ASX 200 stock Dalrymple Bay Infrastructure Ltd (ASX: DBI) is in focus after it drew a positive outlook in a recent report from Canaccord genuity.

Company overview

Dalrymple Bay Infrastructure owns and operates the metallurgical coal export facility at Dalrymple Bay. The facility is located at the Port of Hay Point, south of Mackay in Queensland. 

It is the world’s largest coal export facility, serving the coal-rich Bowen Basin. It is an important link in the global steelmaking supply chain. 

The company provides handling and loading capacity to independent customers shipping coal for export.

Its share price has risen significantly in the past 12 months, up 35.3%. 

For context, the S&P/ASX 200 Industrials (ASX:XNJ) index is up roughly 5% in that same span. 

What did it report in February?

In late February, the company released full-year results for the financial year 2025.

This included:

• Terminal Infrastructure Charge (TIC) revenue rose 3.9% to $307.6 million
• EBITDA increased 5.2% to $294.3 million
• Statutory net profit after tax was $29.2 million
• Funds From Operations (FFO) grew 10.6% to $173.3 million
• Net debt stood at $1,975.7 million at year end
• Total distributions for FY-25 climbed 11.9% to 24.625 cents per security. 

The share price spiked following these results, but has since softened over the last week or so. 

Why you should add this ASX 200 stock to your portfolio. 

According to a recent report from Canaccord Genuity, Dalrymple Bay Infrastructure’s business model is underpinned by a regulated framework and favourable contract structure. 

This supports defensive, inflation-linked earnings with high cash flow visibility. 

The firm said in yesterday’s report the Terminal Infrastructure Charges indexed to inflation, 100% take-or-pay contracts, socialisation of un-contracted capacity, and recoverable operating costs collectively drive ~95% EBITDA margins and stable, predictable cash-flow growth with minimal exposure to coal price or volume volatility.

According to Canaccord Genuity, the company’s CPI-linked earnings base combined with these incremental initiatives supports a credible pathway to mid-to-high single-digit FFO growth and double-digit dividend growth over the medium term. 

Consensus currently expects a three-year (FY25-28) FFO and DPS CAGR of ~7% and ~10%, respectively.

From a valuation perspective, DBI trades on a forward EV/EBITDA of 14.1x and a forward dividend yield of 5.6%, representing compelling value relative to key ASX infrastructure peers (e.g. TCL at ~25x and 4.9%). Our conviction is further supported by DBI’s superior contract visibility and simpler regulatory framework relative to key peers, alongside strong earnings momentum and, in our view, further upside risk to consensus.

The post Should you add this rising ASX 200 stock to your portfolio? appeared first on The Motley Fool Australia.

More reading

• Here are the top 10 ASX 200 shares today
• Buy, hold, or sell? 3 ASX 200 shares at record highs
• Dalrymple Bay Infrastructure lifts revenue and distributions for FY25

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.

Numerous ASX share investments have gone through volatility over the last few weeks and months. The declines can be a great buying opportunity, in my view. I think this could be an excellent time to look at an investment like Global X Fang+ ETF (ASX: FANG).

While it’s not your typical ASX share, the exchange-traded fund (ETF) can be bought on the ASX and it’s about investing in shares.

When I think about which investments would be good buys, I’m optimistic that it’s the best businesses that will deliver the strongest results over the long-term. This fund is about great stocks.

The appeal of the FANG ETF

This ASX ETF aims to give investors exposure to some of the largest global tech companies.

There are only 10 businesses in the portfolio, so it’s a highly concentrated investment that gives exposure to names like Nvidia, Netflix, Meta Platforms, Alphabet, Amazon.com, Broadcom, Apple, Crowdstrike, Palantir and Microsoft.

Each of those positions is meant to roughly have a 10% weighting. The position sizing is reweighted every so often to ensure each business takes up around a tenth of the ETF.

These businesses operate across a wide range of areas such as AI, social media, online video, online search, e-commerce, smartphones, semiconductors, software for devices, cybersecurity and so on.

The FANG ETF has delivered an average return per year of 20.5% over the last five years, but it has noticeably declined over the last few years, as the chart below shows.

Past performance is not a guarantee of future performance, but the fund’s holdings are the ones at the forefront of developing the next products and services for society. I think it’s a good idea to look at investing in this ASX share during this period.  

