The ASX dividend stock GQG Partners Inc (ASX: GQG) has fallen close to 30% since its February 2025 peak, as the chart below shows. Despite its strong rise since November 2025, I think it could still be undervalued at this level.

GQG is a fund manager that’s headquartered in the US, but it also has a geographic presence in a number of other markets including Australia, the UK and Europe.

The ASX dividend stock offers four main strategies for investors – US shares, global shares, international shares (excluding US shares) and emerging market shares.

There are a couple of reasons why I think the ASX dividend stock could still be a solid, underrated buy.

Low earnings multiple

Fund managers normally trade on a lower price/earnings (P/E) ratio compared to other sectors, but I think GQG’s P/E ratio is particularly depressed.

The business regularly reports to investors about its funds under management (FUM), which is the key factor for generating profit because nearly all of its earnings are based on management fees rather than performance fees.

GQG regularly pays a large dividend to investors each quarter. In October, it declared a quarterly dividend of 5.6775 Australian cents, which was 90% of the company’s estimated third-quarter distributable earnings. That implies the GQG share price is only trading at 7x annualised earnings.

If the business can grow its earnings, it could be undervalued at this level.

Additionally, with such a low earnings multiple and such a high dividend payout ratio (of 90%), it can provide investors with a strong return through cash payments. Based on the latest quarterly dividend, it has an annualised dividend yield of 12.6%, at the time of writing.

If the business is able to maintain its dividend over the next 12 months, that level of passive income alone could outperform the S&P/ASX 200 Index (ASX: XJO).

Performance turnaround?

For a fund manager, the performance of its funds is key. GQG’s funds have recently underperformed due to taking a defensive position in an expensive market.

But, recently some of those high-flyers have gone backwards, and if GQG can own the right stocks going forwards it could lead to regaining client confidence and hopefully a slowing of FUM outflows (or even inflows).

In November 2025, the ASX dividend stock reported that its FUM grew by $2.4 billion to $166.1 billion, despite experiencing net outflows of $2.4 billion.

Prior to 2025, GQG had a long-term record of outperformance across its main strategies and I think the investment team have the skills to rediscover that track record.

The post 1 ASX dividend stock down 30% I’d buy right now appeared first on The Motley Fool Australia.

More reading

• At 13.4%, this ASX 200 dividend stock has the largest yield on the index
• Why Cogstate, European Lithium, GQG Partners, and Lindian Resources shares are falling today
• GQG Partners share price in focus after November FUM update
• $20,000 in savings? Here’s how you can use that to target an $8,000 yearly second income
• 2 cheap Australian shares under $50 to buy this December

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

Sometimes, boring is beautiful. This ASX dividend share doesn’t sell flashy tech, mine lithium or promise AI-fuelled riches.

What Metcash Ltd (ASX: MTS) does offer is something many investors are craving right now: a chunky dividend yield, a modest share price and a business model built to grind on, even when times are tough.

The price of the ASX dividend share took a tumble in the past month with 14% to $3.28 at the time of writing. This year it has lost 5.5%, compared to a 5.7% gain for the S&P/ASX 200 Index (ASX: XJO).

At current levels, Metcash shares look more appealing than exciting — and that’s precisely the point.

Dividend drawcard

Metcash sits behind some of Australia’s most familiar retail brands. It’s the wholesaler powering independent supermarkets under the IGA banner, as well as foodservice businesses, liquor retailers and hardware chains such as Mitre 10 and Home Timber & Hardware.

The biggest drawcard is the dividend. Metcash has built a reputation as a reliable payer, and its dividend yield looks attractive compared with many larger ASX names that have either trimmed payouts or failed to grow them meaningfully.

With the share price sitting at relatively low levels, that yield looks even more compelling at 5.5%. Investors aren’t paying up for blue-sky growth — they’re being paid to wait. In a market still jittery about interest rates and consumer spending, that steady income stream matters.

