the market may eventually decide the business deserves a higher valuation multiple. That can happen when investors gain confidence in the quality, durability, and scale of the company’s earnings.

That combination — earnings growth plus multiple expansion — can be powerful.

Foolish takeaway

Tasmea shares have already had a huge run, so investors should not ignore the risks.

The stock is no longer undiscovered. Expectations are rising. Any slowdown in earnings growth, acquisition misstep, margin pressure, or weakness in end-market demand could lead to volatility.

However, Tasmea remains a useful reminder that strong returns do not always come from the loudest corners of the market.

Sometimes they come from underappreciated businesses doing essential work, growing earnings, and steadily building scale in the background.

The post Could this surging ASX small cap still be hiding in plain sight? appeared first on The Motley Fool Australia.

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Motley Fool contributor Leigh Gant has positions in Tasmea. 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

Westpac Banking Corporation (ASX: WBC) shares are sliding on Wednesday as investors weigh up another regulatory headache for the ‘big four’ bank.

At the time of writing, the Westpac share price is down 1.78% to $35.96.

It continues a softer start to the year for the banking giant. Westpac shares are now down around 7% in 2026, despite still sitting about 13% higher over the past 12 months.

The selling follows court findings over how the bank handled some customers seeking financial hardship support.

Here’s what happened.

Westpac in trouble?

According to ASIC, Westpac failed to respond to more than 200 online hardship requests within the time required by law.

Those failures occurred over nearly 6 years, from 2017 to 2023.

The requests came from customers of Westpac and its subsidiaries, St George Bank, BankSA, and Bank of Melbourne.

These customers had told the bank they were experiencing financial hardship and were struggling to meet repayments on products including home loans, credit cards, personal loans, and car loans.

ASIC said some customers were seeking help after events such as domestic abuse, natural disasters, serious illness, or job loss.

Federal Court Justice Timothy McEvoy found Westpac had not acted deliberately. However, he said the bank’s conduct was “grossly negligent” and ordered the penalty.

Why investors are selling

Westpac has been ordered to pay a $26 million penalty, but the amount itself isn’t large compared with the bank’s earnings base.

Earlier this month, the bank reported first-half statutory net profit of $3.4 billion, up 3% on the prior corresponding period.

It also declared an interim dividend of 77 cents per share, fully franked, payable on 26 June 2026.

Nonetheless, the banks are already dealing with a more difficult backdrop. Investors are watching mortgage competition, funding costs, arrears, household budgets, and possible changes to housing policy.

A court ruling tied to hardship customers adds another uncomfortable headline at a time when the sector is already getting plenty of attention.

The bigger picture

Westpac said it had apologised to affected customers and was “deeply sorry” it let them down.

The bank said it has also completed a remediation program, including fee refunds, debt waivers, and compensation.

It said it has strengthened processes and upgraded its online hardship systems.

The question for investors is whether this is now largely behind the bank, or whether it keeps Westpac in the regulatory spotlight for longer.

Westpac still has plenty behind it, including a large mortgage book, a major retail deposit base, and a fully franked dividend.

But after a 7% fall this year, today’s court findings appear to have given investors another reason to stay cautious.

The post Westpac shares sink after court calls conduct ‘grossly negligent’ appeared first on The Motley Fool Australia.

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