Christmas Eve was a relatively flat trading day for the S&P/ASX 200 Index (ASX: XJO). 

The index closed before Santa’s arrival, falling approximately 0.4%. 

However there were a few ASX 200 stocks that had strong performances, building on big gains over the month of December. 

Zimplats Holdings Ltd (ASX: ZIM)

This ASX 200 materials stock engages in the production of platinum group and associated metals. The firm’s metals include platinum, palladium, rhodium, iridium, ruthenium, nickel, gold, copper, cobalt and silver.

It operates four underground mines, an open-pit mine, and various processing facilities, all located in Zimbabwe.

Its stock price rose an impressive 8.24% on Christmas eve. 

Its stock price is now up 40% over the last month, and roughly 83% year to date. 

The company has benefited from an increase in metal prices this year. 

In FY25, the company reported steady growth: 

• Revenue (+8%)
• Gross profit margins improved to 13% (FY2024: 11%) on higher metal prices. 
• Profit after tax increased to US$40.5 million (FY2024: US$8.2 million). 

IGO Ltd (ASX: IGO)

On Christmas eve, IGO shares gained more than 2.27%. 

The company owns and operates the Nova nickel-copper-cobalt operation, as well as the Forestania and Cosmos nickel operations – all of which are in Western Australia.

After last weeks’ gain, this ASX 200 stock is now up an impressive 21.8% in the last month. 

It’s been one of the many lithium shares enjoying a bull run in the back half of the year. 

Global lithium prices have lifted to the highest levels in 18 months, while spodumene (a lithium bearing mineral) is trading at its highest levels in two years.

Year to date, IGO shares have now risen more than 66%. 

MA Financial Group (ASX: MAF)

MA Financial Group is a diversified financial services company, specialising in managing alternative assets, lending, corporate advisory, and equities.

After tumbling in the back half of the year, ASX financials stocks are now slowly rebounding in December. 

The S&P/ASX 200 Financials Index (ASX: XFJ) is up 4.88% in the month of December. 

MA Financial Group has been among the stocks that has performed the best. 

It is up 13.22% in the month of December. 

This rise has come on the back of the acquisition in late November of Hyperdome Town Centre shopping centre for $678.7 million.

Year to date it is now up approximately 88%. 

The post Finishing strong – 3 ASX 200 stocks soaring in December appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Is it too late to buy surging ASX lithium shares like Mineral Resources and Liontown?
• Here are the top 10 ASX 200 shares today
• Wondering which ASX shares to buy for 2026? Experts weigh in
• ASX mining shares dominate stocks hitting 52-week highs

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

The CSL Ltd (ASX: CSL) share price has tested investor patience like few other blue chips in recent memory. After falling almost 40% during 2025, CSL shares are now trading around the $170 mark. That is a level not seen for many years for one of Australia’s most consistent long-term performers.

With 2026 approaching, investors are asking a simple question. Is there more downside ahead, or has most of the bad news already been priced in?

Why CSL shares struggled so badly in 2025

CSL’s weak share price performance was not caused by a single event. Instead, it was the result of several issues compounding over time.

Profit guidance fell short of expectations, costs stayed higher than investors wanted, and the recovery in plasma collections took longer than hoped. Currency movements also weighed on earnings, adding to the pressure on the share price.

The company also announced a $500 million cost-cutting plan. While sensible, some investors took it as a sign that costs had grown too high. Confidence continued to slip, and CSL moved from market favourite to one of the most sold large-cap stocks on the ASX.

What the market may be missing

Despite the share price slump, CSL’s core businesses remain intact. Plasma collection volumes have been improving, Seqirus continues to deliver steady vaccine earnings, and CSL Vifor is beginning to settle after a difficult integration phase.

Just as importantly, CSL is moving out of a heavy investment cycle. As collection efficiency improves and cost controls tighten, operating leverage should begin to re-emerge.

Several brokers think the market has been too hard on CSL. While some, including Macquarie, have lowered their price targets and taken a more neutral view, most still see value well above the current share price. Many analysts believe CSL shares could be worth between about $260 and $300.

