If you would like some exposure to the small side of the market, then IPD Group Ltd (ASX: IPG) shares could be worth considering.

That’s because analysts at Bell Potter believe this small cap ASX share could rise over 30% from current levels.

What is the broker saying about this small cap ASX share?

Bell Potter was pleased with the electrical solutions provider’s trading update at its annual general meeting. It notes that its guidance for the first half was ahead of the market’s expectations. It said:

IPG has provided 1H FY26 EBITDA and EBIT guidance based on its unaudited accounts for the first 4 months of FY26 and management expectations for November and December, and commentary on CMI.

1H FY26 earnings guidance: EBITDA to be within the range of $24.8-25.3m (+6.1% YoY growth at the mid-point; BPe $24.9m; VA $24.4m). EBIT to be within the range of $21.1-21.6m (+5.7% YoY growth at the mid-point; BPe $21.2m; VA $20.6m).

Another positive was that management spoke positively about current trading conditions, which Bell Potter believes will be supportive of growth in FY 2026. It adds:

IPG is observing strong demand for its integrated electrical solutions across Commercial, Industrial, Infrastructure and Data Centre construction markets. In FY26, we are forecasting revenue growth of +5.7% for Commercial (-12.5% in FY25) and +15.0% for Data Centres (+35.0% in FY25).

Big potential returns

According to the note, the broker has reaffirmed its buy rating and $5.00 price target on the small cap ASX share.

Based on its current share price of $3.68, this implies potential upside of 36% for investors over the next 12 months.

But the returns won’t stop there. Bell Potter is expecting a fully franked dividend of 14.7 cents per share in FY 2026. This equates to a 4% dividend yield, which boosts the total potential return to approximately 40%.

Commenting on the update and its buy recommendation, the broker said:

IPG’s AGM Trading Update outlined operating resilience, with 1H FY26 EBITDA and EBIT guidance exceeding consensus expectations. Pleasingly, following a weak FY25, CMI financials appear to be recovering, with an expanding orderbook and opportunity pipeline indicating growth over FY26.

IPG is well positioned to capitalise on the Commercial construction market recovery currently underway as well as continued strong momentum in Data Centre and Infrastructure construction activity. IPG represents a relatively undervalued Industrials business compared with the ASX300 Industrials index with strong re-rate potential, in our view.

The post Why this small cap ASX share could deliver a 40% return appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Why Gentrack, IPD, SRG, and Web Travel shares are racing higher today

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

These ASX 200 shares have all soared over the past 12 months, but they’ve still got a way to go until they reach their peak. These are the shares I’d buy with $10,000 today.

Newmont Corporation (ASX: NEM)

The Newmont share price closed 4.63% higher on Tuesday afternoon, at $132.88 a piece. The ASX 200 mining stock has climbed 7.87% over the past month and has climbed an impressive 120.55% higher since January. 

The miner recently made the list of top global copper producers, ranking in 20th place, after producing 35,000 tonnes during the third quarter of 2025. Newmont holds a resource base containing some 25 million tonnes of copper across North America, Latin America, and the Asia Pacific. The ranking surprised investors since Newmont is best known for being the world’s largest gold producer with global operations in countries across North and South America, Africa, and Australia.

Surging gold and copper prices have supported Newmont’s share price this year. Gold hit a record high last month, surpassing US$4,000 per ounce for the first time and reaching an all-time peak of approximately US$4,358 per ounce. Copper also hit a record high in late October at US$11,200 per tonne on the London Metal Exchange.

The ASX 200 share is tipped to continue growing too. Morgans said it had maintained an accumulate rating on Newmont shares following its 3Q FY25 results. It also raised its 12-month share price target from $146 per share to $148 per share. That implies an upside of 11.4% over the next 12 months.

Macquarie is more cautious with a neutral rating and a higher share price target of $153. That implies a potential 15.2% upside at the time of writing.

Tradingview data shows that some analysts are even more bullish, with the maximum target price of $186.49 per share. That represents a potential 49.5% upside for investors at the time of writing.