Squeezing suppliers, cautious shoppers

Let’s be clear, Metcash is not a growth rocket. It operates in fiercely competitive markets, with supermarket giants constantly squeezing suppliers and shoppers watching every dollar. If consumer spending weakens sharply, volumes can come under pressure.

Metcash won’t make you rich overnight. But at a low share price, with an appealing dividend yield and solid long-term prospects, it’s doing exactly what many ASX investors want right now. The ASX dividend share is paying them reliably while keeping risk in check.

Increasing dividend payouts

UBS projects the ASX dividend share to increase its payout every year between FY25 to FY29. That could be great news for investors focused on passive income.

Early December, the company highlighted that its latest dividend will be worth 8.5 cents per share. It will come fully franked, as the payouts from Metcash tend to do.

This dividend matches last year’s interim payout, but it is lower than the 9.5 cents per share final dividend investors enjoyed back in August.

What next for the ASX dividend share?

Most analysts also predict moderate to strong upside from Metcash’s current share price with the maximum potential upside at 43%.

The average 12-months price target has been set at $3.93, which suggests a share price gain of almost 20%. That could lift total Metcash earnings, including dividends, past the 25% mark.  

The post Time to buy this ASX dividend share now it’s down 14% appeared first on The Motley Fool Australia.

More reading

• Two ASX 200 stocks with buy recommendations from Ord Minnett
• Why Austal, Fenix Resources, Metcash, and Polynovo shares are falling today
• This retail stock could deliver healthy double-digit returns after a steep fall this week
• Macquarie slashes price target on Metcash shares as price plunge continues
• Here’s how much the new Metcash dividend is worth

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

With markets still feeling a bit uneasy and plenty of stocks well off their highs, I’ve been spending more time looking for quality rather than chasing momentum. In my experience, some of the best opportunities show up when strong businesses fall out of favour for reasons that are often temporary.

Right now, 3 ASX shares stand out to me as top-quality companies trading at prices that look far more attractive than they did a year or two ago.

A global healthcare leader trading at a rare discount

CSL Ltd (ASX: CSL) is trading at levels I rarely see for a business of this quality. With the share price around $175, the stock is back near prices from several years ago, despite the company being larger and more diversified today.

The pullback has been driven more by frustration than fundamentals. Currency headwinds, cautious guidance and heavy investment across the group have weighed on short-term earnings, pushing investor sentiment lower.

What hasn’t changed is the strength of CSL’s core franchises. Demand for immunoglobulin therapies continues to grow globally, while Seqirus has become a more meaningful contributor to earnings over time.

CSL is also coming out of a major investment phase, which should support better operating leverage as growth normalises. For a business with global scale, strong cash generation and a long track record of compounding value, the current valuation looks difficult to ignore.

A dominant tech platform the market has cooled on

WiseTech Global Ltd (ASX: WTC) is another high-quality name that has fallen sharply out of favour. After trading near $130 earlier this year, the share price has slid to around the $70 mark.

The pullback reflects slower near-term growth, softer freight volumes and ongoing investment in product development and acquisitions. While this has pressured margins in the short term, the long-term opportunity remains compelling.

WiseTech is still the clear global leader in logistics software through its CargoWise platform, serving many of the world’s largest freight forwarders. Demand for digital, end-to-end logistics solutions continues to grow, and WiseTech sits right at the centre of that shift.

Several brokers believe the market reaction has been too harsh, with some price targets sitting well above current levels. If growth steadies and margins start to lift, WiseTech could rebound faster than expected.

A proven growth business that’s fallen 40%

Xero Ltd (ASX: XRO) is another quality growth stock that has taken a hit, with the share price down close to 40% from its highs, and is trading around $115.

Some of that reflects weaker sentiment across global tech, but there’s also been a broader reset in how the market values software businesses. With higher interest rates and a tougher macro backdrop, investors have shifted their focus away from pure growth and towards profitability and cash flow.

That shift could actually suit Xero over time. The business produces predictable, recurring revenue, retains customers well, and has shown it can lift pricing as the platform grows. As the customer base matures, earnings should continue to improve even without rapid growth.