Could CSL shares really crash again?

For CSL shares to fall sharply again, fundamentals would likely need to weaken further. Issues with plasma volumes, margins, or execution could all cause renewed pressure.

That said, expectations are much lower than they were a year ago. The valuation has come back, confidence is low, and it wouldn’t take much good news to support the share price.

Foolish takeaway

After a brutal year, much of the bad news appears to be reflected in the current CSL share price.

While short-term volatility may persist, it is becoming harder to argue CSL looks expensive at these levels. Whether 2026 delivers a rebound will depend on management executing on its plans.

For now, the risk profile appears far more evenly balanced, with long-term upside becoming clearer.

The post Will CSL shares crash again in 2026? appeared first on The Motley Fool Australia.

More reading

• 3 no-brainer ASX 200 shares to buy with $5,000
• 5 amazing ASX 200 shares I want Santa to bring me for Christmas
• My 5 top stocks to buy in 2026
• Should you buy CSL shares before 2026?
• I think these ASX blue chips shares are primed for a major rebound in 2026

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

There have been plenty of emerging stories in 2025 amongst global investing. Many investors were fortunate to cash in on individual stocks of ASX ETFs that had exposure to these markets. 

For example, hot topics this year have been the boom in ASX gold and silver shares.

Similarly, global defence emerged as a stock market winner. 

These sectors have been hotly covered – and rightly so. 

But there have been other niche themes that have brought investors strong returns. 

While many ASX ETFs are designed to track broad markets, this year more and more funds have joined the ASX targeting more niche themes.

This kind of investing is called thematic investing. 

Here are some ASX ETFs that fit into that category that have enjoyed big gains this year on the back of targeting niche sectors or themes. 

Betashares Video Games and Esports ETF (ASX: GAME)

Put simply, this fund provides a portfolio of leading global video gaming and esports companies.

According to Betashares, the video games and esports industry has been growing strongly, with industry revenue, profit margins, and the number of global players all forecast to increase in the coming years.

Video games and Esports now generate more revenue than the movie and North American sports industries combined. 

At the time of writing, it is made up of 37 holdings. 

Three countries dominate the weighting of this fund: 

• Japan (35.1%)
• United States (32.6%)
• China (21.0%)

In 2025, the fund has risen by an impressive 26.72%. 

VanEck Vectors Video Gaming And eSports ETF (ASX: ESPO)

This fund focussed on the Esports and Gaming industry has also had success in 2025.  

The VanEck fund gives investors exposure to a diversified portfolio of the largest and most liquid companies involved in video game development, esports as well as related hardware and software globally.

At the time of writing it is made up of 25 holdings, with a similar geographic profile to the previous fund: 

• Japan (29.0%)
• United States (28.3%)
• China (21.1%) 

In 2025, the fund has risen by almost 12%. 

Global X S&P Biotech ETF (ASX: CURE)

This ASX ETF invests in companies that potentially stand to benefit from further advances in the field of genomic science, such as companies involved in gene editing, genomic sequencing, genetic medicine/therapy, computational genomics, and biotechnology.

Essentially, this niche fund provides global exposure to emerging areas within the health care sector, at the intersection of science and technology.

It has more than 125 holdings, with no individual company representing more than 1.45% of the total fund. 

This theme has brought strong returns in 2025, with this fund rising almost 28%. 

The post 3 ASX ETFs to target in the new year – the booming themes of 2025 appeared first on The Motley Fool Australia.

More reading

• Where to invest $250 in ASX ETFs this month
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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.

After a strong year, many ASX financials stocks stumbled between November and early December. 

The S&P/ASX 200 Financials (ASX:XFJ) index dropped almost 9% from November 10 to December 1. 

This may have created some buy low opportunities in the sector, and one ASX financials stock that fits the bill is Infratil Ltd (ASX: IFT). 

It is down approximately 12% in 2025, which includes a drop of more than 8% since November 12.

The company is engaged in the ownership of an infrastructure business, which provides services to individuals and communities.

The team at Morgans recently initiated coverage on this financials stock. This included an accumulate rating and a healthy upside following the stock price fall in the past month or two. 