Eagers Automotive Limited (ASX: APE)

The Eagers share price closed 3.01% higher on Tuesday afternoon, at $30.09 a piece. Over the past month, the shares have fallen 3.25% but they’re still a huge 156.3% higher for the year-to-date.

A significant portion of Eagers’ success over the past year is the rise of the fast-growing Chinese electric vehicle brand, BYD. Eagers operates around 80% of the dealerships that sell BYD cars in Australia. Meanwhile, Eagers’ used-car retailer Easyauto123 has been boosted by a shift in consumer preference towards used cars. This has been fueled by the cost-of-living crisis.

The company also announced a $1 billion acquisition of CanadaOne Auto Group. To fund the deal, Eagers raised $452 million and brought in Mitsubishi Corporation as a new strategic partner. Mitsubishi is also taking a 20% stake in Easyauto123, signalling ambitions to help scale the used-car business.

Analysts are bullish on the outlook for the stock, too. So it looks like even after this year’s share price surge, any stock purchased right now can still benefit from a robust upside. 

Macquarie has an outperform rating Eagers’ shares and a $29.98 target price. Although this implies a potential 0.36% downside at the time of writing. 

The team at RBC Capital Markets are also bullish on the shares and have a $32 target price in place. What implies a 6.34% upside at the time of writing. 

Tradingview data shows some analysts expect Eagers’ shares to climb as high as $34, which implies a 12.99% upside at the time of writing. 

The post 2 soaring ASX 200 shares I’d buy with $10,000 today appeared first on The Motley Fool Australia.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• Revealed: BHP and 4 other ASX 200 mining stocks rank among top global copper producers
• 5 things to watch on the ASX 200 on Monday
• 5 things to watch on the ASX 200 on Thursday
• 5 things to watch on the ASX 200 on Wednesday

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

Small-cap stock IVE Group (ASX: IGL) held its Annual General Meeting yesterday. 

IVE Group is the largest integrated marketing communications business in Australia, with leading market positions across every sector in which the company operates.

This small-cap stock has been a market beater in 2025.

It has risen more than 33% year to date.

For context, the S&P/ASX Small Ordinaries Index (ASX: XSO) is up 16% in the same period.

However, the company provided a trading update yesterday, which was effectively a soft downgrade to FY26 guidance. 

Ive Group reported that YTD revenue has been softer than expected across the retail and media sectors, impacting IVE’s catalogue business in particular. 

FY26 underlying NPAT is now expected to be at the bottom end of the previously advised $50-54m guidance range. 

Markets reacted poorly to this update, as the small-cap stock lost more than 6% yesterday. 

Following the AGM, the team at Bell Potter released fresh guidance on the ASX small-cap stock, which included a reduced price target. 

Here’s what the broker had to say. 

EPS downgrades

The broker has maintained its buy recommendation on IVE Group; however, it has downgraded the underlying NPAT/EPS forecasts for FY26, FY27, and FY28 by 6%, 7%, and 7%, respectively. 

Bell Potter said it previously forecasted underlying NPAT of $54.2m, which comprised $53.4m for the core business and $0.8m for the recent acquisitions. 

Yesterday, it downgraded its core forecast to $50.2m, which is consistent with the bottom end of the range. 

Reduced share price target

Based on this guidance, the broker has downgraded the price target to $3.10 (previously $3.25). 

Our updated PT of $3.10 is an 11% premium to the share price and we maintain the BUY recommendation.

Based on yesterday’s closing price of $2.81, the broker sees an estimated upside of 10.32%. 

Small-cap stock also offers generous yield 

This ASX small-cap stock could be an option for investors looking to generate passive income through healthy dividends. 

Bell Potter said IVE group has a history of paying dividends and has a payout ratio policy of between 65-75% of underlying NPAT/EPS. 

The company has, however, held the dividend steady at 18 cents recently and has said it intends to keep it at this level in FY26.

Thereafter, however, the company intends to return to a payout ratio policy of 55-65% of underlying NPAT/EPS.

The broker said the forecast dividend yield over the next three years is a healthy 6.4%, 7.1%, and 7.5% fully franked.