Xero is also building more automation and AI into the platform to reduce admin for small businesses and accountants. That should help keep customers engaged and support higher-value services over time.

Several brokers still see upside from here, suggesting the market may be underestimating Xero’s margin potential as it scales. For a business that dominates cloud accounting in multiple regions, the current valuation looks very attractive.

Foolish takeaway

CSL, WiseTech and Xero are very different businesses, but they share one thing in common: they are high-quality companies trading well below levels investors were happy to pay not long ago.

None are without risk, but for investors willing to take a longer-term view, I think all three look like compelling opportunities at today’s prices.

The post Why I think these 3 ASX shares are top-quality buying at today’s prices appeared first on The Motley Fool Australia.

More reading

• Could these ASX ETFs be set for a rebound in 2026?
• Why I’d buy dirt-cheap ASX shares now and aim to hold them for a decade
• Where will CSL shares be in 5 years?
• Why experts think the Xero share price could rise 70% in 2026!
• 3 unstoppable ASX shares to buy with $3,000

Motley Fool contributor Aaron Teboneras has positions in CSL and WiseTech Global. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended WiseTech Global and Xero. 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.

On Friday, the S&P/ASX 200 Index (ASX: XJO) finished the week on a positive note. The benchmark index rose 0.4% to 8,621.4 points.

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

ASX 200 expected to rise again

The Australian share market looks set for a good start to the week following a strong finish to the last one on Wall Street on Friday. According to the latest SPI futures, the ASX 200 is expected to open the day 41 points or 0.45% higher. In the United States, the Dow Jones was up 0.4%, the S&P 500 rose 0.9%, and the Nasdaq stormed 1.3% higher.

Oil prices charge higher

It could be a decent start to the week for ASX 200 energy shares Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) after oil prices charged higher on Friday night. According to Bloomberg, the WTI crude oil price was up 0.9% to US$56.52 a barrel and the Brent crude oil price was up 1.1% to US$60.47 a barrel. Traders were bidding oil prices higher after Donald Trump wouldn’t rule out a war with Venezuela.

Quarterly rebalance

This morning, a number of ASX 200 shares will leave the benchmark index after being kicked out at the quarterly rebalance. Leaving the index this morning are the likes of Bapcor Ltd (ASX: BAP), HMC Capital Ltd (ASX: HMC) and Corporate Travel Management Ltd (ASX: CTD). Joining the index this morning are stocks including Aussie Broadband Ltd (ASX: ABB), Resolute Mining Ltd (ASX: RSG), and Silex Systems Ltd (ASX: SLX).

Gold price rises

ASX 200 gold shares Newmont Corporation (ASX: NEM) and Northern Star Resources Ltd (ASX: NST) could have a good start to the week after the gold price pushed higher on Friday night. According to CNBC, the gold futures price was up 0.5% to US$4,387.3 an ounce. Rate cut optimism gave the gold price a boost.

Buy Boss Energy shares

Bell Potter thinks that investors should be buying Boss Energy Ltd (ASX: BOE) shares after their sell off. This morning, the broker has reaffirmed their buy rating on the uranium producer’s shares with a reduced price target of $2.00 (from $2.90). It said: “Our valuation assumes production at Honeymoon over the short 10Y mine life is limited to ~1.6Mlbs pa and costs remain elevated, until such a time that management have completed the work to guide otherwise.”

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

More reading

• Here are the top 10 ASX 200 shares today
• Why Bapcor shares are falling today despite a powerful 14% rebound this week
• Aussie Broadband shares sink 2% on ACCC report
• Downer EDI wins $870m NZ highway maintenance contracts: What investors need to know
• Buying Santos shares? Meet your new CFO

Motley Fool contributor James Mickleboro has positions in Woodside Energy Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Aussie Broadband, Corporate Travel Management, and HMC Capital. The Motley Fool Australia has positions in and has recommended Corporate Travel Management. The Motley Fool Australia has recommended Aussie Broadband and HMC Capital. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Australian dividend stock Washington H. Soul Pattinson and Co Ltd (ASX: SOL) looks far too cheap to me after its fall of approximately 20% since 10 September 2025, as the chart below shows.