Receives investment grade credit rating

The positive report from Morgans came a day after S&P Global Ratings assigned its ‘BBB+’ long-term and ‘A-2’ short-term issuer credit ratings to Infratil on December 22.

According to S&P Global, the outlook on the long-term rating is stable. 

A report from S&P Global said the rating on Infratil reflects its stable funding, underpinned by substantial permanent capital, and its access to committed bank facilities through many funding relationships. 

It did note the company’s material single-name concentration risk and the illiquid nature of the asset portfolio partially offset these strengths.

Morgans view on this financials stock

In a note out of the broker last week, Morgans said Infratil is a high quality, concentrated structural growth investor targeting 11-15% per annum post fee returns. 

The broker said investors have enjoyed 18% per annum returns over the last 30 years. 

Assuming delivery of target returns, post fees the Net Asset Value (NAV) should nearly double over the next five years and create substantial value for equity holders. 

Morgans also said the share price is currently trading at a 30% discount to NAV. 

Assuming a return to a more normalised 20% discount would lift the share price by ~10% and from there NAV needs to lift for the share price to lift. 

Both seem likely, in our view. We initiate coverage with an ACCUMULATE rating and $11.30 target price. This report is the first part of a series that reviews IFT’s assets in more detail.

Price target upside 

This ASX financials stock closed trading pre-christmas at $10 per share. 

Based on the target price of $11.30, this indicates an upside of 13%. 

Elsewhere, TradingView has a one year price target of $11.61 which indicates roughly 16% upside. 

Online brokerage platform Selfwealth lists this financials stock as undervalued by 17%. 

The post Morgans just initiated coverage on this financials stock tipping strong upside appeared first on The Motley Fool Australia.

More reading

• Infratil gets investment grade credit rating in funding milestone

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.

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

In typical fashion, shares of Tesla (NASDAQ: TSLA) have exhibited extreme levels of volatility, swerving between lanes of pessimism and optimism. But through its wild ups and downs, the top purveyor of electric vehicles (EVs) has performed well in 2025. Shares are up 22% this year (as of Dec. 22), and they trade near record levels.   

The automotive disruptor is in the early innings of some huge projects that could reshape its entire financial picture. But there are strong arguments on both the bull and bear sides of the debate here. So, should you buy this EV stock before 2026? 

Tesla is working on innovations that could provide a long-term financial boost

Autonomous driving technology is the project that investors are most focused on. Tesla has a history of overpromising and under delivering — not only on the capabilities of its full self-driving (FSD) technology, but also on the timeline of when features will be launched.

The business took a step forward in June, when its robotaxi ride-hailing service started in Austin, Texas, even though it was in a very limited and restricted capacity. Tesla’s robotaxis are also in the San Francisco Bay Area, and there are plans to enter a handful of new cities in 2026.

Elon Musk said on the second-quarter 2023 earnings call that its robotaxi service could have “quasi-infinite” demand. Obviously, the total addressable market is huge, as people all over the world need to get from point A to point B.

Tesla believes that as costs come down and safety improves, most people won’t need to buy their own cars anymore. And that could bring high-margin revenue from its FSD software on a global level, both from a dedicated company-owned robotaxi fleet and from customers who choose to let their EVs be used in the ride-hailing service.

The company is also focused on expanding production of its humanoid robot, known as Optimus. The goal is to boost the annualized output to 1 million of these by the end of next year. Besides handling certain tasks in factory settings, these machines can have consumer applications.

Again, Musk isn’t shy when it comes to his forecast; he believes that robotics will one day represent 80% of his company’s market value.

The market is exuberant over this struggling car company

The EV company has never traded in line with its automotive peers. The stock has a price-to-earnings ratio (P/E) of 329. Detroit automakers Ford Motor Company and General Motors trade at P/E multiples of 12 and 17, respectively. And supercar luxury brand Ferrari can be purchased at a P/E of 38. So Tesla is on another planet.

