The TPG Telecom Ltd (ASX: TPG) share price has had a rough ride over the past year. Even with today’s 1.5% lift to $3.86, the stock is still well below prior levels after a stretch of network issues, capital management changes, and growing investor uncertainty.

With 2026 fast approaching, many investors are now wondering if this could finally be the year TPG starts to rebuild confidence.

TPG has also released its key dates for 2026, giving shareholders a clearer view of when major updates and dividends will land.

Here is what I’ll be watching over the next 12 months.

Full-year results kick off the calendar

TPG’s first big moment arrives on 27 February 2026, when it unveils its full-year results and announces its next dividend.

This update will be crucial for several reasons. Investors will want to see:

• How the business is recovering after the 000-network outage
• The financial impact of its recent capital initiatives
• Whether margins and mobile subscriber trends are stabilising
• Any early signs of earnings momentum returning

The ex-dividend date falls on 5 March, with payment on 2 April, giving ample time for investors to jump on the dividend.

AGM and mid-year reset

Shareholders will hear straight from management again at the Annual General Meeting on 8 May 2026. After a challenging year, this is likely to be an important opportunity for TPG to lay out its strategy and provide reassurance that operational issues are firmly behind it.

The company then hits its half-year reporting period, ending on 30 June, before delivering interim results on 21 August 2026. That update will also include TPG’s interim dividend.

Here are the key dividend dates:

• Interim dividend ex-date: 27 August
• Record date: 31 August
• Payment date: 29 September

What could drive a turnaround

TPG has spent months navigating outages, investigations, and major capital returns. But with its free float increasing and large reinvestment plans completed, 2026 may provide a cleaner run for the business.

A few things I will be watching closely:

• Improvements in network performance and customer satisfaction
• Progress in integrating fibre assets and improving mobile coverage
• Evidence that operating costs are being brought under control
• More consistent earnings as short-term disruptions pass

If TPG can tick a few of these boxes, the share price could begin to move in the right direction.

Foolish Takeaway

TPG has had a tough stretch, but the company now has a clear calendar of catalysts in 2026. With dividends back on track and several opportunities to rebuild investor confidence, next year could be an important one for the telecom giant.

The results will speak for themselves, but 2026 is already looking like a year worth keeping on the radar.

The post Could 2026 be a turning point for TPG? Here’s what I’m watching appeared first on The Motley Fool Australia.

More reading

• TPG Telecom lifts free float after $73 million Retail Reinvestment Plan
• The 4 worst performing ASX 200 stocks to hold in November unmasked
• TPG Telecom launches $438m reinvestment plan after $3bn capital return
• 3 ASX 200 stocks plumbing 52-week lows today
• Why Ausgold, DroneShield, EML, and TPG shares are falling today

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

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a decline. At the time of writing, the benchmark index is down 0.8% to 8,627.7 points.

Four ASX shares that are falling more than most today are listed below. Here’s why they are dropping:

ASX Ltd (ASX: ASX)

The ASX share price is down almost 7% to $53.03. Investors have been selling the stock exchange operator’s shares after it committed to a strategic package of actions with the Australian Securities and Investments Commission (ASIC). These commitments address the findings contained in an interim report from the expert ASIC Inquiry Panel and are designed to deliver confidence in ASX as a provider of critical market infrastructure. One action will be ASX accumulating an additional $150 million of capital above net tangible asset (NTA) value by 30 June 2027. This will then be in place until agreed milestones in the revised accelerate program are completed to the satisfaction of ASIC.

CSL Ltd (ASX: CSL)

The CSL share price is down over 2% to $179.77. This is likely to have been driven by a broker note out of Macquarie Group Ltd (ASX: MQG) on Monday. According to the note, the broker has downgraded the biotech giant’s shares to a neutral rating with a reduced price target of $188.00. It said: “With the risk of share losses from CIs in CIDP, we downgrade CSL to Neutral (from Outperform). We also see risks to FY26 guidance, given it is in the second half club, noting significant headwinds in 1H26. Our TP declines -32% from A$275.20 to A$188.00 reflecting a shift away from DCF valuation (~A$228) given uncertainty in CSL’s long-term earnings profits and towards PE valuation based on a basket of comps with similar EPS growth (~$175).”