The post Is this small-cap stock a buy after shedding 6% yesterday? appeared first on The Motley Fool Australia.

More reading

• Why Bendigo Bank, Bougainville Copper, Iress, and IVE 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.

With interest rates edging lower and term deposit returns slipping, many Australians are beginning to look to the share market for income.

But if you don’t fancy stock-picking, don’t worry. That’s because ETFs make things simple.

In one trade you gain exposure to lots of dividend-paying shares and in some cases, access to unique sources of income that you won’t find in traditional Australian portfolios.

As we head into December, here are three ASX ETFs that stand out for income-focused investors.

Betashares Global Royalties ETF (ASX: ROYL)

The Betashares Global Royalties ETF could be worth considering. Rather than relying on banks, miners, or property trusts, this ASX ETF targets shares that generate revenue from royalties. This is a model that often provides stable, recurring cash flows.

This includes businesses like ARM Holdings (NASDAQ: ARM), with its licensing-based chip architecture, Wheaton Precious Metals (NYSE: WPM), which receives royalties from global mining operations, and Universal Music Group (AMS: UMG), which earns from music catalogues and streaming rights.

At present, this fund trades with a trailing dividend yield of 5.2%. Betashares recently highlighted it as an attractive option for income-seeking investors.

Betashares S&P Australian Shares High Yield ETF (ASX: HYLD)

The Betashares S&P Australian Shares High Yield ETF focuses on 50 high-yielding ASX shares that are selected using dividend forecasts rather than backward-looking payouts. This helps avoid some of the classic dividend traps and keeps the portfolio geared toward sustainable income.

Among its largest holdings are the likes of big four banks Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB), miner BHP Group Ltd (ASX: BHP), and retail powerhouse Wesfarmers Ltd (ASX: WES). These companies form the backbone of Australia’s dividend landscape.

The Betashares S&P Australian Shares High Yield ETF currently offers a forward yield of approximately 4.7%, making it an appealing option for investors who want diversified income without overcomplicating their portfolio.

Betashares also recently flagged this ASX ETF as a top choice for income-focused investors this month.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

Finally, the Vanguard Australian Shares High Yield ETF could be a top ASX ETF for income investors.

It tracks a basket of shares with the highest forecast dividend yields based on broker expectations, giving investors exposure to some of Australia’s best dividend payers.

Its top holdings currently include BHP, Commonwealth Bank of Australia (ASX: CBA), and Telstra Group Ltd (ASX: TLS). These blue-chip names have long histories of delivering fully franked dividends, even during challenging market conditions.

This fund currently trades with a 4.2% dividend yield.

The post 3 excellent ASX ETFs for income investors to buy in December appeared first on The Motley Fool Australia.

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• 2 Australian dividend giants that I think belong in every portfolio
• Invested in NAB shares? Here are the key dates for 2026
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• What is Ord Minnetts’ view on Virgin Australia and BHP shares?

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 Wesfarmers. The Motley Fool Australia has positions in and has recommended Telstra Group. The Motley Fool Australia has recommended BHP Group, Vanguard Australian Shares High Yield ETF, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

ASX dividend shares can be a great source of passive income for investors because of their ability to share profits year after year with shareholders.

Some businesses trade at relatively low multiples of their earnings, which can support a relatively high dividend yield. Additionally, some businesses may pay out a high level of their earnings each year, which can also lead to a higher dividend yield. When a business has both elements in its favour, that can mean a very high dividend yield.

The two ASX dividend shares I’ll discuss both have the potential to yield double-digit dividends in the coming years.

GQG Partners Inc (ASX: GQG)

GQG is one of the larger listed fund managers on the ASX, with a market capitalisation of close to $5 billion. I think it’s very good value at that price.

The business has been paying investors a dividend payout ratio of around 90% of its distributable earnings in recent times, which means a very good dividend yield for investors.

Its latest quarterly dividend alone equates to a dividend yield of 3.4%. That’s an annualised dividend yield of close to 14%, at the time of writing.