The market’s excitement shows just how convinced investors are that Musk’s company will make good on its promises, namely that its FSD software and its robots can drive unprecedented financial success at some point down the road This could happen, but no one has any idea when.

At the current valuation, Tesla isn’t a smart buying opportunity before the calendar turns to 2026. Investors would be paying a nosebleed P/E for a struggling business. Automotive revenue gains have disappointed, and profit margins have been dwindling.

There are notable headwinds getting in the way. The EV market is more crowded these days, making it harder for Tesla to stand out. In the U.S., the end of the $7,500 tax credit for EVs can also definitely pressure demand, forcing consumers to think if paying up for one is worth it.

The market for Tesla’s vehicles has exhibited slower growth recently than industry experts had hoped for. Perhaps we’re past the phase of early adopters rapidly buying EVs, a group that was easy to sell to. The next chapter of growth could be more difficult to come by since it can be challenging to convince certain consumers to make the switch from gas-powered or hybrid vehicles when the experience or the economics aren’t as compelling.

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

The post Is Tesla stock a buy before 2026? 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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• Tesla vs. Alphabet: Which is the better AI stock for 2026?

Neil Patel 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 Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Ferrari and General Motors. The Motley Fool Australia has recommended Ferrari. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

As the calendar flips toward a new year, I’m not necessarily looking to overhaul my portfolio.

Instead, I’m focusing on a few new additions, including exchange traded funds (ETFs) that offer long-term tailwinds, diversification, and quality.

With that in mind, here are three top ASX ETFs I’m thinking of buying in 2026:

Betashares Global Cybersecurity ETF (ASX: HACK)

Cybersecurity has become a mission-critical necessity for businesses and consumers across the world. Governments, corporations, and consumers are all more dependent on digital infrastructure than ever, and the threat landscape continues to expand alongside it.

The Betashares Global Cybersecurity ETF provides exposure to companies operating at the front line of this arms race. Its holdings include global leaders such as Palo Alto Networks (NASDAQ: PANW), CrowdStrike Holdings (NASDAQ: CRWD), Fortinet (NASDAQ: FTNT), and Zscaler (NASDAQ: ZS). These businesses are deeply embedded in enterprise systems, with recurring revenue models and high switching costs.

Rather than betting on a single winner, this fund spreads risk across the sector, giving investors diversified exposure to a structural growth theme that looks set to persist well beyond 2026.

iShares S&P 500 ETF (ASX: IVV)

When it comes to core portfolio holdings, it is hard to look beyond exposure to the US market. The iShares S&P 500 ETF tracks 500 of America’s largest listed companies. This offers instant diversification across industries, business models, and economic cycles.

While mega-cap technology stocks remain important components, the fund’s exposure extends well beyond them. Non-tech holdings include Warren Buffett’s Berkshire Hathaway (NYSE: BRK.B), UnitedHealth Group (NYSE: UNH), JPMorgan Chase (NYSE: JPM), Exxon Mobil (NYSE: XOM), and Procter & Gamble (NYSE: PG).

For investors who want reliable access to global innovation, strong earnings growth, and stocks with robust business models, the iShares S&P 500 ETF is a fund I would be happy to buy in 2026.

VanEck Morningstar Wide Moat ETF (ASX: MOAT)

The VanEck Morningstar Wide Moat ETF focuses on US stocks with sustainable competitive advantages and attractive valuations. This sort of focus is never a bad idea and has been championed by Warren Buffett for decades.

The ETF’s portfolio includes stocks such as Thermo Fisher Scientific (NYSE: TMO), Merck & Co. (NYSE: MRK), Danaher (NYSE: DHR), Nike (NYSE: NKE), and Adobe (NASDAQ: ADBE).

For long-term investors who value resilience as much as growth, the VanEck Morningstar Wide Moat ETF offers a compelling blend of both. I would be happy to buy this again in January.

The post 3 ASX ETFs I’m buying in January 2026 appeared first on The Motley Fool Australia.