There are not many businesses as old as Soul Patts on the ASX – it has already been listed for 120 years.

I’d say there are plenty of reasons to believe the business will continue to be an excellent ASX dividend share for decades to come, for both passive income and capital growth.

There are a few reasons why I’ve made this business my largest holding and why I’m optimistic about the future.

Long-term investing

The business operates as an investment conglomerate, it makes active decisions about what to invest in.

Management has broad flexibility to invest in virtually any asset class, whether it’s a large or small business.

Thankfully, the company doesn’t need to invest with any particular time horizon in mind, unlike some active fund managers. The Australian dividend stock can be an investor, a partner, or the complete owner of the businesses/assets it invests in.

By taking a long-term approach with its own investments, Soul Patts itself is able to be a pleasing long-term investment for Aussies.

It has invested in a number of compelling areas in recent times, such as nuclear energy, agriculture, swimming schools, a funeral operator, electrification, industrial properties, building products, and more to diversify and potentially strengthen its long-term returns.

I think the business is boosting its appeal as it steadily adds to its portfolio. Its investment flexibility allows it to ensure its portfolio is future-proof by selling assets with weakening outlooks and buying into more appealing ideas.

Great dividend track record

In my view, Soul Patts is the best Australian dividend stock around. It doesn’t have the highest dividend yield. But it does have an incredible record of consistency for paying dividends.

It has paid a dividend every year in its listed life (of around 120 years) – that’s through the world wars, global pandemics, economic crashes, and various other challenges.

The business has also increased its annual ordinary dividend every year since 1998. That’s the longest dividend growth streak on the ASX and suggests to me the business is heavily focused on continuing that record of payout growth for investors, though that’s not a guarantee.

I’m expecting the business to grow its dividend in FY26, with the 2025 financial year payout of $1.03 per share translating into a grossed-up dividend yield of 4.1%, including franking credits. That’s a great starting point, in my view, and the payout could steadily grow over the coming years.

The post 1 impressively awesome Australian dividend stock down 20% to hold for decades! appeared first on The Motley Fool Australia.

More reading

• Where I’d invest $10,000 into ASX dividend shares right now
• $5,000 to invest? Consider 4 no-brainer ASX dividend shares with over 20 years of growth
• 3 Aussie passive income stocks delivering decades upon decades of dividends
• 3 great ASX shares I’m buying to become a millionaire
• 5 ASX 200 shares I’d buy with $10,000 this week

Motley Fool contributor Tristan Harrison has positions in 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. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

As the year comes to a close, it can be a great time to reflect on portfolio performance. 

It’s always fun to focus on the winners. However looking at traditionally strong sectors that underperformed this year can help reveal future opportunities. 

One way to target these sectors is by looking at ASX ETFs that track these indexes or themes. 

Here are three ASX ETFs that have historically performed well, however underperformed this year. Could they bounce back in 2026?

BetaShares S&P/ASX 200 Financials Sector ETF (ASX: QFN)

This ASX ETF aims to track the performance of the S&P/ASX All Technology Index (before fees and expenses). 

The Index provides exposure to leading ASX-listed companies in a range of tech-related market segments such as information technology, consumer electronics, online retail and medical technology.

The fund has returned almost 14% per annum (after fees) since launching in 2020. 

Since its inception, it is up more than 80%. 

However in 2025 it is down 12.6%. 

It’s no surprise this fund has struggled, as its largest exposure is to WiseTech Global Ltd (ASX: WTC), Computershare Ltd (ASX: CPU), and Xero Ltd (ASX: XRO). 

However these technology companies have all been tipped to rebound next year, making this ASX ETF a tempting buy-low option. 

Vanguard Australian Property Securities Index ETF (ASX: VAP)

This fund seeks to track the return of the S&P/ASX 300 A-REIT Index. 