If the business can just maintain its dividend at this level, then that’s an impressive return by itself.

I also think the ASX dividend share can deliver capital growth for shareholders if the investment performance of its funds can turn around. It recently took a defensive positioning with its portfolios because of the perceived overvaluation of AI/tech businesses – a prudent move, in my eyes.

While being defensive has led to underperformance in 2025, I think the recent decline of tech valuations will have helped GQG’s funds catch up.

Based on the latest quarterly dividend, the GQG share price is currently trading at less than 7x its distributable annualised net profit, which seems cheap, particularly if it can deliver stronger investment performance/stabilise the funds under management (FUM) outflows.

Shaver Shop Group Ltd (ASX: SSG)

Shaver Shop is one of my favourites for ASX dividend shares, boasting a large yield due to its track record of consistently delivering and regularly growing dividends. It has grown its annual dividend almost every year in the last several years, aside from one year (FY24) when it maintained its payout.

The company has 126 stores, with 116 in Australia and 10 in New Zealand. It claims to be the market leader in a growth sector. Its products are focused on DIY grooming, personal care, hair and beauty appliances for men and women, with a specialisation in premium products.

The ASX dividend share increased its payout to 10.3 cents in FY25, which translates into a grossed-up dividend yield of 10.1%, including the franking credits. If it hikes its dividend slightly to 10.4 cents in FY26, that’d be a grossed-up dividend yield of 10.25%.

I’m optimistic the company can grow its profits further with the growth of its own brand (called Transform-U), additional exclusive agreements with new shaver brands, more stores, and the potential to increase margins as it becomes larger.

According to the estimates on CMC Markets, the business is trading at 12x FY26’s forecast earnings.

The post Get paid huge amounts of cash to own these ASX dividend shares! appeared first on The Motley Fool Australia.

More reading

• I’d buy 11,429 shares of this ASX stock to aim for $100 a month of passive income
• Here are the top 10 ASX 200 shares today
• 3 ASX 200 stocks storming higher in this week’s sinking market
• Why DroneShield, GQG Partners, Origin Energy, and Worley shares are falling today
• Here are the top 10 ASX 200 shares today

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

ASX 200 tech shares are in a bear market, with the S&P/ASX 200 Information Technology Index (ASX: XIJ) down 24% from its peak.

A bear market is defined as a 20% (or more) fall from the most recent high point.

The ASX 200 tech stock index reached an all-time high of 3,060.7 points on 19 September.

Yesterday, the index closed at 2,317.6 points, down 743 points in just a little over two months.

By comparison, the S&P/ASX 200 Index (ASX: XJO) hit a record 9,115.2 points on 21 October and has slipped 6.3% since its peak.

The other market sectors have also fallen from their recent highs, set between August and October, but not as dramatically as technology.

Healthcare is also in a bear market, down 23.6%, but that decline has occurred over 10 months since the sector’s peak on 31 January.

Take a look.

S&P/ASX 200 market sector	52-week high	When	Fall since the high
Materials (ASX: XMJ)	20,192.4 points	21 October	(3.4%)
Industrials (ASX: XNJ)	8,811.8 points	27 October	(3.6%)
Utilities (ASX: XUJ)	10,323.9 points	29 October	(4.8%)
Energy (ASX: XEJ)	9,460.2 points	27 August	(8.8%)
A-REIT (ASX: XPJ)	1,975.8 points	21 August	(9%)
Communication (ASX: XTJ)	1,986.2 points	22 August	(9.2%)
Financials (ASX: XFJ)	9,978.4 points	28 October	(9.7%)
Consumer Staples (ASX: XSJ)	12,992.9 points	26 August	(9.9%)
Consumer Discretionary (ASX: XDJ)	4,620.6 points	21 August	(13.2%)
Healthcare (ASX: XHJ)	46,575.4 points	31 January	(23.6%)
Information Technology (ASX: XIJ)	3,060.7 points	19 September	(24.3%)

Why are technology and healthcare in a bear market?

ASX 200 tech and healthcare shares are in bear territory partly because each sector’s largest company has been significantly derated.