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JPMorgan Chase is an advertising partner of Motley Fool Money. Motley Fool contributor James Mickleboro has positions in Nike and VanEck Morningstar Wide Moat ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Adobe, Berkshire Hathaway, BetaShares Global Cybersecurity ETF, CrowdStrike, Danaher, Fortinet, JPMorgan Chase, Merck, Nike, Thermo Fisher Scientific, Zscaler, and iShares S&P 500 ETF. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Palo Alto Networks and UnitedHealth Group and has recommended the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool Australia has recommended Adobe, Berkshire Hathaway, CrowdStrike, Nike, VanEck Morningstar Wide Moat ETF, and iShares S&P 500 ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

You don’t need to chase speculative small caps or time the market perfectly to build wealth from shares.

Some of the most reliable returns over time have come from simply backing high-quality ASX 200 shares and letting them compound.

With $5,000 to invest, I would focus on companies with strong competitive positions, proven earnings power, and the ability to grow through different economic cycles.

Three ASX 200 shares that arguably tick these boxes and could be no-brainer buys are listed below. Here’s what you need to know about them:

CSL Ltd (ASX: CSL)

The first ASX 200 share that could be a no-brainer buy is CSL.

It is one of Australia’s true global champions. The biotech giant operates at the crossroads of healthcare innovation and essential medicine, supplying plasma therapies and vaccines to patients worldwide.

While its shares have been underperforming significantly this year due to short term headwinds, its long-term fundamentals remain compelling. Demand for plasma products continues to rise, its research pipeline remains deep, and its scale provides a powerful competitive moat. For patient investors, CSL offers exposure to global healthcare growth at an attractive price.

If you are looking for a cornerstone holding to anchor a $5,000 investment, CSL arguably fits the bill.

Woolworths Group Ltd (ASX: WOW)

Woolworths is about as defensive as it gets with ASX 200 shares. As Australia’s largest supermarket operator, it generates consistent cash flow regardless of economic conditions because people still need to buy groceries.

Beyond its core supermarket business, Woolworths has been investing in automation, digital retail, and supply chain efficiency, all of which will support its margins over time. It also has a long history of paying dividends, making it appealing to investors who want both stability and income from their investments.

Overall, for those seeking reliability and lower volatility in their ASX share portfolio, Woolworths could be a logical choice. Especially with its shares down materially from their highs.

Macquarie Group Ltd (ASX: MQG)

Finally, Macquarie is an ASX 200 share that adds a different flavour to a $5,000 portfolio. Unlike traditional banks, it operates as a global financial services group with strengths in asset management, infrastructure, commodities, and advisory services.

Its diversified earnings streams mean it can thrive in a range of market environments. Over the long term, Macquarie has demonstrated an ability to grow earnings, reinvest capital intelligently, and reward shareholders through dividends and capital growth.

For investors wanting exposure to global finance and infrastructure trends, Macquarie provides that opportunity within a well-established ASX 200 name.

The post 3 no-brainer ASX 200 shares to buy with $5,000 appeared first on The Motley Fool Australia.

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

ASX dividend stocks are capable of producing excellent levels of cash flow for investors. In-fact, investing $3,500 across the three names I’m going to highlight could unlock $331 of annual passive income in 2026 and beyond.

Certain businesses are able to produce very big dividend yields thanks to a mixture of a generous dividend payout ratios and low valuations. While consistent dividends aren’t guaranteed, I think it looks like the following businesses can continue delivering large payouts.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop is an underrated retailer, in my view. It wants to be the leader of male and female hair removal, selling products like electric shavers, clippers, trimmers and wet shave items. It also sells items from the oral care, hair care, massage, air treatment and beauty categories.

The ASX dividend stock has increased its payout in almost every year since 2017, aside from when it maintained the payout in 2024.

The Shaver Shop share price is trading at less than 13x FY25’s earnings, with a current grossed-up dividend yield of 10.2%, including franking credits, at the time of writing. I think the company’s moves to open more stores and grow its own brand called Transform-U will help its bottom line. I also believe the ASX dividend stock’s margins could rise in the coming years thanks to bigger scale and more private brand and exclusive product sales.

Bailador Technology Investments Ltd (ASX: BTI)

Bailador is an investment business that focuses on buying stakes in private technology businesses.