This fund offers a diversified blend of Australian real estate investment trusts (A-REITs) with residential, office, retail, and industrial assets.

It is made up of 31 holdings, with its largest allocation being to Goodman Group (ASX: GMG) which makes up roughly 33% of the fund. 

In 2025 the fund has risen by a modest 2.2%. 

It has dropped almost 8% since late October. 

However since its inception in 2010, it has returned approximately 10% per annum.

BetaShares FTSE RAFI U.S. 1000 ETF (ASX: QUS)

This fund provides exposure to 500 leading listed US companies, with each holding in the index weighted equally. 

This ASX ETF rose just 1.9% in 2025 despite the S&P 500 Index (SP: .INX) rising almost 17% in the same span. 

It appears that this fund’s equal weight method worked against it this year. 

However, according to Betashares, it has generated annualised returns of 13.29% over the past 5 years.

Therefore, it could be another candidate to rebound next year. 

The post Could these ASX ETFs be set for a rebound in 2026? appeared first on The Motley Fool Australia.

More reading

• Why I think these 3 ASX shares are top-quality buying at today’s prices
• Are Computershare shares a buy after reaching new lows?
• Why experts think the Xero share price could rise 70% in 2026!
• 3 unstoppable ASX shares to buy with $3,000
• Here are the top 10 ASX 200 shares today

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

Some of the best Australian stocks are trading at much more appealing prices compared to where they were earlier this year. I think this could be a good time to invest in some of the leading ASX shares right now.

When businesses have a strong revenue growth outlook, they could deliver a lot of earnings expansion.

Both of the businesses have good tailwinds and I’m optimistic they can deliver good returns for long-term shareholders. I’d happily buy them with $5,000 (or more).

Propel Funeral Partners Ltd (ASX: PFP)

Propel is the second-largest provider of ‘death care services’ in Australia and New Zealand. It currently has 208 locations, including 41 cremation facilities and nine cemeteries.

Australia’s growing and ageing tailwinds are likely to help deliver revenue growth for the business. Death volumes are expected to increase by 2.8% per year from 2025 to 2035 and then grow by 2.4% per year between 2036 to 2045.

That’s not the strongest growth rate around, but there are two other things that can help drive the Australian stock’s long-term success. Inflation is a powerful force to help drive its top line too – average revenue per funeral grew at a compound annual growth rate (CAGR) between FY15 and FY25.

The final tactic that Propel is utilising is acquisitions, which is helping expand its geographic presence and boost its scale.

According to the forecast on CMC Markets, the Propel share price is valued at 28x FY26’s estimated earnings.

Temple & Webster Group Ltd (ASX: TPW)

Temple & Webster is one of the most compelling retail Australian stocks, in my view.

Its business model is impressive – the company sells a huge number of furniture and homeware products through a drop shipping model where products are sent directly to customers by suppliers, reducing the need to hold inventory, allowing for a larger product range. It’s also capital-light, unlocking strong cash flow generation.

It also has a growing range of home improvement products, as well as trade and commercials ‘solutions’.

The Australian stock’s recent trade update showed growth was slower than expected, but I think this is the right time to invest at a much lower valuation. It’s down 26% in the last month.

In FY26 to 20 November 2025, revenue grew by 18% year-over-year, with continuing market share growth. Home improvement revenue rose 40%, which bodes well for the future as it becomes a larger slice of the pie.

The company is steadily growing toward $1 billion of annual sales, which could bring benefits such as operating leverage and a larger marketing budget.

Temple & Webster is seeing fixed costs as a percentage of revenue decline over time – it reached 10.6% in FY25, down from 11.3% in FY24. Profit margins are also being boosted by AI and tech tools.

With ongoing adoption of online shopping and the recent expansion to New Zealand, the Australian stock still has a very promising future, in my opinion.

The post 2 strong Australian stocks to buy now with $5,000! appeared first on The Motley Fool Australia.