Galan Lithium Ltd (ASX: GLN)

The Galan Lithium share price is down almost 2% to 26.5 cents. This is despite the release of a positive update on the progress of its phase 1 construction activities for Hombre Muerto West (HMW), as it advances towards its final stages. Galan’s managing director, Juan Pablo Vargas de la Vega, said: “The project is transitioning into an exciting final phase of construction and commissioning. The momentum being built across the team gives us confidence as we move toward becoming a producing lithium company.” It is possible that profit taking from some investors is overshadowing the news. After all, its shares are up almost 70% since the start of November.

Nextdc Ltd (ASX: NXT)

The Nextdc share price is down almost 2% to $13.28. This appears to have been driven by weakness in the tech sector on Monday. Investors have been selling AI stocks following a selloff on the tech-focused Nasdaq index on Friday night.

The post Why ASX, CSL, Galan Lithium, and NextDC shares are dropping today appeared first on The Motley Fool Australia.

More reading

• Why did Macquarie just downgrade CSL shares?
• ASX Ltd shares drop 6% on $150m capital charge
• Why are ASX 200 tech stocks like Xero shares taking a beating on Monday?
• Here are the latest growth forecasts for the CSL share price
• Top brokers name 3 ASX shares to buy next week

Motley Fool contributor James Mickleboro has positions in CSL and Nextdc. 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. 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.

The MFF Capital Investments Ltd (ASX: MFF) share price is edging higher today, trading around $4.87, up 0.2%. This comes after the company announced a significant leadership update that will take effect from 1 January 2026.

Given MFF’s focus on stability and disciplined returns, this is a meaningful update for shareholders. Here’s what the company shared on the ASX this afternoon.

A new CEO steps in

According to the release, MFF has appointed Gerald Stack as its new CEO and Managing Director. Stack is a well-regarded figure in Australian funds management, with over 30 years of experience, including 18 years at Magellan Financial Group (ASX: MFG), where he led the global infrastructure business and oversaw assets exceeding $16 billion.

Stack only joined MFF in September 2025 as head of Investment Management, so today’s promotion doesn’t come as a big surprise. Given the market’s reaction, it’s a clear sign the investors want him steering the company into its next stage of growth.

Chris Mackay, meanwhile, will hand over his portfolio manager duties but remain on the board and slide into an Executive Director role focused on investments and capital. As Mackay has been a big part of MFF’s track record, shareholders will also probably welcome the fact that he’s staying close to the action.

Why this change matters

MFF highlighted that the leadership shift sits within its broader transition to a longer-term operating model. The fund now manages an investment portfolio of roughly $3.1 billion in assets and net cash and has expanded its internal investment capabilities through Montaka Global Investments.

The company noted several important achievements:

• Employee headcount has grown meaningfully
• The fund continues to prioritise disciplined risk management
• Portfolio liquidity and transparency remain key priorities
• MFF has grown its balance sheet significantly over the long run

MFF Chair, Annabelle Chaplain, described the leadership expansion as the “right balance of continuity and growth”.

Dividend update

MFF also announced its intention to pay a fully franked dividend of 10 cents per share for the six-month period ending 31 December 2025, subject to legal and commercial considerations. This would be an increase on the fully-franked dividends of 9 cents per share previously paid in October 2025 and 8 cents in April 2025.

Foolish Takeaway

Leadership changes can sometimes unsettle a market, but this one appears to have landed smoothly. With a strong balance sheet, improving dividends, and an expanded investment capability, MFF looks well placed for the years ahead.

For long-term, income-focused investors, it continues to look like a steady and reliable option worth keeping on the watchlist.

The post MFF Capital just announced a major leadership change. Here’s what it means for investors appeared first on The Motley Fool Australia.

More reading

• I’d buy this ASX dividend stock in any market
• 2 magnificent ASX stocks to own for the long haul
• 3 great ASX shares I’m buying to become a millionaire
• Lazy investor: this ASX dividend growth stock deserves a spot in your portfolio
• Could this undervalued ASX stock be your ticket to millionaire status?

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

In afternoon trade, the S&P/ASX 200 Index (ASX: XJO) is on course to record a disappointing decline. At the time of writing, the benchmark index is down 0.8% to 8,629.6 points.