The company is invested across an array of software businesses including hotel management and room distribution, financial advice and investment management, digital healthcare and telehealth, tours and activities booking, volunteer management, AI-enabled property investment, and fitness and wellness.

Bailador looks for a number of characteristics with its targets, including being founder-led, having a proven business model with attractive unit economics, international revenue generation, having a huge market opportunity and the ability to generate repeat revenue.

It aims to provide investors with a dividend yield (excluding franking credits) of 4% of the net tangible assets (NTA). But, due to the fact that it’s trading at a discount of around 40% to the November 2025 pro-forma NTA of $1.98, at the time of writing, it has a dividend yield of 6.6% or 9.4% including the franking credits.

Centuria Office REIT (ASX: COF)

The office sector has struggled over the last few years because of the impacts of working from home and higher interest rates. To me, it’s not a surprise that the Centuria Office REIT unit price has dropped over 50% since September 2021.

However, I think there are signs that the business could be undervalued, while providing pleasing levels of passive income. For starters, it’s trading at a discount of more than 30% to the stated NTA of $1.67 at 30 June 2025.

The ASX dividend stock’s fund manager Belinda Cheung said in August:

COF continues to execute its strategy through active leasing as well as asset and capital management initiatives. Despite this, the office leasing momentum remains fragmented across Australian office markets and, accordingly, the FY26 FFO guidance range takes into consideration anticipated downtime and lease-up assumptions for existing vacancy and pending expiries across COF’s portfolio.

Looking ahead, higher replacement costs and office withdrawals for alternate-use conversion is expected to stem future supply and reduce the market size to rebalance office markets, reducing future vacancy rates. COF’s portfolio is well positioned to benefit from these future tailwinds.

It expects to pay a distribution of 10.1 cents per unit in FY26, translating into a potential distribution yield of 8.8%, at the time of writing.

Across the three businesses I’ve mentioned, they have an average yield of close to 9.5%. With investments totalling $3,500, that translates into annual passive income of $331, which is a rewarding starting point.

The post All it takes is $3,500 in these three ASX dividend stocks to help generate $331 in passive income in 2026 appeared first on The Motley Fool Australia.

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• Forget term deposits! I’d buy these two ASX shares instead
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Motley Fool contributor Tristan Harrison has positions in Bailador Technology Investments. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Bailador Technology Investments. The Motley Fool Australia has recommended Bailador Technology Investments and Shaver Shop Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

I think virtually every Australian adult would love to be financially independent, where you don’t have to rely on your work earnings to sustain your life expenses. I believe dividends from ASX dividend shares could be the answer.

This is a great time of year to look at potential financial goals. What could be better than building enough wealth that pays tens of thousands of dollars in dividends?

But, a large nest egg doesn’t appear out of nowhere – it’ll take consistency and good financials choices. I believe it boils down to three steps.

Save money

Being able to put money into the ASX share market comes down to one simple equation: spending less than you earn.

If someone earns $10,000 and spends $11,000 per month then they won’t have anything to invest. Earning $6,000 and spending $5,000 per month would be a better monthly financial picture, in my view, because it would mean having $1,000 to put into wealth-growing assets.

It takes money to make money in the ASX share market, so for someone to unlock savings with a tight/negative budget, they may need to earn more, spend less or both. The extra earnings could come in the form of a side hustle/part-time job. Every household has different spending requirements, but finding value for money with the biggest categories (food, transportation and so on) is usually a useful strategy.

Invest for the long-term in ASX shares

Compounding is a very powerful financial force. Albert Einstein once supposedly said:

Compound interest is the most powerful force in the universe. Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t pays it.

The longer we give our investments to grow, the more they can help our net wealth become a meaningful figure.

There are a number of appealing investments we could make for the long-term. I’d want to own ASX shares/investments that I think could grow nicely in value over the long-term.

For capital growth, I’m thinking of exchange-traded funds (ETFs) like Vanguard MSCI Index International Shares ETF (ASX: VGS), VanEck MSCI International Quality ETF (ASX: QUAL) and Betashares Global Quality Leaders ETF (ASX: QLTY).