ASX shares I’m not buying right now

There are a few ASX shares that have declined over the last week or two amid the volatility, but there are a few compelling businesses I’m not looking to invest in today.

I think that ASX mining shares can make great investments because of how cyclical they are. Changes in supply and demand can lead to big changes in resource prices, net profit and valuation shifts.

After a strong run-up of share prices (though there has been a decline very recently), I’m not looking to buy into names like BHP Group Ltd (ASX: BHP), Rio Tinto Ltd (ASX: RIO), Fortescue Ltd (ASX: FMG), PLS Group Ltd (ASX: PLS) and Lynas Rare Earths Ltd (ASX: LYC).

I’ll be more interested if/when investor excitement about these ASX mining shares settles down and future expectations are reduced. I’ll be looking at other opportunities in the meantime.

The post 1 beaten-down ASX share to consider buying today, and 5 I’m shunning for now appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Alphabet, Amazon, Apple, CrowdStrike, Meta Platforms, Microsoft, Netflix, Nvidia, and Palantir Technologies. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Broadcom and Lynas Rare Earths Ltd. The Motley Fool Australia has recommended Alphabet, Amazon, Apple, BHP Group, CrowdStrike, Meta Platforms, Microsoft, Netflix, and Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

A new report has offered an updated comparison of Australia’s supermarket giants Coles Group Ltd (ASX: COL) and Woolworths Group Ltd (ASX: WOW). 

Greg Burke, Equity Strategist at Canaccord Genuity said these supermarkets have demonstrated resilience against an incrementally more challenging consumer backdrop, amidst persistent inflation and a tightening RBA. 

Both companies delivered early 2H26 trading updates showing accelerating top-line growth, outperforming most of the broader retail cohort where growth has generally moderated. 

In addition, both supermarkets are demonstrating strong cost discipline, amidst their respective cost-out programs, which has supported impressive operating leverage, driving double-digit EBIT growth in 1H26 (WOW +14.4%, COL +10.2%).

Earnings snapshot for Coles and Woolworths

Coles released half-year results on February 27. 

Highlights from the report included:

• Group sales revenue: $23.6 billion, up 2.5% on the prior period
• Net profit after tax (excluding significant items): $676 million, up 12.5%
• Group EBIT (excluding significant items): $1,231 million, up 10.2%
• Interim dividend: 41 cents per share, fully franked. 

Coles shares are down 0.33% since the start of 2026, although the share price has faced volatility.

Woolworths released half-year results on February 25 which included: 

• Half-year sales of $37.14 billion, up 3.4% year on year
• Earnings before interest and tax (EBIT) of $1.66 billion, up 14.4%
• Net profit after tax (NPAT) up 16.4% year on year to $859 million
• Fully-franked interim dividend of 45 cents per share, up 15.4% from last year’s interim payout.

Woolworths shares have rocketed on the back of these results, and now sit 22% higher than the start of 2026. 

It closed yesterday at $35.92.

This marks a sharp turnaround since October last year when Woolworths shares were trading around $26 per share.

Which is a better buy?

According to Canaccord Genuity, Woolworths’ ability to regain sales leadership over Coles was a notable theme. 

This was particularly evident in WOW’s 2H26 trading update, with its top-line growth accelerating to 5.8% (7.2% ex-tobacco), compared with COL at +3.7% (+5.3% ex-tobacco), implying market share gains for the market leader.

Mr Burke said Woolworth’s strong result suggests it is beginning to reap the rewards of its turnaround strategy, which is focused on improving its consumer value proposition through disciplined investments into price, range optimisation and loyalty. 

With WOW delivering consensus EPS upgrades of +5% (compared with modest downgrades for COL), we are increasingly confident that WOW’s downgrade cycle has drawn to a close, solidifying our preference for WOW.

The post Are Coles or Woolworths shares a better buy right now? appeared first on The Motley Fool Australia.

More reading

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• 5 things to watch on the ASX 200 on Wednesday

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

Endeavour Group Ltd (ASX: EDV) shares have been in focus this week after the company released its half-year results on Wednesday. 

Endeavour’s portfolio includes Australia’s largest retail drinks network mainly across its Dan Murphy’s and BWS brands. These account for approximately half of all off-premises retail liquor sales in Australia. 