Four ASX shares that are not letting that hold them back today are listed below. Here’s why they are rising:

4DMedical Ltd (ASX: 4DX)

The 4DMedical share price is up 6% to $2.36. This has been driven by news that the respiratory imaging technology company has received regulatory approval for its CT:VQ product. It is the world’s first and only non-contrast, CT-based ventilation-perfusion imaging solution. Management notes that this approval marks a significant expansion of 4DMedical’s presence in North America. This approval allows immediate commercial deployment of CT:VQ across Canada through the company’s strategic partnership with electronics giant Philips.

Electro Optic Systems Holdings Ltd (ASX: EOS)

The EOS share price is up 25% to $6.27. Investors have been scrambling to buy this defence and space company’s shares after it made a big announcement. EOS revealed that it has signed a binding conditional contract worth $120 million to manufacture and supply a 100kW high energy laser weapon to a company in the Republic of Korea. This conditional contract represents the second export order for a 100kW class laser defence system, following a first export order to a Western European customer earlier this year.

Gorilla Gold Mines Ltd (ASX: GG8)

The Gorilla Gold Mines share price is up 9% to 51.2 cents. This follows news that the gold developer has upgraded the estimated mineral resource for its Comet Vale project to 860,000 ounces of contained gold. Gorilla Gold’s CEO, Charles Hughes, said: “The Comet Vale Project is rapidly emerging as a camp-scale gold development project, with this resource update incorporating the three new, high-grade discoveries that Gorilla has made within the project area over the past year.”

Neuren Pharmaceuticals Ltd (ASX: NEU)

The Neuren Pharmaceuticals share price is up 2.5% to $19.45. Investors have been bidding this pharmaceutical company’s shares higher after it received FDA approval for a new product. The regulator has given the thumbs up to Daybue STIX, which is a dye- and preservative-free powder formulation of trofinetide for the treatment of Rett syndrome. Neuren’s CEO, Jon Pilcher, said: “The Neuren team is excited about the approval of this new treatment option for Rett syndrome families and the continued investment and innovation for trofinetide by our global partner, Acadia.”

The post Why 4DMedical, EOS, Gorilla Gold, and Neuren shares are racing higher today appeared first on The Motley Fool Australia.

More reading

• This ASX 200 stock is charging higher on FDA approval news
• Guess which high-flying ASX All Ords gold share is rocketing again today on a ‘major upgrade’
• Key Canadian approval sends 10-bagger biotech’s shares higher
• Counter drone company surges past $1 billion valuation with new contract win
• Neuren Pharmaceuticals wins DAYBUE STIX FDA approval

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 Electro Optic Systems. 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.

Mineral Resources Ltd (ASX: MIN) shares are shaking off the broader market retrace today and marching higher.

Shares in the S&P/ASX 200 Index (ASX: XJO) lithium miner and diversified resources producer closed Friday trading for $52.03. During the Monday lunch hour, shares are changing hands for $52.22 up 0.4%.

For some context, the ASX 200 is down 0.7% at this same time.

That’s some welcome outperformance from the ASX 200 mining stock today.

And investors who bought Mineral Resources shares at the multi-year closing low of $14.40 on 9 April will really be cheering, with the stock now up a blistering 262.6% since that low. Or enough to turn a $10,000 investment into $36,264.

Boom!

But following on that tremendous run, is the Aussie miner still a good buy today?

Should you buy Mineral Resources shares today?

Alto Capital’s Tony Locantro recently ran his slide rule over the diversified mining stock (courtesy of The Bull).

“MIN is a diversified resources company, with extensive operations in lithium, iron ore, energy and mining services across Western Australia,” he said.

“The company delivered strong operational results in the first quarter of 2026, which included record iron ore output from Onslow Iron, triggering a $200 million payment,” Locantro noted.

Indeed, Mineral Resources shares closed up 13.7% at $48.20 on 30 October, the day the company reported its Q1 FY 2026 results.

As Locantro mentioned, with Onslow Iron operating at its 35 million tonne per annum (Mtpa) nameplate capacity between August and October, investors reacted enthusiastically after the miner said it will receive a $200 million contingent payment from Morgan Stanley Infrastructure Partners.

The miner also reassured the market, saying it was on track to meet its fully year FY 2026 volume and cost guidance across all of its divisions.