For long-term dividends and growth, I’d look at names like Washington H. Soul Pattinson and Co. Ltd (ASX: SOL), MFF Capital Investments Ltd (ASX: MFF) and Wesfarmers Ltd (ASX: WES).

Replace your wage with dividends

By regularly investing, preferably monthly, Australians can steadily build up their portfolio enough to generate enough passive income to replace a wage with dividends through ASX shares.

Remember, the ASX share market has returned an average of close to 10% per year over the ultra-long-term. If an investment grows at 10% per year, it doubles in value in around eight years.

Trying to replace a wage could take time, but consistent effort will pay off. If someone can invest $1,500 per month into ASX shares (and never increasing that amount) and it grows at an average of 10% per year, it would turn into $1 million after 20 years and $1.5 million in less than 24 years.

If your portfolio had a 5% dividend yield, $1 million would unlock $50,000 of passive income, while $1.5 million would unlock $75,000 of dividends from ASX shares. That sounds good to me!

I think investing in ASX shares is the best way to build a river of passive dividend income, with franking credits being a major boost.

The post 3 steps to replace your wage with dividends from ASX shares appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has positions in Mff Capital Investments, VanEck Msci International Quality ETF, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited and Wesfarmers. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Mff Capital Investments, Vanguard Msci Index International Shares ETF, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

With most brokers taking a break over the Christmas and New Year holiday period, research notes are few and far between right now.

But don’t worry! Listed below are three recent broker buy recommendations that still have plenty of upside potential.

Here’s why brokers think these ASX shares are in the buy zone:

ResMed Inc. (ASX: RMD)

According to a note out of Ord Minnett, its analysts retained their buy rating and $48.80 price target on this sleep treatment disorder company’s shares. This followed the release of ResMed’s first quarter update which impressed the broker. Ord Minnett noted that its mask sales were strong and its focus on cost savings resulted in gross margin improvements ahead of consensus estimates. In response to the update, the broker increased its earnings per share estimates for FY 2026 and FY 2027. It now expects double-digit earnings per share growth for both years. And given ResMed’s growing cash balance, the broker highlights that ResMed has capital management optionality. The ResMed share price ended the week at $36.22.

TechnologyOne Ltd (ASX: TNE)

A note out of Morgan Stanley revealed that its analysts upgraded this enterprise software provider’s shares to an overweight rating with an increased price target of $36.50. This followed the release of the company’s full year results and a selloff that ensued. Although Morgan Stanley acknowledged that there was a slight slowdown in TechnologyOne’s growth outside the UK market, it continued to be highly profitable and generate significant free cash flow. As a result of this, its positive growth outlook, and defensive earnings, Morgan Stanley felt that an attractive entry point was created for investors. The TechnologyOne share price was fetching $28.56 at the Christmas break.

Xero Ltd (ASX: XRO)

Analysts at Macquarie retained their outperform rating on this cloud accounting platform provider’s shares with an increased price target of $230.30. According to the note, the broker was pleased with Xero’s performance in the first half of FY 2026. It highlighted that there was nothing in Xero’s result that breaks its thesis, despite what the market reaction to its release might have implied. In fact, Macquarie stated that it believes the US growth platform (Payments: Melio; Payroll: Gusto) is in place earlier than expected and management is executing. Overall, it feels that Xero has a great growth story that is on sale and only needing a catalyst. And at under 25x estimated FY 2027 earnings, the broker thinks that Xero shares are undervalued and sees scope for big returns over the next 12 months. The Xero share price ended the week at $112.78.

The post Top brokers name 3 ASX shares to buy next week appeared first on The Motley Fool Australia.

More reading

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• What $100 invested in Australian shares each week starting this Christmas could become
• 3 incredible ASX 200 tech stocks for smart investors in 2026
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Motley Fool contributor James Mickleboro has positions in ResMed, Technology One, and Xero. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group, ResMed, Technology One, and Xero. The Motley Fool Australia has positions in and has recommended Macquarie Group, ResMed, and Xero. 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.