In the tech sector, WiseTech Global Ltd (ASX: WTC) shares have fallen 51% from their 52-week high of $134.26 on 5 December 2024.

Governance concerns have plagued the logistics software supplier this year, along with investors’ disappointment with FY25 earnings.

In the healthcare sector, CSL Ltd (ASX: CSL) shares are down 37% since their 52-week high of $290.32 per share on 8 January.

The global biotech has been hit by weaker global flu vaccine demand and is undergoing a major restructure, including 3,000 job cuts.

It’s notable that ASX 200 healthcare shares have fallen 23.6% over 10 months, while tech shares have plummeted 24.3% in two months.

This may indicate that ASX 200 tech shares are facing other immediate tailwinds.

One of them is the concern that artificial intelligence (AI) is creating a market bubble.

We saw this play out last week, with markets experiencing high volatility ahead of a quarterly report from AI chip giant Nvidia Corp (NASDAQ: NVDA).

This led to significant fluctuations in the ASX 200, with technology the worst-performing sector of the week, falling 4.07%.

Joe Koh and Elan Miller, portfolio managers of Blackwattle’s Large Cap Quality Fund, said many clients are asking about an AI bubble.

Koh and Miller said uncertainty over further interest rate cuts was another factor weakening ASX 200 tech shares in recent weeks.

They commented:

Some of the weakness was company-specific (such as the ASIC investigation into Wisetech executives’ share trading), but there was also increasing concern around the health of both US and Australian economies.

Higher interest rate expectations following the September inflation numbers also affected growth names in the IT sector, whose earnings and cash flows are further into the future and are therefore more impacted by higher discount rates.

Look outside the tech sector for AI gains: expert

Joe Davis, Vanguard’s Global Chief Economist, expects a rotation out of tech shares as AI matures.

He suggests investors will need to look beyond the tech sector if AI does, indeed, transform the global economy, as markets expect.

Davis said:

In every technology cycle, the firms producing the new technology do initially outperform (sometimes by fantastic or even “irrational” levels); but as the technology spreads, it is non-tech companies that benefit.

That is what happened with manufacturers and service companies during the age of electricity.

Similarly, in the age of AI, health care or financial companies could hold the most transformational potential, implying a rotation in stock outperformance, with the best returns shifting from technology stocks to other sectors.

ASX 200 tech share prices in 2025

Here is how the biggest ASX 200 tech shares by market cap are faring in 2025 so far.

WiseTech shares are down 47% in the year to date.

The Xero Ltd (ASX: XRO) share price is down 28%.

TechnologyOne Ltd (ASX: TNE) shares are down 0.1%.

Nextdc Ltd (ASX: NXT) shares are down 9.3%.

The Life360 Inc (ASX: 360) share price is up 84%.

Codan Ltd (ASX: CDA) shares are up 85%.

Megaport Ltd (ASX: MP1) shares are up 87%.

Dicker Data Ltd (ASX: DDR) shares are up 21%.

The Iress Ltd (ASX: IRE) share price is down 2.2%.

The Siteminder Ltd (ASX: SDR) share price is up 5.9%

The post Bear market alert: ASX 200 tech shares down 24% since September peak appeared first on The Motley Fool Australia.

More reading

• These ASX 200 shares could rise 40% to 90%
• 3 amazing ASX growth shares to buy and hold forever
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• Morgans just upgraded these ASX 200 shares
• Down 21% in 30 days, this top ASX 200 stock now looks on sale to me

Motley Fool contributor Bronwyn Allen 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 CSL, Life360, Megaport, Nvidia, SiteMinder, Technology One, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Dicker Data, Life360, SiteMinder, WiseTech Global, and Xero. The Motley Fool Australia has recommended CSL, Nvidia, and Technology One. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

When you’re building a passive income stream, reliability matters just as much as a dividend yield.

Plenty of companies offer attractive payouts today, but far fewer can maintain, and ideally grow, those dividends.

Thankfully, the ASX is home to several high-quality businesses with strong cash flow, resilient demand, and long records of shareholder returns.