Less than two weeks later, Mineral Resources shares leapt another 9.2% on 12 November. That came after the miner announced a major agreement with South Korean steel manufacturing giant POSCO to sell some of its interests in its Western Australian lithium mines.

“MIN’s joint venture lithium terms with POSCO Holdings will realise it an upfront payment of $A1.2 billion for part of MIN’s lithium business,” Locantro said.

But following on the massive run higher, he has a sell recommendation on Mineral Resources shares.

Locantro concluded:

MIN’S shares have risen from $14.40 on April 9 to trade at $51.90 on December 11. With most of the upside seemingly priced in and commodity cycles still volatile, it may be prudent to cash in some gains made on the strong share price recovery.

The post Up 263% since April are Mineral Resources shares still a good buy today? appeared first on The Motley Fool Australia.

More reading

• 5 ASX shares to buy now: experts
• Will Mineral Resources shares resume dividends in 2026?
• 10 most-traded ASX shares last week
• 7 ASX mining shares to buy for Christmas amid upgrades from Macquarie
• Here are the top 10 ASX 200 shares today

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

I’ve considered an investment in many ASX 200 shares. Only a few have ever made the cut as members of my investment portfolio. But one popular ASX stock has never even got close to the entryway. That would be Woodside Energy Group Ltd (ASX: WDS) shares.

This ASX 200 energy stock is one of the largest shares in the S&P/ASX 200 Index (ASX: XJO) – number 12 at present, to be exact. Many investors buy Woodside for its large portfolio of oil and gas assets, which spans from Australia to North America. Many more are attracted to this stock’s fully franked 6.8% dividend yield.

On paper, there are many things to like about Woodside shares. But I’ve never owned this stock, and I probably never will. There are two reasons why.

Two reasons I will never buy Woodside shares

No moat, no advantage

Woodside shares are cursed with the same affliction that all mining and drilling shares are. They are always at the mercy of a capricious and volatile market, which they have almost no influence over.

Most companies produce a good or service that they can sell at a determined price. Now, the invisible hand of the market always puts constraints on the price, of course. But the best companies tend to have some level of discretion over what they charge. There’s a reason why Apple, for example, enjoys some of the best margins around. People are simply willing to pay what the company asks for its products due to strong brand loyalty. It can afford to decide its own prices.

But Woodside can only ever sell its oil and gas at whatever the current market rate is. A barrel of Woodside’s oil is no better or worse than a barrel of anyone else’s. As such, the company has no moat, no competitive advantage it can leverage to the benefit of its investors. It can make hay while the sun of high oil prices is shining, of course. But when prices go through the floor, as they do every so often, there is nothing Wooside can do to stop its profits from eroding.

As such, Woodside’s profits, and thus dividends, are highly cyclical, and thus difficult to compound over long periods of time.

Woodside shares: A poor history of capital management

It’s for the reason above that I tend to avoid most commodity-based stocks. But Woodside has a particularly poor performance track record amongst its peers.

Many oil companies manage the ups and downs of their sector with reasonable success. I would argue Wodoside is not one of those companies. Take a high-quality energy stock like the American giant Chevron Corp. Chevron shares bounce around from year to year. But the trajectory has always been slowly upwards. The Chevron stock price’s latest all-time high came back in late 2022, when oil prices were still at elevated levels following the Russian invasion of Ukraine.

But Woodside’s? That was way back in May 2008. Yep, Woodside shares hit just over $61 a share back then, and have never even come close since. An investor who bought this company at that time would still be down 60% as it currently stands. Sure, there have been ups and downs since. But the downs have come far more frequently than the ups.

As it stands today, Woodside shares are up just 4.06% over the past five years, and up 3.5% over the past 12 months. Investors would have been far better off owning a simple ASX 200 index fund over both periods (and most others).

This arguably shows a poor capital management track record from the company.

Foolish Takeaway

I don’t have anything against Woodside as a business. But there is simply nothing in its past or present that indicates to me that it will be a market-beating investment in the future. Some corners of the economy are simply easier to make money in than others. I tend to try and stick to the easier ones.

The post Loser stock? Here’s why I’ll never own Woodside shares appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Monday
• Dividend investors: Premier ASX energy shares to buy in December
• 5 ASX shares to buy now: experts
• Looking for strong dividend yields? Look no further than these energy stocks
• 5 things to watch on the ASX 200 on Monday

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

Investors in well-known ASX retail stock Myer Holdings Ltd (ASX: MYR) have endured a tough year.