The company’s other brand names include ALH Hotels, Langton’s, and Jimmy Brings.

Initially, earnings results sent Endeavour shares tumbling, before recovering 2.8% yesterday. 

As a quick recap, the company reported: 

• Group sales of $6.7 billion, a 0.9% increase on the prior corresponding period
• A 6.7% decline in underlying net profit after tax to $278 million
• 17.1% decline in statutory net profit after tax to $247 million
• A fully franked interim dividend cut by 13.6% to 10.8 cents per share.

Its share price is currently down approximately 6% over the last 12 months.

What did brokers have to say?

Following the results, brokers were quick to update guidance on the company. 

Bell Potter adjusted EBIT by 0%, -3%, and -4% over FY26, FY27, and FY28e, respectively. 

This led to a share price target increase from $4.00 to $4.15 for Endeavour shares, along with a retained buy recommendation. 

After closing yesterday at $3.95, Endeavour shares are roughly 6% below that target. 

Morgans provides an update

The team at Morgans have also adjusted their outlook on Endeavour shares following this week’s results. 

In a note out of the broker, it said there were no major surprises in EDV’s 1H26 result following the company’s trading update in January. 

While EDV continues to work on its refreshed strategy with further details to be provided at an investor day on 27 May, management confirmed that the combined Retail and Hotels portfolio will be retained. Management also noted that they will continue investing in Dan Murphy’s to restore its price leadership, while accelerating hotel renewals and electronic gaming machine (EGM) replacements.

Price target falls for Endeavour shares

The broker also reduced its FY26-28F underlying EBIT outlook by between 0-1%. 

Additionally, the broker lowered its price target to $3.65.

It has retained its hold rating. 

Based on this price target, Morgans is less optimistic on Endeavour shares, as the price target suggests a downside of 7.6%. 

Elsewhere, it seems brokers are mostly neutral on Endeavour shares. 

15 analyst forecasts via TradingView have an average price target of $3.83. 

That’s roughly 3% below yesterday’s closing price. 

The post What is Morgans’ updated view on Endeavour shares? appeared first on The Motley Fool Australia.

More reading

• Why Endeavour, Lindian, Magellan, and WiseTech shares are storming higher today
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• 5 things to watch on the ASX 200 on Thursday
• Are Endeavour Group shares a buy after its earnings results crash?
• Why Brightstar, Endeavour, Evolution Mining, and Woolworths shares are falling 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.

It has been a shaky start to the year for many shares on the ASX. But sharp pullbacks can sometimes create opportunities for patient investors.

Two companies that could have plenty of upside if things go right are WiseTech Global Ltd (ASX: WTC) and Electro Optic Systems Holdings Ltd (ASX: EOS).

The WiseTech share price is down about 30% in 2026, though it showed signs of life on Thursday. The stock finished the day up 7.14% to $47.57.

Meanwhile, the EOS share price has been mostly flat this year, but it slipped 3.07% on Thursday to $9.48.

Despite the recent weakness, both companies could still have strong growth ahead.

WiseTech could bounce back

WiseTech has been under pressure over the past year. Concerns about artificial intelligence (AI) and broader market volatility have weighed on the logistics software company.

However, the business itself continues to grow.

WiseTech develops software used by freight forwarders and logistics companies around the world. Its CargoWise platform helps manage complex global supply chains and is widely used across the industry.

The company recently reaffirmed its revenue outlook for FY26, expecting revenue of around US$1.39 billion to US$1.44 billion.

WiseTech is also investing heavily in automation and AI. Management believes these technologies can improve efficiency and help the business grow over time.

Several brokers remain positive on the stock despite the share price fall. UBS has a ‘buy’ rating and a price target of $89, while Bell Potter has a target of $83.70.

If the company delivers on its growth plans, the current share price could look far more attractive in hindsight.

EOS could benefit from rising defence spending

EOS operates in the defence technology sector. The company develops products such as remote weapon systems (RWS), counter-drone technology, and high-energy laser systems.

Global defence spending has been rising in recent years as geopolitical tensions increase. This trend could support demand for the company’s technology.

While EOS reported a mixed set of recent financial results, one figure stood out. The company finished the year with an unconditional order book of about $459 million.

This large pipeline of work gives the business better visibility over future revenue.