More reading

• 3 of the best Australian shares to buy and hold until 2035
• Here are the top 10 ASX 200 shares today
• 2 quality ASX 200 stocks to buy for your 2026 portfolio
• 3 ASX 200 stocks storming higher in this week’s sinking market
• Macquarie says these two ASX retail stocks are good buying at current levels

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

Develop Global Ltd (ASX: DVP) is an ASX materials stock that saw its share price jump 4% on Friday after announcing a key contract. 

The company operates under a hybrid model as an underground mining contractor and operator of two mining assets: The Woodlawn Zinc-Copper Mine in New South Wales and The Sulphur Springs Zinc-Copper Project in Western Australia.

Key contract win

On Friday, the company announced it has been awarded a A$200 million underground development contract to establish access tunnels at OceanaGold’s Waihi North Project in the North Island of New Zealand.

According to Develop Global, the five-year contract at the Waihi North Project will start in the first half of 2026. 

Develop Managing Director Bill Beament said: 

This contract reflects the strength and depth of our Mining Services division, which includes some of the most experienced underground mining specialists.

We are delighted to be working with such a highly regarded multi-national mining house as OceanaGold and we look forward to combining the skills and experience of our people with a strong local workforce.

Bell Potter adjusts forecast

Following the announcement, broker Bell Potter released an updated report on this ASX materials stock, which included an increased price target. 

The broker said it had not included any additional mining services contracts in previous forecasts.

According to the report, revenue generation from this contract over the next 5 years is therefore incremental to its estimates; that is, scaling up to ~$40m per annum by FY27. 

Importantly, Bell Potter noted the OceanaGold contract improves DMS’ revenue and earnings mix while building an important relationship with a global gold and copper producer that has a portfolio of four operating mines around the world.

The broker upgraded EPS forecasts by +2% in FY26 and +3% in FY27 after incorporating the OceanaGold contract.

Price target upside

Bell Potter has maintained its buy recommendation on this ASX materials stock. 

It has also raised its price target to $5.20 (previously $5.00). 

Based on Friday’s closing price of $4.36, this indicates an upside of 19.27%. 

We expect demonstration of earnings and FCF expansion from Woodlawn to drive a re-rate for DVP; spot copper, zinc and silver prices are currently ahead of our FY26 forecasts, presenting upside to valuation and earnings expectations the longer they remain ahead of forecasts.

It said near-term catalysts include Sulphur Springs financing completion and processing plant construction commencement and further external DMS contract wins.

The post Top broker just raised its price target on this ASX materials stock appeared first on The Motley Fool Australia.

More reading

• Why 4DMedical, Develop Global, EOS, and Maas shares are racing higher today

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.

Warren Buffett didn’t become one of the world’s greatest investors by chasing the latest trends or reacting to short-term market noise.

Instead, the Oracle of Omaha built his fortune by owning high-quality businesses, buying them at sensible prices, and then letting time and compounding do the heavy lifting.

That approach translates surprisingly well to the Australian share market.

While the ASX doesn’t have as many global giants as the US, it does offer a handful of businesses with strong competitive advantages, resilient earnings, and the ability to grow shareholder value steadily over decades.

If I were building an ASX portfolio today with a 20-year horizon, Buffett’s playbook would be front and centre.

Start with businesses that have competitive advantages

One of Buffett’s most famous principles is the idea of an economic moat. He looks for stocks that competitors struggle to displace, whether through brand strength, scale, regulation, or switching costs.

On the ASX, REA Group Ltd (ASX: REA) stands out as a textbook example. Its dominant position in property listings is extremely difficult to replicate, gives it strong pricing power, and allows it to grow earnings year after year.

Buffett favours companies that can raise prices without losing customers.

Woolworths Group Ltd (ASX: WOW) also fits neatly into this category. Supermarkets aren’t exciting, but they are vital. Woolworths benefits from scale advantages, strong supplier relationships, and a brand Australians trust. Over time, those qualities translate into reliable cash flows and steady compounding, even through economic cycles.