If I were constructing a long-term income portfolio right now, these three ASX dividend stocks would be at the top of my list.

APA Group (ASX: APA)

APA Group remains one of the most dependable income generators on the ASX. As Australia’s largest owner of gas transmission infrastructure, APA earns stable, regulated revenue by transporting a large portion of the nation’s domestic gas through its 15,000km pipeline network. Its assets span gas pipelines, power generation, electricity transmission and renewable energy, which are all industries with high barriers to entry and predictable cash flows.

Management has increased the distribution every year for more than a decade, and the company continues to invest heavily in long-term growth projects across its East Coast Gas Grid, remote power assets and interconnector upgrades. Analysts expect these developments, alongside disciplined cost control, to support further distribution growth well into the future.

Based on its current share price, APA shares are expected to deliver a partially franked dividend yield of 6.2% in FY 2026.

Transurban Group (ASX: TCL)

Toll road operator Transurban is another high-quality ASX dividend stock for long-term income seekers. Its network of roads stretches across Sydney, Melbourne, Brisbane and North America, giving the business a highly defensive earnings base. Traffic volumes tend to rebound quickly from economic slowdowns, and population growth, urbanisation and rising congestion continue to underpin long-run demand.

Because Transurban operates under long-dated concession agreements, it enjoys extraordinary cash-flow visibility. Toll escalations, many of which track inflation, help support predictable and growing distributions. The company also has a robust development pipeline, including major upgrades and expansions that will underpin revenue growth for years to come.

The consensus estimate is for a dividend yield of approximately 4.6% in FY 2026.

Woolworths Group Ltd (ASX: WOW)

Woolworths may not be the highest-yielding stock on the ASX, but what it lacks in headline yield it makes up for in consistency. As Australia’s largest supermarket operator, Woolworths generates steady cash flow through all types of economic conditions. Shoppers may trade down during tougher periods, but they never stop buying essentials.

Its digital transformation, supply-chain improvements and focus on customer loyalty continue to strengthen margins and earnings quality. Over time, these enhancements support sustainable, fully franked dividends, which is exactly what long-term income investors should look for from a defensive blue chip.

Based on current estimates, Woolworths shares offer a fully franked FY 2026 dividend yield of 3.3%.

The post 3 ultra-reliable ASX dividend stocks I’d buy for long-term income appeared first on The Motley Fool Australia.

More reading

• No savings at 55? Here’s how to still retire with passive income
• Best buy for dividends today: Coles or Woolworths shares?
• These top ASX dividend stocks offer 5% yields
• What’s driving a 9% divergence in ASX 200 consumer staples vs. discretionary shares?
• Should you buy Woolworths and these ASX dividend shares?

Motley Fool contributor James Mickleboro has positions in Woolworths Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Transurban Group. The Motley Fool Australia has positions in and has recommended Apa Group, Transurban 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.

The AGL Energy Ltd (ASX: AGL) share price closed in the red on Tuesday afternoon. The ASX energy stock ended the day 0.22% lower at $8.97 a piece. That means that over the month, the shares have now fallen 1.32%. They’re down 21.3% since the start of the year.

A lot of the company’s share price decline is due to weak earnings for FY25. In August, AGL posted a 9% drop in its underlying EBITDA, a 21% decline in underlying NPAT, and a $98 million loss after tax. Investors were spooked, and it caused a sharp sell-off and a 21% plummet of its share price.

At the time, AGL also set a conservative guidance for FY26. It said it expected underlying EBITDA to be between $1,920 million and $2,220 million, and NPAT of $500 million to $700 million. The company said it expects plant availability and fleet flexibility to improve further, with the Liddell Battery coming online in early 2026 and ongoing investment in new flexible assets and customer growth initiatives.

Why buying the ASX energy stock is a no-brainer

AGL has been making some great growth progress recently. In late October, the company announced plans to buy four new gas turbines for approximately $185 million from Siemens AB. The move is part of AGL’s strategy to provide backup capacity for renewable energy.