Brokers also see potential upside. Ord Minnett has a speculative ‘buy’ rating on EOS with a price target of about $12.95.

That suggests there could be meaningful upside if the company successfully converts its contracts into revenue.

Foolish takeaway

Both WiseTech and EOS have faced challenges recently, which helps explain the share price weakness.

However, both companies also operate in industries with strong long-term growth potential.

If WiseTech continues expanding its global software platform and EOS benefits from rising defence spending, these 2 ASX shares could have the power to climb higher in 2026.

The post These 2 ASX shares have the booster power to rocket higher in 2026 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 positions in and has recommended Electro Optic Systems and WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

Australian dividend shares remain a popular choice for investors looking to generate passive income from the share market.

With the right mix of companies, even a relatively small investment can begin producing regular cash payments while also offering the potential for long-term capital growth.

For example, if you had $5,000 ready to invest today, spreading it across a few high-quality dividend payers could be a simple way to start building an income-focused portfolio.

With that in mind, here are three ASX dividend shares that could be worth considering.

HomeCo Daily Needs REIT (ASX: HDN)

The first ASX dividend share to consider is HomeCo Daily Needs REIT.

It owns a portfolio of convenience-based retail properties across Australia. These centres are typically anchored by essential services such as supermarkets, medical facilities, childcare centres, and other everyday retailers.

Because these tenants provide services people rely on regularly, the portfolio tends to benefit from relatively stable demand even during economic downturns.

This stability has allowed the REIT to deliver attractive and reliable income for investors. Based on recent guidance, HomeCo Daily Needs REIT currently offers a dividend yield of 6.9%.

For income-focused investors, this makes it one of the more generous dividend payers on the ASX.

Rural Funds Group (ASX: RFF)

Another ASX dividend share that could be worth a look is Rural Funds Group.

It is an agricultural real estate investment trust that owns farmland and agricultural infrastructure. Its assets include almond orchards, cattle properties, vineyards, and macadamia farms across Australia.

Instead of operating these farms directly, Rural Funds leases the assets to experienced agricultural operators on long-term contracts.

This structure provides investors with exposure to the agriculture sector while also generating relatively predictable rental income.

Rural Funds has a long history of paying steady distributions to investors and is currently guiding to an annual distribution of around 11.7 cents per unit, which equates to a dividend yield of roughly 5.5% at recent prices.

Super Retail Group Ltd (ASX: SUL)

A third ASX dividend share to consider is Super Retail Group.

Super Retail operates several well-known Australian retail brands including Supercheap Auto, Rebel, BCF, and Macpac.

These businesses give the company exposure to automotive, sports, outdoor recreation, and lifestyle retailing, which have proven to be resilient categories over time.

Super Retail has also built a strong reputation for generating solid cash flow and returning a meaningful portion of its profits to shareholders through dividends.

While retail earnings can fluctuate with consumer spending cycles, the company’s strong brand portfolio and loyal customer base have supported attractive dividend payments in recent years.

At present, its shares are expected to offer a 4.3% dividend yield in FY 2026.

The post 3 ASX dividend shares to buy with $5,000 appeared first on The Motley Fool Australia.

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

If your ultimate goal is to earn $1,000 per month in passive income, you’ll need to know how much you need to invest upfront.

Generating $1,000 per month equates to $12,000 per year in dividend payments. And while it sounds ambitious, it’s actually more straightforward than you’d think if you have the right portfolio of shares.

Here’s the math 

There is an easy calculation to work it out, but the answer varies significantly depending on the yield of the ASX shares you’re buying.

To calculate the investment you need, you can simply divide the annual income by the dividend yield.

For example, a portfolio which averages a 4% dividend yield will need a $300,000 investment in order to earn $12,000 per year (or $1,000 per month) in passive income. 

A 4% yield is typical of major Aussie banks such as ANZ Group Holdings Ltd (ASX: ANZ), Telstra Group Ltd (ASX: TLS), and some other blue chip companies.

If the yield is higher, at around 5%, you’re looking at a $240,000 investment.

A 5% yield is typical of stronger-yielding blue chip companies, energy shares or even some retail businesses such as Origin Energy Ltd (ASX: ORG) and Harvey Norman Holdings Ltd (ASX: HVN).

For an average 6% yield, you’ll need to commit $200,000. 