Don’t ignore financial strength

Another quality that Buffett looks for is balance sheet strength and sensible capital allocation. Companies that manage debt carefully and reinvest profits wisely tend to survive downturns and emerge stronger.

Macquarie Group Ltd (ASX: MQG) ticks this box. Its diversified global operations, disciplined risk management, and ability to generate earnings across market environments give it a resilience few financials can match. While its profits can fluctuate year to year, its long-term growth record aligns closely with Buffett’s preference for well-run financial businesses.

Think in decades

Perhaps the most important part of Buffett’s strategy is patience. He famously says his favourite holding period is forever.

Building an ASX share portfolio for the next 20 years means accepting volatility along the way while staying focused on business quality rather than share price movements.

By owning stocks with strong moats, pricing power, and talented management, investors give themselves the best chance of letting compounding work its magic. And history shows it is one of the most reliable ways to build lasting wealth.

Foolish takeaway

You don’t need to reinvent the wheel to succeed in the share market. By borrowing Warren Buffett’s principles and applying them thoughtfully to high-quality ASX shares, investors can build a portfolio designed to grow for decades to come.

The post How to build significant wealth like Warren Buffett with ASX shares appeared first on The Motley Fool Australia.

More reading

• 3 of the best Australian shares to buy and hold until 2035
• 4% yield: Is NAB’s dividend safe?
• Top picks! Macquarie says these ASX stocks can rise 20% to 30%
• Buy, hold, sell: Flight Centre, Suncorp, and Zip shares
• 5 top ASX dividend shares I would buy with $5,000

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

History shows that some of the best returns are generated when investors are willing to buy quality businesses during periods of pessimism.

But it is also true that not every beaten-down share is a bargain. Some deserve to be cheap, and many never recover. That is why selectivity matters.

I would avoid companies with stretched balance sheets, structurally declining industries, or business models that could be made obsolete over time.

Instead, I would focus on ASX shares with financial resilience, strong brands, and clear long-term growth drivers, even if the short term outlook looks uncomfortable.

Here are a couple of ASX shares that fit that bill, in my view.

Accent Group Ltd (ASX: AX1)

Accent Group is a good example of a business that looks cheap because sentiment has turned against the retailer due to temporary headwinds, rather than because the company itself is broken.

As the owner of major footwear brands such as Platypus, Skechers, Stylerunner, Hype DC, and The Athlete’s Foot,, Accent Group has scale advantages, strong supplier relationships, and a proven ability to execute across both physical stores and online channels. While discretionary spending pressure has weighed on sales in the short term, footwear remains a non-negotiable category, and Accent’s exposure to global brands helps it stay relevant through economic cycles. And with interest rates easing in recent months, consumer spending could soon improve.

When it returns to consistent growth over the coming years, today’s low valuation could look overly pessimistic in hindsight.

CSL Ltd (ASX: CSL)

CSL is another ASX share that has fallen sharply, but for reasons that look cyclical rather than structural.

The biotech giant has faced margin pressure, weak influenza vaccine rates, and uncertainty related to strategic changes within the business. That has been enough to knock the share price to below average earnings multiples.

However, CSL still owns a collection of globally significant plasma and vaccine businesses, operates in markets with high barriers to entry, and continues to invest heavily in research and development. It is also embarking on a bold cost cutting plan that could save it upwards of US$500 million.

In addition, demand for plasma therapies is growing long term, driven by ageing populations and expanding medical applications.

For patient investors, CSL’s current valuation looks far more attractive than it has been for several years.

The post Why I’d buy dirt-cheap ASX shares now and aim to hold them for a decade appeared first on The Motley Fool Australia.

More reading

• Where will CSL shares be in 5 years?
• Down 60% with a 6% yield and P/E of 13x – are Accent shares a generational bargain?
• 5 ASX shares I’m avoiding this week
• Why these 2 battered ASX 200 stocks could shine in 2026
• Looking for ideas before Christmas? These 2 ASX shares stand out to me

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