The Australian Energy Market Operator (AEMO) assigned 176MW of Peak Certified Reserve Capacity to the project, commencing from 1 October 2027.

Shortly later, the company announced the sale of a 19.9% stake in Tilt Renewables for $750 million. It will retain a small residual 0.1% stake. AGL said it will use the proceeds from the divestment to continue to deliver AGL’s strategy, “including to fund its investment in flexible, dispatchable capacity and to provide additional balance sheet flexibility”. 

I think AGL’s latest developments mean the shares are now attractively priced and that there are signs of a price recovery ahead. It’s a great buying opportunity for investors to get in ahead of a potential uptick.

What do analysts think?

According to TradingView data, 7 out of 11 analysts have a buy or strong buy rating on AGL shares. The average target price on the ASX energy stock is $11.14, and the maximum is $12.24. These target prices represent a potential 24.2% to 36.5% upside for investors at the time of writing.

Macquarie analysts confirmed their outperform rating on AGL shares and $11 target price in September. At the time of writing, this represents a potential 22.6% upside for investors over the next 12 months. The broker noted that wind power purchase agreements (PPAs), a long-term contract for a buyer to purchase electricity at a fixed price, is pricing closer to $120 per MWh (megawatt-hour). According to Macquarie, this suggests an electricity price of $150 per MWh, or higher, will be needed by 2030.

The post 1 no-brainer ASX energy stock to buy with $500 right now! appeared first on The Motley Fool Australia.

More reading

• How to prepare for a share market crash… before it’s too late
• AGL Energy unlocks value with $750m Tilt Renewables stake sale
• ASX 200 energy stock lifts off on $185 million news

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

The ASX 200 has been volatile lately, but that hasn’t stopped analysts from identifying pockets of real opportunity.

In fact, several high-quality companies are now trading at valuations that suggest potential for significant upside over the next 12 months.

For example, the two ASX 200 shares listed below have been named as buys by analysts and tipped to rise 40% or more. Here’s what they are recommending:

Sonic Healthcare Ltd (ASX: SHL)

Sonic Healthcare could be a cheap ASX 200 share to buy.

This leading diagnostic company has been struggling over the past couple of years after COVID-19 testing revenue dried up.

However, with a clean slate and organic growth returning, now could be a good time to snap up shares.

Demand for pathology and diagnostic services is both essential and growing, supported by ageing populations and increasing prevalence of chronic disease. Sonic continues to invest in automation, digital workflow optimisation, and efficiency improvements, all of which are expected to support margin expansion over the medium term.

Bell Potter is positive on the company. It said:

One can expect SHL to generate solid mid-high single digit organic EPS growth with addon benefit of acquisitions to drive double-digit growth on a normal basis. SHL is a sold compound generator, which is why it holds appeal in our view.

The broker has a buy rating and $33.30 price target on its shares. Based on its current share price of $23.19, this implies potential upside of 44% for investors over the next 12 months. It also expects an attractive 4.7% dividend yield in FY 2026.

Xero Ltd (ASX: XRO)

Another ASX 200 share with potential to rise strongly is cloud accounting leader Xero.

It has delivered consistent growth for more than a decade, and the company continues to benefit from the global shift toward digitised financial management. At the last count, it boasted 4.59 million subscribers and annualised monthly recurring revenue of NZ$2.7 billion.

However, this is just a fraction of its total addressable market, which is an estimated 100 million small businesses globally. Clearly, there is scope for a significant increase in recurring revenue over the next decade. Especially with management aiming to grow its average revenue per user metric alongside its subscribers.

In light of this, the team at Macquarie thinks investors should be taking advantage of recent share price weakness. It said:

Mgmt is walking the walk, making data-driven decisions that invariably lead to better capital allocation outcomes. We have high conviction in >12mo story, driven by the US opportunity. Gusto and Melio are the platform for US growth and mgmt is executing quickly. Reiterate Outperform.

Macquarie has an outperform rating and $230.30 price target on its shares. This suggests the upside of 91% is possible from current levels.

The post These ASX 200 shares could rise 40% to 90% appeared first on The Motley Fool Australia.

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