Since the start of January, Myer shares have plunged by 62% to trade at $0.47 at the time of writing.

This compares with a 5.4% rise for the All Ordinaries Index (ASX: XAO) across the same timeframe.

Not only that, but Myer shares reached a 52-week low of $0.39 each just last month, a far cry from last year’s high of $1.27 per share.

Much of this weakness appears to reflect an underwhelming operating performance in recent months.

Let’s take a closer look at how 2025 unravelled for the company.

What happened?

In January, a trading update rattled investors as Myer reported softer sales and a decline in operating gross profit amidst a challenging retail environment.

The market reaction was swift, with Myer shares tumbling by more than 20% on the day of the announcement.

Sentiment deteriorated further in September following the release of the company’s FY25 results.

Here, Myer shares dropped by 25% on the back of a small sales increase but a significant decline in operating earnings (EBIT).

The ASX retail stock also opted not to declare a dividend, citing ongoing cost pressures and difficult retail conditions.

However, fast forward to today and investment bank Canaccord Genuity believes the outlook for Myer shares could be recovering.

Let’s dive into the reasons for the broker’s bullish views.

Why Myer shares could storm higher

Senior analyst at Canaccord, Allan Franklin, appeared to strike an optimistic tone following an update at Myer’s AGM on Thursday last week.

The company reported that total sales for the first 19 weeks of FY26 lifted by 3% from the same time last year.

This performance marks a faster pace of growth than Canaccord’s modelling.

The broker also noted that like-for-like sales for Myer Retail and Apparel Brands both showed an improvement.

According to Canaccord:

Myer’s AGM commentary displayed steady progress on several fronts (engaged customers, brand curation, omni-channel execution) and pleasingly stronger-than expected YTD sales growth. Both Myer Retail and Apparel Brands look to have traded well through Oct/Nov ahead of peak trading.

Canaccord also pointed to encouraging momentum in Myer’s loyalty program.

The retailer has added 475,000 new MYER one members in the first half of FY26 so far, with around half under the age of 35.

Another positive includes the expansion of Myer’s partnership with Commonwealth Bank of Australia (ASX: CBA), allowing CommBank awards points to be transferred to MYER one.

In addition, JD Sports Fashion PLC (LSE: JD) and The Dom adopted MYER one as their loyalty platform.

That said, Canaccord trimmed its earnings forecast for Myer shares, largely reflecting a more cautious view on the company’s gross margins.

Upside potential for Myer shares

Overall, Canaccord appears positive on Myer’s prospects.

The broker has retained its buy rating and set a target price of $0.79 per share.

This implies 68% upside potential from $0.47 per share at the time of writing.

The post Broker tips 68% upside for Myer shares following brutal sell-off appeared first on The Motley Fool Australia.

More reading

• Why is the Myer share price rocketing 10% on Thursday?

Motley Fool contributor Bart Bogacz 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 Myer. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

CSL Ltd (ASX: CSL) shares are having a poor start to the week.

In afternoon trade, the biotechnology giant’s shares are down 1.5% to $180.99.

Why are CSL shares falling?

There are a couple of reasons why investors have been selling down the company’s shares today.

The first is broad market weakness following a selloff on Wall Street on Friday night. This has led to the ASX 200 index dropping 0.6% today.

Also putting pressure on CSL shares today has been the release of a broker note out of Macquarie Group Ltd (ASX: MQG) this morning.

According to the note, the broker has downgraded the company’s shares to a neutral rating (from buy) with a heavily reduced price target of $188.00 (from $275.20). This is only modestly ahead of where its shares currently trade.

Why the downgrade?

Macquarie made the move on the belief that CSL’s shares are going to remain being valued at levels that implies that the company is now out of its growth stage. This is being driven by competing therapies that are under development, structural changes in China, and US vaccination rates. It explains:

CSL’s share price has close to halved since COVID. Recent R&D disappointments (eg, Kcentra), structural changes (eg, China albumin) and multiple downgrades have painted CSL as ex-growth. The core Behring franchise has also been threatened, starting with FcRn antagonists, and now complement inhibitors. US vaccinations continue to decline, proving risk beyond FY26E.