These will be your high-yield shares or real estate investment trusts (REITS). For example, Dexus (ASX: DXS) or HomeCo Daily Needs REIT (ASX: HDN).

And if you manage to create a portfolio with an average 8% dividend yield you’d only need to invest $150,000 to see the same passive income. 

But you’d need to buy much higher-risk ASX shares or income trusts like the Metrics Master Income Trust (ASX: MXT) or the BetaShares Australian Dividend Harvester ETF (ASX: HVST).

Can’t I just buy shares with the highest yield so I don’t need to invest as much?

You could, but it wouldn’t be the wisest investment idea. It’s true that an 8% yield means you need to invest less to hit your $1,000 per month passive income goal. 

But there is a catch.

Higher yields often mean higher risk. These companies might be unstable or there could be minimal dividend growth. Instead your focus should be on sustainable dividends over a long-term period, not the highest yield available today.

And the ultimate goal is diversification. A balanced and diversified portfolio can give you the best of both worlds. 

The post Passive income: How much would I need to invest in ASX shares to earn $1,000 every month? appeared first on The Motley Fool Australia.

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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 positions in and has recommended Harvey Norman and Telstra Group. The Motley Fool Australia has recommended HomeCo Daily Needs REIT. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

On Thursday, the S&P/ASX 200 Index (ASX: XJO) was back on form and pushed higher. The benchmark index rose 0.45% to 8,940.3 points.

Will the market be able to build on this on Friday and end the week on a high? Here are five things to watch:

ASX 200 expected to sink

The Australian share market looks set to sink on Friday following a poor night in the United States. According to the latest SPI futures, the ASX 200 is expected to open 162 points or 1.8% lower this morning. In late trade on Wall Street, the Dow Jones is down 2.2%, the S&P 500 is down 1.2% and the Nasdaq is down 1.1%.

Oil prices jump

It could be a good finish to the week for ASX 200 energy shares Santos Ltd (ASX: STO) and Woodside Energy Group Ltd (ASX: WDS) after a strong night for oil prices. According to Bloomberg, the WTI crude oil price is up 8.4% to US$80.93 a barrel and the Brent crude oil price is up 4.85% to US$85.34 a barrel. Concerns over global fuel supply disruption were behind this rise.

ASX shares going ex-dividend

A number of ASX shares will be going ex-dividend this morning and could trade lower. This includes fuel retailer Ampol Ltd (ASX: ALD), broadband provider Aussie Broadband Ltd (ASX: ABB), and tech company Objective Corporation Ltd (ASX: OCL). Last month, Ampol declared a fully franked dividend of 60 cents per share. This will be paid to eligible shareholders at the start of next month on 2 April.

Gold price tumbles

ASX 200 gold shares Evolution Mining Ltd (ASX: EVN) and Newmont Corporation (ASX: NEM) could have a poor finish to the week after the gold price tumbled overnight. According to CNBC, the gold futures price is down 1.25% to US$5,070.6 an ounce. A stronger US dollar weighed on the precious metal.

Buy Catapult shares

Catapult Sports Ltd (ASX: CAT) shares are good value according to analysts at Bell Potter. This morning, the broker retained its buy rating on the sports technology company’s shares with a trimmed price target of $4.85. It said: “Catapult remains one of our preferred tech stocks amongst the mid caps (along with Gentrack). We note Catapult is likely to come out of the S&P/ASX 200 at the next rebalance later this month but remain in the S&P/ASX 300. This could be viewed as a negative catalyst but in our view is already largely expected so should not come as a surprise.”

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

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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, Catapult Sports, and Objective and is short shares of Aussie Broadband. The Motley Fool Australia has positions in and has recommended Catapult Sports and Objective. The Motley Fool Australia has recommended Aussie Broadband. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX dividend shares could be the way to go during this period of uncertainty and market volatility.

But, not every business is destined to provide investors with resilient payouts over the years. Certain businesses do seem to have a bigger commitment to rising payouts than others.

I’d focus on those names with increasing payouts if receiving passive income is a key focus. Of course, dividends are not guaranteed, but businesses do have a significant level of control over the size of the payout they send to investors each year.

APA Group (ASX: APA)

APA has been, and continues to be, one of the most stable ASX dividend shares in terms of consistent distribution growth.