We estimate 25% of CSL’s IG share in CIDP is at risk, which could result in a 4% EPS impact by FY33. While this impact is modest, positive Phase 3 trials would add to the market’s concern that CSL is ex-growth, and that earnings should be capitalised at a lower multiple. This is yet to be captured in our forecasts.

In addition, the broker fears that CSL could yet fall short of its revised guidance in FY 2026, putting further pressure on its shares. It adds:

We see risk to FY26 guidance with 2H reliant on containing China’s albumin impacts. CSL plans to expand its China footprint, strengthen retail partnerships and drive demand generation. However, we see this structural shift unlikely to be resolved in 2H with competitors expecting impacts to sustain.

Macquarie then concludes:

With the risk of share losses from CIs in CIDP, we downgrade CSL to Neutral (from Outperform). We also see risks to FY26 guidance, given it is in the second half club, noting significant headwinds in 1H26.

Our TP declines -32% from A$275.20 to A$188.00 reflecting a shift away from DCF valuation (~A$228) given uncertainty in CSL’s longterm earnings profits and towards PE valuation based on a basket of comps with similar EPS growth (~$175).

The post Why did Macquarie just downgrade CSL shares? appeared first on The Motley Fool Australia.

More reading

• Here are the latest growth forecasts for the CSL share price
• 3 excellent Australian dividend shares to buy with $1,000
• Buy Australian: ASX stocks positioned to beat global markets next year
• 5 ASX 200 shares I’d buy with $10,000 this week
• Up 40% in a year, why Macquarie expects this ASX 200 dividend stock to keep outperforming in 2026

Motley Fool contributor James Mickleboro has positions in CSL. 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. 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 Ltd (ASX: ASX) shares fell 6% today after the company revealed it must carry an additional $150 million of capital above its net tangible assets (NTA) by 30 June 2027. This additional capital charge will remain in place until regulatory milestones in the revised Accelerate Program are met to the satisfaction of the corporate regulator ASIC.

This follows the release of an interim report from the expert ASIC Inquiry Panel, and the stock is now down 18% year to date, reflecting persistent investor concern over the ASX’s governance, operational resilience, and mounting transformation costs.

Why ASX Ltd’s shares sold off

In a market announcement released this morning, ASX committed to a broad strategic package of actions in response to ASIC’s findings. The Panel’s interim report concluded that ASX must substantially improve operational risk management, governance, and leadership across its clearing and settlement businesses.

The most immediate financial impact is the $150 million uplift in additional capital above net tangible assets, which effectively constrains the company’s balance sheet and depresses future returns on equity.

Dividend policy tightened

In order to accumulate the additional capital, ASX will:

• Lower its dividend payout ratio range from the previous range of 80% – 90% to a new range of 75% – 85% of underlying NPAT
• Hold dividends at the bottom end of the new range for at least the next three dividends
• Operate a discounted dividend reinvestment plan (DRP) to boost retained capital

This combination signals reduced cash yields to shareholders over the near term and is one of the key drivers of today’s share price reaction.

For income-focused investors, this means dividend growth will be softer in the near term. While the ASX remains a profitable business, more of its earnings will now be diverted toward strengthening the balance sheet.

Lower return expectations

The ASX also downgraded its medium-term return on equity (ROE) target from a previous range of 13% –14.5% to a new range of 12.5% –14%.

This reflects the fact that a heavier capital base and the costs associated with remediation efforts will weigh on profitability.

Foolish bottom line

The market’s reaction suggests investors expect a longer, more complex transformation period for the ASX ahead. While the ASX continues to invest heavily in technology and governance improvements, its cost base is rising, returns are becoming tighter, and dividend flexibility is being reduced.

For investors, the key question is whether the worst is now priced in and if the ASX’s near-term challenges create a long-term opportunity. If management successfully delivers its reset and restores confidence, today’s weakness could eventually look like a buying window. But for now, the stock remains under pressure as the company works through regulatory and operational hurdles.

The post ASX Ltd shares drop 6% on $150m capital charge appeared first on The Motley Fool Australia.

More reading

• Why ASX, AUB, Dyno Nobel, and HMC shares are sinking today

Motley Fool contributor Kevin Gandiya has no positions 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.