The energy infrastructure business has increased its annual distribution each year over the past two decades. Only one other business has a longer-term record than that.

There are two factors that have driven the payout higher over the last 20 years.

Firstly, it has regularly added to its energy portfolio across Australia over the years, with new gas pipelines, electricity transmission, wind farms, solar farms and batteries. It has new gas pipelines and a new gas power plant in the works, which should provide a good boost to cash flow. It’s the growing cash flow that funds higher distribution payouts from APA.

A second earnings tailwind is that a vast majority of revenue is linked to inflation. Any upswing in inflation this year – which seems likely – could provide a longer-term boost to revenue and cash flow.

It’s expecting to increase its FY26 annual distribution by 1 cent per security to 58 cents, translating into a forward distribution yield of 6.3%.

Future Generation Australia Ltd (ASX: FGX)

Future Generation Australia has a strong track record of dividend growth. The listed investment company (LIC) has increased its annual payout every year for the last decade. Not many ASX dividend shares have achieved that!

It’s not a typical LIC because there are no management fees or performance fees involved. It’s invested in a range of ASX share-focused funds, who all work for free. Instead of fees, Future Generation Australia donates 1% of its net fees to youth-focused charities.

Future Generation Australia provides underlying exposure to hundreds of ASX shares, resulting in excellent diversification and (typically) less volatility than the wider ASX share market. It recently announced its FY25 result, which included an annual dividend per share of 7.2 cents. At the time of writing, it has a grossed-up dividend yield of 7.5%, including franking credits.

The post 2 ASX dividend shares raising dividends like clockwork appeared first on The Motley Fool Australia.

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• How to retire early using ASX dividend shares
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Motley Fool contributor Tristan Harrison has positions in Future Generation Australia. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Apa Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

This ASX growth stock has staged a remarkable turnaround. After surviving the buy now pay later (BNPL) shake-out and refocusing on profitability, Zip Co Ltd (ASX: ZIP) is now delivering strong earnings growth and attracting renewed analyst support.

Here are three reasons why market watchers believe Zip shares could be a compelling growth buy today.

Profitable growth is finally arriving

The ASX growth stock has spent the past few years shifting away from ‘growth at any cost’ toward profitable expansion. The strategy now appears to be paying off.

In its latest half-year results, the company reported record cash EBITDA of $124.3 million, up 85.6% year-on-year. Total income climbed 29% to $664 million, while total transaction volume reached $8.4 billion, a 34% increase.

Importantly, bad debts remain under control at around 1.7% of transaction volume, which suggests Zip is managing credit risk effectively while growing its lending book.

For investors who previously worried about sustainability, the improving profitability story is a major shift.

Huge expansion runway in the US

The US business has become the engine of the ASX growth stock. Transaction volumes, revenue, and customer engagement have surged as the platform signs new merchants and rolls out additional payment products.

The US market now generates most of Zip’s earnings and continues to grow rapidly. Analysts note that the company is benefiting from strong consumer demand for flexible payments and partnerships with large merchants.

If Zip continues gaining traction in the world’s largest consumer market, its long-term growth runway could be far larger than the Australian BNPL opportunity alone.

Analysts see massive upside

The ASX growth stock has lost some serious ground recently. Despite closing 10% higher on Thursday to $1.78, Zip shares have lost 46% over 6 months.

As a result, most brokers have strong buy ratings on the stock, reflecting confidence in Zip’s improving profitability and expanding US business.

According to analyst estimates, the fintech share carries an average 12-month price target of around $4.21. Forecasts are ranging from roughly $3.35 to $5.27. That implies 88% to 196% upside from current trading levels.

Foolish Takeaway

Despite the improving outlook, Zip is still a higher-risk growth stock.

The BNPL sector faces intense competition from global payment companies, banks, and tech giants. Regulation is also tightening in several markets, which could impact lending models and compliance costs.

Consumer spending cycles are another factor. If economic conditions weaken and bad debts rise, fintech lenders like Zip can see earnings pressured quickly.

Zip is no longer just a speculative BNPL name. With strong earnings growth, improving margins, and expanding US operations, the ASX growth stock has built a more compelling investment case with plenty of potential upside.

The post 3 reasons to buy this oversold ASX growth stock today appeared first on The Motley Fool Australia.

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